Defence Procurement: Small and Medium-sized Enterprises

Sharon Hodgson Excerpts

Tuesday 28th January 2025 Westminster Hall

[Alan Strickland]

I thank my hon. Friend for his intervention. I absolutely agree. In my previous life in the housing and the charity sector, I have interacted with Government procurement across Departments. There is a challenge with culture across Whitehall, as my hon. Friend says, of often struggling to deal with the realities of innovative and agile small firms.

The approach I described means the US spends around a quarter of its entire military budget directly with SMEs, much higher than the comparable figure for the UK. The UK Defence and Security Accelerator does good work in directly using SMEs to fill technology gaps. However Northern Defence Industries, representing more than 300 companies, has called on the MOD to do more to facilitate open call competition. That would allow SMEs to showcase their defence products directly to Government, without having to wait for specific procurement projects and tenders to be opened.

I strongly welcome the intention of Defence Ministers to use the defence industrial strategy to drive engagement with non-traditional contractors, including SMEs. We have a real opportunity to change the way Government think about procurement and a real chance to grow the culture, to which my hon. Friend the Member for Reading Central (Matt Rodda) referred, that gives us the wartime pace of innovation that we need. Just as Churchill’s groundbreaking military technology labs did during the second world war, let us use the resources of the British state to harness the inventiveness and ingenuity offered by our world-leading science and tech companies.

Turning finally to the practical steps we can take to place SME innovation in the service of our national defence, one of the key things we could look at is the reliance across Government on the prime contractor model. In practice this means that the Ministry of Defence often uses large contractors to work with SMEs further down the supply chain rather than engaging with them directly. For some years it has been common across Government, under all parties, to shift to working with smaller pools of larger suppliers. That has some obvious benefits, such as reducing the number of contracts that officials need to manage, transferring financial risk and outsourcing much day-to-day contract management, but there is also evidence that the approach can have its downsides, particularly in squeezing out smaller, innovative suppliers. When I worked in the charity sector, strengthening the prime contractor approach in delivering the Work programme led to a number of innovative charities with a real track record of getting people into jobs being unable to work with Government in the future.

So what can be done? Where possible, let us try to reserve complex framework contracts for large projects that genuinely need them, reducing the proportion of tenders available only to prime contractors. Where large contracts are required, can we look at these to see whether we can break them down into smaller components that are more accessible to SMEs? Secondly, where working through a prime contractor is the right answer, could we strengthen the requirements for them to engage with SMEs proactively and simplify contract arrangements? Thirdly, could we open up opportunities for the Ministry of Defence to contract directly with SMEs by removing red tape and doing so with an agile and entrepreneurial mindset? If businesses at NETpark can be direct suppliers to DARPA, the US Defence Department, NASA and other allied Governments, I am confident that, through the defence industrial strategy, we too can open up more opportunities for SMEs.

[Mrs Sharon Hodgson (Washington and Gateshead South) (Lab)]

My hon. Friend is making an excellent speech. To simplify the point he is making, we should all remember that from small acorns great oaks grow, and even big companies in my constituency such as Rolls-Royce and BAE Systems will have started at some point as an SME. What he is suggesting today would help those SMEs that we all have in our constituencies maybe one day to grow into those grand great oaks.

[Alan Strickland]

My hon. Friend makes a really important point. Considering that we have shop-bought drones making such a difference in Ukraine and that technology is being used in all sorts of ways, my hon. Friend is absolutely right that we need to hunt out and support the small, innovative businesses doing very different and distinctive work in constituencies around the country.

It has been a privilege to set out some of the challenges faced by our innovative SMEs and how the defence industrial strategy can address them. I look forward to welcoming the Minister to my constituency soon for a business roundtable to discuss these issues in more detail. I strongly welcome the Government’s putting growth at the heart of the new defence industrial strategy. The defence sector supports one in 60 jobs in the UK, the majority of which are outside London, so this is a real and tangible way of spreading growth, skills and opportunity to all corners of our country. More than that, if we can improve the way we work with SMEs, it will allow us to build an ironclad, sovereign supply of vital defence equipment. Not only will that provide jobs and drive growth but it will protect us from global shocks in the supply chain.

Warfare is changing, and we must change with it. Global production is threatened, so we must ensure sovereign supply. As the threat grows, so must our defence manufacturing base. I look forward to working with Defence Ministers on this important strategy and to further contributions from hon. Members of all parties in this debate.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 15th March 2021 Commons Chamber

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

Last week, we saw Meghan Markle speaking out about how her pleas for support for her mental health crisis were dismissed. While obviously the military is a very different institution, military charities continue to see an increase in demand for mental health support, although people do still struggle to speak out. What steps is the Minister taking to help reduce the stigma around mental health in the military and veteran community?

[Johnny Mercer]

I pay tribute to the hon. Member for all the championing she does in this area. Mental health has come on in leaps and bounds, particularly in the last five to 10 years. Actually, this year we are introducing mandatory mental health and fitness training for our armed forces personnel, which they will undergo every year. We are fundamentally changing our approach to mental health, fundamentally making it easier for people to come forward. It does take courage, but I encourage all those who have mental health concerns to speak up. There is help available, and they can get better.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 1st February 2021 Commons Chamber

[Johnny Mercer]

I thank my right hon. Friend for his tireless campaigning on this issue. The Secretary of State has taken a personal lead and has recently written to Mary Moreland. As a result, the Department is currently considering how we can best support those represented through her War Widows Association, and, indeed, what that support might actually look like.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

I have been speaking to a number of local authorities about their commitment to the armed forces covenant. We already know that many local authorities do a really great job of supporting service personnel, veterans and their families, but having the covenant in law will enhance those responsibilities. When there are more legal responsibilities, will Government funding to local authorities follow?

[Johnny Mercer]

The Department is looking to issue in due course statutory guidance on how precisely these matters will be achieved. The key thing is that the legislation is very clear that it does not specify outcomes, but simply ensures that a set of principles is adhered to. That is what the armed forces covenant was always about; it was designed never for advantage, but to prevent disadvantage. That is what this Bill does. It is carefully calibrated to ensure that we raise the floor so that the experience for veterans, the serving community and their families is equal across the nation.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 7th December 2020 Commons Chamber

[Johnny Mercer]

Over the course of the past 15 months, the UK’s first Office for Veterans’ Affairs has spent every day trying to design a system to stop veterans who leave the military from falling through the panoply of services that are there. That includes working with the third sector, which has an enormously important role, and also with statutory provision, because we understand that, ultimately, this nation’s duties to its veterans should be ensured—not delivered—by the state. I am determined we will reach the goal that this will be the best country in the world to be an armed forces veteran.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

I thank the Minister for his remarks. As he knows, many of our veterans up and down the country have faced loneliness and isolation as they shield during the pandemic, and that feeling will only get worse as we approach Christmas, with the reality of not being able to see family as usual. Will the Minister support and promote the Jo Cox Foundation’s “Great Winter Get Together” to help our veterans who may be experiencing loneliness this winter?

[Johnny Mercer]

I would be delighted to support the initiative in the name of my friend, Jo, who was in the same parliamentary intake as me. Loneliness is an acute problem, particularly at this time of year, and I am especially aware that our veterans, who often depend on the sort of face-to-face contact of such things as cognitive behavioural therapy, will have been challenged by the specific circumstances we find ourselves in. I would be delighted to support that effort.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 2nd November 2020 Commons Chamber

[Johnny Mercer]

The hon. Gentleman is right to raise this issue. I spend every day fighting to get more money into the sector. The veterans care sector is changing, and aspects of it needed to change. We have seen a decrease in giving as the overt nature of operations in Iraq and Afghanistan has faded, yet the demand continues to go up. That delta is being met through the new programmes that I have outlined. There is always more to do and I am happy to speak to the hon. Gentleman outside the Chamber to hear his particular concerns.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

At the previous Defence questions, the Minister said:

“For too long we have over-relied on the third sector”—[Official Report, 21 September 2020; Vol. 680, c. 611.]

when it comes to veterans’ care, and I totally agree. As far back as June, Cobseo reported that one in 10 armed forces charities will have to close in the next 12 months as a result of coronavirus. The pressures will only intensify with the second lockdown imminent, so what urgent action will the Minister take to ensure that no gaps in charity provision and vital support arise over the next four weeks?

[Johnny Mercer]

I want to be clear with the hon. Lady. A rationalisation and professionalism is definitely currently going on in the veterans’ care charity sector, and in respect of many aspects that needed to happen. My concern is veterans, the provision for them and what it looks like to the veteran. We are working hard to bring together seamlessly the panoply of care, whether it is in the third sector or statutory provision, and we will get there. There are financial challenges, but I am confident that we can meet them and that this country will be the best place in the world to be an armed forces veteran.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 21st September 2020 Commons Chamber

[Johnny Mercer]

I thank my hon. Friend for her sterling work. I also thank groups such as Forward Assist for their work on this. I am clear that there are some very good veterans provisions in this country, but there are areas where we need to do a lot better. For example, the experiences of many females who serve are still not what I would like them to be and similarly with females who leave. I would be delighted to meet my hon. Friend to continue my work with Forward Assist. I have seen the work that it has done recently. We are absolutely determined to make this the best country in the world in which to be an armed forces veteran—both for females and males—and we are determined to continue our work on this.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

The Wigston review of inappropriate behaviours was published in July 2019 and estimated that it would take from five to 10 years to make a measurable difference. Why then is a review taking place of the Wigston review that was published just over a year ago? Why are charities, community interest companies and external stakeholders excluded from this review of a review?

[Johnny Mercer]

The reason we are doing that is very clear. I am aware that, within Government, we are very good at doing reviews, but seeing the impact of those reviews in the real world is something else. What I have asked to do with the Wigston review is to find out where we are with it one year on. The review was not for external organisations; it was an internal report that addressed some serious shortcomings. This review is very clearly shining a light on the Department, showing where we are doing well and where we are doing not so well, and I would be more than happy to share that with the hon. Lady.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 6th July 2020 Commons Chamber

[Johnny Mercer]

I would be delighted to look at that. We have secured specific funding during this challenging time—£6 million out of the Treasury, which has gone to over 100 armed forces charities dealing with the unique challenges of this crisis. I am determined that we will realise this Government’s vision to make this the best country in the world to be a veteran. I would be delighted to meet my hon. Friend and find out what more we can do.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab) [V]]

I want to start by wishing the Minister and his wife a huge congratulations on the birth of their daughter, Audrey.

The Government’s ambition is to make the UK the best country in the world to be a veteran, and the Opposition obviously share that ambition, but for 10 and a half weeks, the telephone service of the Veterans UK helpline was closed. The Minister will no doubt say that there was an email service, but his own figures show that that email service saw an overall reduction of over 10,000 contacts on average per month between April and June this year compared with last year, proving that veterans were not emailing instead. What assessment has he made of the impact of the closure of the telephone service on those people who would normally have called the helpline?

[Johnny Mercer]

I thank the hon. Member for her kind comments about my daughter. She is right—the telephone service was briefly suspended while Veterans UK, like every other organisation in the country, tried to reconfigure its services, to ensure that we met the demand out there. We have helped over 13,000 veterans since 23 March. Per month, we make 470,000 pension and compensation scheme payments. I am still unaware—as I was six weeks ago, when I spoke from the Dispatch Box—of a single veteran whose urgent need has not been responded to, but if she is aware of any, I would be more than happy to meet her and find out what we can do better.

Oral Answers to Questions

Sharon Hodgson Excerpts

Monday 5th March 2018 Commons Chamber

[Guto Bebb]

I can assure the hon. Lady that announcements will be made before the end of the financial year.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

The parents of Corporal Simon Miller are yet to receive justice for their son, one of the Red Caps murdered in Iraq in 2003. I have written to Ministers over many years on this issue. Will the Minister agree to meet me and the Millers to find some justice for their son?

Al-Sweady Inquiry Report

Sharon Hodgson Excerpts

Wednesday 17th December 2014 Commons Chamber

[Michael Fallon]

On the first question, I lack the legal expertise to comment on whether a civil claim would have a chance of success. On the practice certificates of the two firms, that is a matter for the Solicitors Regulation Authority.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

I was interested to hear Sir Thayne Forbes say that the reason for gathering the bodies of the combatants was

“to see if there was amongst them an individual, known by the codename Bravo 1, who was suspected of having been involved in the murder of the six Royal Military Policemen in Majar Al Kabir in June 2003.”

The Defence Secretary will know that my constituent, Corporal Simon Miller, was among the Red Caps murdered in that massacre. Does he therefore agree with me that the attempt to identify Bravo 1 was justified? Can he tell us whether the suspect in question was indeed identified that day?

[Michael Fallon]

As I understand it—I am open to correction—all the detainees were revealed to have been insurgents. One of the things that the inquiry has thrown up is the distinction between general interrogation and what is called tactical questioning, where people need very quickly to get as much information as they can in order to save lives or to prevent further bloodshed on the battlefield. It is that distinction that Sir Thayne discusses when he comes to the various procedures. As I understand it, in terms of the very specific identification on that day, it did not take place.

Armed Forces Restructuring

Sharon Hodgson Excerpts

Thursday 23rd January 2014 Commons Chamber

[Mr Hammond]

I am grateful to my right hon. Friend, and that is exactly what I want to convey today. This has been a difficult time: a period of uncertainty and change, and no one likes uncertainty or change. The armed forces will now be able to concentrate on the future and on building the skills and capabilities that we have set out for Future Force 2020, knowing that we have completed the draw-down in size and the major restructuring that we have undertaken. That provides a very robust base to build for the future, with armed forces that will remain one of the most experienced combat-hardened and capable armed forces in the world.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

Will the Secretary of State clarify whether personnel who are serving on operations will be accepted or refused if they apply for redundancy?

[Mr Hammond]

I am happy to clarify that for the hon. Lady. Personnel who are serving on operations are, of course, eligible to apply for redundancy if they wish to do so, but if they are serving on operations at any point between now and the announcement date on 12 June, they will not be eligible for compulsory redundancy. So if they do not volunteer, they will be exempt from redundancy.