Better Defence Acquisition

Lord Walney Excerpts

Monday 10th June 2013 Commons Chamber

[Mr Hammond]

I hear my hon. Friend’s point but, to be blunt, I think that we have to be realistic about this and acknowledge that military personnel are not necessarily trained to be best equipped to deal with world-class industrial project managers employed on eye-wateringly large salaries by the defence contractors we have to negotiate with. It is to try to allow DE&S to engage with those multinational corporations and world-class project managers on a level playing field that we are considering these changes. There will be a role for the military in this organisation, but it will not generally be as lead project mangers.

On my hon. Friend’s other point, I am grateful to him for drawing the House’s attention to the fact that the majority of the US nuclear programme is in the hands of non-public sector organisations—federally funded research and development corporations—which look very much like GoCos.

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

The strategic defence and security review in October 2010 resulted in a four-year delay to the in-service date for the Vanguard class replacement submarines. It was by no means the first project that has been shifted to the right with increased costs, but it caused particular disappointment because it was done by an Administration who, when in opposition, criticised the former Administration for doing similar things. If a GoCo is in place when such decisions are considered in future, on submarines or anything else, will it be taken out of Ministers’ hands?

[Mr Hammond]

As I have already said, Ministers will retain the ability to provide strategic direction. If the hon. Gentleman does not mind, I will take no lectures from the Opposition on shifting projects to the right at huge cost, because the previous Government shifted the carrier project two years to the right at a cost of £1.6 billion. What was actually done in 2010, in relation to the submarine enterprise, was a reconfiguration of the programme between the Astute class submarines and work on the Vanguard class replacement submarines, which resulted in a delay to the introduction into service of the Vanguard class, but within the overall constraint that we have in this country of needing to sustain a submarine yard at Barrow, and the minimum level at which we can sustain a submarine yard is building one submarine at a time. However we configure them—Vanguard class first or Astute class first—we have to provide that work flow if we are to keep that sovereign capability. That is the kind of single-source procurement that we are targeting in the announcement I made today on the single-source procurement rules.