The Minister for Defence Procurement (Mr Philip Dunne)

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This Government are committed to sustaining shipbuilding skills on the Clyde. As we confirmed in the strategic defence and security review last November, we will build two additional offshore patrol vessels before build work starts on the Type 26. This will help sustain shipbuilding skills between the completion of major blocks of the Queen Elizabeth class carriers and commencement of the Type 26 build. That remains the case; the plan has not changed. Over the next decade we will spend about £8 billion on Royal Navy warships.

Mr Dunne

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We have already invested £1.6 billion in Type 26, including £472 million this March. I say to the hon. Lady as gently as I can that that commitment could not have been made if her friends had had their way and become independent, because shipbuilding would have ceased two months ago.

Mr Dunne

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I say to my right hon. Friend, who is knowledgeable about these matters, that this will be one of the largest defence programmes that this Government will enter. I am sure that he will agree that it is absolutely right to enter into a contract once we are confident of the delivery schedule and the ability of the contractors to meet that schedule on a cost-effective basis. Once we are in that position, we will be ready to contract.

Mr Dunne

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As I have already indicated, this Government have already contracted significant sums into the programme. Once we are in a position to sign a contract, we will say what the duration of the build programme will be. We are not there yet.

The Minister for Defence Procurement (Mr Philip Dunne)

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I will answer pithily. This Government are delivering stronger defence. The defence budget will rise by 0.5% above inflation every year to 2020-21, and we will access up to £1.5 billion a year from the joint security fund by the end of this Parliament. This is the first time in six years that the defence budget will increase in real terms.

Mr Dunne

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As my right hon. Friend the Secretary of State said earlier, NATO is the cornerstone of our defence, and we are leading players in influencing fellow NATO members to meet the spending commitment. Allies have made welcome progress since 2014; five now spend 2% of GDP on defence, eight spend 20% of their defence budgets on major equipment and research, 16 have increased defence spending in real terms and 24 are now spending more of their defence budgets on equipment.

Mr Dunne

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My hon. Friend and constituency neighbour is right that the Nimrod programme suffered repeated and unacceptable delays and cost overruns. The decision in 2010 to cancel it was difficult but the planned purchase of nine P-8 Poseidon aircraft for maritime patrol will give us the capability we need in the timeframe we want, and at best value for the taxpayer.

Mr Dunne

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I am pleased to confirm to the right hon. Lady that in the area of defence equipment procurement, for which I am responsible, the Public Accounts Committee has found that we have consistently brought programmes in within budget and with minimal time overruns. I accept we have more to do on housing.

Mr Dunne

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We have adopted the Government’s policy to ensure that defence contractors make all steel procurement opportunities available to UK producers. The amount of steel expected to be available for tender for future work is much reduced, because the most substantial amounts have been in the aircraft carrier programme and we will not be building vessels as big as that for the foreseeable future.

Mr Dunne

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As was made clear in last year’s comprehensive spending review at the same time as the strategic defence and security review, and as I have already said this afternoon, the defence budget is going up in real terms in each year of this Parliament.

Mr Dunne

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I am not going to join those in the Opposition who seek to talk the economy down. We have a clear commitment to meet the NATO defence spending pledge and that is what we will do.

The Minister for Defence Procurement (Mr Philip Dunne)

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The Department continues to develop our naval force structure, as we set out in the defence review. That will include completion of two new Queen Elizabeth class aircraft carriers, eight Type 26 global combat ships, new solid support ships and two new offshore patrol vessels.

Mr Dunne

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As I said in answer to other questions on the Type 26 programme, we will enter into a contract once we have established best value for the taxpayer, and a delivery schedule that can be met by the contractor.

Mr Dunne

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The hon. Gentleman will have heard the Secretary of State confirm that that will not take too long.

The Minister for Defence Procurement (Mr Philip Dunne)

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Small businesses are a crucial engine for growth and innovation in this country, and we are determined that they should play an increasing part in supplying defence. We are committed to achieving 25% of our procurement spend with small and medium-sized enterprises by 2020, and that target is 10% higher than the one set during the last Parliament. We recently refreshed our SME policy to show how we will work to achieve that.

Mr Dunne

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We have already appointed a new network of supply chain advocates to provide a named point of contact for potential suppliers. We are providing a new online tool for suppliers to highlight opportunities, and we are simplifying our standard terms and conditions.

Mr Dunne

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Apprentices are very important to maintain the skills on the Clyde to complete the Type 26 programme. The intention is that once we have signed the contract we will have clarity on the best value for money for the taxpayer. That is our priority.

The Minister for Defence Procurement (Mr Philip Dunne)

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I can confirm that the new MOD Donnington facility will be completed on schedule before the end of the year.

Mr Dunne

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The P-8 contract has not yet been let. We announced at the time our intention to procure P-8, and some $4.5 million per aircraft is UK-sourced. The support contracts will be let in due course.

Mr Dunne

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Airbus is an important defence contractor and a significant employer in my hon. Friend’s constituency for both civil and defence work. Where it chooses to locate wings in the civil contracts in the future will be a matter for Airbus.

Mr Dunne

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We have a very clear policy in this country on the export of cluster munitions and the like. We have not sold cluster munitions since 1989. The right hon. Lady asks about phosphorous, and I will write to her about it later.

The Minister for Defence Procurement (Mr Philip Dunne)

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The United Kingdom last provided BL755 cluster munitions to Saudi Arabia nearly 30 years ago; the final delivery was in 1989. We ratified the convention on cluster munitions on 4 May 2010 and we no longer supply, maintain or support these weapons. We have not done so since we signed the convention in 2008. Based on all the information available to us, including sensitive coalition operational reporting, we assess that no UK-supplied cluster weapons have been used, and that no UK-supplied aircraft have been involved in the use of UK cluster weapons, in the current conflict in Yemen.

We are aware of reports of the alleged use of cluster munitions by the coalition in Yemen. We have raised their use during the current conflict in Yemen several times with the Saudi Arabian authorities and, in line with our obligations under the convention on cluster munitions, we continue to encourage Saudi Arabia, as a non-party to the convention, to accede to it. The Saudis have previously denied using UK cluster munitions during the conflict in Yemen, but we are seeking fresh assurances in the light of this serious new allegation.

Mr Dunne

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The Government recognise the seriousness of the allegation and have therefore requested that the Saudi authorities reconfirm any evidence suggesting that UK munitions have been involved in the way alleged. We have no evidence of that at present. As I have said already, we have not supplied any such munitions for a long time. There have been seven conflicts in the border area between Saudi Arabia and northern Yemen over the past decade, and it is unclear from the evidence provided thus far that the munitions came from the current conflict.

As for the other issues mentioned by the hon. Lady, we have been clear that the role of the United Kingdom’s advisors to the Kingdom of Saudi Arabia’s armed forces in this conflict is not operational. We welcome the ceasefire and the negotiations that are under way and have been for the past six weeks or so. We want them to be successful so that the cessation of hostilities continues to result in no further conflict in Yemen.

Mr Dunne

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I am grateful to my right hon. Friend, who speaks with considerable experience on matters Yemeni as the Prime Minister’s envoy to the country, which he visits, along with its neighbours, more often than most other Members. I gently remind Opposition Members who are rightly concerned about the impact of certain munitions in this conflict that, were it not for the Kingdom of Saudi Arabia establishing the coalition following UN resolution 2216, it is highly likely that Yemen would have been entirely overrun and would be in a state of continuous chaos.

Mr Dunne

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We regard the reports as serious. We are seeking to investigate, through our discussions with the Saudis, any further evidence to substantiate the allegations that have been made. I can categorically reassure the hon. Lady and this House that no British planes have been involved in this coalition effort at all, let alone in dropping cluster munitions—that is the potential allegation. There is no British involvement in the coalition in targeting or weaponising aircraft to undertake missions.

The Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Bournemouth East (Mr Ellwood), who deals with the middle east, was in Doha yesterday, where he met the United Nations envoy for Yemen. He has impressed upon him the need to continue with the delicate negotiations under way in Yemen.

Mr Dunne

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I joined other Ministers in appearing before my hon. Friend’s Committee recently—a novel experience that I hope was satisfactory to its members. I am happy to undertake that, should we receive further evidence as a result of our inquiries into the use of cluster munitions, we will provide it to the Committees.

Mr Dunne

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I ask the hon. Lady to consider her last remarks. There is no suggestion—none whatsoever—that the United Kingdom or our forces are involved in breaches of humanitarian law in this conflict. The humanitarian aid provided by this country to refugees as a result of the crisis in Yemen is second in the ranking of countries around the world. We have a proud record of supporting the humanitarian cause of people disturbed by this crisis. As she will probably be aware, the UN estimates that some one fifth of people in need around the world as a result of conflict are in Yemen. We are committed to supporting a peaceful resolution of the conflict.

Arms exports to the Kingdom of Saudi Arabia in recent years have primarily been about providing capability to cope with incursion by foreign powers. These exports support the Kingdom of Saudi Arabia’s contribution to the anti-Daesh coalition, in which they play a vital role. The hon. Lady has to look at the challenges in the round in the region and at the role that Saudi Arabia plays in providing continued security to the region.

Mr Dunne

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I am grateful to my hon. Friend for pointing out that this is a very volatile country that has played host to a number of international terrorist organisations, including al-Qaeda. I agree that it is desirable for more countries to sign up to the convention on cluster munitions. We have encouraged our friends in Saudi Arabia to do so on several occasions.

Mr Dunne

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I am not casting doubt on the photographic evidence. The challenge is to determine where and when the munitions were laid, and by whom. There is very little evidence at this point. We are taking this matter up with the Saudi authorities. We are particularly concerned about the potential evidence of any UK munitions that might have been used in this way. As I have indicated, if we find any evidence, we will pass it on to the Committees on Arms Export Controls, on which the hon. Gentleman sits. In relation to the questions that he posed to me and the other people who appeared before the Committees the other day about the extent of the investigations into other matters that we are reviewing and on which we are seeking information from the Saudi authorities, I am not aware that any further information has been forthcoming since we met the Committees a couple of weeks ago.

Mr Dunne

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I am grateful to the right hon. Gentleman, who has taken a consistent interest in Yemen for many years, for pointing out that the coalition effort in Yemen began at the invitation of President Saleh—

Mr Dunne

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Sorry, President Hadi. It is therefore a fully legitimised operation. The right hon. Gentleman is right that the primary aim of the efforts of the United Kingdom Government is to ensure that peace is restored to the country. To that end, the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Bournemouth East (Mr Ellwood), meets the Saudi ambassador routinely. He last saw him last week and continually impresses upon him the importance of the negotiations in Kuwait. We are seeking to assist those negotiations to the extent that we can.

Mr Dunne

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In my response to the urgent question, I made it clear that 1989 was the last time we supplied any BL-755 munitions.

Mr Dunne

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This is a civil war and in civil wars, difficult things happen. This is a very complex environment. Actors use whatever is available to them, in respect of the terrain that is there, to adopt positions. It is not a nice, straightforward, clinical exercise like a training event. Therefore, accidents do happen. As a result of our relationship with the Saudi Arabian armed forces, we are in a position to exert some influence on the coalition and, in particular, its leadership in respect of investigating accidents when they occur and allegations of incidents such as those that the right hon. Gentleman has mentioned. We are putting that pressure on the Saudis and they have given us undertakings that they are undertaking those investigations, and we are awaiting the outcome.

Mr Dunne

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The hon. Gentleman, who is experienced in these matters, will be aware of the coalition’s efforts to intercept matériel that foreign Governments, in particular Iran, are seeking to supply to rebels through the waters surrounding Yemen. The Under-Secretary of State for Foreign and Commonwealth Affairs met the Iranian chargé d’affaires last week to raise that specific issue. We will continue to put diplomatic pressure on the Iranians to cease their support for the rebels.

Mr Dunne

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Again, the hon. Gentleman has taken a consistent interest in this subject and plays an important role on the Committees. I repeat what I said to the Committees, which is that we at the Ministry of Defence provide advice to the Department for Business, Innovation and Skills, which is the entity within the UK Government that provides arms export licences. Our advice will be shaped by the circumstances at the time. At present, we have an allegation of the use of a UK munition. Until such time as we have established whether that munition has been used by a member of the coalition as part of the current conflict, we will not be in a position to speculate on what might happen to future licence applications.

Mr Dunne

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I am grateful to my hon. and learned Friend for pointing out that munitions have quite a long shelf life. As I indicated, it is quite possible that the munitions that are the subject of this allegation are a relic of previous conflicts in the area, of which there have been seven over the past 10 years.

Mr Dunne

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As a signatory to the convention, we encourage non-signatories with which we have close military relations to consider acceding to the terms of the convention or joining it themselves. Through our offices at the UN, there are periodic dialogues with countries that are not, as yet, signatories to the convention, and we will continue to support those discussions.

Mr Dunne

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We are looking at all the allegations made by the various bodies mentioned in the Chamber, and we have the opportunity to indicate to the Saudi military that these incidents are worthy of investigation. This is an ongoing process, and we have had opportunities to encourage the Saudis to speed up their investigations. However, at this point, I am afraid that I cannot put a timetable on it.

Mr Dunne

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The hon. Lady referred to munitions falling. We do not know at this point when, where or how the munitions referred to in the allegations were delivered. It is that kind of information that will help to inform the investigation and what is then done about it. In relation to clearing up the munitions that clearly do exist in northern Yemen, we are supporting a number of non-governmental organisations by providing resource and training to encourage them to undertake this very important work.

Mr Dunne

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I can help my hon. Friend. The last munitions were supplied to Saudi Arabia in 1989. The convention was signed in 2008; at that point, although it did not come into effect until May 2010, we ceased supplying or supporting those weapons any further.

Mr Dunne

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Completely confident.

Mr Dunne

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I would gently remind the hon. Gentleman that we are not members of this coalition. We do not have locus in Yemen to undertake direct investigations ourselves. What we are talking about are alleged violations of international humanitarian law. The correct procedure when an incident has been brought to the attention of members of the coalition is for them to undertake the investigation itself. We are able to encourage and stimulate them to undertake that investigation, because there is a long-standing relationship between our respective armed forces. That is what we are doing, and that is the right way to proceed.

Mr Dunne

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This is an allegation. There are a number of allegations of potential violations of international humanitarian law. If investigations lead to clear evidence, that evidence will have to be taken into account whenever an arms export licence is presented and where that information is relevant.

Mr Dunne

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Such a call would, of course, have no impact on the use of weapons that have already been supplied, so it would not achieve what the hon. Gentleman looks to do. The answer is that we are using our influence on the Saudi Arabians to encourage them to undertake investigations in circumstances where there has been conflict on the ground. This has been a war environment; difficult things happen in wars, and it is not possible to be absolutely certain about everything that takes place in such an environment. That is why it is important to investigate these allegations of actions that appear to be in breach of international humanitarian law.

Mr Dunne

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There are no UK Royal Air Force planes involved in the coalition, and there are no cluster munitions in the arsenal of the British armed forces.

Mr Dunne

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There is a clear process under which the Saudis, as leaders of the coalition, undertake the investigation. That is a novel aspect of this conflict. The Saudis have not done that before in previous conflicts in which they have been engaged. We think that that is appropriate, as do all other nations.

The Minister for Defence Procurement (Mr Philip Dunne)

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More broadly for Scotland, our commitment to the successor programme will sustain 6,800 military and civilian jobs there, rising to 8,200 by 2022. As the programme progresses, an additional 270 personnel will be based at Her Majesty’s naval base Clyde. Extending the Typhoon until at least 2040, and upgrading it with the active electronically scanned array radar, will benefit RAF Lossiemouth and continue to benefit Selex ES in Edinburgh. Our new maritime patrol aircraft will be based at RAF Lossiemouth, which is ideally placed for the most common maritime patrol areas and is currently used as a maritime patrol aircraft operating base by our NATO allies. This will also lead to significant investment, and our current estimate is for some 200 extra jobs in Scotland.—[Official Report, 25 April 2016, Vol. 608, c. 1139.]

Letter of correction from Philip Dunne.

An error has been identified at the end of my response.

The correct response should have been:

Mr Dunne

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More broadly for Scotland, our commitment to the successor programme will sustain 6,800 military and civilian jobs there, rising to 8,200 by 2022. As the programme progresses, an additional 270 personnel will be based at Her Majesty’s naval base Clyde. Extending the Typhoon until at least 2040, and upgrading it with the active electronically scanned array radar, will benefit RAF Lossiemouth and continue to benefit Selex ES in Edinburgh. Our new maritime patrol aircraft will be based at RAF Lossiemouth, which is ideally placed for the most common maritime patrol areas and is currently used as a maritime patrol aircraft operating base by our NATO allies. This will also lead to significant investment, and our current estimate is for some 400 extra jobs in Scotland.

The Minister for Defence Procurement (Mr Philip Dunne)

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Before I answer the hon. Lady’s question, I am sure that the whole House will join me in offering our sincere condolences to the family and friends of Captain David Seath, who tragically died after collapsing during the London marathon on Sunday. This was of course not an operational casualty, but given the interest that many hon. Members take in raising funds for charity through the marathon, as do many members of our armed forces, I thought that it was appropriate to start my response in that way. Our thoughts are with his family and friends at this difficult time.

I welcome the opportunity to outline our plans for building complex warships. The Type 26 global combat ship programme is central to those plans. The strategic defence and security review restated this Government’s commitment to the Type 26 global combat ship programme. The ships are critical for the Royal Navy, and we are going ahead with eight anti-submarine warfare Type 26 global combat ships. The SDSR also made it clear that build work on Type 26 would be preceded by the construction of two additional offshore patrol vessels and that we would launch a concept study and then design and build a new class of lighter, flexible, general purpose frigates. The construction of the additional offshore patrol vessels will provide valuable capability for the Royal Navy and, crucially, will provide continuity of shipbuilding workload at the shipyards on the Clyde before construction of the Type 26 begins.

Nothing has changed since the publication of the SDSR, and over the next decade, we will spend around £8 billion on Royal Navy surface warships. We continue to progress the Type 26 global combat ship programme, and we announced last month the award of a contract with BAE Systems valued at £472 million to extend the Type 26 demonstration phase to June 2017. That will enable us to continue to work with industry to develop an optimised schedule for the Type 26 and OPV programme to reflect the outcome of the SDSR, to mature further the detailed ship design ahead of the start of manufacture, to invest in shore testing facilities and to extend our investment in the wider supply chain in parallel with the continuing re-baselining work.

Overall, the SDSR achieved a positive and balanced outcome, growing the defence budget in real terms for the first time in six years, delivering on our commitment to spend at least 2% of GDP on defence and, in the maritime sector, setting the trajectory for expansion of the Royal Navy’s frigate fleet. That growth in numbers will be achieved through the introduction of a more affordable light general purpose frigate—GPFF. The GPFF reflects a shift in the Navy’s focus and posture to delivering the strategic defence outputs of continuous at-sea deterrence and continuous carrier capability with our unique high-end warships: six Type 45 destroyers and eight Type 26 frigates. A large range of other naval tasks will be undertaken by the GPFF.

To deliver the SDSR, we must improve and develop our national shipbuilding capability to become more efficient, sustainable and competitive internationally. To that end, we announced the intent to have a national shipbuilding strategy, and I am delighted that Sir John Parker, a pre-eminent engineer and foremost authority in naval shipbuilding, has started work as the independent chair of that project. I look forward to receiving his recommendations, which will address, among other things, the best approach to the GPFF build.

I understand the strong interest in the timing of the award of the contract to build the T26 global combat ship, and I also understand that reports of delays create anxiety, but let me assure the shipyard workers on the Clyde that this Government remain absolutely committed to the Type 26 programme and to assembling the ships on the Clyde, and that we are working closely with BAE Systems to take the Type 26 programme forward, ensuring that it is progressed on a sustainable and stable footing.

More broadly for Scotland, our commitment to the successor programme will sustain 6,800 military and civilian jobs there, rising to 8,200 by 2022. As the programme progresses, an additional 270 personnel will be based at Her Majesty’s naval base Clyde. Extending the Typhoon until at least 2040, and upgrading it with the active electronically scanned array radar, will benefit RAF Lossiemouth and continue to benefit Selex ES in Edinburgh. Our new maritime patrol aircraft will be based at RAF Lossiemouth, which is ideally placed for the most common maritime patrol areas and is currently used as a maritime patrol aircraft operating base by our NATO allies. This will also lead to significant investment, and our current estimate is for some 200 extra jobs in Scotland.[Official Report, 3 May 2016, Vol. 609, c. 1MC.]

Mr Dunne

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I am grateful to you, Mr Speaker, for your advice at the end of my opening remarks. I will keep my response brief.

The hon. Lady is seeking to make party political capital out of a routine meeting between BAE Systems and the trade unions that took place last week and that happened to come nearly two weeks ahead of the election for the Scottish Parliament. As I said in my opening remarks, the commitment of this Government to the Royal Navy is crystal clear. We have a 10-year forward equipment plan, in which we will be investing more than £8 billion in surface ships. Where is her party’s commitment to the Royal Navy? What percentage of GDP will her party commit to spend on defence in this country? We hear nothing about that.

Let me turn to the hon. Lady’s specific questions. She asked whether construction will begin this year. As I said earlier, we placed a contract last month for a further £472 million, which takes our contract on this programme up to some £1.6 billion. That is paying for equipment sets for the first three vessels; long lead items; and shore-testing facilities. The programme therefore remains on track. We have confirmed before, and I have done so again today, that there will be eight Type 26 frigates built on the Clyde. As I have said, this is a multi-year programme that extends beyond the equipment plan. The Type 23s will be replaced by a combination of the Type 26s and the new GPFF.

The hon. Lady asked when the national shipbuilding strategy will be published. We have invited the independent chairman to ensure that his work is completed before the end of the year, and I fully expect that it will be. She asked when the timeframe for the general purpose frigates will be determined. As that is a principal part of the national shipbuilding strategy, the answer will be apparent once that strategy is published.

Mr Dunne

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I thank my right hon. Friend for his question. He is very knowledgeable about matters naval. He is right to draw attention to the fact that the introduction of a new and lighter class of frigate raises the prospect not only of more surface platforms for the Royal Navy, but of more exports. As far as I am aware, there has not been a complex warship exported from Clyde yards to other navies around the world for some decades. This provides us with the opportunity, through the general purpose frigate and the additional offshore patrol vessels, to give the Royal Navy, in due course, a larger physical presence and therefore to reverse the decades of decline.

Mr Dunne

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What I can confirm to the hon. Gentleman is that, had the independence vote gone the way that he and his colleagues would have liked, no warships would have been built on the Clyde, because the United Kingdom Government would not have chosen to build them there; we made that very clear. As it is, as I have just confirmed to the House, we will be proceeding with the construction of eight complex Type 26 warships on the Clyde as and when the programme is ready.

Mr Dunne

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My hon. Friend is right to highlight that obfuscation on the part of the official Opposition. I draw to his attention the backlog of work ahead of shipbuilders in this country as a result of our equipment plan and our commitment to build the eight Type 26 vessels. No warship yard in Europe has the prospect of eight warships to look forward to. From that perspective, those working in those yards in Scotland can take considerable heart from the fact that they are working in our yards, rather than those elsewhere in Europe.

Mr Dunne

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That is a good question, and I wish that I were in a position to give the hon. Gentleman a full answer. What I will say is that the vast majority of the contracts that have been placed thus far have gone to UK contractors. In relation to the systems and long-lead items that have been placed thus far, the contracts have gone primarily to BAE Systems and Rolls-Royce; in relation to the gearboxes, they have gone to David Brown. As far as the steel content is concerned—I know this is a matter of great interest to the hon. Gentleman—I have made it very clear previously in the House that UK steel mills will have the opportunity to bid for steel tenders that are put out by the prime contractor over the course of this programme. It will be up to the British steel industry to see whether it is in a position to match those orders for the specification and the timelines required.

Mr Dunne

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My hon. Friend pushes me to pre-empt the Royal Navy’s normal routine on the making of designations and, indeed, the naming of vessels—she did not ask about that, but I am regularly asked about it by colleagues in the House, who rightly like to express an interest on behalf of their constituents. I am afraid I cannot currently give her any comfort on the designation of the vessels. She is right to ask whether they will be designed with export prospects in mind. As I said to my right hon. Friend the Member for New Forest East (Dr Lewis), the Chairman of the Defence Committee, that is something we intend to look at, but the priority will be to meet the requirements of the Royal Navy, rather than of other navies, so the vessels will be designed to Royal Navy specifications, but with an eye on the possibility of exports to other navies.

Mr Dunne

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The hon. Gentleman is a doughty champion of English shipbuilding capability in his constituency, which is across the border from Scotland. I do not have a figure for him—he asked what would happen with the Type 26 programme in Scotland—but our intent is to build the ships on the Clyde, in Scotland, so I do not foresee any direct change from the position we were in last year. As far as his comment on independence is concerned, he is absolutely right that there would have been an enormous reduction in the jobs in Scotland had the Scottish people decided to follow Scottish National party advice and vote for an independent Scotland. [Interruption.]

Mr Dunne

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We have made it very clear that British Government procurement policies are being adopted by the Ministry of Defence. In all our contracts where steel is involved, we are looking to provide for contractors to ensure that British steel manufacturers have an opportunity to bid. In that respect, the only change is that there are perhaps greater opportunities since we implemented that new policy than there were before.

Mr Dunne

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I am grateful to the right hon. Gentleman for focusing his question on that important subject, and I agree that the workforce on the Clyde are highly skilled; indeed, I make a point of meeting the trade union representatives of shipbuilders on the Clyde, and I did so last month. The short answer to his question is yes. The five offshore patrol vessels—three of which are in build, and two of which we added as part of the SDSR—do provide continuity between the Type 45s and the aircraft carrier blocks, as they finish being produced on the Clyde, and the beginning of work on the Type 26s.

Mr Dunne

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I think my hon. Friend is referring to the Type 23 class of frigates. The Royal Navy’s intention is that the new vessels replace Type 23s on a like-for-like basis as they come out of service.

Mr Dunne

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I can tell the workforce that, as I have told their trade union representatives—I also said this to the hon. Lady when she visited me last month—we have a programme for the Type 26, the offshore patrol vessels and the subsequent general purpose frigate that will secure jobs for the shipbuilding workforce in this country, especially on the Clyde, for decades to come. This is the biggest shipbuilding forward programme we have had in this country for a number of years, and that should reassure the highly skilled workforce that they will have jobs for decades to come.

Mr Dunne

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My hon. Friend is right to highlight the gear box work for David Brown, which, as I said earlier, has secured long-lead contracts last month. The benefit of the Royal Navy shipbuilding programme is not confined to Scotland; it affects constituencies right across this country, which is just as it should be. When contracts are placed, we will seek to highlight to hon. Members the work we will be providing in their constituencies for their constituents.

Mr Dunne

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I hope that some of the remarks I made earlier will provide some reassurance to the families of those who work on the Clyde. Part of the contracts we have already signed with BAE Systems will help to provide shore test facilities both on the Clyde and through the supply chain, so some investment is going into facilities. The overall level of facilities investment will be part of the overall contract, so I cannot update the hon. Lady further at this point.

Mr Dunne

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My hon. Friend makes a really valuable point. There is no doubt that before starting the construction of a complex warship, it makes an enormous difference if the design is more complete than otherwise. He is right to point out that the Type 45 programme began with a less advanced design than the Type 26 will have, and we hope we are learning lessons from that. We have certainly learned lessons in relation to the power and propulsion, and we will have a different system.

Mr Dunne

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It is very unfortunate that the hon. Gentleman, who represents his constituents well—I have been pleased to meet him at the yard in the past—uses words such as “betrayal”, because that does not characterise what is happening. We are making commitments to build the Type 26 for several years ahead. I cannot, I am afraid, give him an update on the date for cut steel, as that will emerge from the programme work that is yet to be finalised. It is wrong to suggest that people should be fearful of the outcome of the national shipbuilding project, which seeks to put the rollercoaster ride of shipbuilding in this country in recent years on to a firm and stable footing so that there is clarity for the next decades. [Interruption.] The hon. Gentleman says, “That is what they think”, so perhaps I can help him by saying that the objective of the national shipbuilding strategy is to align the Royal Navy’s requirements, which stretch out for many years ahead, with the capability to maintain in this country the high-quality engineering skills that, at present, reside primarily on the Clyde in his constituency.

Mr Dunne

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The hon. Gentleman will have to wait and see what emerges from the national shipbuilding strategy. The intent is that by having a more affordable design we are able to do some of the less high-tempo tasks that the Type 26 will undertake. That should allow the Royal Navy to have more than five frigates. I can confirm that the intent is to replace the Type 23s on a like-for-like basis as between the Type 26 and the general purpose frigate, with the potential for there to be more. He will have to wait to see what emerges from the national shipbuilding strategy with regard to the timetable and the location.

Mr Dunne

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I remind the hon. Gentleman that part of the strategic ambition is fulfilled by the two primary battlegroup capabilities: continuous at-sea deterrence and the continuous carrier capability. I can absolutely reassure him that the military assets in place on and around the Falklands are of an order of magnitude greater than they have been in previous times, particularly compared with 1982, so the notion of having to send a flotilla of the type that was sent at that time would not be required in the event of a threat to the Falklands today.

Mr Dunne

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The objective of the national shipbuilding strategy is to look at the manufacture of complex warships. As part of that, there are, as the hon. Lady says, significant capabilities across the country through the supply chain. We are not expecting a detailed review of all elements of the supply chain, but I take her point and will reflect on it in my conversations with Sir John Parker.

Mr Dunne

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The hon. Lady will have to have a little more patience. The way in which major procurements of this nature take place means that it is not appropriate to set hares running or, frankly, to be alarmist about the prospects for individual companies or locations. Until such time as a contract has been signed, there is not the clarity that the hon. Lady seeks to achieve.

Mr Dunne

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The hon. Lady needs to speak to those who were in post when the decisions were taken to reduce the Type 45 class. That was certainly not done under this Government. We made it crystal clear in the SDSR that eight Type 26 global combat ships would be built on the Clyde. In response to the hon. Member for East Renfrewshire (Kirsten Oswald), may I say that that is the reassurance that the workforce on the Clyde need? This is a forward programme, the like of which, during the past six years under the previous coalition Government, we had not been able to implement: now we can.

Mr Dunne

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As the hon. Gentleman knows—he may well have been an expert on the subject for a long time, but he is certainly something of an expert now—steel of the specification and standards required for naval warships is not available in many of the routine runs of, for example, plate steel provided by UK suppliers. That is why there have been different proportions of UK steel content in different types of military platforms. The offshore patrol vessels, for example, have a thinner plate than that which is currently available from any of the mills in the UK, which is why no UK mills chose to bid for the steel content that has been contracted thus far. I cannot tell him whether there is capability at this stage for the Type 26 steel requirements, but I have made a commitment that we will invite steel manufacturers to understand what those capabilities are and give them an opportunity to bid.

Mr Dunne

- Hansard -

All I can say to the hon. Gentleman and to the workforce on the Clyde is that we have, through the SDSR and again today, made a commitment to build eight Type 26s on the Clyde. That will provide work for the highly skilled workforce on the Clyde for many years.

Mr Dunne

- Hansard -

I find it hard to characterise a commitment to build eight complex warships on the Clyde as a betrayal. That is what we did in the SDSR and it has not changed.

Mr Dunne

- Hansard -

I am sorry to have to say to the hon. Gentleman that the risk to employment on the Clyde would have arisen if the people of Scotland had followed his advice and chosen to vote for an independent Scotland. Thankfully, they did not, and as a result hundreds of people are still working in shipbuilding on the Clyde.

Mr Dunne

- Hansard -

I encourage the hon. Gentleman to spend a little more time in the yards on the Clyde to understand how components and systems are an integral part of the capability of building a complex warship. Fabrication is an important part, but much of the value and content comes from introducing weapons command and control systems, which are not built on the Clyde. Fabrication is done there, as is integration, and that will continue to be undertaken there.

Mr Dunne

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I have to repeat to the hon. Gentleman that we have committed to build eight Type 26 complex warships on the Clyde. Had the people of Scotland voted for an independent future, we would not have made that commitment.

Mr Dunne

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I am not sure that the simmering has really calmed the hon. Gentleman down. As I have said, we have made a clear commitment to build eight Type 26s on the Clyde, providing high-quality jobs. That would not have been the case had the people of Scotland voted for independence.

The Minister for Defence Procurement (Mr Philip Dunne)

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As from this month, the Ministry of Defence’s budget has risen to more than £35 billion—that is an increase of £800 million on the year just ended. This is the first real-terms increase in six years, reflecting the priority set out by this Government in the 2015 spending review to increase defence spending by 0.5% above inflation every year to 2020-21. This Government have clearly committed this country to meeting the NATO guideline of spending 2% of GDP on defence each and every year of this decade.

Mr Dunne

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My hon. Friend is right to identify that the threats we face are growing in scale, complexity and concurrency, and a failure to meet this commitment would have a significant adverse impact on our ability to deliver the capability we need to face those threats and would send a very wrong message to our adversaries. Our commitment to spending 2% of GDP on defence enables us to deliver one of the most capable armed forces in the world; to spend more than £178 billion on equipment and equipment support over the next decade; and to fund an increase in the number of regular personnel for both the Royal Navy and the Royal Air Force, and of reservists for the British Army.

Mr Dunne

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The hon. Gentleman, in characteristic style, is looking for smoke where there is no fire. We use the NATO definition to make the calculation of our proportion of GDP spent on defence, and it assesses the figure and then publishes it. We have done that in the past under previous Administrations and we will do it again under this one.

Mr Dunne

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I thank my hon. Friend for giving me the chance to rehearse again our commitment to increased spending on defence and security for each and every year of this Parliament—that will be a real-terms increase. We have published our 10-year forward equipment plan, which shows the contribution that defence will be making to the prosperity of the nation—that is another objective we have taken on in the defence review for the first time. That will benefit both the security of our nation and the economy as a whole.

Mr Dunne

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The hon. Lady is very experienced in these matters, and she will know that, in 2010, the then coalition Government inherited a dire financial situation across the public sector, and especially in defence, and some very difficult decisions had to be taken to reduce certain front-line elements, including our aircraft carriers. She is also fully aware that we are in the midst of the largest shipbuilding programme that this country has ever known. Early next year, we expect to see the first of the Queen Elizabeth-class aircraft carriers moved out of Rosyth to take up their position with the Royal Navy.

Mr Dunne

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I thank my hon. Friend who, in a previous role, had responsibility for promoting defence exports. I also wish to say that I have even better news for him: the announcement last week of the sale of Typhoons to Kuwait was for not for 24 aircraft, but for 28.

Mr Dunne

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This Government have undertaken a new set of procurement guidelines for steel, which we have implemented through the Ministry of Defence through a combination of briefings to the Defence Suppliers Forum undertaken by the Secretary of State. I have also written to the chief executives of the 15 largest contractors. We are cascading that through the supply chain to ensure that, for future defence procurement, there is every opportunity for UK steel manufacturers to bid for tenders.

Mr Dunne

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The hon. Gentleman really needs to read those letters more carefully. The reduction to which he referred related to the in-year spending of the Department, which ended at the beginning of this month. The defence budget for the current year, and for each future year, is going up, and the question that he and his colleagues need to answer is this: why will his party not commit, as our party has, to the 2% NATO commitment?

The Minister for Defence Procurement (Mr Philip Dunne)

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As my right hon. Friend the Secretary of State indicated earlier, the nuclear deterrent is at the apex of the UK’s full spectrum of defence capability. The UK’s defence nuclear enterprise is gearing up to deliver the successor to the Vanguard class submarines. Last month we announced a further £642 million of preparatory work ahead of the investment decision for this £31 billion programme. That investment in Successor submarines will not only help keep Britain safe but support over 30,000 jobs across the UK.

Mr Dunne

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My hon. Friend is absolutely right. As the Secretary of State indicated in his speech on nuclear deterrence before Easter, we have both a political and a moral responsibility to protect our people and allies. The nuclear deterrent is assigned to NATO, and as a leading member of NATO we cannot and should not outsource our commitments to others. There has been broad political consensus for decades in this House on the need to maintain the UK’s independent strategic deterrent. Government Members are clear where we stand. This remains the official policy of Her Majesty’s official Opposition, and it is in our view irresponsible that the hon. Member for Islington South and Finsbury (Emily Thornberry) and her leader appear determined to put the ultimate security of our nation at risk.

Mr Dunne

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The right hon. Gentleman, who speaks with some knowledge on these matters, has given a strong indication to the House that there will be a broad measure of support, which we thoroughly welcome. I will offer the Prime Minister his advice.

Mr Dunne

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I thank my hon. Friend for highlighting the fact that that programme will benefit not just those folks working for Rolls-Royce in various plants, particularly around Derby, or those employees of BAE Systems, the prime contractor, but companies in constituencies right across the breadth of this country, including his own.

The Minister for Defence Procurement (Mr Philip Dunne)

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The UK is proud to be one of five NATO countries that meet the commitment to spend 2% of GDP on defence. Since the defence investment pledge was made at the Wales summit in 2014, progress has been made, with 16 allies increasing defence spending in real terms and 24 allies now spending more of their defence budgets on equipment. As it happens, the leadership role that the UK is given in NATO on this issue was warmly welcomed once again by the US Deputy Defence Secretary in my bilateral discussions with him last Friday.

Mr Dunne

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I am not sure that the Speaker will give me enough time to answer both those issues, so I will focus on the first, if I may. The NATO Secretary-General was here last week and he praised the United Kingdom for our leadership on defence spending and our contribution to NATO. By the NATO summit in Warsaw in July, we expect to see further progress on the part of our allies in working to meet NATO’s 2% guideline. By contrast, the deafening failure to match that commitment by the Labour party sends precisely the wrong message to our allies and, even worse, to our adversaries.

Mr Dunne

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As I indicated earlier this afternoon, NATO makes the definition and assesses the contributions that are made by each member nation to its return. It is not for the United Kingdom to make that determination; it is for NATO to do so.

The Minister for Defence Procurement (Mr Philip Dunne)

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In the recent strategic defence and security review, the Ministry of Defence agreed a new strategic objective of contributing to the nation’s prosperity. We do that in many ways, not least by spending some £20 billion a year with industry, around half of which is in the manufacturing sector, and some £4 billion with small and medium-sized enterprises.

Mr Dunne

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I am in a position to update the House on the steel component of the aircraft carrier contract, which is much the largest defence procurement contract. Of the structural steel, some 95,000 tonnes have been procured from UK steel mills over the period of that contract.

The Minister for Defence Procurement (Mr Philip Dunne)

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We welcome wholeheartedly this month’s contract signed by Kuwait for 28 Typhoon aircraft. Kuwait thereby becomes the eighth country to select the Eurofighter Typhoon and the third in the Gulf to do so. It is very positive both for our bilateral and defence relationship and, as my hon. Friend indicates, for jobs across the British aerospace and defence industry, including the thousands employed by BAE Systems at Warton in Lancashire, many of whom are her constituents. It is excellent news for the whole supply chain right across the UK.

Mr Dunne

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I assure the hon. Gentleman that the Government as a whole are committed to supporting the UK steel industry. The Ministry of Defence has issued new policy guidance to the prime contractors to address barriers to the open market. I am working closely with our contractors to ensure that they support the new policy. In relation to the submarine contracts, as and when they are placed, UK suppliers have an important role to play in the supply of some specialist steels, but at present we do not have manufacturers that are capable of supplying other specialist steels, so there is a balance.

Mr Dunne

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I recently announced a new support contract for the Hawk aircraft that takes it up to November 2020. We have time to decide how to sustain Hawks beyond that. That is much as I can say. However, I will tell the hon. Lady that the Red Arrows are due to commence a substantial programme of displays in this country and overseas this summer. I hope that many Members have the opportunity to watch them.

Mr Dunne

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The Department places the safety of our nuclear fleet at the highest possible level. There are continuous attempts to ensure that any potential threats to our submarines are monitored. If the hon. Gentleman has something specific he would like to draw to our attention he should do so, and I am happy to meet him to discuss it.

Mr Dunne

- Hansard -

I am grateful to my hon. Friend for highlighting the success of Tata Steel in supplying steel for the aircraft carrier. Other grades and types of steel are not currently available in this country and we would be happy to talk to the industry about what steps it can take to make such steel types available.

Mr Dunne

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As my hon. Friend knows, the UK defence and security industry is the largest in Europe. As the default position, we continue to place contracts on the basis of open competition. EU procurement directives apply to our procurement, which means that EU contractors are eligible to compete for our contracts in the same way as UK and other international companies, other than when we declare an article 346 exemption for warlike stores, which accounts for about 45% of our procurement.

[Official Report, 29 February 2016, Vol. 606, c. 662.]

Letter of correction from Mr Dunne:

An error has been identified in the response I gave to my hon. Friend the Member for Bath (Ben Howlett) during Questions to the Secretary of State for Defence.

The correct response should have been:

Mr Dunne

- Hansard -

As my hon. Friend knows, the UK defence and security industry is the largest in Europe. As the default position, we continue to place contracts on the basis of open competition. EU procurement directives apply to our procurement, which means that EU contractors are eligible to compete for our contracts in the same way as UK and other international companies, other than when we declare an article 346 exemption for warlike stores.

Mesothelioma

The following is an extract from Questions to the Secretary of State for Defence on 29 February 2016.

The Minister for Defence Procurement (Mr Philip Dunne)

- Hansard -

In the strategic defence and security review published last November, the Ministry of Defence agreed a new strategic objective of contributing to the nation’s prosperity. We do that in many ways, not least through our procurement spend of some £20 billion a year with UK industry, around half of which is in the manufacturing sector. The British defence and security industry is the largest in Europe, and it plays a vital role in delivering battle-winning capabilities for our armed forces. As a Department, we are driving greater innovation into defence procurement, maximising opportunities for small and medium-sized businesses, investing in skills and contributing to a more prosperous economy.

Mr Dunne

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I can tell the hon. Lady that I have meetings with colleagues in the Department for Business, Innovation and Skills on a monthly basis. In fact, I was in its offices earlier this month. We are constantly looking for better ways to encourage medium-sized and small businesses, in particular, to engage in the Ministry of Defence supply chain, and I am pleased to tell the House that we have confirmed with the Cabinet Office a target of 25% of MOD spend through SMEs, both direct and indirect.

Mr Dunne

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I am happy to try to respond to the right hon. Gentleman, particularly in relation to the specifics that he has raised. About 20% of the steel used in the three offshore patrol vessels has been sourced from UK steel mills. As the prime contractor, BAE Systems issued invitations to 24 companies to tender for the steel contract. Only four were returned, of which only one was from a British contractor. It won the contract to provide steel, which was then sourced from a wide range of suppliers.

Mr Dunne

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My hon. Friend speaks magnificently not only for his constituents, but for the largest UK defence contractor, whose main centre of engineering innovation is in his constituency. I congratulate him on that and applaud him for it.

Mr Dunne

- Hansard -

As my hon. Friend knows, the UK defence and security industry is the largest in Europe. As the default position, we continue to place contracts on the basis of open competition. EU procurement directives apply to our procurement, which means that EU contractors are eligible to compete for our contracts in the same way as UK and other international companies, other than when we declare an article 346 exemption for warlike stores, which accounts for about 45% of our procurement.[Official Report, 2 March 2016, Vol. 606, c. 5MC.]

Mr Dunne

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My hon. Friend might have preferred to put that question to the Secretary of State, who has just visited the Falkland Islands. He is the first United Kingdom Defence Secretary to do so for over a decade. I can confirm to my hon. Friend that, as part of the SDSR conclusions, the Ministry of Defence has committed to investing £180 million in the Falkland Islands, including the improvements he seeks to the accommodation.

Mr Dunne

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The hon. Gentleman should have a word with the leader of his party. Government Members care about both security and prosperity, and the hon. Gentleman may like to remind his leader that grandstanding on a Saturday places at risk not only the ultimate security of the nation, but the tens of thousands of jobs and the hundreds of companies in the submarine industry in this country.

Mr Dunne

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UK suppliers make a significant contribution to the supply of steel for our defence programmes, including some 94% of the steel in the aircraft carriers—77,000 tonnes—being sourced from UK mills. The Government and I recognise that there is an issue that is affecting steel production in this country. That is why we established the steel procurement working group, on which the Ministry of Defence is represented. I instructed the Department and wrote to our major defence prime contractors last December to ensure that the guidance on steel procurement was implemented across defence. That will enable proactive engagement with the UK steel market on procurement pipelines through the supply chain and ensure that cost calculations can be taken into account over the whole life, and not just at the initial price.

The Minister for Defence Procurement (Mr Philip Dunne)

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I can confirm to my hon. Friend that in 2013 the Trident alternatives review concluded that no alternative system was as stable, capable or cost-effective as the current Trident-based deterrent. There is no alternative. The part-time deterrents and half-baked measures currently being suggested by some Labour Members could be ruthlessly exploited by our adversaries and would present a real danger to the safety and security of the United Kingdom.

Mr Dunne

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I am grateful to the hon. Gentleman for taking such an interest in the equipment plan, which is a bit of a specialist subject. We will be publishing the next annual iteration of the equipment plan, just as we have done for each of the past three years, and it will demonstrate that there will be an additional £12 billion committed to spending on military equipment over the next 10 years. That will take it up to £178 billion, but he will have to be a bit more patient before he sees how that is allocated.

Mr Dunne

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All our defence exports to the King of Saudi Arabia or to any other country go through the same rigorous export control system that we have in place. We are proud of that system as it is more rigorous than that of any other country, and that will continue to be the case while this Government are in post.

Mr Dunne

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My hon. Friend is very brave to have joined the Royal Marines in the Arctic. I pay tribute to her and her colleagues for doing so. The SDSR is committed to maintaining amphibious capability. We will be making modifications to one of the two Queen Elizabeth carriers to ensure that that persists for the life of that platform.

The Minister for Defence Procurement (Mr Philip Dunne)

- Hansard -

The nuclear deterrent is the cornerstone of the UK’s defence security policy. Maintaining continuous at-sea deterrence requires four ballistic nuclear submarines. The UK’s defence nuclear enterprise is gearing up to deliver the Successor replacement to the Vanguard class submarines. It will not only keep Britain safe but support over 30,000 jobs across the UK in England, Scotland, Wales and Northern Ireland. It makes a significant contribution to the UK economy.

Mr Dunne

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My hon. Friend is quite right to highlight the importance of the deterrent to our national security. We have seen—I think he was referring to comments made in the past 24 hours—the most extraordinary contortion emerging from the champagne socialist salons of Islington. The idea of spending tens of billions of pounds to build but not arm a strategic deterrent betrays the new kind of politics from the Labour leadership: a lurch back to the discredited unilateralism of the 1970s and a breathtaking lack of understanding about how to keep this country safe, with consequent threats both to national security and to tens of thousands of jobs across the UK.

Mr Dunne

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I would like to add my tribute to the hon. Gentleman’s stalwart work, both on the Government Benches when he was a Defence Minister and on the Opposition Benches when he was a shadow Minister; it is a sorry state of affairs to see him sitting right at the back of the Back Benches today.

The hon. Gentleman is, of course, quite right to point out that this is a long-term endeavour: to design and build a nuclear-enabled submarine takes decades. This is a 35-year project from initial conception to commissioning. Those skills not only take a long time to develop; they cannot be switched on and off. They are at the very forefront of engineering capability in this country. Building a nuclear submarine is more difficult than sending a man to the moon.

Mr Dunne

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I am grateful to my hon. Friend for the considered way in which he made the point that this House is here to deliver national security to the United Kingdom as a whole. It is in all our interests to share a common objective to maintain, at the cornerstone of our defence, a continuous at-sea deterrence posture. We very much hope that, when it comes to a vote, colleagues from across the House will be able to recognise the consensus on this issue.

Mr Dunne

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Our deterrent is a NATO asset, so the NATO alliance depends in part on our ability to make that asset available should the need arise. Our NATO allies are taking a very intense interest in the deliberations of this House and the hon. Lady is right to highlight that.

Mr Dunne

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I have already indicated that I think it is completely farcical to spend tens of billions of pounds on a weapon that can never be used and therefore can never fulfil its deterrent objective. I completely agree with my hon. Friend.

Mr Dunne

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I think this gets to the heart of the confusion that lies at the centre of Scottish nationalist party policy. The deterrent has been in use every single day—and night—for the last 53 years.

The Minister for Defence Procurement (Mr Philip Dunne)

- Hansard -

I had a successful bilateral meeting with Bob Work, the US Deputy Secretary of Defence, only last Friday, at which the F-35 programme came up. Aircraft costs are in line with estimates, operational capability is expanding and fleet reliability is improving as more aircraft come on stream and into the programme, and logistic support increases. The aircraft remains on schedule to meet our initial operating capability in December 2018.

Mr Dunne

- Hansard -

The outstanding air-to-ground capability of our Tornado squadrons is being steadily migrated on to the Typhoon platform initially. In November’s SDSR, we secured considerable investment in the RAF combat jet fleets, including the extension of our Tornado squadrons’ out-of-service date to 2018-19, an increase in our Typhoon fleet by two squadrons, and the extension of the Typhoon out-of-service date to 2040. In addition, we reaffirmed our commitment to acquiring a total of 138 F-35s during the life of the programme and buying more aircraft earlier, so that we have 24 F-35 Lightning IIs by 2023.

The Minister for Defence Procurement (Mr Philip Dunne)

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I am grateful to my hon. Friend for reminding the House that this year we do celebrate 100 years of the outstanding research effort at Porton Down, which was first established in response to the threat from chemical weapons during the first world war. Last week, I reported to the House that we have just decided to make the Defence Science and Technology Laboratory an Executive agency, and I am looking forward to visiting next month, when I hope he will be able to join me to thank all the folk who do such a fantastic job there.

Mr Dunne

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The hon. Lady is right to identify the fact that precision munitions are costly, but I can reassure her that we are keeping a very close watch on stockpiles and ensuring that we have sufficient missiles in stock to meet our requirements. As the Prime Minister said in this House during the Syria debate, it is absolutely the Government’s intent to press for a rebuilding programme for Syria when this terrible civil war comes to an end.

Mr Dunne

- Hansard -

The hon. Gentleman will be interested in the statement relating to Government measures in connection with British steel that will immediately follow this Question Time. Clearly, we are keen to ensure that British manufacturers have an opportunity to compete for defence contracts with significant steel components, and that will continue to be the case.

Mr Dunne

- Hansard -

rose—

Mr Dunne

- Hansard -

I am grateful to my hon. Friend for giving me the credit for establishing the UK Defence Solutions Centre, but I think it is only fair to the House, and indeed to my future career, if I place the credit where it is properly due: at the feet of my right hon. Friend the Secretary of State, in his former role. I enjoyed our visit to UKDSC last week. It is doing a great job in placing UK innovation at the heart of the defence industrial supply chain globally. I am sure that my hon. Friend will have noted that the strategic defence and security review referred to investing in a unique British capability for advanced high-altitude surveillance, which I know will be of interest to him.

Mr Dunne

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As we made crystal clear in the SDSR, we have recalculated the cost of manufacturing the four boats, which we now estimate will be £31 billion, and we have added a £10 billion contingency. We have no intention at this point of replacing the warheads; the decision on that will be taken later. Therefore, I urge the hon. Gentleman to focus on the £31 billion commitment for the submarines, plus the £10 billion contingency, as the cost that is relevant today.

The Minister for Defence Procurement (Mr Philip Dunne)

- Hansard -

It is a pleasure to serve under your chairmanship, Mr Nuttall. It is all too infrequent that we have the opportunity to debate defence matters—and particularly defence procurement—in Westminster Hall, so I am especially grateful to the hon. Member for Clacton (Mr Carswell) for securing the debate, and I congratulate him on doing so. The subject is one of great interest to me, and to him, but of somewhat less obvious interest to other Members. It is a pleasure to see the hon. Member for Strangford (Jim Shannon) here; he takes a personal interest in the subject on behalf of his constituents and Northern Ireland.

It is a good time to have such a debate, not least because it comes two months after the Government published the gratifyingly well received strategic defence and security review in November. The review was comprehensive and ambitious, and when combined with the Chancellor’s summer Budget announcement it was good news for defence. Defence procurement is central to our plans to deliver our national security objectives, and that was precisely the point on which the hon. Member for Clacton opened his remarks—that the purpose of defence procurement must be to provide the capability for our armed forces to keep us safe. That is the primary duty of Government, as has been recognised in the priority that the Government have given defence and in the reform of defence procurement processes, in which the hon. Gentleman takes such a keen interest.

By giving us an increasing budget, the SDSR will help us to protect our people with more new planes, ships and armoured vehicles over the procurement cycle. It will help promote our prosperity. An additional task for defence—an additional strategic objective—of contributing to the economic prosperity of the country has been emphasised through the SDSR in a way that has not happened before. That has a number of implications for how we go about procurement.

Promoting prosperity provides a stimulus for innovation, which is essential for maintaining technological superiority over our adversaries. It provides the opportunity for the Department to become a champion of small business, which in many respects is where innovation originates. It also allows us to encourage defence exports, which means that we can allow our defence supply chain to be competitive internationally, from which we benefit through our own procurement. All in all that is a good thing, as I am sure the hon. Gentleman will agree as we explore the issue in this debate and on future occasions. We are on the right track. We may not have gone as far as he would like or necessarily as fast as we would like, but in my view we are making great strides.

Before I look to the future and address some of the hon. Gentleman’s comments, it is worth acknowledging the enormous achievements in the previous Parliament. I want to preface my comments on the document prepared by his party, which he referred to and which he has in front of him, by saying that many of the criticisms it makes—in many respects rightly—relate to a period that we are now some way beyond. They relate to the defence industrial strategy that was authored in 2005-06 under the previous Administration, which no longer prevails. Part of the disagreement that there may be between us will be about the extent to which today’s policy has moved on beyond the defence industrial strategy, rather than being grounded in it.

In 2010 we inherited a defence procurement position that was unquestionably unfit for purpose. It was not delivering to time, performance or, above all, cost. That is why, at a time of heightened pressure on the national finances, we had to make some tough decisions. We did not shrink from cancelling overrunning and massively expensive programmes such as the Nimrod MRA4 programme, to which the hon. Gentleman referred in his remarks. We embarked on the most radical series of defence reforms in decades, and I am pleased to say that those reforms meant that defence ended the last Parliament in a markedly better state than it began it in.

The National Audit Office’s major projects report for 2015, which was published before the end of last year and covered the most recently available material we had, recorded a fall of £247 million in the forecast cost of defence projects—the second successive year of reductions in the major projects it reviewed. That compares with a £1.2 billion in-year cost overrun reported for 2009 by the NAO in its major projects report.

The 2015 report builds on the success of the 2014 report, which reported the best cost performance since 2005 and the best time performance since 2001. That is powerful evidence of how far we were able to progress in improving performance during the previous Parliament. Indeed, Lord Levene of Portsoken said in his 2014 report on the Department as a whole that,

“a leopard really can change its spots”—

rare praise indeed from Lord Levene.

If I may reflect on the comments of the hon. Member for Clacton and the document to which he referred, we recognised the glaring inadequacies of the defence industrial strategy of 2005-06. That was why we determined to overturn it in a White Paper published in 2012, “National Security Through Technology”, which set out our thinking on industrial policy. It replaced outdated concepts of industrial sovereignty at any cost with a much more nuanced approach, saying that the sole aim of defence procurement was to equip our armed forces with the best capabilities we could afford at the best value for money. That meant putting an end to unaffordable gold-plated requirements and instead increasingly buying things off the shelf, from the global market where possible and appropriate.

“National Security Through Technology” highlighted the benefits of working with other countries, as the hon. Gentleman seeks to do, to open up each other’s defence markets and, where we share requirements, collaborate on international acquisition programmes. The best live example of that new way of collaborating on procurement is the F-35 programme—the largest defence procurement programme in the world ever. Eleven nations are pooling their demand signal to provide as large an order as possible to the contractor consortium—at the moment in annual buys, but in the future it will be multi-year buys. That order is for three different variants of the aircraft type, but it is essentially the same aircraft type for each customer, in order to avoid the bespoking that, as the hon. Gentleman said, becomes so expensive in defence procurement. We are already doing that, and we are doing it in a big way.

The White Paper also recognised that defence procurement is different from other procurement, so for some aspects of capability, we still need to take special measures to maintain our operational advantage and freedom of action, but we stated that those would become the exception rather than the rule.

Having pointed out some of the areas where we agree with the hon. Gentleman’s critique, I will have to disappoint him by saying that I do not see the document prepared by his party as a valid critique of today’s policy and the important work that has been done over the past five years. The White Paper that we published heralded a series of sweeping reforms to defence procurement, which went hand in hand with the much-needed reforms we made to the wider Ministry of Defence. We adopted the proposals outlined by Lord Levene to overhaul the structure and management of the Ministry of Defence. We have thereby created a much leaner, more strategic head office, devolved responsibility and accountability to the single services and, crucially, stood up a Joint Forces Command to look after cross-cutting areas such as helicopters and ISTAR—intelligence, surveillance, target acquisition and reconnaissance. Far from being dominated by single service rivalry, the Department is now more joined up than at any time in its history. That was amply demonstrated by how we handled defence’s contribution to the SDSR, with virtually no trace of the behaviours that had so coloured the exercise five years before.

Nowhere has the extent of our transformation been more ambitious than in our procurement entity, Defence Equipment and Support. DE&S provides vital support to the armed forces, without which they simply could not operate, and I pay tribute to the civilian and military staff employed in that endeavour for their dedication. Re-formed as a bespoke trading entity in April 2014, DE&S now has the freedom to make the changes needed to transform it into a world-class acquisition organisation. DE&S staff numbers have already reduced by around 18,000 since 2007 and, through transformation, we will continue to professionalise it and focus on the people and skills we need.

Mr Dunne

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I cannot give the hon. Gentleman an exact number, but some of the activities previously held within DE&S have been outsourced. One example is the operation of the Royal Navy operating bases, which had, for some historical reason, been managed within DE&S. That has now gone back to the Navy, so those jobs by and large remain, but a large number of the 18,000 are a reduction in individual roles, to become more efficient.

Turning to how we obtain equipment, it is not as simple as making direct comparisons with other nations’ defence procurement models. Structures, roles, operational commitments and, consequently, equipment needs vary. For the past three years we have published a comprehensive and fully costed 10-year forward-looking equipment plan that takes account of our defence priorities and the capabilities needed to support them.

Our £178 billion investment in equipment over the next decade will support all three services, including committing to the F-35 joint strike fighter, which I have mentioned, and to new maritime patrol aircraft. Incidentally, we have decided that those aircraft should be procured off the shelf, to take advantage of the existing production line in the United States, to maximise interoperability with the United States and the other allies that will be procuring that capability, and to minimise bespoking, so that the cost is as plain vanilla as it can be. Through the equipment programme, we will also invest heavily in the Navy through the Type 26 frigates and in the Army through forming the new strike brigades with its equipment, which will be state-of-the-art.

Mr Dunne

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That will allow us to acquire the capability we need, with minimal costly bespoking, in the timescale required. The hon. Gentleman has just indicated from a sedentary position that he supports those initiatives.

We share the hon. Gentleman’s view that protectionism is not good for defence or for the UK in the long term, not because we do not want to support British industry—we do—but because we recognise that protectionism provides no lasting solution. It does not give us the capabilities we need when we need them, at a price we can afford. Above all, it does not help industry. It stifles innovation, saps productivity and suppresses competitiveness.

That is why we focus on competitive procurement, with one of the most open defence markets in the world. It is why, for example, we decided to procure the new fleet of Royal Fleet Auxiliary tankers from South Korea, which the hon. Gentleman touched on in his remarks. The fleet will come into operation later this year and draws on key British technology, with some 25% of the supply chain for the vessels coming from the UK. There is still a strong UK component to an international procurement, demonstrating that having an open defence market helps to sustain a competitive defence industry in this country.

We recognised that we needed to reset the relationship with industry, particularly on the large single-source projects of which the hon. Gentleman is so critical. For that reason, we used the Defence Reform Act 2014 to reform single-source procurement. It established a statutory governance framework to ensure that costs are fair to us and to our suppliers. We have also set up the Single Source Regulations Office as an independent review body, and it has now been operational for 12 months. No longer will suppliers have carte blanche to set the terms of the trade. We believe that that will help to address the hon. Gentleman’s concern about defence inflation by imposing a much greater spotlight of transparency on individual single-source contractors and the bill invoices they submit, which we think will put downward pressure on inflationary pressures.

I point out gently to the hon. Gentleman that some of the cost comparisons in his party’s document confuse different things, often comparing apples with pears by not taking into account some of the additional costs that appear when we procure in the UK, other than on an off-the-shelf basis. We tend to include the cost of support, training and simulators alongside the cost of the capital equipment itself, which can often distort a like-for-like comparison with an off-the-shelf purchase.

Question put and agreed to.

The Minister for Defence Procurement (Mr Philip Dunne)

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I am pleased to be able to follow the hon. Member for East Renfrewshire (Kirsten Oswald). I believe that she was making her debut in winding up a debate on behalf of her party, and I congratulate her on that. As she said, this has been a well-informed and at times passionate debate, and rightly so, because the strategic deterrent forms a key part of the Government’s No. 1 priority: the defence of the realm.

The Government are committed to maintaining a minimum credible and assured deterrent, as was clearly stated in the manifesto on which they were elected to govern the whole of the United Kingdom. The hon. Lady argued that we should respect the wishes of the Scottish people, and we should indeed take them into account, but that is the same argument as was advanced by the then leader of the Greater London Council when he declared London to be a nuclear-free zone. No nuclear weapon would have been allowed in this country had his views been entirely respected. That is not an argument that we can respect, because we have responsibility for the government of the United Kingdom as a whole.

We are committed to building four new nuclear-armed submarines to replace the current four Vanguard class submarines, but not to replacing the Trident missile, which is the notional subject of the debate. As was pointed out by the hon. Member for Chesterfield (Toby Perkins), the subject of the debate is not, strictly speaking, what is at stake today, because what we are actually discussing is whether or not to replace the submarine class, rather than the missile system.

Why do we stand by our commitment? First, as the Secretary of State said, this is about being realistic. We do not live in an ideal world, much as we might wish to. Our deterrent is there to deter the most extreme threats to our national security and way of life. Those threats have not gone away, however much people might wish it were otherwise. The national security review which was published yesterday shows that, if anything, they are growing and becoming more complex and more diverse by the day.

Under the coalition Government, we as a nation took steps to reduce nuclear arsenals, and we have reduced the number of deployed warheads on each submarine from 48 to 40. Other nations with nuclear weapons have not responded to that unilateral action. They need to follow our example, and nations without nuclear weapons should end all notions of obtaining them. Those who wish to gamble with the nation’s security do so with no ability to predict what the world might be like in decades to come.

Mr Dunne

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I am afraid that I have very little time.

Secondly, our deterrent works for us every day, for 365 days and nights each year, thanks to the brave service of so many of our valiant personnel serving on the Vanguard class submarines—and, indeed, the husband of the hon. Member for Glasgow North West (Carol Monaghan), whom she mentioned earlier. I believe that he has now retired from the Royal Navy, but I respect the service that he gave.

The fact that we have a continuous at-sea deterrent sows the seeds of doubt in the minds of our potential adversaries. As was emphasised by my hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) in a powerful speech, continuous at-sea deterrence works because it provides the ability to strike back. It also provides another decision-making centre in the NATO alliance, and complicates and confuses an enemy’s calculations.

Finally, there is no alternative. Notwithstanding the recollection of my friend and former colleague the right hon. Member for Orkney and Shetland (Mr Carmichael), the 2013 Trident Alternatives Review made it very clear that if we were to have a cost-effective way of delivering the minimum nuclear deterrent, Successor was the only viable solution. Moreover, the ramifications of removing our deterrent would be immense, putting at risk not just our national security and our position in NATO—the cornerstone of our defence—but our economy, our essential skills base, and thousands of jobs across the United Kingdom.

Mr Dunne

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I am about to respond to some of the comments that have been made today. Before I answer the hon. Gentleman’s question, I want to deal with the fantasy figures presented by the SNP’s defence spokesman, the hon. Member for Argyll and Bute (Brendan O’Hara), who had conjured up from nowhere the idea that if the nuclear deterrent ceased to exist, Scotland would benefit by some £15 billion as a result of not spending money on it. The cost of replacing the Vanguard class with the Successor class is, as identified clearly in yesterday’s document, £31 billion spread over decades—over some 30 years—so the idea of a much larger figure is not correct.

Mr Dunne

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No, I am afraid I will not give way.

I welcome the hon. Gentleman’s apparent admission that in the event that the deterrent was to be decommissioned, Scotland would take its share of the nuclear decommissioning risk and location of nuclear material. That is very welcome indeed and is in stark contrast to the responses we have had from the Scottish Government to the disposal project currently in consultation.

The hon. Gentleman also indicated no willingness to acknowledge there is any potential threat from nuclear-empowered nations. He was challenged and signally failed to provide an answer as to what the potential threat might be from Russia, despite the fact that every time there is an incursion into either air or sea space approximate to our national territorial waters SNP Members are the first to jump up and ask what we are doing about it. It seems that they have, as so often, double standards. Finally, I point out to the hon. Gentleman that there has been no increase in nuclear weaponry in this country—far from it; nuclear weapons numbers have declined.

The hon. Member for Chesterfield gave a thoughtful speech from a somewhat confused party position. On the governance of implementing a delivery organisation to make sure we deliver the Successor programme on time and to budget over the years to come, I can confirm that this will remain subject to oversight by the MOD. We are in the process of working out how we best learn the lessons of delivering major procurement projects like Aircraft Carrier Alliance to get the industry properly aligned, and the Ministry and the delivery organisations currently within DE&S properly aligned, to work in partnership to deliver this vital programme.

Mr Dunne

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As the Prime Minister and the Secretary of State have made clear, this will be reporting through the MOD structures to the Secretary of State, and of course the Treasury will take its interest in the delivery of major programmes as it does in all our category A programmes, of which this will obviously be the largest.

We have had contributions from a number of Members across the House, and they have been well-recognised already. I do not have time to thank Members for contributing, but I would just say by way of conclusion that it was welcome to see consensus between most of the contributions of the Official Opposition and the contributions from the Government Benches. I recognise that many who stood up have done so with courage in speaking of their belief in the vital importance of our strategic deterrence, some despite the appalling provocations and bigoted comments from the former Mayor of London, who has allegedly been appointed by the Leader of the Opposition, without the courtesy of informing the shadow Defence Secretary, to, as we heard today, co-convene a Labour review of the strategic deterrent.

The hon. Member for Chesterfield did his best, but even he was unable to make clear what this review is for, who is in charge and what difference it will make. Heaven knows what will emerge from the review—we might get a clue from the vote imminently—but I was astonished to learn from the Opposition spokesman that he does not regard it as appropriate to vote on this motion in Parliament today. I say to those Labour Members who share my concern to maintain continuous at-sea deterrence, “Let your conscience guide you into the right Division Lobby this afternoon.” I urge Members of both sides of the House to do the right thing for the whole of the UK, not just for today but for tomorrow, and restore the consensus that has kept us safe for decades.

Question put.

The Minister for Defence Procurement (Mr Philip Dunne)

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The strategic defence and security review will shortly set out for the hon. Gentleman and the House how we will invest more in bigger and stronger defence for Britain. The British defence industry plays a vital role in delivering more planes, ships, armoured vehicles and battle-winning capabilities for our armed forces. We are looking at how we can drive greater innovation into defence procurement, maximise the use of small and medium-sized enterprises, and ensure that investment decisions contribute to a more dynamic and productive economy.

Mr Dunne

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As with all major defence equipment programmes, the contractors determine the materials, which includes sourcing steel on the basis of competitive cost, time and quality. In 2010, no UK steel manufacturer was able to meet the prime contractor’s requirements, so no UK bids to supply steel for the Ajax programme were forthcoming. I can confirm for the hon. Gentleman, who takes a great deal of interest in this matter because the Ajax vehicles, after the 100th vehicle, will be assembled in Merthyr Tydfil, next to his constituency, that some 2,700 tonnes of steel—about 30% of the total requirement —remains open to competition, and that a competition is under way to supply sets of training armour that is open to applications from UK firms.

Mr Dunne

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My hon. Friend is an experienced Member of the House and it will not be lost on him that after Defence questions, we have a statement from the Prime Minister, who I am quite sure will be able to address the question that he has just posed to me.

Mr Dunne

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I am grateful to the hon. Gentleman for reminding the House that on Thursday last week, I accompanied him to his constituency to recognise the signature of the contract for the fifth Astute boat, Anson. It was good to be able to thank many of his constituents who have been involved in its construction. With regard to the investment decision for Successor, I think that that subject will come up shortly.

Mr Dunne

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The Ministry of Defence is participating in the working group that was established last month by my right hon. Friend the Minister for the Cabinet Office and Paymaster General. Although steel is clearly a significant and important component in much defence manufacturing, the steel involved in all our current major programmes represented less than 1.5% of the steel manufactured in this country in 2013. Relatively speaking, although defence is important, it is a small contributor to the total steel output of this country.

Mr Dunne

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The hon. Lady may recall that the programme she refers to, which was commissioned by the previous Labour Government, was more than £1 billion over-budget. It was reduced in scale by that Government to nine aircraft—more than half what was originally procured—and the prototype aircraft that was produced had more defects than any previous aircraft in production. We were not sure whether it would ever fly. That was the right decision to take at the time, and now it is the right decision —if the Prime Minister is about to announce it—to have a replacement capability. We will have to hear when that will be available.

Mr Dunne

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I am sorry to have to disappoint the hon. Lady. It is now twenty to 3, so she must be a little more patient and see what the Prime Minister announces in his statement later this afternoon. I am quite sure that she will be in her place to hear it.

The Minister for Defence Procurement (Mr Philip Dunne)

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Steel is sourced by our contractors from a range of UK and international suppliers, reflecting the need to ensure a competitive price and delivery at the required time and quality. UK suppliers have provided significant quantities of steel for major defence equipment procurement programmes, whenever they have been able to meet specified standards. Our new Government guidelines, published last month, will help UK steel suppliers to compete effectively with international suppliers for major projects, including those in defence.

Mr Dunne

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I am sure the hon. Gentleman will agree that the steel that is specified needs to be the steel that can do the job. We are open-minded about who can supply that, but we are adopting the new Government guidelines. For the offshore patrol vessels, some 20% of the requirement—about 775 tonnes—was sourced through UK steel mills.