Review Board for Government Contracts

Philip Dunne Excerpts

Monday 15th April 2013 Written Statements

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

My predecessor, the hon. Member for Mid Worcestershire (Peter Luff), announced updated Government profit formula (GPF) allowances to the House on 25 April 2012, Official Report, column 38WS, in line with recommendations made by the independent Review Board for Government Contracts. These rates are used by the Ministry of Defence (MOD) when pricing new single source contracts and amendments. The MOD has continued to consult industry on recommendations made in October 2011 by Lord Currie of Marylebone following his independent review of single source pricing and, pending the outcome, the review board has been asked to maintain the existing arrangements.

The work on new single source pricing regulations (SSPRs) and the replacement of the review board with a more empowered public body, the Single Source Regulations Office (SSRO) is proceeding well and we currently plan that these will be fully implemented in 2014-15. In the meantime the MOD will be seeking to negotiate new SSPR terms into selected high-value single source contracts during 2013-14.

One aspect of the existing regime that Lord Currie recommended should be retained is the methodology behind the Government profit formula as far as the calculation of the baseline profit rate and capital servicing allowances are concerned. Accordingly, the review board has recently completed its 2013 general review and has recommended revised GPF allowances. The Government have accepted the board’s recommendations and the updated allowances have been agreed with industry, to be implemented on new single source work from 1 April 2013. A copy of the review board’s 2013 general review report is being placed in the Library of the House, along with a copy of its 2012 annual report detailing the running costs of the review board.

Submarine Dismantling Project

Philip Dunne Excerpts

Friday 22nd March 2013 Written Statements

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

I am announcing today that, following public consultation, the submarine dismantling project (SDP) has passed a main gate decision point.

The Ministry of Defence (MOD) has previously proposed that the intermediate level waste (ILW) storage site selection process should start by narrowing the range of options to a particular type of site, that is, by deciding whether Nuclear Decommissioning Authority (NDA) or MOD and industry sites should be considered further, and discounting the other types. However, based on the findings of the public consultation, alongside recent legal advice, it has been decided that the process of selecting a specific site for the interim storage of ILW should consider all UK nuclear licensed and authorised sites that might be suitable. This will therefore include MOD sites, industry sites and NDA sites on an equal basis. The MOD will carry out further public consultation as part of this process. No radioactive waste will be removed from the submarines until a disposal or storage solution has been agreed.

We have decided to demonstrate the initial dismantling process for nuclear-powered submarines that have left service with the Royal Navy by removing all radioactive waste from a single nuclear-powered submarine at Rosyth. The reactor pressure vessel from this submarine will be removed and stored whole. Subject to the successful conclusion of this demonstration, we then intend to carry out dismantling of the remaining submarines at both Rosyth and Devonport.

These decisions have taken account of the findings of the public consultation that was announced by the then Minister for Defence Equipment, Support and Technology, 27 October 2011, Official Report, column 16WS and ran from 28 October 2011 until 17 February 2012.

More than 1,200 people attended consultation events and the MOD received over 400 written responses, all of which were recorded and considered by the SDP team. We are grateful to everyone who took part in this consultation, and the wide range of comments provided valuable input to the MOD’s options analysis, which has changed and matured significantly as a result.

We have today published the MOD “Response to Consultation”, which summarises the comments that were received and explains how they have been taken into account. This is available from the SDP consultation page on the www.gov.uk website:

https://www.gov.uk/government/consultations/consultation-on-the-submarine-dismantling-project

A copy will also be placed in the Library of the House.

Oral Answers to Questions

Philip Dunne Excerpts

Monday 25th February 2013 Commons Chamber

[Jeremy Corbyn (Islington North) (Lab)]

2. What his most recent estimate is of costs up to 2016 of the replacement of the Trident nuclear missile system.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

As the hon. Gentleman is aware, the Trident D5 missile is expected to remain in service until the 2040s. No decision on a replacement system is expected to be made during this Parliament. The estimated cost remains at £2 billion to £3 billion at 2006 prices for the missile itself, as was set out in the White Paper published by the previous Government, whom he occasionally supported.

[Jeremy Corbyn]

Will the Minister undertake to report to Parliament regularly on expenditure on the missile replacement ahead of the 2016 main gate decision? Does the estimate that he has given today include the upgrading of AWE Aldermaston? Does he think that in a time of austerity it is really such a good idea to prepare to spend £100 billion on a nuclear missile system that will be our very own weapon of mass destruction, which will not help to bring about world peace?

[Mr Dunne]

As the hon. Gentleman knows and as I have just said, we published an update to Parliament at the end of last year and we intend to publish such updates periodically. The upgrade at Aldermaston is part of the regular routine maintenance of that site which is needed for the existing programme, irrespective of the successor programme.

[Mr Marcus Jones (Nuneaton) (Con)]

17. Notwithstanding my hon. Friend’s answer, will he join me in paying tribute to the brave submariners who have ensured that the UK has had a continuous at-sea deterrent and who have been the guarantor of our country’s security for 50 years?

[Mr Dunne]

I am very pleased to pay tribute to the bravery of the men and women who support our submarine fleets, both the conventional fleet and the deterrent fleet. As my hon. Friend rightly says, they have done so for many decades. The deterrent is an important component of the defence of the realm and long may it stay so under this Government.

[Mr Bob Ainsworth (Coventry North East) (Lab)]

I have tabled parliamentary questions on the Trident alternatives review. The Government are refusing to tell me how much it is costing and what it is looking at. The review is blatantly the Liberal Democrats researching their manifesto at taxpayers’ expense and in secret. Will the Government release the details of the Trident alternatives review?

[Mr Dunne]

The right hon. Gentleman should be aware that the coalition agreement made it clear that the Liberal Democrats were allowed to produce their own alternative review. It is up to the Liberal Democrats to decide as and when they wish to publish the review’s findings.

[Dr Julian Lewis (New Forest East) (Con)]

Talking of alternatives, does my hon. Friend agree that the few percentage points of the defence budget that will be spent on replacing Trident give far better value for money than the alternative of putting nuclear cruise missiles on Astute class submarines, as has been recommended by the Liberal Democrats, almost all of whom are unaccountably absent from the Chamber today?

[Mr Dunne]

My hon. Friend is a stalwart defender of this country’s nuclear deterrent. I applaud him for that and for the debate that he called on this subject at the end of last year. It remains to be seen what costings are attached to the alternative plans that our coalition partners may or may not publish in due course.

[Angus Robertson (Moray) (SNP)]

The majority of Scottish MPs at Westminster have voted against Trident renewal, just as the majority of Members of the Scottish Parliament have voted against Trident renewal, and just as the Scottish trade unions, the Scottish Council for Voluntary Organisations, every single faith group and the majority of public opinion are against Trident renewal. Why are the Government ignoring the democratic majority in Scotland and wasting billions of pounds on something that could never be used, rather than investing in conventional defence?

[Mr Dunne]

The hon. Gentleman should address his remarks to the workers of the Rosyth area and see how they feel about whether we should retain a nuclear deterrent in this country. Decisions about this country’s nuclear deterrent are made in this Parliament, as they were in 2007, and they will continue to be made here.

[David Mowat (Warrington South) (Con)]

3. What consideration he has given to routinely storing DNA samples for all members of the armed forces.

--- Later in debate ---

[Andy Sawford (Corby) (Lab/Co-op)]

16. What progress his Department has made on the aircraft carrier programme.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

While I am on my feet and with your indulgence, Mr Speaker, I wish to correct the impression that I may have given in answer to a previous question. The thousands of jobs in Scotland supporting the deterrent are, of course, in Faslane. The other thousands of jobs in Scotland supporting the construction of the QEII class of aircraft carrier—the subject of these questions—are at Rosyth.

There are now more than 30,000 tonnes of ship in the dock at Rosyth. The forward and aft island structures, containing the ship’s bridges, funnels and radar masts, will be fitted in the coming months, followed by the final hull and flight deck sections. The ship will be largely structurally complete by the end of this year and she will be floated off next year. Construction of HMS Prince of Wales is also well under way, with all the lower block units in build.

[Diana Johnson]

The Select Committee on Defence says that the coalition’s double U-turn on aircraft carriers has cost taxpayers £100 million-plus, and we face years without carrier capability. With Hull considering a bid for the decommissioned HMS Illustrious, is the Minister aware that even Hull might soon have one more aircraft carrier than the Royal Navy?

[Mr Dunne]

As the hon. Lady has heard already today, the National Audit Office criticised the previous Administration for introducing a delay to the aircraft carrier that cost the taxpayer £1.6 billion, so the Government will not take lessons on how to run a major procurement programme.

[Andy Sawford]

Will the Minister confirm that the Government’s plans on whether a second aircraft carrier will be deployed will be based on the unit cost of the joint strike fighter, which is still unknown due to budgetary uncertainty in America?

[Mr Dunne]

As the hon. Gentleman should know, decisions on the deployment of the second aircraft carrier will be made in the 2015 strategic defence review.

[Mr Julian Brazier (Canterbury) (Con)]

I welcome my hon. Friend’s commitment to this programme. Will he confirm that the aircraft carriers will be the largest in British history, and can I urge him not to let anyone put him off building them?

[Mr Dunne]

My hon. Friend is a redoubtable champion for all matters to do with the armed forces. He is aware that the 65,000 tonne aircraft carriers that will form the Queen Elizabeth class will be not only the largest aircraft carriers ever built in this country, but the largest naval ships ever built in this country.

[Sir Tony Baldry (Banbury) (Con)]

10. What plans he has for the future of the defence estate at Bicester.

--- Later in debate ---

[Neil Carmichael (Stroud) (Con)]

13. What steps he is taking to improve defence procurement.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

Reforming defence acquisition and support so that it provides the right equipment to our armed forces at the right time, while driving better value for money from the budget, is a key element of the defence transformation programme currently under way. This is one of my top priorities, which will reverse more than a decade of mismanagement by the Labour Government. Through the materiel strategy work, we have concluded that only significant reform will solve the problems that have for years beset defence procurement. We expect to make decisions on the next steps of that work soon.

[Neil Carmichael]

Does the Minister agree that the need to ensure that the UK defence industry has encouragement and a sense of continuity is also important to the small and medium-sized businesses that supply the defence industries? What steps is he taking to ensure that they can play a major part?

[Mr Dunne]

In 2012, 40% of new contracts placed by the MOD were with small and medium-sized enterprises; they are at the heart of the innovation within the supply chain for defence contractors. My hon. Friend may be interested to know that next week I will be addressing an NDI conference in Manchester on the very subject of encouraging SMEs into the defence supply chain.

[Mr Tom Watson (West Bromwich East) (Lab)]

Please can the Minister tell me what knowledge he and his Department have of weapons procurement by the Syrian opposition funded by the Saudis and supported by the Americans?

[Mr Dunne]

This Minister can offer no enlightenment to the hon. Gentleman on that subject.

[Karl MᶜCartney (Lincoln) (Con)]

14. What assessment he has made of the credibility and effectiveness of a part-time nuclear deterrent.

--- Later in debate ---

[Stephen Phillips (Sleaford and North Hykeham) (Con)]

T3. My hon. Friend will be aware of recent problems caused by former military personnel accessing the MOD estate. Will he tell the House what measures he is going to implement to deal with this matter?

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

I am grateful for this opportunity to announce a comprehensive set of measures implemented in the MOD by the Secretary of State to ensure that both former and current employees are clear about the rules and restrictions on access.

For the first time, a list of all ex-MOD personnel who are subject to lobbying restrictions under the rules of the Advisory Committee for Business Appointments will be available for all MOD staff to see. The MOD permanent secretary has written to all former MOD personnel who are subject to business appointment restrictions to remind them of their duties under the advisory committee, and to the Association of Defence Suppliers to ensure that industry members are aware of the rules. Transparency measures have been radically increased, and since the review the permanent secretary has removed nearly 2,500 passes allowing access to the MOD’s main building to ensure that only members of staff who require regular access to the MOD are granted it. Passes that have not been used for 60 days have been disabled, and there will be an ongoing audit of those who are granted visitor passes.

[Mr Jim Murphy (East Renfrewshire) (Lab)]

When Ministers were last asked about the need to double the reserve force numbers, they dodged the question, instead talking about the increase in Territorial Army inquiries. Today we have heard from Ministers that they are hopeful that the policy will be a success. However, a policy that the country needs to be a success is being totally mishandled, with missed targets and too few businesses aware of the Government’s plans. Instead of talking about inquiries, will Ministers now place on record the fact that recruitment targets are being missed? Surely, in relation to this important issue, accepting that there is a problem would be the first step towards dealing with the problem.

--- Later in debate ---

[Richard Drax (South Dorset) (Con)]

T4. I understand that it costs about £14 million a year for HMS Bulwark’s sister ship, HMS Albion, to sit in Portsmouth doing not very much. Given the Prime Minister’s new-found enthusiasm for spending on our armed services, may I suggest that some of the money be used to put this wonderful ship to sea—if for no other reason than to help the Department for International Development?

[Mr Dunne]

The Prime Minister has always been enthusiastic in his support for defence, but as my hon. Friend knows, in October 2010, as part of SDSR 2010, we outlined plans to place one of our two landing platform dock vessels at extended readiness, while holding the other at high readiness for operations. HMS Albion entered a period of extended readiness in late 2011, and according to current plans will remain at Her Majesty’s naval base Devonport until her upkeep is completed in 2016. At that point, HMS Bulwark will go into extended readiness and HMS Albion will be placed at high readiness for operations.

[Diana Johnson (Kingston upon Hull North) (Lab)]

T8. Bearing in mind what the Minister said about the military covenant and the Liberal Democrats’ 2010 campaign for a fair deal for our troops, will he now publish the impact assessment—which I am sure he undertook—of the effect of the bedroom tax on the armed forces, and the actual numbers affected?

--- Later in debate ---

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

Products from Belted Galloway beef cattle reared and slaughtered on the Falkland Islands travel 30 miles to the NAAFI shop at Mount Pleasant. To be used in the kitchens, I am told by the Falkland Islands Government, the beef travels 8,000 miles back to the United Kingdom, is rebagged and goes back. Is that smart procurement?

[Mr Dunne]

Food for our armed forces on operations, including in the Falklands, is supplied under a contract with Purple Foodservice, which undertakes supply to our forces wherever they are stationed. The hon. Gentleman raises an interesting point and I will look specifically, and write to him, as to whether there is any possibility of shortening procurement lines for beef in the Falklands.

[Penny Mordaunt (Portsmouth North) (Con)]

In Portsmouth and the surrounding area, we have world-leading maritime infrastructure, including dockyards, port facilities, marinas, protected and controlled waters, Europe’s largest hydrodynamic tank and a host of high-end maritime electronics system design and integration facilities. As well as maintaining the 200,000 tonnes of warship that will soon be in the harbour, ought we not to be capitalising on those assets too?

[Mr Dunne]

My hon. Friend is right to highlight the wide range of world-class defence-based skills around the maritime industry in Portsmouth. We will continue to capitalise on the capabilities offered around Her Majesty’s naval base, providing vital defence jobs for thousands in Portsmouth and the surrounding area, including along the M27 in Eastleigh.

[Jim McGovern (Dundee West) (Lab)]

Given the earlier answer about equipment for our armed forces and given the plight of the remaining Remploy factories, will the Minister use his good offices to ensure that Remploy factories are the first preference for providing equipment and other procurement within the remit? The Remploy factory in my constituency has a long-standing relationship with the MOD, and if the MOD would commit to continue it, the factory may—just may—be secure.

[Mr Dunne]

The Ministry of Defence does not give long-standing commitments for any individual sources of supply; they need to be competitively tendered. But I will be happy to look at the point the hon. Gentleman raised, if he writes to me with details.

[Graham Evans (Weaver Vale) (Con)]

My hon. Friend has worked hard on the award of the Arctic Convoy Star medal to veterans of the second world war Artic convoys. He will appreciate that time is of the essence, so will he pledge to complete the necessary processes as soon as possible so that the remaining Arctic convoy veterans can receive their hard and bravely earned recognition?

Rolls-Royce Submarines (Foundation Contract)

Philip Dunne Excerpts

Wednesday 13th February 2013 Written Statements

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

I am pleased to announce that the Ministry of Defence has awarded a 10-year foundation contract to Rolls-Royce Submarines worth around £800 million that will underpin the future delivery and support of the UK’s nuclear propulsion capability. This is the first of three foundation contracts, to be signed as part of the MOD’s submarine enterprise performance programme (SEPP), and will enable savings to the MOD of around £200 million.

The SEPP aims to deliver at least £900 million of savings across the Royal Navy’s submarine programmes by 2020-21, by improving commercial arrangements with industry partners. This was announced in “Securing Britain in an Age of Uncertainty: The Strategic Defence and Security Review” (Cm 7948, 19 October 2010).

The foundation contract covers the overhead, running and business costs at Rolls-Royce Submarines’ sites. Historically, these costs were included in each individual contract placed with the company. This new foundation contract, however, will consolidate these costs, focus on efficiency, and will secure key terms and conditions for future contracts between the MOD and Rolls-Royce Submarines.

The foundation contract will help sustain around 2,000 jobs at Rolls-Royce Submarines in the UK, which provides a unique national strategic capability that has a vital role to play in meeting the present and future defence and security needs of the UK.

The MOD is in similar negotiations with its other tier 1 industry partners in the submarine enterprise: BAE Systems Maritime—Submarines; and Babcock Marine. I shall make further announcements in due course.

Nuclear Deterrent

Philip Dunne Excerpts

Thursday 17th January 2013 Commons Chamber

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

I welcome this opportunity to speak about such an important element of the nation’s defence capability, and I thank my hon. Friend the Member for New Forest East (Dr Lewis) for securing this debate and for making so many cogent arguments in his speech. The House has not debated the need for a strategic deterrent for some time, and it is right that we do so.

I echo and welcome my hon. Friend’s strong support for the Government’s unwavering commitment to retain an operationally independent nuclear deterrent, based on Trident and operating on the basis of continuous at-sea posture. I also welcome the support of the Opposition Front-Bench spokesman, the hon. Member for North Durham (Mr Jones).

As many Members are aware, our continuous at-sea deterrence patrols under Operation Relentless have been operating without pause since 1969. It is the UK’s most enduring military operation. I pay tribute to the crews of our submarines and their families, and all the men and women, both military and civilian, whose support has been essential to this operation, and I thank them for their unwavering dedication.

Whether we like it or not, we live in a nuclear age, and have done so since the first atomic weapons were tested in July 1945. We cannot put back the clock and un-invent nuclear weapons. Most of us in this House are not, as was alleged by the hon. Member for Newport West (Paul Flynn), locked in the permafrost of the cold war, but we do recall the bipolar stand-off between the west and the Soviet Union. They were dangerous and often tense times, but in contrast to the uncertainties of the present, the cold war years now, almost paradoxically, appear to have been more stable, as we knew then who our adversary was. We are now living in a period of increasing threat of nuclear weapons proliferation. Other states, not all well disposed towards us or our allies, located in highly unstable regions are on the verge of owning these weapons. That makes the current era far less predictable. It is a sobering fact that, although our nuclear arsenal, like those of our allies and Russia, has reduced significantly since the early 1990s, the reductions have not encouraged states that are seeking a nuclear weapon capability to cease their attempts to cross the nuclear threshold.

In April 2009, President Obama said that

“the threat of global nuclear war has gone down, but the risk of a nuclear attack has gone up.”

I see no reason to disagree with the President’s remarks. We live in a perilous world. North Korea has tested nuclear devices and ballistic missiles, in defiance of the international community, and it maintains a threatening stance towards its neighbours in north-east Asia. Iran is determined to continue producing highly enriched uranium, in excess of any conceivable non-military need, and it continues to develop a ballistic missile capability and maintains a hostile stance towards both the west and many of its immediate neighbours. The actions of those countries reinforce my view that Britain needs a nuclear deterrent to protect us from nuclear coercion, nuclear blackmail and nuclear attack.

NATO has been the bedrock of our defence and security since 1949. At a time when the United States—its main contributor—is shifting focus from the north Atlantic to the Pacific, a non-nuclear Britain would weaken an international organisation that makes a crucial contribution to global peace and security. Would the world be a better place with a weakened NATO—with a NATO that may become less certain of its role and purpose? I do not think it would.

Given those circumstances, it would be an act of supreme folly to abandon unilaterally the nuclear deterrent that has served us, and our allies, well for more than half a century. To disarm unilaterally would send entirely the wrong signal. It would undermine our credibility as a reliable partner and NATO’s credibility as an alliance. NATO is a nuclear alliance, and its recently agreed new strategic concept makes it clear that our nuclear forces, including those based in Scotland, contribute to its overall deterrence and security.

We share the vision of a world without nuclear weapons, but only if that is achieved through multilateral disarmament. We take the disarmament commitments of article VI of the nuclear non-proliferation treaty very seriously. We therefore fully support multilateral nuclear disarmament, when the conditions are right. That is a long-term process which will take many years, although we have taken a leading role in arranging and participating in P5 conferences since 2010. We have already reduced the size of our deterrent considerably since the end of the cold war, and in the strategic defence and security review we committed to reducing it further, as has been identified by the hon. Member for North Durham. It will decrease from a stockpile of about 300 warheads in the mid-1990s to no more than 180 by the mid-2020s. Under SDSR 10 we undertook to reduce the number of operationally available warheads to no more than 120 by the mid-2020s. That means that we already have probably the smallest arsenal of the P5 powers, and are the only P5 power to rely on a single delivery system. Our disarmament credentials are second to none, yet all this progress has not been matched by emerging nuclear states. It is simply wishful thinking that any further UK disarmament would be a catalyst for disarmament elsewhere.

It has sometimes been argued by hon. Members that we face new security threats in the 21st century for which the nuclear deterrent is not relevant, but nobody has ever claimed that nuclear weapons are an all-purpose deterrent. We have a wide range of capabilities to deal with the wide range of potential threats that we face.

The fact remains that we cannot pick and choose which threats we should face. Not every capability is suitable for every threat and the nuclear deterrent is the only secure way to deter nuclear threats. In making it clear to potential adversaries that they cannot infringe our vital interests without risk and in providing reassurance to our allies, our deterrent helps prevent major war and provides a backdrop that enables us to pursue a foreign policy that seeks to enhance international trust and security and to promote conflict resolution.

The abandonment of the nuclear deterrent would deprive us of the means to counter the most extreme threats from adversaries armed with weapons of mass destruction. It would leave us vulnerable to blackmail, coercion and attack from those adversaries. For all those reasons, I wholeheartedly support the decision of the Government to maintain a continuous submarine-based deterrent and to replace the current Vanguard class submarines when they leave service in the late 2020s.

A continuous at-sea deterrent also has considerable diplomatic utility. Let us think of the impact, if we did not have continuous at-sea deterrence, of a decision the Prime Minister might have to make to provide an order to put an intermittent deterrent to sea. That act alone could exacerbate an already tense international situation. Operating the deterrent on an intermittent basis might well require additional conventional military assets to enable the deterrent to put to sea, assets that are not required in the routine of a continuous posture.

By being continuously at sea, the deterrent maximises our political freedom of manoeuvre in crisis. A submarine-launched ballistic missile system offers invulnerability, range and endurance. All promote the credibility of this ultimate safeguard for national security. It is a permanent factor for a potential aggressor.

Hon. Members have also charged that the renewal of the deterrent is an extravagant use of resources at a time of great financial stringency and fiscal uncertainty. The first duty of any Government is to ensure the security of the nation, its people and their vital interests. This Government do not and will not gamble with Britain’s national security. We recognise that people wish to be reassured that the money will be well spent and the hon. Member for Barrow and Furness (John Woodcock)—it is a pleasure to see him in his place—rightly highlighted some of the reasons Trident is the most cost-effective delivery mechanism available within the necessary time scale. That is why the Government scrutinised the procurement programme for the successor to ensure value for money and will continue to submit it to rigorous scrutiny in the run-up to the main-gate investment decision in 2016. We are talking about maintaining a capability of service until the middle of the century and it is essential that we can protect the UK against future uncertainties that might arise 15 to 50 years from now. I challenge any advocate of unilateral disarmament to predict what threats we might face over that period.

[Several hon. Members]

rose—

Defence Industrial Base (Scotland)

Philip Dunne Excerpts

Wednesday 16th January 2013 Ministerial Corrections

[Angus Robertson (Moray) (SNP)]

Last week, the UK Government published a paper about Faslane, which was widely reported together with incorrect job projections. Will the Minister dissociate the UK Government and the Better Together campaign from double counting and fabrication on such a serious issue?

[Mr Dunne]

The hon. Gentleman has clearly been reading information that is simply not emerging from the Ministry of Defence. The base at Faslane is the largest employment site in Scotland, with some 6,700 military and civilian jobs projected to increase by around 8,200 by 2022 as the Royal Navy moves all its submarines there. Those are the numbers.

[Official Report, 14 January 2013, Vol. 556, c. 592.]

Letter of correction from Philip Dunne:

An error has been identified in the oral answer given to the hon. Member for Moray (Angus Robertson).

The correct answer should have been:

[Mr Dunne]

The hon. Gentleman has clearly been reading information that is simply not emerging from the Ministry of Defence. The base at Faslane is the largest employment site in Scotland, with some 6,700 military and civilian jobs projected to increase to around 8,200 by 2022 as the Royal Navy moves all its submarines there. Those are the numbers.

Oral Answers to Questions

Philip Dunne Excerpts

Monday 14th January 2013 Commons Chamber

[Gavin Williamson (South Staffordshire) (Con)]

4. What support he has given to the promotion of British defence exports.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

Under this Government, there has been a sea change in both attitude and activity in support of responsible defence exports. There has been a concerted effort by senior ministerial colleagues, from the Prime Minister downwards, to support British defence exports by promoting proven British equipment. The announcement just before Christmas of the sale of 12 Typhoon and 8 Hawk aircraft to Oman is a good example.

[Gavin Williamson]

Often when we talk about defence exports, we mean big deals by large companies, but as my hon. Friend will know from when he visited Oldbury UK in my constituency, many small and medium-sized businesses are involved in the defence sector. What additional support and encouragement is he giving to small and medium-sized enterprises to consider exporting more?

[Mr Dunne]

I was pleased that my hon. Friend was able to accompany me on my visit to the firm in his constituency to which he referred. I have been appointed the SME champion in the Ministry of Defence. Where possible I am seeking to raise the emphasis on procurement —both direct and through our prime contractors—towards SMEs, given the source of innovation that they so often provide. The next SME forum, which I shall be chairing shortly, will focus its activities on how we can improve export prospects for SMEs.

[Andrew Gwynne (Denton and Reddish) (Lab)]

Notwithstanding the Minister’s answer that he is an SME champion in the MOD, does he not see it as incompatible with his Government’s default position to buy off the shelf rather than seek greater exports from British industry? Will he commit to giving extra effort and support to UK sovereign companies?

[Mr Dunne]

As the hon. Gentleman will appreciate, some larger procurements within the MOD cannot, by definition, be directed towards SMEs—the contract size is such that if it were awarded, the company would cease to be an SME. That said, the White Paper published in February last year made a specific pledge towards open procurement and to encourage the purchase of matériel through competitive process. That is the best way to maintain a fit industrial base in this country that is capable of exporting and winning orders through competition. Alongside that was a commitment to increase the proportion of goods purchased from SMEs.

[George Eustice (Camborne and Redruth) (Con)]

5. What recent progress he has made on improving the interoperability of UK and French expeditionary forces.

--- Later in debate ---

[Glyn Davies (Montgomeryshire) (Con)]

14. What estimate he has made of the number of people employed in Scotland as part of the defence industrial base.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

There are over 15,000 military and civilian personnel employed in Scotland, including at the largest single site employer in Scotland, Her Majesty’s Naval Base Clyde. There are hundreds of contracts with defence companies operating in Scotland, but the Ministry of Defence no longer compiles employment statistics by region within the supply chain, as such information does not directly support either policy making or operations.

[Glyn Davies]

Does the Minister share my opinion that, from the perspective of the strength of our defence industrial base, from the perspective of job creation and retention and from the perspective of the effective defence of our nation, it is crucial that Scotland remains an integral part of the United Kingdom?

[Mr Dunne]

I entirely endorse my hon. Friend and neighbour’s view that maintaining Scotland within the United Kingdom will be the best way to maintain defence jobs in Scotland, to maintain a powerful industrial base in engineering and high-technology jobs and to provide Scotland with the best defence capability. The Scottish Government have yet to provide any answers on how they will provide such capability for defence and security in the unlikely event of an independent Scotland.

[Angus Robertson (Moray) (SNP)]

Last week, the UK Government published a paper about Faslane, which was widely reported together with incorrect job projections. Will the Minister dissociate the UK Government and the Better Together campaign from double counting and fabrication on such a serious issue?

[Mr Dunne]

The hon. Gentleman has clearly been reading information that is simply not emerging from the Ministry of Defence. The base at Faslane is the largest employment site in Scotland, with some 6,700 military and civilian jobs projected to increase by around 8,200 by 2022 as the Royal Navy moves all its submarines there. Those are the numbers.[Official Report, 16 January 2013, Vol. 556, c. 6MC.]

[Mr Edward Leigh (Gainsborough) (Con)]

18. Every new procurement Minister promises the House to get a grip on MOD procurement and the costs arising from our defence industrial base. In the light of the latest National Audit Office report that the cost of the MOD’s major projects has risen by a staggering £6.6 billion and is 39 years delayed, what action is the Minister taking?

[Mr Speaker]

With reference to Scotland, I think.

[Mr Dunne]

My hon. Friend asks what is being done to improve procurement in the MOD. I assure him that it is the top priority for the current year, at least for this procurement Minister. As I said earlier, we do not differentiate between Scotland and the rest of the United Kingdom when it comes to procurement.

In my view, the most interesting fact to emerge from the report from the National Audit Office was the improving trend in procurement. A reduction was forecast in the delivery costs of 13 of the 16 projects to which it referred, and 70% of the projected overspend relating to the remaining three related to increased fuel costs up to 2035 over which the MOD had no control whatsoever.

[Mr William Bain (Glasgow North East) (Lab)]

Has the Minister had an opportunity to consider last week’s report from the Scottish Affairs Committee, which states that a further 1,500 jobs at Her Majesty’s Naval Base Clyde could be lost by 2022 if Scotland became a separate state, and that 8,200 jobs relied directly on Scotland’s remaining part of the United Kingdom?

[Mr Dunne]

I was in Afghanistan with my right hon. Friend—[Interruption.]

[Mr Speaker]

Order. I apologise for interrupting the Minister, but I must remind the hon. Member for Moray (Angus Robertson) that he is the leader of his party and a very senior parliamentarian. It ill behoves him—and it is beneath his dignity—to yap across the community like an undisciplined puppy. He must conduct himself with decorum. That is what we expect of him. We look up to him, and we want to continue to do so.

[Mr Dunne]

I was about to explain to the hon. Member for Glasgow North East (Mr Bain) that unfortunately, as I was in Afghanistan with my right hon. Friend the Minister for the Armed Forces last week, I have not had an opportunity to read the report from the Scottish Affairs Committee, to which I gave evidence before Christmas. However, I look forward to reading it, and will certainly look out for the interesting statistic that the hon. Gentleman has revealed.

[Mel Stride (Central Devon) (Con)]

T1. If he will make a statement on his departmental responsibilities.

--- Later in debate ---

[Peter Luff (Mid Worcestershire) (Con)]

For the third time of asking at three successive Defence questions, may I ask the Minister when we can expect the publication of the very important but long-delayed audited defence equipment plan?

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

Shortly.

[Mr Speaker]

The preservation of his good humour on the part of the hon. Member for Mid Worcestershire (Peter Luff) is remarkable in the circumstances.

Spectrum Release

Philip Dunne Excerpts

Monday 17th December 2012 Written Statements

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

I wish to inform the House that the Ministry of Defence intends to auction around 200MHz of its radio spectrum usage rights; the preparations for the auction are expected to start at the end of 2013.

The spectrum to be sold will contribute towards the Government’s target that at least 500MHz of public sector spectrum will be released by 2020.

The sale will give private operators the opportunity to acquire more capacity to support, for example, the introduction of fourth-generation mobile services to people in cities, towns and villages across the United Kingdom, or to expand wireless access to broadband services, both of which are vital to the UK’s prosperity.

Unmanned Aerial Vehicles

Philip Dunne Excerpts

Tuesday 11th December 2012 Westminster Hall

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

It is a pleasure to serve under your chairmanship, Mr Leigh, in a different capacity from when you chaired the Public Accounts Committee, on which I was privileged to sit.

I congratulate the hon. Member for Birmingham, Edgbaston (Ms Stuart) on securing the debate. As all speakers have said, it demonstrates the increasing interest among not only Members of the House but the public at large about the use of unmanned aerial vehicles, as currently deployed in Afghanistan and as might be deployed in the future. As she said, only last month I responded to a similar debate, which had been secured by my hon. Friend the Member for Gillingham and Rainham (Rehman Chishti). He made a brief intervention during the hon. Lady’s speech, and I am sorry that he is not with us to hear mine, because I will try to cover many of the issues raised in this debate and since the previous one in early November.

I start by setting out the context of how, where and why the UK armed forces employ remotely piloted aircraft systems, or UAVs as they are regularly referred to. In this debate, I shall use the term RPAS—remotely piloted aircraft systems—as the more accurate description of their capability, not only because that is what they are, but because that is how they are commonly referred to by the armed forces, particularly the RAF. Although the vehicles are unmanned, the system is guided by a whole team of highly trained and skilled people. Pilots, sensor operators and analysts all make decisions in real time, just like the crew of a manned aircraft. Defence remains a human endeavour. As the hon. Member for Dunfermline and West Fife (Thomas Docherty) said, humans have taken stand-off weapons development through the generations and the centuries, but there has always been human involvement.

[Mr Kevan Jones]

Does the Minister agree that there are also lawyers in the chain of that decision-making process, who ensure that the targets selected fall within legal parameters?

[Mr Dunne]

I will explain how the UK armed forces use rules of engagement that are clearly defined and informed by legal opinion, as the hon. Gentleman indicates.

RPAS technology is principally required and used by our armed forces for surveillance and reconnaissance tasks, as several Members mentioned, providing vital intelligence in support of our forces on the ground. While the utility of sensors is broadly similar to those aboard conventionally manned aircraft, RPAS have the ability to loiter for longer, building an intelligence picture that significantly enhances the situational awareness of commanders, forces on the ground and air crew.

RPAS surveillance and reconnaissance capability and the requirement for ever better intelligence, precision and situational awareness are such that they are now vital to mission success, as has been clearly demonstrated in theatre in Afghanistan. The UK currently only deploys RPAS for support of operations in Afghanistan. With the progress of technology and increasing appreciation of their military utility, the number deployed in Afghanistan has continued to increase, with further task lines of Reaper due to become operational next year.

To deliver operational RPAS capability for our forces in Afghanistan, a number of UK RPAS are being used for development trials and training in the UK and in a number of our partner nations. I confirm again that currently the operational deployment for RPAS is for the purposes of operations in Afghanistan, and that UK RPAS are saving the lives of both British and coalition service personnel and Afghan civilians on a daily basis. In that respect, RPAS are no different from other aircraft. The same rules that govern the use of conventional military aircraft apply to RPAS. As I said, UK RPAS are anything but unmanned.

[Ms Gisela Stuart]

Just for clarity, can the Minister tell us whether there are plans to use RPAS against pirate actions off the coast of Somalia? At the moment, he seems to be stressing that we are looking at the system in terms of Afghanistan and not further.

[Mr Dunne]

I was not intending to get into the wider deployment of RPAS, but it is the case that we are about to embark on a concept-of-use demonstration trial to see whether, for surveillance purposes, a maritime system could be deployed in the future, which relates to a question that was raised by the hon. Member for Dunfermline and West Fife. It is not at present beyond the demonstration phase.

[Thomas Docherty]

The Minister shows his skill by guessing what I am going to press him to say. As part of the procurement work for the T-26 and the development of the QE class, is it the intention of the Ministry of Defence that it will in the future be using RPAS?

[Mr Dunne]

The hon. Gentleman is seeking to jump some way ahead. The aircraft carrier will not be deployed in its full air strike capability until 2020. The main gate decision on the T-26 is not until the middle of the decade, so he is asking me to foresee military capability several years away. He may not be surprised that we are at least contemplating trialling some capability for future use at some stage. I will not be pressed further on that point, but I will address some of the issues that the hon. Lady mentioned. I want to continue setting the scene for a few more minutes.

The Reaper system, which is the UK’s only armed RPAS, is flown by professional pilots who remain in full control of the aircraft at all times; they follow the law of armed conflict and the UK rules of engagement in exactly the same way as pilots of manned aircraft. Reaper, as with other forms of RPAS, is primarily used for intelligence surveillance and reconnaissance, but through technological advance it has been enabled to be armed with precision-guided weapons, thereby meeting a secondary military requirement.

The decision-making process leading to the identification and engagement of a target by one of the two weapons systems available to UK Reapers is identical to that of conventionally manned aircraft, but the greater access to information through a combination of the aircraft’s onboard sensors, ability to access off-board information and duration of missions enables them to be deployed before engagement. Reaper pilots are, arguably, the best informed and connected of all air crew in this operating environment. They are well placed to provide battle-winning surveillance and engagement capability to meet UK ground forces’ needs.

The Reaper was fielded in 2007 and as of 1 December, despite more than 42,000 hours flown over Afghanistan, it has fired only 360 weapons—52 laser-guided bombs and 308 laser-guided Hellfire missiles. Of those precision-guided weapons on Reaper, the type employed is carefully selected in every engagement, which ensures that the most appropriate munition is used to deliver the required effect, in a proportional manner, thus minimising the risk to civilians and their property. The sophistication of the weapons also provides the ability remotely to change the course of the weapon post release, which is another example of the many steps taken by RPAS to avoid civilian casualties as collateral damage.

I am aware of only one incident where civilians have been killed by weapons deployed from a UK Reaper. As I mentioned last month, on 25 March 2011, there was a strike on two pick-up trucks in Afghanistan carrying a significant quantity of explosives, which resulted in the death of two insurgents and four Afghan civilians. That incident was highly regrettable. The subsequent report did, however, confirm that the actions of the Reaper crew had been in accordance with extant procedures and UK rules of engagement. Every weapon released by the UK’s RPAS is under the command of a professional pilot bound by the UK rules of engagement.

Touching on a point raised by the hon. Member for Hayes and Harlington (John McDonnell) about the psychological considerations of operating the Reaper, the experience thus far suggests that far from being detached from the reality of the situation, Reaper air crew are just as connected to the situation on the ground as operators of other aircraft types. They have increased information available to them, a longer time to study the information and the ability to abort the mission even after they have fired the weapon. The increasing specialisation of the role of flying RPAS is being considered by the RAF for recognition as a distinct skill within the flying service.

Of course Reaper is not the only RPAS operated in Afghanistan. To correct the hon. Member for North Durham (Mr Jones), there are in fact five types—not four—of unmanned aircraft systems in operation. As I have already mentioned, Reaper is the only armed version, but we have also deployed the Hermes 450, which has already flown 65,000 hours for intelligence, surveillance and reconnaissance purposes. It will be replaced by the more modern Watchkeeper, which again is for surveillance purposes and is not armed. In response to the question put by the hon. Member for Birmingham, Edgbaston about Watchkeeper, training is already under way and we expect the system to replace Hermes during 2013. These and other smaller deployed tactical systems being operated by Army units in Afghanistan form part of a mix of airborne ISR capabilities, of which they are but one, albeit increasingly important, component. They complement the more traditional manned surveillance capabilities provided by our other aircraft types. Looking further ahead, technological advances are likely to increase the level of automation in some systems, just as in other non-military equipment, but I stress the point that the Government have no intention of developing systems that operate without human intervention in the weapon command and control chain.

Let me turn to the other specific points mentioned by the hon. Member for Birmingham, Edgbaston. On the main thrust of her remarks on the moral and ethical considerations, it would be instructive for her to look at the joint doctrine note 2/11, if she has not done so already, to which the hon. Member for North Durham referred. It was published in March 2011 by the Government, and was the first Government sponsored document to go into the UK’s approach to unmanned aircraft systems. It has a specific section on moral and ethical considerations, which inform the rules of engagement and the operations in which we are engaged at present.

[Anas Sarwar]

The Minister has quite rightly outlined the moral and ethical use of drones by the UK Government. What discussions have we had with our allies to ensure that they are applying the same principles?

[Mr Dunne]

As is standard procedure, I am here to answer for the UK Government use of unmanned air vehicles. Other countries that use such systems have their own rules of engagement, as is the case for the UK. We do not publish rules of engagement for the sensible reason that to do so would risk prejudicing the capability, effectiveness or operational security of our armed forces, and that is also the doctrine applied by other countries.

The hon. Member for Birmingham, Edgbaston asked about the military chain of command and whether it would be retained. We have no plans in the Ministry of Defence to operate any of our facilities outside the military chain of command. The hon. Member for Dunfermline and West Fife referred to potential civil uses in the future for airborne surveillance equipment; the hon. Member for Strangford (Jim Shannon) referred to offshore fishing. It is conceivable that in due course other Departments might find other uses for the technology, but I am not aware that it is something that the MOD is engaged in at present.

[Thomas Docherty]

On Government thinking and working across Departments, can I press the Minister to say a bit more about what role he sees for UK companies in developing RPAS, and how the UK Government, through their various Departments, are supporting that procurement process?

[Mr Dunne]

Indeed, a number of Opposition Members asked about that issue. The extent to which the Government are supporting UK industrial investment in this technology is demonstrated by the commitments that we have made, in particular for Watchkeeper, where a very substantial investment has been made for a British-designed, British-built capability.

We have also undertaken some collaborative work with other nations. The issue of our collaboration with the French was raised earlier. We have committed, through a memorandum of understanding signed in July, to two specific strands of that work. One is investing in the concept phase for a future combat air system; that is at the very early stages of the work stream, but work is beginning. The second was in relation to potential French interest in procuring the Watchkeeper system. If British industry is able to export that system to the French in due course, that would be a further success for it. We recognise that British aerospace industry will take an increasing interest in this capability, and through our procurement we are seeking to support that interest.

[Jim Shannon]

The Minister, in an earlier response, said that there might not be a role for drones in the MOD in its entirety, but there is a role through the Royal Navy. The Royal Navy’s responsibility is for fishing enforcement, through European regulation. There are three ships set aside for that; I had the opportunity a few weeks ago to be on one, HMS Severn. Is there any intention of introducing drones in the Royal Navy for enforcement of fishing regulation?

[Mr Dunne]

As I mentioned earlier, the Royal Navy is undertaking a short-duration capability concept demonstrator, to inform the future concept of use for tactical maritime unmanned air systems. We are not intending to test a specific system, but a system will go through concept demonstration next year. The uses will be for the Royal Navy to decide, if it decides to procure a system in due course.

I think I have addressed the specific questions that the hon. Member for Birmingham, Edgbaston put to me.

[Ms Gisela Stuart]

rose—

[Mr Dunne]

I will give the hon. Lady the opportunity to ask one more question.

[Ms Stuart]

Clearly we intend to keep the chain of command within a purely military concept, but some of our very close allies do not. Do we have difficulties working with other Governments whose chain of command is not purely military?

[Mr Dunne]

As I have explained a couple of times, we are at present using RPAS on operations in Afghanistan, and at present we have no other operational use in mind for UK assets beyond Afghanistan. I think that is as far as I can go on that matter at the moment.

I will pick up on some of the comments made by the hon. Member for North Durham. I am grateful for his support for the continued use of unmanned aircraft systems. I am glad that he referred to the joint doctrine document, because it begins to set out some of the issues that are of concern. However, I do not accept the need to undertake a codification of separate rules for RPAS. As I have already mentioned, and as the hon. Gentleman acknowledges, all aircraft operators must follow national and international laws, together with the rules of engagement. Those rules are the same whether an air, sea or land-based platform is being used. Similarly, we have well-established command, control and supervisory frameworks for all our operational assets, so we do not believe at this point that additional measures are needed for RPAS. I will just pick up on the thrust of why I think he was suggesting that we need to take the public with us in our use of RPAS, which is something that I agree with. There is a greater role to be played by politicians and the military in explaining to the public the utility of unmanned systems from a military perspective, from the safety perspective of our own personnel, which is obviously vital, and in minimising the risk of collateral damage when weaponised systems are used. As a Government, we need to do more, and I welcome the help of the hon. Gentleman in advocating the use of such systems to the public at large.

[Mr Kevan Jones]

My hon. Friend the Member for Birmingham, Edgbaston said that we have to bring the public with us. The Americans are already looking at codification. Would it not be a help to the MOD in getting the arguments across? I accept that an anorak like me reads those documents, but the average person in the street does not. If we had a clearly laid out code, it would give reassurance to individuals who are rightly worried that this new technology is not under any type of control; that is not the case, so it will at least give them some reassurance.

--- Later in debate ---

[Mr Dunne]

The difficulty with a code is how it is differentiated from rules of engagement. For the reasons I have explained, we do not wish to publish specific rules of engagement, so having a code would head us down a direction of potentially having to publish more about our operational use than would be safe for us to do.

We already have procedures in place for the oversight of all the military capabilities that we have deployed, and the National Security Council will consider whether forces should be deployed in the future. It operates with the benefit of the NSDR and NSDA, to use military acronyms—

[Mr Kevan Jones]

The Minister has been captured already.

[Mr Dunne]

I am in danger of falling into a trap that I should not have set myself.

Finally, RPAS is not shielded in secrecy, which was the expression used in the article in The Times that was referred to earlier in the debate. During the last few weeks, months and years, we have released significant details about our use of RPAS, but our use of RPAS should not be confused with general MOD policy on safeguarding information relevant to targeting and intelligence. I hope that, on reflection, the hon. Gentleman will recognise that that is an overriding requirement and puts to rest the need for any potential confusion with a system of codification, rules of engagement or secrecy over the matter.

Let me finish by restating that the UK complies fully with its obligations under international law, as set out in article 36 of additional protocol 1 to the Geneva conventions, to review all new weapons, and means and methods of warfare. That process applies to unmanned capabilities as well as to other manned weapons systems.

I welcome the opportunity presented by the hon. Member for Birmingham, Edgbaston to put on the record once again the Government’s clear view of the benefits of RPAS in minimising the risk to civilians, as well as to our own service personnel and other coalition forces. RPAS provide vital intelligence to our forces on the ground and I can only see their importance increasing, as part of our overall service capability.

[Mr Edward Leigh (in the Chair)]

Order.

Oral Answers to Questions

Philip Dunne Excerpts

Monday 26th November 2012 Commons Chamber

[Diana Johnson (Kingston upon Hull North) (Lab)]

4. How many joint strike fighter jets his Department plans to procure.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

The UK took delivery of its first joint strike fighter aircraft in July and its second in October, both of which are both operating from Eglin air force base in Florida, where they are undergoing operational testing. A third aircraft is due in the second quarter of 2013. Decisions on the overall order for joint strike fighters will not be made until the strategic defence and security review in 2015.

[Diana Johnson]

When will the Minister be able to tell the House precisely how much the Government’s U-turn to procure the F-35B rather than the F-35C, which the SDSR committed to, will cost the taxpayer?

[Mr Dunne]

The hon. Lady should recognise that the decision to change the configuration of the aircraft carriers and the aircraft operating on them will save the taxpayer money.

[Mr Ben Wallace (Wyre and Preston North) (Con)]

The previous Government entered into the joint strike fighter agreement without securing the source access code to allow British manufacturers to make British products for our planes without having to go via the American prime contractor. Will the Minister update the House on what progress has been made in acquiring the very important source data?

[Mr Dunne]

My hon. Friend is well aware that the arrangements entered into whereby the UK became a tier-1 partner in the JSF programme mean that 15% of the aircraft’s components are manufactured in this country, securing more than 25,000 jobs.

[Julie Hilling (Bolton West) (Lab)]

5. What recent progress he has made on enabling businesses to employ members of the reserves.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

As set out in the White Paper published earlier this year, increasing opportunities for SMEs in defence procurement is an important strand in our open procurement policy. We have set up an SME forum, which I chair, precisely to identify barriers to participation. Specific measures include standardising and simplifying procurement systems, promoting opportunities for SMEs through e-procurement mechanisms and marketplace events, and working with our prime contractors to boost opportunities for smaller businesses in the supply chain.

[Gordon Henderson]

I welcome that statement. I was a senior contracts officer with GEC Marconi Avionics, so I would like to think I know something about the complexity of the MOD procurement process. Large companies such as BAE Systems have access to teams of expert contracts officers who can plough through the bid documents. Sadly, SMEs often do not have that luxury, which puts them at a disadvantage. Will my hon. Friend consider how the bid process can be made less complicated and more user-friendly for SMEs?

[Mr Dunne]

I am grateful to my hon. Friend for demonstrating his expertise and bringing it to bear on our complicated procurement processes. We recognise that smaller companies, unlike the larger ones, do not have the resources to focus on putting bid proposals together, which is why we are introducing a number of measures to make that easier for them. They include publishing on web portals all tenders over £10,000, streamlining contract processes and speeding up invoice and bill payment systems, which will make it more convenient for SMEs to receive timely payments. We are also considering requests for interim payments on procurement.

[Angus Robertson (Moray) (SNP)]

According to the MOD’s own statistics, only 2% of SME contracts are given to Scottish companies. Meanwhile, the new Defence Business Services organisation is set to have 1,672 members of staff, only 13 of whom will be in Scotland. Is the Minister not embarrassed by that track record?

[Mr Dunne]

The hon. Gentleman might be interested to know that I will be in Scotland on Wednesday evening to meet defence contractors precisely to encourage them to participate more in the procurement that is on offer.

[Peter Luff (Mid Worcestershire) (Con)]

The Minister has explained to the House how much has been done to make it easier for smaller businesses to do business with the MOD. One outstanding action item is publication of the audited equipment programme. A month ago, the Secretary of State told me that it would be published “shortly”. How shortly is “shortly”?

[Mr Dunne]

I pay tribute to my predecessor for his work in championing the role of SMEs in defence procurement. As far as his direct question is concerned, as he knows the equipment plan is with the National Audit Office, and as soon as it has finished its deliberations the Department will publish it, alongside the NAO’s review.

[Mr Jim Murphy (East Renfrewshire) (Lab)]

SMEs will be affected by any decision by BAE Systems to shut any of its three yards in Portsmouth, Scotstoun or Govan. Will the Minister update the House on behalf of the businesses and workers in Glasgow who want to know whether, if they were in an independent Scotland, they could compete for work on Royal Navy warships? Will he also update the House to address the concerns of SMEs and workers in Portsmouth who will want to know about any future order of two offshore patrol boats that could fill any production gap?

[Mr Dunne]

The shadow Secretary of State is well aware that under EU procurement rules any nation can direct warlike stores, such as large warships, to be built within its national boundaries. That would mean that in the very unlikely event of a Scottish independence vote leading to an independent Scotland, a new Scottish Government could place orders for Scottish warships to be built in Scottish yards, whereas the residual UK Government could direct warships to be built in their own yards, if they decided to take advantage of the EU exemption. As far as Portsmouth is concerned, the terms of business agreement entered into by the previous Government left the decisions about how the company should rationalise the ship building programme for another day. Having placed large orders that would run beyond the general election, they were not prepared to take tough decisions on what should happen to consolidate the industry.

[John Glen (Salisbury) (Con)]

7. What assessment he has made of the success of Operation Atalanta.

--- Later in debate ---

[Mr Iain Wright (Hartlepool) (Lab)]

14. What plans he has for the future of Defence Equipment and Support; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

Our evaluation of how best to improve the delivery of procurement and support is progressing well. A soft market testing of the potential for a Government-owned contractor-operated model is due to conclude before Christmas, and the outcome of the value-for-money comparison is expected shortly. Subject to those conclusions, we are on track to make decisions on how we intend to proceed in the new year. In the meantime, we continue to drive efficiency and improvements within Defence Equipment and Support.

[Mr Wright]

Defence procurement is a key part of an active industrial strategy. Defence firms need certainty to plan and invest for the long term. There has been far too much uncertainty over the future shape and direction of Defence Equipment and Support. Notwithstanding what the Minister has said, the position is still vague, with promises made about the new year. Will he provide further clarity and, in so doing, help British businesses to invest for the long term?

[Mr Dunne]

The single most effective answer to the hon. Gentleman’s question is that this Government have removed the overspend in the defence equipment budget that we inherited from Labour. By narrowing the spend for the next 10 years into a £160 billion envelope, it is now clear that some 95% of that money is committed and the contractors know that the programmes will be delivered. That was not the case under the previous Government.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

The success of the future structure of Defence Equipment and Support lies at the heart of our ability to deliver Future Force 2020. The concerns raised by the industry about exactly how a Government-owned, contractor operated model would work therefore need to be taken seriously. The Minister’s predecessor, the hon. Member for Mid Worcestershire (Peter Luff), also highlighted the delay to the announcement on the equipment programme. My hon. Friend the Member for Hartlepool (Mr Wright) was absolutely right about the Department for Business, Innovation and Skills perspective—it is vital that the defence sector has certainty. Will the Minister undertake to come to the House at the earliest possible opportunity in the new year to set out the detail of the GOCO model and give us a definitive list of the projects that will be overseen by it?

[Mr Dunne]

I thank the hon. Lady for her question. This Government are engaging with industry more proactively than has been the case in recent times. We have just announced the defence growth partnership in conjunction with the Department for Business, Innovation and Skills to drive forward how we support defence contractors in growing the economy in this country. Once we have made the decision, we will make an announcement to Parliament in the usual way.

[Caroline Nokes (Romsey and Southampton North) (Con)]

17. What comparative assessment he has made of the value and terms of armed forces pensions and other public sector pensions.

--- Later in debate ---

[Bill Esterson (Sefton Central) (Lab)]

Warm words alone are not enough when it comes to enabling small businesses to compete in the defence supply chain. Will the Minister confirm that he will take the action needed to create a level playing field, so that small businesses can compete?

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

The Ministry of Defence is determined to increase the participation of small and medium-sized enterprises in the supply chain. To that end, we are holding a marketplace next week, on 3 December, which the hon. Gentleman is welcome to attend, to show off the innovation coming out of our SMEs to the prime contractors.

[Sir Menzies Campbell (North East Fife) (LD)]

May I take the right hon. Gentleman back to the issue of Syria? Will he tell the House in what conceivable circumstances he would think it appropriate for British troops to intervene in a civil war?