(6 years, 6 months ago)
Commons ChamberThat is a very good point. With France, and after America, we are the leading military power in Europe and we have to set an example. If we withdraw from exercises, that creates a bad impression.
I am glad to see that the hon. Member for Gedling (Vernon Coaker) is here. He introduced his Backbench Business debate on defence last month and pointed out that the risks this country faces are only intensifying. If we face a multiplicity and variety of threats, surely our capabilities must reflect that. Russia is indeed a threat again, because it realised that the only way to be taken seriously is to be seen to be a threat. We treated Russia with contempt during the 1990s and it has drawn the lesson. It is a geopolitical gamble that we may not approve of, but in terms of Russian influence it has paid off. What have we been talking about for the past hour except Russia? According to some estimates, its economy’s GDP is equivalent to that of Italy or even that of Australia. Russia’s emphasis on its defence spending has made it an extremely important geopolitical player. Although we are constantly told that times have changed and that defence spending is not as important as it was, perhaps the Russian example shows that defence spending does pay off. I am not for one moment defending or approving of Russia or anything it does, but it has drawn the obvious lessons from the 1990s. There is a threat from Russia and we need to take it seriously.
Surely one lesson we can draw from the past, particularly from the lead-up to the second world war, is that, in terms of commitments, we must have a real presence. There is no point in our having a token commitment to or presence in the Baltic states; we need a real presence if deterrence is to work.
Many other threats are developing from Russia, the Chinese and other potential opponents: cyber-attacks and information warfare are all potential threats.
The hon. Gentleman rightly identifies the potential difficulties on the north European plain. Should not the Ministry of Defence therefore reconsider its decision to withdraw from north Germany and reinstate our capability there?
I will not defend what happened in 2010. I was a shadow Defence Minister for slightly longer than the duration of the second world war in the years up to 2010, and I was told retrospectively that the reason I never became a real Defence Minister was that it was known that I would not go along with what they were planning to do. So I am not inclined to lay down my life for the Cameron-Lib Dem coalition of those years. I did not do it then, and I will not do it now.
Having said that, it is all part of a bigger trend, and I come back to my projection of the situation. At the end of the cold war, as we have heard, we took the peace dividend. We had the reductions, which were reasonable under the circumstances. But in 1995-96—the middle of the 1990s and several years after we had taken the peace dividend reductions—we were not spending barely 2% of GDP on defence as we do now, but we were spending fully 3% of GDP on defence. From then on it was downhill all the way—
I will give way to my good friend the deputy Chairman of the Committee in a moment.
I can remember Tony Blair on HMS Albion in 2007, looking back on his 10 years as Prime Minister and saying, “Well, I think we can say that we have kept defence spending roughly constant at 2.5% of GDP if the cost of operations in Afghanistan and Iraq are included.” But in fact the cost of operations should not have been included, because they are meant to be met from the Treasury reserve. The real figure over the Blair decade came down to 2.1% or 2.2% of GDP.
It is clear from the figures provided by the Library that while in most years there was an actual increase in defence expenditure during the years of that Labour Government, since 2010 it has been -1.4%, -1.4%, -4%, -3.3%, -2.4% and -2.9%, and in 2016-17 it did actually go into the positive, +1.4%. My friend should be clear that there was a step-change when the Cameron Government came in that led to year-on-year cuts, and our armed forces are feeling the effect of that.
What I am looking for today is agreement across the House that we recognise that we should not be having almost theological debates about whether we are just above or just below the 2% minimum guideline that NATO prescribes to its member states for defence expenditure, but that we have to get back to the level—at the very least—of what we considered appropriate for so long, right up until the mid-1990s, when the Labour Government came in, which was 3% of GDP.
I am pleased the Defence Secretary is in his place, because this is very much of concern to him, as it is to all of us in the House, and it gets raised regularly. The last time he was in Brussels he raised it, and our allies in the United States are concerned about it too. The hon. Gentleman raises a very important point. Let us be honest: we know that, for varying reasons, the financial year has been tough. We are grateful to the Treasury for recognising the fiscal pressures the MOD is under and providing an extra £200 million window to allow us to close the books on the financial year 2017-18. I make it clear that this is new money; it is different from the £300 million that has been brought forward to assist with the continuous at-sea deterrence programme.
Looking ahead, there continues to be a lot of debate, as has been expressed today, about the pressures on and size of the armed forces, their annual budget and the 10-year spending plan. I thought it would be helpful to place things into context following the defence and security capability review and the defence modernisation programme, and to flag up some realities that are not for this budget, but which are coming around the corner. The Defence Secretary has spoken of the need to look at outputs, rather than inputs. We must not just set out the number of tanks, ships or personnel that we need; we must first ask ourselves what we actually want to achieve. That leads us to determine the size of our armed forces and the defence posture we wish to show. This should reflect our duties, both domestic and overseas; our ambitions as a force for good; and our international responsibilities as a permanent member of the UN Security Council and lead member of NATO.
We also need to adapt to the changing circumstances, as the threats we face become complex and intertwined. We must recognise that the world has become more dangerous since the publication of the 2015 SDSR. The risks and threats we face are intensifying and diversifying faster than expected, hence the purpose of the defence modernisation programme. It will allow more time to carefully consider how defence works, as well as what defence needs; it will aim to improve how defence operates; and it will focus on achievable efficiency and create different arrangements with suppliers. This modernisation will allow us to take the necessary long-term decisions about our military capability.
For clarity, let me say that the defence modernisation programme consists of four workstreams: the delivery of a robust MOD operating model, creating a leaner and more efficient MOD; a clear plan for efficiencies and business modernisation; a study of how we improve our commercial and industrial strategy, building on, for example, the shipbuilding strategy and the recently announced combat air strategy; and a focus on our defence policy outputs and our military capability—arguably the most important of the four.
That is all well and good, and all long term. Given that, why are the Government not sorting out the Capita contract on recruitment, which is clearly, visibly, obviously and lamentably failing the country, our armed forces and the recruits?
The right hon. Gentleman touches on something that I am not going to disagree with, but it is pertinent to and included in the workstreams I have just mentioned; we will be seeking more efficiencies and business modernisation. That means looking at our relationship with the contractors we work with, in order to improve the service we need to provide for our service personnel.
The work I have described will be led by the MOD, working closely with the National Security Secretariat and the Treasury, and engaging widely with Parliament, think-tanks, academics, defence experts, international allies, the media, devolved Administrations, the defence industry and, of course, the public.
Having all of those other worthy people involved does not get to grips with the problem of the here and now; it is pushing everything off to the right and over the horizon—again. Why will the Department not get a grip of just this programme and sort it out, because it is crippling to our armed forces?
We have a programme—it is not fiscally neutral, as the last study was. This will allow us to make the changes and the recommendations that we need to take forward. I hope that the right hon. Gentleman will be able to get behind that, in order to make sure we can provide the service and the changes that we need to make, and which our armed forces deserve.
(6 years, 7 months ago)
Commons ChamberI thank my right hon. Friend for all that he has done for our armed forces. Without his work and campaigning, we would not today have a rising budget, with £4 billion of extra resources committed to our armed forces by the Government. I will take on board his comments. His article in The Daily Telegraph today sets absolutely the right tone and approach for how to take things forward. I hope I have the opportunity to sit down with him to discuss how we get the balance right and ensure that we achieve everything that he has set out and built on for our armed forces over the past four years. We must look at getting additional resources for our armed forces so that they have the capability to protect and truly defend Britain’s global interests, both near and far.
My reaction to this much heralded, hokey-cokey statement is, is that it? Although the voice was Williamson’s, the hands were clearly Hammond’s. Will the Secretary of State confirm whether the programme is still fiscally neutral? Why does it not say that increases in security expenditure will not be at the expense of defence? Why does it rehash the same old tired call for so-called and unspecified “efficiencies”? Why will he not just confirm that the winner is in fact the Treasury and its view that there are no votes in defence? In spite of his warm words, will not the real losers be our superb troops, our excellent defence industry, and the defence and security of our nation?
I apologise if the right hon. Gentleman did not hear me. There is not the constraint of the programme being fiscally neutral; we are looking at what we can do and how we can deliver it to the best of our ability. I am very grateful to both the Chancellor and the Prime Minister for all they have done to work towards the position where we can put forward this programme and have the opportunity to look at the needs of our defence industry and establishment.
(6 years, 7 months ago)
Commons ChamberThat question goes to the heart of everything we read from the all the various Select Committees and debates. It is the desire of all those Committees, of this Parliament and of all of us who take an interest in defence that we identify the strategic threats we face as a country, and then mould and adapt our armed forces and our security and intelligence services to meet those threats. I will say a little more about my hon. Friend’s point in a minute.
Only yesterday, General Sir Nick Carter, the head of the British Army, said on the “Today” programme that the threats had never been greater in his 40-year career. In evidence to the Joint Committee on the National Security Strategy, Mark Sedwill, the National Security Adviser, confirmed that in the last two years we have seen an intensification of the threats we face. Indeed, the former Defence Secretary spoke at another evidence session of an intensification of the risks that our country faces.
We can all name those risks: we have seen the various adventures that Russia has been involved in; we have seen what has happened with China and North Korea; we have seen terrible terrorist incidents in our country; we have seen the identification of risks in respect of new technologies, cyber and artificial intelligence and where that may take us; and we have seen the undermining of the rules-based international order. Those are not made-up threats; they are very real assessments of what our country faces, alongside its allies and those who stand with us. Parliament has a responsibility and a duty to debate how we will meet those threats. That is, I believe, something that the public would expect us to do.
This has been added to, whatever the rights and wrongs of it, by Brexit, which has caused us, as a nation, to reflect on our place in the world. I say strongly to hon. Members—looking around, I think many will agree—that this Parliament should once again send a clear message to our allies and the rest of the world that as a senior member of NATO, a permanent member of the United Nations Security Council and a leader of the Commonwealth, we will not turn inwards and we will not flinch from our historical role as a promoter of democracy and defender of human rights, while also ensuring that our own interests are fully protected.
My hon. Friend mentioned North Korea. Is it not the case that the actions of the North Korean regime are a massive threat to the international rules-based order, and does not that need to have higher priority in the thinking not only of our own Government but of our allies?
My right hon. Friend makes a very good point. North Korea and China are threatening some of the rules-based international order—particularly, as he says, North Korea. We have to meet that threat, and this debate is partly about how we do that. We have to win the argument again with the British public on this. The British public have to be persuaded—or not, because they can say, “We don’t agree.” We as a Parliament have to make the case again for why it is sometimes important for us to be concerned about actions that are taking place thousands and thousands of miles away, and understand why they have an impact on our own interests and our own security here at home. It can no longer be enough just to assert a problem—we have to once again make the case as to why matters such as North Korea are important.
Just two years after the strategic defence and security review of 2015, here we are in the midst of another review, led by Mark Sedwill. I know—other Members have mentioned this to me—that the Defence Secretary is trying to pull away the defence part of the security capability to provide a longer time to reflect, and I hope he is successful in doing that. However, as it stands, we have a review that is shrouded in uncertainty and that we are now told is to be delayed. One particular thing that was said in the Committee is completely wrong and has to be changed by the Government. Mr Sedwill said that
“this exercise was commissioned by the Council as fiscally neutral.”
Fiscally neutral? How can we come to such a conclusion before all the strands of the review are finished? Surely this is about matching resources to threats, not the other way round. Let this be the line in the sand that ensures that this principle is at the heart of the decisions we take as we now move forward.
We see story after story appearing in the media, speculating on which capability may or may not be cut. Why does this speculation abound? Why are there not statements to Parliament? Why is there no explanation of what is actually going on? To be fair to the Minister, I know that he will be concerned about some of this, but it is not good enough for the Government to dismiss these potential capability cuts as mere speculation by saying, “We don’t comment on these” or “No decisions have been made”. I do not want—nor, I am sure, does any Member of this House—a statement to be made to this House in three months’ time telling us what is going to be done rather than this House having debated and discussed it and come to a view as to where we should go. I do not want, and I do not believe Parliament wants, to wait for a set of decisions to be presented to us as a fait accompli. That is not good enough. Our country deserves better. The public and Parliament need to be properly informed. I am certain that colleagues across this House believe that it is for Parliament to debate the issues, to inform the decisions, and to play our full part in the choices we make as to how we defend our country and its freedoms.
According to the permanent secretary at a hearing of the Defence Committee at the end of last year, it appears that the Secretary of State has, as yet, made no explicit request for additional funding from the Chancellor. Will the Minister tell us where the discussions that have been reported in the media have got to? Will he confirm what the Defence Secretary is now saying to the Chancellor? Has he demanded any additional funding? Where has the discussion got to, or not, as to whether there is to be any additional funding? Will the Minister also confirm whether the defence aspect of the capabilities review has been delayed?
I am grateful to the Minister for making that point in that way, and nobody could be doing more than he is, within the constraints of his office, to make the case. We all know that.
The reality is that defence is always difficult to get funded in peacetime because it is analogous to paying the premiums on an insurance policy, and people are always reluctant to pay the premiums, although they are very glad to have paid them when the time comes to call in the policy because something adverse has occurred.
I thank my right hon. Friend the Chairman of the Committee for giving way, but surely this is the role of Ministers. It is the role of the Prime Minister, the Chancellor and the Secretary of State for Defence to be providing that leadership, setting out that strategic vision, and therefore the reason for that expenditure. That is where the leadership has to come from.
I agree, but I think it is something more important than that. They must have a proper strategic planning machine at their service; otherwise, they are just a bunch of individuals giving their personal opinions.
It may suit civil servants to sideline the military professionals—to reduce the uniformed contribution to strategic planning to the input of one individual, the Chief of the Defence Staff. It may suit them, too, to sideline the Ministry of Defence and reduce its contribution to a single strand of a so-called national security strategy, but it does not suit the national interest to have inadequate specialist military pushback against politicians with poor strategic grasp and a political bee in their bonnet. That is how disastrous own goals, like the Libya fiasco, come to be inflicted upon us, despite the warnings of the then Chief of the Defence Staff against overthrowing the Libyan regime.
A single military adviser, no matter how capable, cannot have the same impact as the combined contribution of a Joint Committee of the heads of the armed forces. So it is not enough just to set ourselves a 3% target for defence expenditure, as indeed we must; it is vital also to recognise that our tried and tested machinery for making military strategy has been vitiated and largely dismantled. The Chiefs of Staff must once again be more than budget managers, stuck on the sidelines while politicians and officials call the shots and, as often as not, call the shots incorrectly.
When it comes to defence, we have to accept that without the right personnel with the right expertise and in enough numbers, the military cannot function. All the most sophisticated technology imaginable is useless if we do not have the skilled individuals to operate it. The planes cannot fly, the ships cannot sail and the vehicles cannot move without the people with the expertise. In essence, without people there is no military capability, and yet it is the people that we keep cutting.
Following the strategic defence and security review in 2010, there was a restructuring of the Army through a plan dubbed Army 2020, along with Future Reserves 2020 for the Army Reserve. The plan was refined in 2015. It proposed to reduce the number of Regular Army, or full-time, personnel from 102,000 to 82,000 and to increase the rebranded and re-enrolled reserve forces, or part-time personnel, from around 15,000 to 35,000 to make up the shortfall. On paper, that looks great. In April 2017, the Regular Army numbered 83,560 personnel and the Army Reserve 29,940. However, we need to dig deeper.
Reserve soldiers work hard as reservists, but many also have full-time jobs. They are required to complete a minimum commitment of days and training with the Army Reserve each year to be fully up to date and able to deploy in support of the regular Army. The completion of this training is not mandatory, but those who do not complete it are not considered qualified to fulfil their function during that given training year. Those soldiers who complete the training are awarded a tax-free bounty or bonus. This bonus shows how many reservists each year are ready and able to deploy quickly to support the Regular Army.
Over the last few years the number of Army Reserve soldiers has increased dramatically, from 21,030 in April 2015 to 29,940 in April 2017. That is an increase of 42% in the space of a few years. Those figures have been obtained from the Ministry of Defence through parliamentary questions. Given such an impressive increase, one would expect to see a proportional increase in those achieving the annual bounty as more and more reserve soldiers achieve their annual training targets. In April 2015, 14,270 achieved their bounty. That was 67.85% of the total Army Reserve. However, in April 2017, 14,930 got their bounty, representing just short of 50% of the total. That represents a 17.98% fall in the proportion of the Army reservists achieving their annual training targets.
The bounty is broken down into five levels. Each year that a soldier achieves a bounty, the next level is paid until they get to year five. Of the bounties awarded in 2017, 1,980 were for year 1; 1,470 were for year 2; years 3 and 4 were grouped at 1,310; and the figure for year 5 was 10,160. That is not a weighting one might expect, given the increased numbers of recruits. The numbers imply that the number of reserve personnel able to complete the training required of them in order to be considered fully up to date and able to support their regular colleagues has been pretty stable but not growing. Despite the 42% growth, the number of reserve soldiers able to fulfil the minimum commitment set out by the Government is still at the same level. The growth in the Army Reserve is a paper growth, not a real growth.
The Government’s expectation is that people will be able to marry up having a full-time job with the capability to operate at the same level as a full-time member of our armed forces. That assumption is being made as a result of a cost-saving decision to cut the Regular Army, and it is simply unrealistic. We now have a Regular Army of about 78,000 and an effective reserve strength of roughly 15,000, with both barely able to fulfil their required duties, especially as the Regular Army was previously more than 100,000 strong.
There is a further problem with the Government’s approach. We are reliant on experts to operate in a sensible and effective manner equipment that is often at the cutting edge of technology. Those skills cannot be replaced overnight. The Government’s solution was to cut those experts from the Regular Army and attempt to re-recruit them as reservists with a £10,000 incentive scheme.
As of 1 October 2017, 4,350 ex-Regular Reserve soldiers had been recruited using the bonus incentive scheme since its inception in 2013. The £10,000 bonus is broken down into four instalments, called key milestones, that are paid out over four years provided that the soldier has completed a number of days of training and tests. Considering that it equates to almost a quarter of those cut from the Regular Army in a similar period, 4,350 is a good number. However, of those who have entered the scheme, 3,320 made it to key milestone 1, 2,370 made it to key milestone 2, only 1,280 made it to key milestone 3, and just 480 reached key milestone 4 —a drop-out rate of 88.97%. Therefore, despite the offer of a £10,000 bonus, these ex-regular soldiers are also unable to meet the requirements of a full-time job while being a fully trained reservist that is capable of deployment. We risk having an undermanned regular force that lacks the skills and knowledge that come from the experienced soldiers that we made redundant, and an overworked reserve force that is doing its best to make up the shortfall while its people also try to get on with a civilian career. Once again, the apparent cost saving is elusive.
Returning once again to the ex-regulars in the reserve forces, each ex-regular at the rank of private is on a basic rate of £50 a day. Many earn much more than that, but let us just go with the basic. The total amount spent since the inception of the scheme on just wages and bonus payments is roughly a minimum of £26.3 million. For that £26.3 million, we get an 88.97% drop-out rate and only 480 reserve soldiers. That is before any consideration of the cost of restructuring both the Regular Army and the Army Reserve. We are cutting full-time capable soldiers and replacing them with people of whom we expect too much.
The Government have created a personnel problem in our armed forces that threatens to spiral out of control. We all acknowledge that the men and women in our armed forces, whether regulars or reserves, are dedicated professionals who are asked to do a difficult and demanding job, but their numbers have been cut to dangerously low levels and we are losing vital expertise. To make up the shortfall, we have put in place increased, unrealistic and unfair burdens on the reserve forces, which are also made up of honest, hard-working people, in the name of a cost saving that appears to be nothing at all.
The immensely frustrating factor in all this is that the Ministry of Defence and the services seem to be replicating exactly the same mistakes that were made in the “Options for Change” White Paper at the end of the cold war. They are pushing regulars out and creating an atmosphere in which people think that the forces are not recruiting, and they are damaging morale. Then, during the Christmas period, they spend however much they did on blitzing the airwaves to try to attract people in an atmosphere in which people are seeing those who have been forced out of our services.
My right hon. Friend makes an important point. Some statistics released today show that 71% of businesses in the service sector are finding it difficult to recruit from the skilled workforce, and the figure for manufacturing is 76%. We are operating in a climate where skilled people are at a premium. The armed forces had skilled people, but they sacked them and, rightly enough, the business community has grabbed them. We then tried to bring them back into the armed forces by offering them a bonus, but that has not worked. We have managed to keep only 480 of them. It is shocking, irresponsible and downright dangerous. This is an unpredictable world, and we cannot afford to play games. We are not showing our friends and allies our willingness and ability to support them and to support our own interests around the globe if we are not retaining and training our full-time personnel.
I am grateful to the hon. Gentleman for allowing me to go over the figures again. An Army sergeant with a salary of about £33,000 pays £1.44 a week more. I think that it is fair to ask them to pay a little more, and entirely fair to ask officers who are earning in excess of £65,000 to pay a little more. Let us bear in mind that the average salary in his seat is under £23,000.
Will the Army sergeant, or member of whichever rank, be paying these tax rates based on where he was born, where he was living when he joined the forces, or where he is based?
I am grateful to my right hon. Friend. He asks an operational question about the amphibiosity of our capability. I stress to the House that we must maintain our amphibiosity, a capable Royal Marine presence and, dare I say it, a capable Para presence as well, so he can rest assured. I will not go any further than that because we are getting into the weeds of operational decisions, and more will become clear very soon.
Going back to the point made by the Chair of the Defence Committee, if the capability was vital last year, when we were given an end date, what has changed in the meantime to put that capability in any way in question?
The right hon. Gentleman is trying to pre-empt the capability review and what will follow. All I can ask for is patience, because the answers will be forthcoming.
Turning to a couple of other contributions, this has been a tough time for recruitment and retention, and we should be honest about the challenges, something which my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) studied in detail in his report. Nevertheless, I am pleased to say that recruitment is moving forward. We do have to change our approach, and we need to recruit specialists as well, because the art of war is fundamentally changing. The requirements for what is needed on the battlefield mean that we should not necessarily have to train somebody from start to finish. It may be easier to have somebody with the technology, understanding or detailed knowledge instead. For example, a subject matter expert for a country in the middle east could be brought in and trained and then could join our armed forces to provide that intelligence detail. That is exactly what 77th Brigade does, and it provides huge value away from the teeth arms, with which the right hon. Member for Warley (John Spellar) and I are more familiar.
We need to adapt and to reflect society as a whole. We have now opened up all roles to women, and our new campaign has led to a rise in applications of 20% since 2016-17. Reserves are also up by almost 5% on last year. The offering must also change, and some worries have been raised about accommodation, but we are looking at a new accommodation model, and I am concerned about what is happening with Carillion. We need to give individuals more opportunity. Do they want to stay in a garrison, do they want to rent, or do they want to own their own house? That is what other people aspire to, so why should somebody who joins the armed forces not be able to do the same? That is what our accommodation model is looking at. Many hon. Members have participated in the passage of the Armed Forces (Flexible Working) Bill, which will allow somebody to step back from what they are doing in the armed forces for a period of time, perhaps to spend more time with their family or possibly to have a child. That proposal is proving hugely popular.
The enterprise approach is about attracting people on sabbatical, such as someone with a senior engineering, cyber or linguistic capability whom it would not be cost-effective for us to train from the bottom ranks all the way through. The veterans’ package has been mentioned, and I am proud of this Government’s work in supporting the armed forces covenant, which over 2,000 companies have signed. We also have the Veterans’ Gateway which, if hon. Members are not familiar with it, is the online portal that allows any individual to comprehend the myriad military-facing charities that are there to support our brave armed forces as they make the transition into civilian life. It is an excellent bit of work, and I recommend that all hon. Members look at it. Finally on that front, through our mental health strategy we are trying to remove the stigma from someone stepping forward if they are suffering from any form of mental health issue.
A couple of comments were made about the public sector. Pay is obviously up to the Armed Forces Pay Review Body, but the cap has been lifted and there is the freedom to go above 1%. However, it is for the pay review body to make recommendations.
The last contribution that I want to comment on came from my hon. Friend the Member for Isle of Wight (Mr Seely). His pertinent point was that if the armed forces are not being used, they can be perceived as redundant. As Sun Tzu wrote in “The Art of War”:
“Supreme excellence consists in breaking the enemy’s resistance without fighting.”
Having an armed force, a posture and a strong capability that backs up our soft power can do much to influence the world around us without our having to leave it to war fighting or military engagement.
I would like to give a couple of minutes to the hon. Member for Gedling, who moved the motion, so I conclude by thanking all Members for their contributions. I hope the House will agree that we are deeply indebted to all those who choose to wear the uniform and, if required, stand in harm’s way in defence of our country and values and in aid of those in need across the world.
The professionalism of our defence people forms the hard power that is respected by our allies and feared by our adversaries, and it is that hard power that sits behind the country’s soft power that allows us to continue playing such an influential role on the world stage.
As the world moves faster and becomes more dangerous, we must not be naive about the durability of the relative peace that the UK has enjoyed over the past few decades. Our country, our open international economy and our values are vulnerable to a range of growing world threats that have no respect for our borders. It is critical that Britain’s defence posture remains credible and that we maintain our military edge. That is exactly what the Secretary of State is working to achieve.
I end by reminding the House that President Reagan said:
“Freedom is never more than one generation away from extinction.”
Let us not take our ability to fight and the security we have for granted. All of us in this House should make the case for strong and credible defence.
(6 years, 9 months ago)
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That is an interesting intervention —in fact, I am just going to ignore it because it was pretty childish.
We must get our priorities right when it comes to defence. Over the weekend the Government announced that £2.3 billion would be put into artificial intelligence and driverless cars. Fantastic—great stuff—but when it comes to social policies such as those we cut our cloth according to what we can afford. When it comes to defence, we listen to the professionals who we ask to go and do the job for us and to wear the uniform. We ask them what we need and we provide them with what they need to keep us safe. As has been alluded to by my right hon. Friend the Member for New Forest East (Dr Lewis) time and again, the idea that we can come to this place and say, or sell it to the general public, that threats have intensified, diversified and increased so much that another security review needs to be conducted, and yet reduce the budget or capability for our armed forces to do that, is simply not credible. It will not be worn by the British public and it will not be worn by Back-Bench Conservative MPs.
Finally, all that I am asking for, and all that the MPs who have signed my letter, and MPs across the Conservative party, are asking for—we are the party of defence—is that we meet our manifesto commitment of a 2% of GDP spend and a 0.5% above inflation increase in the defence budget. That is the platform on which I stood at the general election, and I fully expect that commitment to be realised. We must get to a stage where we are being realistic about defence, and if the threats have increased, that must be met by a commensurate increase in money, commitment and willpower from both No. 11 and No. 10.
I thank the hon. Gentleman and fellow member of the Defence Committee for giving way, but may I slightly correct him? He said that the Tories are the party of defence. They are the party that talks about defence. I fully accept the bona fides and the genuine intentions of the hon. Gentleman and many of his fellow Back Benchers, but in fact under “Options for Change” after the end of the cold war, it was the Tory party that slashed the—
Order. In the context of UK amphibious capability, Johnny Mercer.
(7 years, 7 months ago)
Commons ChamberI am sure that my hon. Friend noticed that, on Thursday, I launched the Enduring Challenge, which is run by the defence and security accelerator. It is designed to be a simple front door allowing anyone with a great idea that could benefit UK defence and security to enter into defence. The funding for that will be available throughout the year. On the other side of that door are helpful innovation partners who will guide small firms through a simplified procurement process, and I encourage firms from across the UK to visit the accelerator website on gov.uk to see how they can develop the next world-beating idea.
But in order to innovate, companies must have markets and customers. President Trump has clearly proclaimed that he intends to buy American, so will the Minister assure us that, whether it is high-tech equipment, cars or supplies, her Department will actually start to buy British?
As the right hon. Gentleman knows, we are of course the industry’s biggest customer. He will also know that there are great examples of international collaboration. For example, we are purchasing 138 planes from the 3,000 in the F-35 programme, and 15% of each of those 3,000 planes is being built in the north-west of England. We have also been selected as the global hub for the repair and maintenance of those planes.
(7 years, 7 months ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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I am grateful to my right hon. Friend. Earlier Governments in different situations—indeed, in more benevolent times—might have taken different decisions about how much information they were prepared to reveal about demonstration and operations. These are not, of course, such benevolent times, and the decision we took was not to release any information about the testing of all the systems and sub-systems involved in the return to the operational cycle of HMS Vengeance.
There is no doubt about why the hon. Member for North East Somerset (Mr Rees-Mogg) wanted this to be held in private. It was not to keep our secrets from the Russians, but to save the embarrassment of Ministers and the Prime Minister. In Talleyrand’s words:
“It’s worse than a crime, it’s a mistake.”
Order. I have known the right hon. Gentleman long enough to know of his naturally pugnacious and combative spirit, but that must not elide into impugning the integrity of another hon. Member. He has had his bit of fun, but he must now wash out his mouth, withdraw those words and put a question, for which the nation will be grateful.
I certainly withdraw any implication that the hon. Member for North East Somerset (Mr Rees-Mogg) was worried about embarrassment to the Minister.
Will the Minister confirm that in Lord Hennessy’s book “The Silent Deep” there is a full description of a previous firing? How is it an operational matter or a security threat merely to ask when the Minister and Prime Minister were made aware of the problem and why they decided to keep it quiet?
On the first point, I have already made it clear that, of course, earlier Governments in different circumstances took different decisions not to share details with Parliament, but to release information publicly about the completion of tests. We have to take our decision in the light of the circumstances that prevail at the time and the national security considerations.
On the right hon. Gentleman’s second question, I have made it very clear that both I and the Prime Minister are of course informed of nuclear matters at all times and in particular of the successful return of HMS Vengeance to the operational cycle.
(7 years, 9 months ago)
Commons ChamberWe recognise that processes are overly bureaucratic. We have got rid of the idea of an approved suppliers list, and we are working hard to reduce red tape. We are introducing a shorter contract and a network of supply chain advocates. May I suggest that any businesses in my hon. Friend’s constituency or any other contact the relevant supply chain advocate? I look forward to sending my hon. Friend those details later today.
Will the Minister outline what steps are being taken to help British businesses? In that context, will she tell us why the Department decided to procure combat garments for the Army from a Spanish company rather than a Scottish one?
We welcome competition in procurement for all our contracts. We also recognise that our £178 billion equipment budget is being spent with more than 5,000 businesses here in the UK.
It is extraordinary for a pledge of 20 years of work for the Clyde to be welcomed in such a grudging fashion. Let us be very clear that if Scotland was outside the United Kingdom, these frigates would not be built on the Clyde. If Scottish National party Members had been successful in defeating the renewal of Trident, we would not have needed anti-submarine frigates.
The right hon. Gentleman is very knowledgeable about these matters, so, again, I would have thought he would welcome the fact that we are acquiring this capability, which will be based at Lossiemouth in Scotland. Discussions with Boeing are ongoing in relation to the substantial inward investment it is making in the United Kingdom.
(7 years, 10 months ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Yes, the threshold is important for a whole number of reasons, and we want to look at the overall level and get that focus of Government, but it is not the most important thing. The right hon. Gentleman might be about to come to this point, but we ought to be pressing the Government on what capability we are getting as a consequence in terms not only of materiel, but of manpower, and experienced manpower in particular.
The right hon. Gentleman is absolutely spot on, and of course that is what underlies my remarks about the fact that the figures are only, at best, the crudest guides. Nevertheless, they give us some sort of measure of comparison. Spending a certain amount of money on defence—or, should we say, investing it in defence—is not a sufficient condition for the reason that the vice-chairman of the Committee has just explained. It is, however, a necessary condition: if we do not spend enough, we cannot possibly have the potential. If we have enough to spend, we can consider how to ensure that we spend it in the most efficient and productive ways.
At this point, I pay tribute to the staff who help the Defence Committee to prepare our reports and, in particular, to one member of staff, Dr Megan Edwards, who did all the background research for the appendices to the report. They show, on as near as it is humanly possible to express the same terms, how much we have spent every year since 1955-56 up to the present day. That sort of original research work is of lasting value, because it sets into context the minuscule efforts that we make these days in comparison with the efforts that we had to make in the past. The reason that I single out Dr Edwards is that today is her last day working as a specialist member of the staff of the Defence Committee—our loss will be the Cabinet Office’s gain, and we wish her well in her new post and congratulate her on it.
Another aspect of the financial calculations that causes particular concern is the constant emphasis on efficiency savings. The most recent tranche of efficiency savings that the Government required from the Ministry of Defence was, I believe, some £0.5 billion, just before the 2015 strategic defence and security review. Some estimates put the aggregated total of efficiency saving requirements in recent years at something in excess of £1 billion, carried forward year on year. Theoretically, savings are ploughed back into the MOD. In practice, I understand from people who know about such things, it is hard to track that money, to apply those notional savings in concrete terms and to see where exactly the savings have gone in terms of new capacity.
A few days ago, on 18 October, that matter came up during a hearing on the Ministry of Defence’s annual report and accounts for 2015-16. The Defence Committee was interviewing Mr Stephen Lovegrove, the new permanent secretary at the MOD; Lieutenant General Mark Poffley, Deputy Chief of the Defence Staff for military capability; and Ms Louise Tulett, director general of finance at the MOD. They made an impressive trio of witnesses.
At one point, it was put to the witnesses that, of the almost £26 billion of equipment commitments that came out of the SDSR, almost a quarter really was new money, nearly £11 billion was so-called headroom or contingency, which is understood to be used up at appropriate points in the programmes, but the rest of it was in fact efficiency savings. It is therefore understandable if we feel a bit worried that what seems on paper to be a substantial commitment to spending large sums of money is, in a significant respect, notional, because it is dependent on the redistribution of money that the MOD already has but is supposed to spend more efficiently in some way or another.
May we forbear on the nomenclature of the civil service—the so-called efficiency savings? Efficiency, as I understand it, is when we are running a payroll office and using 100 people, but we bring in new equipment and only employ 50 as a result, while keeping outputs the same. Efficiency is when people find new and improved ways of undertaking their work. Everything else is cuts. We should be clear that many of the things we are discussing are not efficiency savings but cuts, and we should describe them as such.
The right hon. Gentleman perfectly exhibits the cross-party basis on which we try to find agreement on such matters in Committee, and the extent to which we succeed in doing so. He is of course absolutely right.
I do not intend to speak much longer, because it is excellent to see so many would-be contributors to this short debate, but I will first refer to the question that was put to Mr Lovegrove. We asked, basically, when the point will arrive at which an organisation can truthfully say, “We are just about as efficient as can be and, indeed, any further ‘savings’ that we make must amount to cutting into the bone, having already cut through the flesh.” The permanent secretary’s response was as follows:
“There may be a moment at which that happens. It is not on the horizon right now. There are certainly efficiency savings that we can get at in the Department, and our focus is on doing that and seeing whether or not we can go even further. It is only at that point that we would start engaging in the kinds of conversations that you suggest.”
With the greatest respect to the permanent secretary, who as I say made a good impression and was a credible witness in our examination of the annual report and accounts, we hear time and again from within the armed forces the same underlying fear: that we are in danger of creating a hollow force, which may have exquisite equipment—perhaps not enough so-called platforms, but exquisite nevertheless—but not enough people to man it.
The trouble is that short-term cuts—I beg your pardon; efficiency savings—can lead to long-term problems. That applies in particular to training. With the carriers coming on stream, the big frigate programme having to get under way and the new F-35 joint strike fighters taking over the maritime air role from the sadly missed Harriers, which will have filled too long a gap in our naval capabilities, now is the time when we should inject maximum effort into training. Yet we find ourselves in a position—perhaps for reasons of morale or under-investment, or perhaps because insufficient emphasis is being placed on defence in our national priorities—of struggling to recruit and retain the people we need even as we cut the size of the armed forces.
The Government have not broken any rules, but they have scraped over the line by the narrowest of margins. There is no guarantee that we will not dip below the 2% figure. People usually come up with the response, “Just remember that we are the second highest spender on defence in NATO.” I remember that sort of argument from back in the 1980s, when people who wanted us to spend less on defence—we were spending quite a lot in those days; between 4.5% and 5%—said, “Why should we spend this amount on defence when Germany and so many other European countries spend so much less than we do?” The answer, as the author of a short and pithy letter to The Times pointed out, was that the countries that we were being compared with were all on our side. We have to judge our defence expenditure by what our potential adversaries spend and what defence and attack capability they get for the money that they invest.
We do not want to engage in a race to the bottom. We do not want to preen ourselves on doing a good job because people on our own side are spending even less than we are. Our percentage expenditure on defence is lower than it has ever been—even on the new calculation, it is 0.1% lower than it was in the previous financial year. Something has gone wrong with our scale of national priorities, and the purpose of the Committee’s report is to draw attention to that, in the hope that the Government will renew their emphasis on their first duty: to keep our nation safe.
It was just outside the constituency of the hon. Member for Bridgend (Mrs Moon) that Her Majesty’s Government first committed two or three years ago to the 2% target—or the 2% figure; I will come back to the target in a moment. I would be ungracious if I did not start by saying that I warmly welcomed that that was the case. Until then, through five years of coalition government, that had not been the case. It probably would not be the case—dare I say, without being too party political—if we had a Labour Government; people would seek to find savings from defence to spend on schools and hospitals. The first thing that we ought to say is that thank goodness we have that 2%. I am glad that the previous Prime Minister made that firm and rather surprising commitment at the Wales summit.
Will the hon. Gentleman tell me in which year under a Labour Government expenditure fell below 2%?
The trouble is that under Labour Governments we always have wars and things so we have to keep spending up—that is the difficulty. However, the right hon. Gentleman is absolutely correct. I am not suggesting that the Labour party made cuts in previous years, but, from listening to some of the speeches produced by the current leader of the Labour party, it would be perfectly reasonable to expect that significant defence cuts would be made were Labour to be in power today.
Before the right hon. Gentleman leaps in to enter into a party political discussion of the matter, the purpose of the debate is not to have a party political pop across the Chamber—and of course I would not wish to tread unreasonably on the Opposition’s personal grief on this subject.
On a point of order, Mr Bone. As we are having a debate on defence, it is perfectly proper for the hon. Gentleman, who is normally much better behaved in the Defence Committee, to make partisan points. What I think is improper and verging on being out of order is then not giving way for a response, because I for one do not believe in unilateral disarmament either in the Chamber or in our defence policy.
The right hon. Gentleman is very experienced and knows full well that that was in no way a point of order.
No, if the right hon. Gentleman will forgive me. We have a short debate and I have one or two things to say. I do not want to go on too long, but too many interventions of that kind will simply delay the proceedings. He knows perfectly well, because he and I are close friends—
I have the strongest respect—[Laughter.] Allow me to finish the sentence. I have the strongest respect for the strength of commitment by Labour members of the House of Commons Defence Committee to the defence of the realm. Perhaps the right hon. Gentleman is right in saying that I have been a little ungracious in talking about some other parts of his party’s approach to defence because I know the members of the Labour party on the Defence Committee are strongly committed to that.
May I thank the hon. Gentleman, my friend from the Committee, for giving way? I point out that in fact he cannot point to any Labour party policy. The policy of the party is decided at our party conference, as indeed is our commitment to Trident. In the previous Parliament, when decisions were being put off on Trident, there was an overwhelming majority in the Labour party to support the Labour party policy of renewal of Trident. It is the same for the defence budget.
I am most grateful and greatly reassured by the right hon. Gentleman’s commitment both to Trident and to an increase in defence spending. I look forward to that vision being repeated by the hon. Member for Leeds North East (Fabian Hamilton) when he replies to the debate from the Front Bench. It is good news to know that that is what Labour thinks.
In all events, the debate is not about which party will spend more on defence. I think perhaps we should move away from that parti pris squabble and move on to discuss the report in front of us, which is a very well worded, calculated and researched paper. The first thing I would say, however, is that the Ministry of Defence’s accounts are second only to the Schleswig-Holstein question in being completely and utterly incomprehensible. I think there is nobody alive today who fully understands the MOD accounts, so the one or two accountants in the Department are well able to move figures around and fiddle with them in such a way that no normal human being can understand or follow.
Indeed, much of the language used is equally incomprehensible. For example, in paragraph 14 of the Government’s reply they are talking about the £11.2 billion of efficiency savings—we asked where they would find that. It lays out a few efficiency savings first and then says:
“A further £2 billion will be delivered through the reprioritisation of existing funding.”
They will save £2 billion through the reprioritisation of existing funding. They then go on to say that £2.1 billion that will come in from the joint security fund will in fact allow cuts in the ordinary defence spending. Therefore, that is not extra money coming in from the joint security fund at all; that is merely replacing moneys that otherwise were to be cut. There are many other examples of precisely the same thing.
Without a PhD in such matters it is simply impossible to understand exactly how the MOD accounts work and I am slightly concerned that the Government’s response tends not to try to clarify matters but to make them even more complicated than before. That makes comparators extremely difficult. It is very difficult indeed to compare our spending today with what we spent in the past. My right hon. Friend the Member for New Forest East (Dr Lewis) touched on this: it is perfectly true that when I was born in 1954 we were spending something like 7.8%—if I remember rightly from the charts in the report—and today we spend about 2%. Therefore, the cut has been gigantic. However, comparing what we were spending then with what we spend today is extraordinarily difficult because of the accounting procedures.
It is unclear whether things like urgent operational requirements, or several other things that occurred in the past, are included, not least because, as the MOD said in its reply, it keeps its accounts only for seven years. Therefore, if we ask officials about any financial matter before seven years ago, they do not know. They are unable to give answers on what happened in the 1950s, 1960s and 1970s because they do not keep the accounts. It seems to me simply bizarre that a Government Department should not keep accounts in perpetuity—it ought to be able to give an answer on what Government spending on defence was at the time of Waterloo if we asked the question sensibly. To say that it does not know for more than seven years ago is simply extraordinary. We therefore do not know how our spending today compares with previously because of that rule and we cannot compare our spending with other NATO countries for the same reason: it is all lost in the shrouds of mystery and antiquity.
My right hon. Friend made the extremely important point that 2% is all very well, but it is not a target and it is not even a floor—it is absolutely the minimum. In terms of the rhetoric, the Government appear as if they are claiming, “Haven’t we done well? We have achieved 2%.” No, never in the history of British defence before have we ever had to spend only 2% of GDP. Actually, that is the lowest figure we have ever been at. Moreover, if we were to listen to the previous Chancellor of the Exchequer and we were to face quite a significant recession post-Brexit—I personally do not believe that will occur, but he said so plainly—2% of GDP would presumably mean a significant cut in the pounds spent on defence. Therefore, the 2% figure is, to some degree at least, misleading. What we need to know is that this year we are spending £35 billion or thereabouts on defence and that that will increase every year irrespective of what happens to the economy.
The opposite applies as well. Supposing the economy were to grow at some fantastic rate thanks to Brexit—let us imagine that we see 2%, 3% or 4% growth—does that really mean that we will spend billions and billions of pounds more on defence than we have currently programmed to do? If so, how on earth will we find things to spend the money on? I am not certain that the 2% figure necessarily allows for sensible comparators with other Departments or that it is quite the right way to judge it.
We need to know how much the Government will spend and, as my right hon. Friend and the hon. Member for Bridgend said, not only how they will spend it but what they will spend it on. What we need to know is what we can do in defence terms—how many ships, tanks, soldiers and sailors and all the other things we need, such as cyber, will we have in the future? The 2% figure does not necessarily tell us that. It is a question of capabilities and not necessarily of money.
While I very much welcome the Government’s commitment to the 2%, which is certainly a step in the right direction, that by no means reassures me that we as a nation are ready to face the appalling threats we now face. Russia is a bigger threat to us today than it has been since the cold war, the middle east is in complete turmoil and much of the rest of the world is a disaster area and we are struggling to maintain a level of spending that we have never before seen.
It seems to me that we are in danger of failing in our primary responsibility of defending the realm by allowing ourselves to be fooled by a piece of camouflage: “Aren’t we being great? We are spending 2% of GDP”. Are we able to defend the realm? I suggest that we may well not be.
While I appreciate that it probably is, I do not think anyone could have anticipated the likely devaluation of the pound in recent days. I hope very much that that is the case, but we will see what happens in the long term when we get the full figures.
Is it not even more significant that, in giving this order directly to Boeing, the MOD did not seek to get any offset in other programmes in order to create work back in the UK?
I totally agree with my right hon. Friend. With the P-8A and even the F-35, we get only 20% of the build in the UK.
And the Apache. There are significant concerns about British manufacturing capabilities within the current procurement programme.
As the UK comes to terms with our future outside the European Union, it is more important than ever that we maintain a strong independent military presence. I believe the Government recognise that. I again welcome their response to the Defence Committee’s report and their ongoing commitment to supporting a robust UK military. I for one believe these issues to be above party politics.
(8 years, 4 months ago)
Commons ChamberMy hon. Friend is absolutely right. As the Secretary of State indicated in his speech on nuclear deterrence before Easter, we have both a political and a moral responsibility to protect our people and allies. The nuclear deterrent is assigned to NATO, and as a leading member of NATO we cannot and should not outsource our commitments to others. There has been broad political consensus for decades in this House on the need to maintain the UK’s independent strategic deterrent. Government Members are clear where we stand. This remains the official policy of Her Majesty’s official Opposition, and it is in our view irresponsible that the hon. Member for Islington South and Finsbury (Emily Thornberry) and her leader appear determined to put the ultimate security of our nation at risk.
The Minister and, indeed, the Secretary of State have referred to the long-held and well-known views of the Leader of the Opposition on this issue, but it is the Secretary of State and the Prime Minister who will put the resolution to the House. Given that there is overwhelming support for the renewal from the Ministry of Defence, the forces, industry, the workforce and the majority of this House, will the Minister get the message through to dithering Dave in No. 10 to stop playing party politics with this issue of national security and to put the vote to this House?
(8 years, 9 months ago)
General CommitteesWhat a pleasure, Mr Hanson, to serve under your chairmanship twice in a week. This is becoming a regular occurrence.
It may help the Committee if I explain a little of the background and why the European Scrutiny Committee recommended this Commission report for debate. A precursor July 2013 Commission communication, “Towards a more competitive and efficient defence and security sector”, was part of the preparations for the December 2013 Defence Council, the first for five years on the EU’s Common Security and Defence Policy—CSDP. It was designed for Heads of State and Governments to agree its strategic direction over the next few years and it was one of a trio of scene-setting documents, all of which were debated.
This Commission report set out a high-level roadmap for implementing activities proposed in the earlier communication. The Minister declared himself encouraged by the Commission’s approach as it began the follow-through process, but the previous Scrutiny Committee had concluded that there was still a significant number of areas that could go in the wrong direction notwithstanding the Minister’s best endeavours, so that Committee accordingly formally requested the opinion of the then Select Committee on Defence.
In brief, the Defence Committee shared the Minister’s concerns that any detailed action in respect of an EU-wide security-of-supply regime and the defence procurement directive could lead to unnecessary regulation, encourage European protectionism, constrain the Government’s ability to make their own defence procurement decisions, or risk undermining the UK’s and other European partners’ relations with the United States. It expressed concerns about a proposed green paper on the control of the defence industry’s capability and the value of new legislation in this area. It was also concerned about Commission action in third-country markets and what value would be added by the Commission’s extending its activities in this area.
The Defence Committee agreed with the Minister that export policy should be a matter of national sovereignty and said that any CSDP-related preparatory action on dual-use research should ensure that UK national interests are protected and that intellectual property rights remain with the industry and not the Commission. Notwithstanding the increasing synergies between the defence and civil sectors, it questioned what value the European Commission could add in a number of areas for action outlined in the report. It also stated that research and development in science and technologies applicable to defence, which the Committee called
“the life-blood of the military capabilities of advanced states and alliances”,
must remain free from unnecessary bureaucracy, especially where dual-use technologies were in development. It concluded that it was concerned that initiatives might arise from this roadmap that would lead to unnecessary legislation and duplication of effort with NATO.
In summary, the Defence Committee strongly endorsed the previous Committee’s view that this report should be debated.
May I just set my hon. and gallant Friend’s mind at rest? There are a number of risks from the Commission, as I have set out, and we are looking forward to seeing the new document that comes out of the Commission after Christmas, but the EDA is not a threat. It is a low-budget organisation, which, in the words of its last director, is basically a speed-dating agency. It enables European countries that are interested in a particular area to sit together, discuss things and find ways of saving money. I mentioned helicopter training as an example. It is not a threat in the way that he describes. There are some threats potentially coming out of the Commission, although I do not think they are as bad as they were a year or two ago, and I outlined some of them in my speech, but I assure my hon. and gallant Friend that that is not one of them.
May I take the Minister back to shipbuilding? Will he tell us what naval shipbuilding capacity there still is in France, Germany and Spain, which are all exporting to a number of other countries? I am not sure about Italy. Germany and Italy also have major civilian capacity in building cruise ships. What are the Government doing, apart from buying ships from South Korea, to help that position?
What we are doing about it is that we have the largest set of naval shipbuilding orders placed of any European country. Each of the major European countries chooses, as we do, to place all its warship orders with its domestic market. Merchant shipbuilding capacity in this country and all its major features had disappeared long before the coalition Government took office—little of it was left in 2010, let alone 2015—but the reality is that we are placing a whole series of very large orders for naval shipbuilding.
Was it not the case that with the vessels referred to on the civil side an offer was in fact made by an Italian company to undertake the design work, with the build in UK yards, but that offer was spurned by Ministry of Defence officials?
I will have to write to the right hon. Gentleman unless—[Interruption.] Ah, I have a note coming, so I shall respond to him in a little while.
It is a pleasure to serve under your chairmanship, Mr Hanson. I stand before the Committee as a pro-European and I will be arguing for this country to remain a member of the EU, but the document before us today demonstrates how the EU is extending itself into areas that mean that it tests the patience even of Europhiles such as myself.
The debate around European defence is a long one. It goes back to the end of the second world war, the foundation of the Western European Union and the treaty of Brussels. We had arguments then about standardisation of equipment and pooling of defence capabilities across Europe. I agree that a cornerstone of our defence should be NATO, but even though this document reflects that, there is a way—I suspect that some Conservative Members will see this as another wicked plot from across the sea—of influencing the sovereign capability and decision making of this country. It is clear that defence matters should be for individual nation states in Europe to decide, and I understand that that is what the Government are arguing in their response to the document, but I have a problem with some of the things that are coming forward.
The first item in the document is that the Commission’s aim is to have an internal market for the defence industry. Thanks to the actions of the previous Labour Government, of which you were a member, Mr Hanson, we have one of the most open and competitive defence markets anywhere in the world. We have only to look at the companies that have now based themselves here or worked with existing capacity here to see why we have that open and competitive market. Finmeccanica, Thalys, Boeing and General Dynamics are just a few of them, and that is because the Labour Government’s approach was that our market should be open not just to Europe, but to the world. I argue strongly that this country, in terms of defence capability, has benefited from that process. The danger with the approach taken in this document is that we look at defence or defence manufacturing as though a fence can be put around it in terms of just Europe. That is not the case. It is a global, international market these days.
My hon. Friend rightly identifies some of the benefits from engaging with the wider defence industry. However, there has to be some payback for that—some degree of equity. Does he therefore share my frustration at the failure of the United States in this regard? Despite the fact that Brimstone is far and away the most effective weapon—it is favoured, actually, by the United States air force—it is being blocked within the system because of narrow industrial interests. Does that not cast a slight shadow over the wider co-operation that my hon. Friend rightly identified and welcomed?
It does. My right hon. Friend and I spent a week in Washington trying to persuade US Congressmen and Senators to make sure that there was nothing wrong in ensuring that technology transfers should be a two-way street. The problem is that although a lot of claims are made about the US defence market being open and transparent, anyone with experience of it knows that protection is clear.
Such protection, however, comes up in Europe. The document talks about overcapacity in the European defence industries, but there is a reason for that: the protectionist policies of certain members, including France, Germany and others. They have not opened up their markets, not only not to US and international competitors, but also not to UK companies. There have been some good examples, as the Minister rightly pointed out, of good defence co-operation and manufacture between European nations and our own, which have been of benefit to not only those nations, but ours.
The objective, according to the document, of
“an Internal Market for Defence where European companies can operate freely and without discrimination in all Member States”,
is frankly pie in the sky. The idea that the French defence market or shipbuilding industry, for example, will be open to competition throughout Europe is unrealistic. A few years ago in Paris, when I was a member of the Defence Committee, I asked the Member for Brest whether she envisaged a French aircraft carrier being built anywhere other than Brest. She looked at me quizzically and said, “I don’t understand the question.”
The Commission is pressing forward in that area, and that has real dangers for our defence industries. It is not, frankly, an area in which the Commission should be getting involved. I fully support, as the Minister does, existing co-operation in the EU for operations that lie outside NATO or involving other countries, but that is where it should stay. If the market comes into our defence industries, that will block off a lot of the opportunities that this country has for co-operation not only with the United States, which is an important market, but with other growing markets around the world. For example, in the south-east Asian market, the easy transfer between civilian technologies and defence ones brings capabilities that could benefit our defence industries. If they are somehow locked out, because our procurement is restricted to Europe, not only will our defence industries suffer, but so could what is on offer to the men and women of our armed forces.