The Ukraine Effect (European Affairs Committee Report)

Lord Levene of Portsoken Excerpts

Thursday 21st November 2024 Lords Chamber

[Lord Levene of Portsoken (CB) (Valedictory)]

My Lords, I am most grateful to the noble Lord, Lord Ricketts, for initiating this debate on the impact of Russia’s invasion of Ukraine, as it emphasises to us the debt that we owe to the gallant men and women of our Armed Forces for keeping us safe from such horrors. It underlines the criticality of ensuring that they are equipped with the very best equipment available.

It is, as always, a great privilege to be able to address your Lordships in this House, particularly today as it is the last opportunity on which I will be able to do so. Having said that, I am aware of the fact that my recent spoken contributions have been few and far between, primarily because of limited mobility. Nevertheless, that has not impaired my ability to offer what advice and assistance I can to the Ministry of Defence on what, should I be a contestant on “Mastermind”, would be my chosen subject of defence procurement.

It is, amazingly, some 40 years since I was approached by the noble Lord, Lord Heseltine, to offer assistance to him as the newly appointed Defence Secretary to endeavour to improve our record in the procurement area. That encompassed what eventually became the successful contractorisation of the royal dockyards, and then far more in the management of defence procurement and other aspects of activities within the Ministry of Defence. Some of that advice may well have hit the right note, since I note with some pride that there are now within the MoD a series of recommendations that have been designated as Levene rules.

Most recently, last year the House of Commons Defence Committee commissioned an inquiry into the UK’s defence procurement system because of wide-ranging concerns as to its efficacy. I gave evidence to that inquiry that is reflected in the committee’s report, which was published in July last year, and I hope that those recommendations will indeed be followed through—something that I am sure will be under consideration by the wider defence review under the chairmanship of the noble Lord, Lord Robertson.

If I tried to summarise those recommendations, I would say that I regard defence procurement as being quintessentially a commercial operation. The more that ability in the commercial sphere is predominant in the thinking of the staff of DE&S, the more successful the outcome is likely to be. I shall explain that, when I held the then position of Chief of Defence Procurement, I was the accounting officer for Vote 2, which is the equipment vote of the Ministry of Defence, and the loss of that direct responsibility by the present chief executive of DE&S represented a critical diminution of his ability to manage. I was therefore pleased to see that the recent report of the HCDC to Parliament recommended that that responsibility should be returned to the chief executive.

I shall comment on the relative interests and responsibilities between the defence industry, the Ministry of Defence and the Armed Forces. There is no doubt in my mind that the defence industry, combined with the gallant members of the Armed Forces and the MoD civilian staff who work with them, both do their very best to obtain the best results. However, this is where we come to the crunch: although they may be working in tandem, their primary drivers will necessarily be on opposite sides of the table. As much as the MoD staff in DE&S are pursuing their role, their opposite numbers in the defence industry may, for obvious reasons, be driven by a different imperative.

When I was in office in the MoD, my watchwords were “competition”—or, as my critics liked to call it, “confrontation”—and “value for money”, which I explained as the golden rule, meaning that those who have the gold make the rules. At the end of my term after six years, these drivers produced a result whereby the verdict of the Public Accounts Committee was that we had fulfilled its remit of value for money. I greatly hope that, with the excellent staff, both military and civilian, who have that responsibility today, we may once again fulfil to the utmost the outcome that we were tasked to achieve, and which was clearly spelled out to me by the Prime Minister, Margaret Thatcher, in her typical forceful manner when she said:

“Your job is to obtain the best possible equipment for the Armed Forces on the best possible terms full stop. PS: Your job is not to keep the UK defence industry in the manner to which it has become accustomed”.


For that reason, I do not believe there is a need for a defence industrial policy. The defence industry in this country is made up of some very successful and resilient companies. They are more than capable of looking after themselves without having someone hold their hand.

On taking my leave from your Lordships in this House, I say again what a privilege it is to have served here. I thank all noble Lords and noble Baronesses, who have always treated me with the greatest kindness and friendship, in the same way as the outstanding staff of this building, in whatever post, to all of whom we owe a great debt of gratitude.