Defence Reform Bill

Martin Horwood Excerpts

Tuesday 16th July 2013 Commons Chamber

[Mr Murphy]

I take your strictures about our not using the speeches we intend to give tomorrow, Mr Deputy Speaker, but I am not making a speech tomorrow—my hon. Friends will be speaking then—so I thought I would say it today.

The point I am making is about procurement, GoCo and DE&S-plus, and the complexity of the deterrent programme in that process. However, what we have learnt today is that the Lib Dem part of the Government has taken two years to review a policy and spent thousands of pounds of taxpayers’ money, only to conclude that the Lib Dems’ past policy was unachievable. Today they appear to have managed to advocate both a Trident-based system and part-time unilateralism simultaneously. That is a real achievement. The British people will marvel at the incompetence of suggesting that we should pay tens of billions of pounds to send boats to sea, while the media are now being briefed that on occasion they will not even carry missiles. That is like someone having a new, expensive burglar alarm at their home with no batteries and a sign above the door saying, “Come on in—no one’s at home”.

[Martin Horwood (Cheltenham) (LD)]

The right hon. Gentleman must understand and be accurate in his descriptions. This was not a Liberal Democrat review; it was a review by the Government, insisted on by the Liberal Democrats, which says:

“The analysis has shown that there are alternatives to Trident that would enable the UK to be capable of inflicting significant damage such that most potential adversaries around the world would be deterred.”

Credibility—

[Mr Deputy Speaker]

Order. We are in danger of running tomorrow’s debate today. I do not want to do that; I want to get back to the Bill. [Interruption.] No, you are taking the bait, Mr Horwood. It is no use looking to Mr Murphy; we know he is not here tomorrow, but you will be.

--- Later in debate ---

[Martin Horwood (Cheltenham) (LD)]

This has been a constructive and positive debate, and I am happy to follow the hon. Member for Cardiff South and Penarth (Stephen Doughty), who made a valuable contribution to the debate along those lines. A discordant note was sounded by the right hon. Member for East Renfrewshire (Mr Murphy), who is no longer in his place, when he deviated into tomorrow’s debate on Trident and launched a bit of a pre-emptive strike on Liberal Democrat policy. Since Labour’s policy on nuclear weapons over the decades has itself been a bit of an unguided missile, it might be wise for Labour Members to look at the evidence and consider the possible value of the Trident alternatives review before finalising their policy too quickly.

Other hon. and gallant Members have made valuable and interesting contributions, including the hon. Member for Canterbury (Mr Brazier), who is no longer in his place, who mentioned the allocation of command. The hon. Member for Dunfermline and West Fife (Thomas Docherty) made a stinging indictment of past procurement policy and outcomes, and we would all echo the hon. Member for Portsmouth North (Penny Mordaunt), whose remarks about the reservists who died recently in the Brecon Beacons were well made. In a debate such as this it is right to pay tribute to the courage, commitment and loyalty of all our armed forces, and to emphasise that those who die in training are people of no less courage, loyalty and commitment than those who die on active service.

This enabling Bill does not directly mandate the creation of a so-called GoCo procurement system, and neither does it set the terms of single-source contracts, the shape of new reserve forces or the plan for implementing them, as that is done in more detail in the White Paper. It does, however, give the Secretary of State power to change defence procurement and the way reservists are recruited and supported, and I think there is general consensus that such powers are badly needed, and that particularly for procurement, the existing system has not delivered. Let us consider some of the statistics: average timing overruns of 80%; cost overruns often 40% over estimate. Bernard Gray’s 2009 report suggested that we might be wasting as much as £1.5 billion a year through poor procurement. Clearly that cannot go on, and it is right for the Government to take tough decisions to tackle the issue.

That does not mean, however, that there are no possible criticisms of the GoCo model—we have heard some in this debate, and in another place Lord Lee made pointed criticisms about the possibilities of a GoCo. I raised in this Chamber the possible complexity of having various bodies involved in procurement and trying to align it. Those bodies obviously include NATO, the Ministry of Defence, the armed forces and eventual contractors, and now we are inserting the GoCo level into that process. I highlighted to the Secretary of State the possible risks of inefficiencies and complexity entering the system, and his reply was good. He said that any structure contains the risk of inefficiency and waste creeping into the system, and that whatever structure we create, we must focus on good management and monitoring, and good assessment of cost effectiveness and management of contracts. I am sure that is right. It is clear that something has to change, and the Bill is going down the right path.

Part 2 creates the regulatory framework for single-source contracts, which is an interesting case. The explanatory notes to the Bill explain the relevance of EU law, which requires most Government contracts to be subject to an open process involving

“publicly advertising the fact that the contract is available for tender, and then a competitive process to select the successful contractor.”

We have taken advantage, as have other states, of the exemption in the European treaties for

“measures which a Member State considers necessary for the protection of the essential interests of its security”.

That is how single-source contracting has managed to develop on such a large scale. However, it has created the strange anomaly whereby there is currently no legal framework regulating defence single-source contracts, and so we are now putting in place something that will, in effect, regulate those contracts. I could make a small point about the value of the European Union on occasion, when we see exposed the fallacy of the argument advanced by some Members that we are beset by EU rules on all these issues. In this case, we find that where an EU rule does not apply, we feel the need to invent a substitute, and I am afraid that that would be the case in many other examples often cited in this Chamber. This is absolutely the right thing to do. I think we all instinctively know that where there are single suppliers, with no competition and no regulatory oversight, there is a real risk that uncompetitive results will be the outcome. We must address the obvious risk in the procurement of single-source contracts, and the Government are right to do so in this Bill.

Part 3 makes changes to reserve forces. This is a sensitive area to deal with but it is very necessary to do so. As we move further into the 21st century, the threats that our military are asked to counter and the demands on them are changing, and we need to look at a more flexible and light-footed model of personnel. The Government plan by 2020 to change the numbers in the Army from 102,000 to 82,000 regular soldiers but to balance that by increasing the number of reserves from 15,000 to 30,000 by 2018, with smaller increases in the maritime reserve and the Royal Auxiliary Air Force, giving us a total reserve armed forces of about 35,000 people. That is a different model that will prove more flexible and more cost-effective but make certain demands as well. If we are to have that level of reliance on our Army Reserve forces, we need to take some of the steps that the Government have considered in providing access to and use of the same equipment and vehicles as regulars, increasing reserves’ training commitments to 40 days a year, and pairing reserve units with regular units for training and deployment purposes.

I might add some ideas such as those put forward by my hon. Friend the Member for North Devon (Sir Nick Harvey) about trying to promote reserve liability. He has particularly identified the Gurkhas as a group who might figurehead and lead that process. Automatic reserve liability for the Gurkhas would send a positive signal that we are aiming for parity of esteem between the regular forces and the reserves. We should also be encouraging ex-regulars consciously to engage with the reserves.

I would like to draw attention to work that is being done in a slightly different context by a company based in my constituency. This may sound like a shameless plug for a local company, and perhaps it is, in a way. It is called Omega Resource Group and it is doing interesting work with 1 Rifles based on the employment of veterans, taking ex-regulars and trying to place them in civilian jobs in a way that makes the best use of their skills and markets those skills effectively. Although that might not seem immediately relevant, I think that it is. If we are to try to increase the demands on employers on behalf of our reserve forces, employers have to understand even more than before the value of having soldiers and military people as part of their establishment.

Omega has made a very good case for that. It says that there are widespread myths among employers—for instance, that soldiers have institutionalised thinking and are incapable of thinking out of the box. Omega points out that exactly the opposite is true—that modern soldiers are brilliant at thinking out of the box, problem-solving, and thinking tactically and differently from the way that might be expected. That kind of skill, resilience and flexibility is exactly what we should be trying to sell to employers. We will have to do that selling job because we will be putting greater demands on them if these increased reserve commitments are to be successful. We need to look at companies like Omega and, I am sure, many others that have experience of military personnel—some will already employ ex-military personnel—who can help to make a success of the whole process.

This is an enabling Bill that will allow us to move to a more flexible, light-footed, effective and, not unimportantly, cost-effective armed forces. For that reason, I am happy to join the seeming consensus throughout the Chamber in support of this very important measure.