Armed Forces Readiness and Defence Equipment

Lord Spellar Excerpts

Thursday 21st March 2024 Commons Chamber

[John Spellar (Warley) (Lab)]

The debate encompasses a wide range of issues. My colleague on the Defence Committee, the right hon. Member for Rayleigh and Wickford (Mr Francois), outlined some of them. I will focus on one aspect: industrial capacity, by which I mean not only the big, well-known manufacturing plants, or the well-known prime companies that we often rightly hear from in the national media, but their extended supply chains and material suppliers, and equally their often under-remarked-on workforce—not just the engineers and craftsmen but the crucial production workers, who are vital for ramping up production and our ability to surge in a crisis. We have experienced difficulties with that in response to the war in Ukraine.

Many in that supply chain also sell to the civilian market, including the public sector. Many of the specialist engineering companies in the midlands supply Formula 1, civil aviation and premium vehicles, as well as defence. They need orders from defence and from public sector bodies to maintain their workload and employment, and to train the workforce of the future. That is why—this will be a theme throughout my contribution—a whole-of-Government approach is necessary. Underlying that is the question of whether we are in a new environment or just an oscillation. Basically, is there a war going on? The people of Ukraine certainly know that. The Baltic nations, Poland, Finland and Sweden know that. It does not mean that war is inevitable, but it certainly means that it is now possible, and failure to respond will actually make it more likely.

One has to question whether the commentariat and the British establishment understand that. The Government need to make clear their view on the state of international relations. Do they regard the invasion of Ukraine by Russia as an interlude—a very bloody one—after which the situation will return to something approximating normal, albeit not the status quo ante, or has there in fact been a tectonic shift, and are we at best back in the cold war, although with a hot war going on in Ukraine and the danger of extension elsewhere along the new iron curtain that is descending over Europe? That is clearly understood not just by the politicians and the defence establishment, but by the publics in Sweden and Finland, with a dramatic shift in opinion, after centuries of neutrality, and their historic decision to join NATO and become very active participants.

Even so, across NATO, there is not that sense of urgency, or a clear realisation of the crisis. Only this week, the boss of the Scandinavian ammunition company Nammo was in the press pointing out that societies were still in peacetime mode. He gave the example of its factory in Norway, which needs additional electricity supply capacity in order to expand. A new site for TikTok has been created nearby, but the factory cannot get enough electricity. He rightly pointed out that the defence of western Europe is slightly more important than cat videos on TikTok. He contrasted that with the Defence Production Act in the United States, which was the Truman-era response to the Korean war, based on the Franklin D. Roosevelt War Powers Act. It gives extensive powers to the US Government, and they are using them. That is why they are responding to the weaknesses in procurement and ramping up production capacity, including through several Government-owned and Government-constructed, company-operated plants. Will the Minister indicate whether our Government are looking at that as a possible mechanism?

Do the Government recognise the fragility of the supply situation? Recent crises such as covid, and the situation in the Red sea and Ukraine, have already shown how vulnerable our supply chains are, and many firms and customers are finding that the so-called cheapest option can end up being very expensive. To be fair, that applies not just to the United Kingdom; all around the world, companies are finding that extended supply lines and single points of failure at home or abroad can have very damaging consequences. The discussion has shifted, and now there is much talk about reshoring, near-shoring and friend-shoring. I am not sure how much of that has penetrated the calcified mindset of our Treasury and the senior civil service, but I hope that the Minister will be able to shed some light on that.

This is not a Eurocentric issue; we must also be aware of the increasing tension in the Gulf, particularly arising from the destabilising impact of Iran and its proxies across the middle east and north Africa, as well as the increasingly aggressive attitude of China, which is why deepening relations through AUKUS and with Japan is so necessary and welcome. I hope that the Minister can report on the success this week at the AUKMIN—Australia-UK ministerial consultations—and AUKUS conferences taking place in Australia. We fully understand why the Secretary of State is there today, rather than responding to this debate.

We have to be clear that these problems did not come out of a clear blue sky. They were shown to us some years ago. The right hon. Member for Rayleigh and Wickford identified the evidence that we had from an American general. When the Americans conducted an exercise with the British Army about an outbreak of conflict in Europe, we basically ran out of munitions in about 10 days, but nothing was done about it. Even once the conflict started in Ukraine in February 2022, and it soon became clear that artillery would play a major role in it, the Ministry of Defence did not place an order for new shells until July 2023. The Minister cannot complain that I have not given him notice of this issue; I have raised it several times in previous debates, and have never had a satisfactory answer about that delay. We cannot afford that degree of indecision going forward. It is not as though we have not had shell crises before; we had one in 1915, which brought down the Government. I am afraid that there does not seem to be much collective institutional memory in the civil service today.

[Mr Francois]

We are giving £2.5 billion in the next financial year to Ukraine, and it is money well spent, but we cannot spend the same pound twice, so does the right hon. Gentleman agree that if we rightly give that money to Ukraine, we cannot then spend it on Army salaries, British shells or submarine maintenance? In other words, it is for the Ukrainians; it is not part of the UK defence budget, is it?

[John Spellar]

Well, it is unfortunately scored as being in the UK defence budget, and in the claim that we are keeping up defence expenditure; that masks an actual cut in British domestic defence spending. It is absolutely right that we supply the Ukrainians—I think we should be supplying more—as they are on the frontline and are carrying the fight. We—not just us, but the rest of Europe, the United States and the free world—should be backing them up with matériel. I agree with the right hon. Gentleman that trying to slip that into the defence budget, rather than it being part of our national commitment, is the wrong way of handling it.

Even with new production, I am still not clear—perhaps the Minister will clarify this—on what is happening with the increasing capacity for propellants and explosives. Across the western world, very few points—just two or three factories—are capable of making them, and they are stretched to capacity. I understand that difficulty, but I want to know what is being done to create new capacity. I know that the United States is doing it, but what are we doing here and in Europe? In that context, I commend the article from Iain Martin in The Daily Telegraph, in which he says that, whatever our differences with other European countries over the EU and Brexit, we should certainly be working much more closely on maintaining and creating new defence capacity—not just military but industrial as well.

Although I accept that the Government and this House must take the lead, others must follow. If we are, as I have been arguing, in a new defence environment, the City of London and the finance houses must accept their responsibilities. They must make it clear that not only is investment in defence a good investment as it leads part of British manufacturing, but it is their patriotic duty and part of the defence of the free world. However, getting that message across and changing the mindset needs a whole-of-Government approach, not just the involvement of the Ministry of Defence and those of us in the House who are interested in the subject.

As I said to union representatives in the evidence session, the unions have tens of thousands of members in the defence and aerospace sector. They should not stand idly by while mobs try to shut down their workplaces. Only this week, we had demonstrations outside GE Aerospace in Cheltenham, which was, for over a century, the Smiths factory. There have also been protests outside the Leonardo site in Edinburgh, which I presume is the old Ferranti site. I hope that unions are backing not just their members’ employment but the national interest, and will look at whether any funding is going to bodies that are organising to shut those places.

I fully acknowledge the issues facing our uniformed forces, as well as their expertise and commitment. I am pleased that others will highlight their contribution. I regret that the Government have taken their commitment for granted. In any conflict, supply and resupply are crucial. Conflicts are won not just on the battlefield, but—sometimes even more so—in our factories and those of our allies. That is why we need a rethink, a reset and a recovery of lost ground. Will the Government take up that challenge?

--- Later in debate ---

[Mr Jones]

As Chancellor of the Exchequer, he cut defence expenditure, so there are parallels there, but not the ones that the right hon. Member for Rayleigh and Wickford is referring to.

[John Spellar]

Another key feature of that era was the Treasury’s 10-year rule of basing defence expenditure on the assumption that there would not be a war in Europe within the next 10 years, which rather unravelled at the end of the 1930s.

[Mr Jones]

It did. If we look back, the common theme —it is a matter of fact, whether people like it or not—is that we have defence cuts under Conservative Governments, and when Labour is in power we maintain or increase the defence budget.

--- Later in debate ---

[John Spellar]

Laughable.

[Mr Jones]

It is laughable, as my right hon. Friend says. We need to make sure that we actually invest, because this is about skills and about ensuring that we have the workforce.

We have seen the effects when we just pull out of such work. We cannot look at our skills base as a tap, which we turn on when we want it and turn off again when we do not. We cannot do so, because we have seen the costs of that—for example, on the Astute programme. To be political, it was again the Conservative Government who stopped building submarines, so we had a gap in skills, and it has taken all the effort recently to rebuild that skills base and ensure we get it back. We must have such a skills base continually, and that has to be done by working with our European allies. Whether the zealots of Brexit and the anti-Europeans like it or not, if we are talking about things such as stockpiles, we do have to work with allies and make sure that we can deliver them through the supply chain we have.