Strategic Defence and Security Review

Julian Brazier Excerpts

Thursday 26th January 2012 Commons Chamber

[Mr Julian Brazier (Canterbury) (Con)]

I will not respond to the right hon. Member for Newcastle upon Tyne East (Mr Brown), because I am confident that one or two of my hon. Friends will do so. Instead, I will talk for a few minutes about defence procurement.

Twenty-five years ago, I was responsible for carrying out a survey with three colleagues as a management consultant to compare the procurement systems in seven western powers. It is depressing, a quarter of a century on, how little things have moved on from the issues at that time. I remain convinced, as I was at the end of that process, that Britain is about average or a little above average, and not as inefficient as it is presented to be by some commentators.

I share the view of the Chairman of the Defence Committee that Bernard Gray is exactly the right man in the right job and that his report is excellent. I am deeply concerned that much of Lord Levene’s report will undermine some of Bernard Gray’s best and most important ideas, much as I respect the noble Lord and the work that he did in procurement at about the time I was a consultant.

There is time to touch briefly on only four points, of which two relate to the procurement function and two to the Ministry of Defence. My first point is that Bernard Gray is absolutely right to point to weaknesses in the contract staff, who are grossly underqualified for the job of stacking up against the highly competent lawyers employed by the other side. In project after project, we have found ourselves badly damaged by the small print.

My second point is about project managers. Gray, Levene and everybody else who has looked at this matter have concluded that we need more continuity in project managers and that they need to be professionally trained. Nevertheless, we are out of line with most other countries in concluding that project managers should be civilians. The most efficient procurers in the world remain, in my view, the Swedes. Their project managers are overwhelmingly military. They are in post typically for four to five years and they are properly trained before they become project managers. The problem, particularly on the army side where there are large numbers of comparatively cheap interlocking projects, is that if civilians are in charge of the projects, as in France, one ends up with lots of detailed user-problems that would have become obvious earlier if they had been before a military project manager. That is why France, despite spending far more on research and development than any other continental country, does not have a particularly good record on land vehicles.

My third point goes more to the heart of the distinction—in my mind, anyway—between Levene and Gray. The heart of Gray’s report—perhaps his single most important recommendation—is at point 4 in his summary, where he says that we must

“Clarify roles and create a real customer-supplier relationship between the capability sponsor (MoD centre)”—

—this is a distinction that we, alone in the whole world, developed before the second world war—

“and project delivery (DE&S)”.

He goes on to stress that the Deputy Chief of the Defence Staff (Capability) is the man who has to drive this. In contrast, Peter Levene suggests that DCDS (Capability) should be merged with one, or possibly two, other functions out of a long list—that it should be downgraded—instead of having, as Gray recommends, one board whose secretariat and day-to-day policing should be provided by DCDS (Capability) to oversee the process. In Levene’s structure we would end up with a complete muddle, with, in effect, four different bodies considering these matters—the new Defence Board, which is all-civilian except for the Chief of the Defence Staff, and the three armed forces themselves. That would take us halfway back to pre-1936.

[Bob Stewart (Beckenham) (Con)]

If the move is to make the CDS the commander-in-chief, and therefore in charge of the Army, with the same going for the other two services, surely it is proper that such people are represented on the Defence Board, if not particularly within the Ministry of Defence?

[Mr Brazier]

I thoroughly agree with my hon. Friend. I was about to come to that as my fourth and final point, but let me first finish my remarks on capabilities.

There is a very important reason, which Bernard Gray fingers exactly in his original report, for having a proper supplier-customer relationship. In the second world war, the Luftwaffe had a much more powerful research and development and industrial base, but the RAF, because it had a separate capabilities group, was able to make sure that all the pieces interacted so that we did not have problems with fighters that could not talk to bombers, and so on.

The A300M is a modern example of where that structure has broken down because—Gray criticises this—the capabilities staff have got weaker, and they will get a lot weaker still if the Levene recommendations are adopted. This aircraft is being bought for the Air Force—I have huge respect for Air Transport Command because of the brilliant work it has done in Afghanistan—but the user is the Army. Bizarrely, we have managed to arrive at a point where we are choosing to buy an aeroplane that is much more expensive than its tried and tested competitor, the Hercules, on the grounds that it can carry one armoured vehicle per aircraft whereas the Hercules cannot. If asked, the Army would say that armoured vehicles usually go by sea—it has C17s if it has to move them by air—and that it could not afford most of the armoured vehicles it wanted anyway. A strong central capabilities directorate would probably have been able to get a grip on that. Furthermore, the problem is as much in the detail as in the big picture.

That brings me to my fourth and last point, which was anticipated by my hon. Friend the Member for Beckenham (Bob Stewart). Some countries, particularly on the continent, do not allow executives on to their company boards; we would say that their company boards are all non-executive. Putting those countries to one side, in all my years as a consultant—I worked on all six continents—I never came across a successful company anywhere in which the heads of the main operating divisions were not on the main board. Peter Levene’s recommendation that the individual chiefs of staff should not sit on the Defence Board is bizarre. If one puts that alongside my third point about capabilities, with the greater powers that the individual services are going to take back from the centre to monitor projects, one can see that it is a recipe for increased in-fighting and for a reduction in interoperability. That is a big step away from joined-up defence.

I should like to end on a more positive note. With Bernard Gray, who is probably the best informed and best equipped man in the country, being put in charge of procurement, there is a fair chance that he will manage to overcome many of these problems. Certainly, under his leadership the performance of the procurement function itself will move from being a little above average internationally to being among the best. However, if we simply implement at the centre the Levene reforms as they are constituted—I have mentioned two of the weaknesses, and I could go into some of the others in detail—there is a risk that, in this area and in several others, we may undermine long-term defence planning.