Armed Forces Pay

Tobias Ellwood Excerpts

Wednesday 1st November 2017 Commons Chamber

[Mr Sweeney]

Yes, I absolutely agree. Engineering and air crews in particular have urgent issues of undermanning in the service.

It is alarming that the entire Regular Army can be comfortably seated in Wembley stadium now that its numbers have fallen below 82,000 and it is 6% undermanned. In contrast, the Regular Army numbered 103,000 when I joined in 2006 and it could not fit into Wembley stadium.

The defence budget has fallen from 2.5% of GDP to under 2% over the term of this Tory Government. There is a chaotic equipment programme. Whether it is Nimrod or the cats and traps on the carriers, fiasco after fiasco has bled resources out of the armed forces through a lack of efficient management of equipment programmes. It is shocking that armed forces pay should suffer as a result.

[The Parliamentary Under-Secretary of State for Defence (Mr Tobias Ellwood)]

I just want to give the hon. Gentleman the opportunity to correct what he just said. It was the Labour Government who chose to abandon cats and traps, and who slowed down the building of the aircraft carrier, which cost over £1 billion on top of the original bill. That is what happened to the aircraft carrier under a Labour Government.[Official Report, 20 November 2017, Vol. 631, c. 3-4MC.]

[Mr Sweeney]

I have to correct the Minister. That is factually incorrect. I worked at BAE Systems at the time. The project was commissioned as a result of the 2010 strategic defence and security review, and £1 billion was utterly wasted before the project was cancelled.

I will quickly draw my comments to a conclusion. The Armed Forces Pay Review Body has highlighted that the 2016-17 pay review was not an increase in real terms at all because of the impact of national insurance increases and the changes to housing cost allowances. From 2010 to present, it actually represents a 5.3% cut in real-terms pay for our armed forces. The reality is borne out by the evidence presented today, and it is comprehensive. We have seen a litany of failure, falling expenditure and stagnating incomes. That leads to a fall in morale. As a result, outflow has exceeded recruitment since 2011. Let us come together in this House today to recognise that there is a vicious cycle of downsizing. We must move towards a virtuous cycle of investment that will stop the continued degradation of our armed forces and ensure that the operational effectiveness of our armed forces is secure for the future in a very dangerous world.

--- Later in debate ---

[Wayne David]

Thank you, Mr Deputy Speaker. I think that the chuntering and the interruptions are indicative of the crass behaviour of the Ministry of Defence, which we are debating this afternoon.

I am not hopeful that Ministers will stand up for the armed forces, which they claim to support, not least because I understand that rather than fighting for more resources, the Secretary of State for Defence is considering scrapping the special allowance given to soldiers serving in Iraq and Afghanistan. Will the Minister, in his response—I will give him time to respond—make a commitment not to cut the special service allowance?

As we approach Remembrance Sunday—several Members mentioned it, including my hon. Friend the Member for Clwyd South (Susan Elan Jones)—it is surely imperative that the House unites in support of our armed forces. This afternoon, many contributions have strongly supported lifting the pay cap. I very much hope that all of us will support the motion, and call for a fair pay rise for our armed forces. Especially at this time of the year, our armed forces deserve nothing less. [Interruption.]

[Mr Ellwood]

rose—

[Mr Deputy Speaker]

Order. The Minister should sit down for a second.

Mr Lancaster, I do not know whether you are deliberately trying to frustrate the Chair—I am sure that is not your intention—but you are going a good way towards doing so. Let me help you. It is up to the Opposition spokesman when he sits down. The Minister has asked for extra time to respond, so you should be thanking Mr David for sitting down to give him that extra time. Let us have less chuntering, and let us hear from Minister Ellwood.

[The Parliamentary Under-Secretary of State for Defence (Mr Tobias Ellwood)]

It is a pleasure to respond to what has been a passionate and mostly constructive debate. It is a real pleasure to add my support, as expressed on both sides of the House, for our noble, gallant and brave armed forces.

Before I respond to the debate, may I join the Prime Minister and I am sure the whole House in sending our best wishes, thoughts and prayers to those affected by yet another terrorist attack in Manhattan in New York? That place is close to my heart: I was born there, and I have worked there as well. The attack reflects the type of security challenges we continue to face not just in this country, but across the world.

As the Minister for the Armed Forces said, we need to see this debate in the wider context of fiscal responsibility, and that must be the backdrop to any discussion on pay. It is only with a growing economy that we can responsibly make any changes to funding for Departments. Let us not forget that we inherited a deficit of almost £150 billion. That is now down by three quarters, but the annual interest on the nation’s debt continues to be more than £50 billion every year, and we cannot simply take money if it does not exist. Under this Government, the economy is growing, employment is up and it is now possible to lift the 1% pay freeze imposed by the Treasury, which is good news.

This debate has focused primarily on armed forces pay, but that cannot be directly compared with other types of public sector pay, such as in the NHS and so forth—we must look at the other aspects that make wearing the uniform very different. We have to recognise the subsidised accommodation and food; the X factor pay, which many hon. Members mentioned; the pensions package; the free medical and dental care; the allowances, including operational pay; and of course the automatic pay progression, which has also been mentioned. The Armed Forces Pay Review Body considers all those factors before any changes are made.

[Stewart Malcolm McDonald]

Specifically on pensions, the MOD’s continuous attitude survey shows that dissatisfaction with the package was at 38% in 2013, but is now at 52%. Why?

[Mr Ellwood]

I take from the continuous attitude survey that, yes, we have to recognise the concerns about pay and indeed about pensions—such concerns are felt on both sides of the House—but the biggest concerns are the long periods of separation and the pressures on family life. That is exactly why we are introducing the armed forces people programme, which will alleviate the pressure on families caused by separation. We are providing a new joiners’ offer and a new accommodation offer, and we are also looking at a new enterprise approach, which will allow highly capable people in the private sector to slide across into the armed forces. There is also the flexible engagement model that we debated in the Chamber on Monday.

As the Minister for the Armed Forces said, and this has been reiterated by Members on both sides of the House, we must recognise how different it is to wear the uniform in today’s context. It is becoming tougher to recruit because we have full employment, and it is becoming difficult to retain because of the challenges and competition we have in public life. Unlike the Opposition spokesman, the hon. Member for Caerphilly (Wayne David)—who perhaps teased my hon. Friend the Minister for the Armed Forces in denying him the ability to intervene—we recognise those different circumstances, and we are trying to get people to step forward.

The conduct of war itself has changed. What we expect to ask of our brave service personnel is also different. That is the context of the debate, and that is reflected perhaps in the recruitment and retention challenges that have been echoed across the House.

[Stephen Doughty]

I thank the Minister for giving way, particularly as I did not get a chance to ask this question when the debate finished half an hour early the other day. Earlier, the Minister for the Armed Forces said that the current commissioning course at Sandhurst was at full capacity, but I looked at the figures for the most recent course: only 210 places were taken up when the capacity was 270. Can the Minister clarify what is going on? Is the course at capacity or not?

[Mr Ellwood]

If I may, I will ask my hon. Friend the Minister for the Armed Forces to write to the hon. Gentleman with the details, but I do not shy away from the challenges that we face. I have just made that clear. It is difficult to recruit and retain in the manner that we would wish because of a number of circumstances, which have been highlighted by the report produced by my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois). I shall come to that shortly.

[Conor McGinn]

rose—

[Mr Ellwood]

This will be the last time I give way, if I may.

[Conor McGinn]

The Minister for the Armed Forces was quick to his feet earlier to dispute figures that I gave that show that numbers leaving the Army Reserve increased by 20% between June last year and this year. Furthermore, the intake decreased by 18%. Those are not my figures; they are the Government’s figures. Would the Minister care to acknowledge that?

[Mr Ellwood]

I think that, overall, reserve numbers are up, but, again, I will ask my hon. Friend the Minister for the Armed Forces to write to the hon. Gentleman with more detail.

To move on—

[Wayne David]

Will the Minister give way?

[Mr Ellwood]

I will not give way to the hon. Gentleman. He tests the patience of the House in rising to his feet after denying my hon. Friend the Minister for the Armed Forces I do not know how many times the opportunity to intervene.

The Opposition spokesperson, the hon. Member for Llanelli (Nia Griffith), talked about the importance of Remembrance Day, which was also highlighted by other hon. Members, and about the importance of pay itself. She also talked about the role of the Armed Forces Pay Review Body, whose recommendations will, I understand, come through in March.

The hon. Member for Glasgow South (Stewart Malcolm McDonald) used the debate as an opportunity mostly to promote his views on Trident, which are not shared across the House. Indeed, this nation would become a lot weaker if we were to get rid of Trident. That would not be in anybody’s interest.

My right hon. Friend the Member for Rayleigh and Wickford produced a report highlighting some of the challenges we face, and I fully agree with him that we need to work on improving diversity. It is important that we attract the brightest and the best, and that includes recruitment moving up to 15% by 2020 for women, and up to 10% for BAME—black, Asian and minority ethnic. I am grateful to him for the work he did on that important report.

The hon. Member for North Durham (Mr Jones) talked about the black hole in defence finances. We came into government recognising that £38 billion was seemingly missing, because it had been stolen from future budgets, but let us take a step back.

[Mr Kevan Jones]

Will the Minister give way?

[Mr Ellwood]

In a second. When we came into government, we found a black hole in the nation’s finances, with £150 billion missing. Although the Labour Government managed to balance the books back in 2000, in every single year thereafter they spent more and more money that they did not have, but which belonged to the taxpayer. That is why we ended up with the deficit and the recession—they were taking money that did not exist.

[Mr Jones]

I am sorry that the Cameron Kool-Aid is now being handed round again in the Conservative party. I ask the Minister to look at the facts—

[Mr Ellwood]

rose—

[Mr Jones]

Look at the National Audit Office report of 2010. What it said on the equipment budget, not the overall budget, was that on its current basis the figure would be £6 billion. If there was no increase in line with inflation over a 10-year period, the figure would be £36 billion, not £38 billion—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. First, if the Minister takes the intervention both Members cannot be on their feet and he cannot suddenly say, “I don’t want to hear any more of it.” In fairness, if he gives way he needs to let the intervention get to the end. If I think the intervention is too long, let me take that decision. Let us not have both Members on their feet.

[Mr Ellwood]

Thank you, Mr Deputy Speaker. I make it clear that the facts are very clear. Look at any—

[Mr Jones]

On a point of order, Mr Deputy Speaker—

--- Later in debate ---

[Mr Deputy Speaker]

Okay. I will accept “accuracy” but not “truth”. Minister.

[Mr Ellwood]

I am not sure whether I should sit down or stand up.

[Mr Deputy Speaker]

No, I tell you what: you’ll sit down. If we are going to play the game, we will start playing it. Now then, Minister: on your feet.

[Mr Ellwood]

Thank you, Mr Deputy Speaker. I have a huge amount of respect for the work that the hon. Gentleman did, and continues to do, in supporting our armed forces, but the numbers are clear. The growth of the deficit since 2000, moving forward, increased, increased and increased; and that is the black hole that I was actually referring to.

I think we have milked this subject enough for the moment, so I will move on. The hon. Member for Stoke-on-Trent North (Ruth Smeeth) spoke about the importance of the covenant. She is in her place. I thank her for the work that she does on this important matter and I would like to meet the Committee at the earliest opportunity.

My right hon. Friend the Member for Hemel Hempstead (Sir Mike Penning) spoke of the package of financial support, which is very important. I have touched on that. The hon. Member for St Helens North (Conor McGinn) said that the reserve numbers are increasing. My hon. Friend the Member for Aldershot (Leo Docherty) spoke with passion about his constituency. It was a pleasure to visit the event to commemorate the 35th anniversary of the Falklands campaign. The hon. Member for Clwyd South (Susan Elan Jones) spoke about the importance of the Royal British Legion. I am really pleased that the Office for National Statistics has agreed to include a tick—a requirement—for veterans and I am pleased that everyone has worked towards that.

My hon. Friend the Member for Cheltenham (Alex Chalk) spoke about the importance of the equipment that we have—£178 billion is being spent on that. He also said that the total cost of the promises that Labour has made so far under this Government is £500 billion. I do not know where that money will come from.

The hon. Member for Glasgow North East (Mr Sweeney) spoke about cats and traps. I want to make it clear that the electromagnetic aircraft launch system—EMALS—was being promoted. That simply had not matured in time. There was no way that we were going to buy F-35Cs for the aircraft carrier; they could not have been launched off it because there is no steam.

[Mr Sweeney]

rose—

[Wayne David]

rose—

[Mr Ellwood]

I will not give way. There is no steam on board the aircraft carriers. They are diesel; they are not powered by atomic energy.

My hon. Friend the Member for Plymouth, Moor View (Johnny Mercer) denied being a Government lackey. I can confirm he is certainly not—

[Wayne David]

On a point of order, Mr Deputy Speaker.

--- Later in debate ---

[Mr Deputy Speaker]

I think people will deliver figures in different ways, and the interpretation of those will always be in dispute. Minister.

[Mr Ellwood]

I was just going to mention the animation—the passion—of my hon. Friend the Member for Plymouth, Moor View, who has done a service to the House with his work to promote the needs and requirements of veterans. I hope that continues.

The hon. Member for Gedling (Vernon Coaker) made an interesting and measured contribution. He was the first to point out that what we need to do is to ask the question, “What do we want our armed forces to do?” Only by asking that question will we determine the size and the equipment we need, and that is why we are undertaking our capability review.

The hon. Members for Easington (Grahame Morris) and for Leeds North West (Alex Sobel) spoke with passion about Remembrance Sunday and the poppy appeal. It was a real honour to visit the Poppy Factory a few months ago to see the work that it is doing with veterans, and the work for Remembrance Sunday itself.

In conclusion, like all Members of the House, the Government want to ensure that our brave armed forces, those exemplary men and women who give their all for our country, continue to get what they deserve. Our forces are currently serving in 25[Official Report, 20 November 2017, Vol. 631, c. 4MC.] operations around the world. They are keeping us safe and enhancing our reputation around the world. They are the best of British, and they have the right to expect the best in return. Therefore, although the need for pay discipline will remain a constant in the coming years, we remain committed to ensuring that their overall package of pay, progression and benefits continues to reflect the enormous value that we place on their work. We await the next review’s findings with interest. Members can rest assured that, as a Defence Minister, a former officer and a reservist, I am determined to do everything in my power to ensure that our people get what they deserve.

Question put and agreed to.

Resolved,

That this House notes that the pay of Armed Forces personnel has been capped at 1 per cent in 2017-18 and that this represents another below inflation pay settlement; further notes that the size of the Army, Royal Air Force and Royal Navy and Royal Marines is below stated targets; notes that dissatisfaction with pay has been identified by service personnel as a reason for leaving their respective force; and calls on the Government to end the public sector pay cap for the Armed Forces and give Armed Forces personnel a fair pay rise.