Better Defence Acquisition

Philip Hollobone Excerpts

Monday 10th June 2013 Commons Chamber

[Mr Hammond]

As I said to the shadow Secretary of State, if we went down this route, we would expect to award a contract next year and for it to be effective by the last quarter of 2014. We would then expect there to be a two-stage process towards the full GoCo-isation—if I may use that term—of DE&S. We would expect savings and efficiencies to be generated from the very beginning, and from the second year of operation we would expect there to be cashable benefits.

[Mr Philip Hollobone (Kettering) (Con)]

I congratulate my right hon. Friend on his statement. Were he to save the full £1.3 billion to £2.2 billion of waste that he has identified, he would be able to buy an extra one or two Type 45 destroyers a year and to start to rebuild the Royal Navy back to its proper size. Will he confirm that this is the biggest waste black hole in the MOD budget and that no other hole in the budget has a bigger annual cost?

[Mr Hammond]

It is certainly our assessment that the frictional costs of inefficiencies within defence procurement are the biggest single challenge that we face and our biggest single opportunity. I was at Portsmouth the week before last and talked to the commander of the dockyard. He told me that once the Queen Elizabeth carriers are berthed there, he will be making provision for some 200,000 tonnes of fighting ships to be tied up in the harbour. That will be largest tonnage that he or his predecessors have had to make provision for since the 1960s.