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Mr. Paul Flynn (Newport, West) : Will the right hon. Gentleman give way?

Mr. King : Will the hon. Gentleman excuse me? I have given way already.

Cm. 675 clearly shows how extensive our commitments have been in other parts of the world. Our commitment in Northern Ireland has been clear, for which I have considerable admiration and pride. Elsewhere we have commitments in the Falklands, Cyprus, Hong Kong and Belize. The Armilla patrol is less active than it was earlier in the year, but it made a great contribution to ensuring the safety of shipping. I do not know how many hon. Members are aware that currently more than 500 members of the armed services are posted in 30 countries helping to train the armies of our allies.

Currently, our armed forces are helping in Namibia, and we have talked about the contribution that they made to the work in dealing with hurricane Hugo. The House may like to know that my right hon. Friend the Prime Minister and I have been in contact with the American authorities to see whether Britain can help with the tragic and appalling earthquake in San Francisco.

Hon. Members who take an interest in the armed forces share my admiration of their professionalism, courage and good humour, particularly in Northern Ireland and other dangerous situations. I should like to pay tribute to our reserve forces. I did not appreciate until I took over these responsibilities that in time of war more than a third of our contribution would be made by the Territorial Army. From what I have seen of the reserve forces, I have been enormously encouraged by their good humour and skills. The support of employers for our reserve forces is important. We all have constituents who are prepared to sacrifice their time for the defence of their country, and I hope that their employers will help them to make their contribution.

Mr. Dalyell : Having moved from Northern Ireland, and before he leaves the subject of Northern Ireland, on reflection does the Secretary of State believe that there is any case for a serious public inquiry into the difficulties at the Kincora boys' home and the case of Colin Wallace? Have his advisers suggested that that might be desirable?

Mr. King : The hon. Gentleman used to raise that point endlessly at Northern Ireland Question Times. That matter has been examined more times than I can remember. However, if the hon. Gentleman has evidence which he believes should be considered, it should be examined. I have nothing more to add.

Mr. Conway : With regard to my right hon Friend's comments about the Territorial Army, I am sure that his visit to 49 Brigade was deeply appreciated and warmly welcomed.

I want to press my right hon. Friend on an important point. If people want to do part-time military service in Ulster, and if the Ulster Defence Regiment is to be made full-time in whatever shape or form, will my right hon. Friend assure the House that those who wish to continue and promote a military career on a part-time basis in Northern Ireland will find other units in the Province which will be expanded to enable them to do that?

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Mr. King : I should like to consider that. Perhaps my hon. Friend the Minister of State for the Armed Forces will address that matter later.

On many occasions I have paid tribute to the work of the security forces in Northern Ireland. While I have been concerned that certain allegations and charges have been made recently--allegations which are under investigation at the moment and, which in the interests of the good name of the UDR, must be properly and fully examined--I pay tribute to the amazing courage and dedication of all the security forces in Northern Ireland who risk their lives every moment of the day and night in their willingness to defend their communities against terrorism. We should always remember that.

I want to refer to the question of security for all our armed forces. At the present time, they face an evil terrorist threat ; and the tragedy in Deal since the House last met is fresh in our minds. The threat poses major challenges for us in terms of living in a democracy and a free society and not in an armed camp. Terrorists have evil ways in which to exploit that situation. We will do our best to ensure that the most sensible security arrangements can be made. I hope that we can all stand together on that and will not try to make party political capital out of a threat to the democracy of this country. It is important that the House stands together on that point.

Mr. David Winnick (Walsall, North) : Will the right hon. Gentleman give way?

Mr. King : No. I have given way a lot already.

Cm. 675 sets out the resources that we seek to maintain our defences and our success in keeping those defences up to date. In the expenditure in the current year--£20,000 million, which is 16 per cent. higher in real terms than it was in 1978-79--we have sought to modernise our nuclear and conventional forces.

Mr. Martin O'Neill (Clackmannan) : Has the Secretary of State moved on from the question of security at home bases and Deal? I believe a meeting was held in London last week at which the Under-Secretary of State for Defence Procurement was present involving the trade unions involved in security and defence matters and the Ministry of Defence. Will the Secretary of State give us some information which might confirm reports in The Guardian that the attitude of the MOD is beginning to change in relation to this question?

Mr. King : That is a wonderful leading question. I did not see the article in The Guardian. If the attitude is that we are determined to do our best in terms of security in facing these difficult problems, that attitude has not changed. My hon. Friend the Under-Secretary of State for Defence Procurement met some union representatives, and he may want to comment on that later if he catches your eye, Mr. Speaker.

I have made my position about private security guards quite clear. If they can help and be a useful addition to the security arrangements, and provided that they are of the standard of competence that the security forces deserve, they have a role to play. However, I set high standards, and I am not prepared to accept incompetence or inadequacy in such arrangements. We are examining that at the moment. I hope that that will help to make our position clear.

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New equipment has come into service during the past year. We are continuing to modernise and develop our defence capability, and my hon. Friend the Minister of State for Defence Procurement will say more about that tomorrow if he catches your eye, Mr. Speaker. The overriding background to our procurement policy has been the progressive development of a more competitive approach. We spend substantial sums of money. The Ministry of Defence is the largest customer in Britain and for that we expect quality. At a time of arms reductions and a reduction in conventional forces, the reliability of equipment will become ever more important, and we shall be stressing that.

In addition to encouraging a more competitive approach for the major equipment programmes, we are keen to encourage the opportunity for more small businesses to be able to quote for and to supply Ministry of Defence requirements. I am encouraged by the growth and substantial increase in the number of firms now supplying the Ministry of Defence. That competitive and competent approach is one that we apply also to collaborative projects and to the activities towards creating an open European armaments market. The development of the independent European programme group has been encouraging in the past year. In case it might be misunderstood in other quarters, that is not to develop a fortress Europe but to ensure that we strengthen the European contribution to the overall NATO effort. In respect of the overall work of the Ministry of Defence, we are developing a new management strategy. My predecessors, particularly my right hon. Friend the Member for Henley (Mr. Heseltine), made key changes in the way that the Ministry of Defence operates. Resources are now allocated across service boundaries and the armed forces are integrated at the top level without diminishing their individual characteristics or denying the healthy rivalry that keeps them on their toes. Further changes are needed in the way in which the Ministry of Defence manages resources away from the centre where local managers can be hamstrung by a host of central controls. We are introducing a major change with the new management strategy. Under this, financial responsibility will be put together with executive responsibilities. That will go right across the Ministry of Defence and the armed forces, covering all defence expenditure except for equipment projects managed by the Procurement Executive. Individual managers and commanders will have delegated authority to enable them to make the most efficient use of the resources allocated to them. The objectives and targets set for each of them will come from the Ministry of Defence overall plans, and our target date for implementation of the new management strategy is 1 April 1991. The new approach can be a major step forward in obtaining better value for money and reducing some of the frustrations that flow from not giving enough discretion and authority to the people responsible for the different units and activities.

Under the "next steps" initiative, the Government are developing arrangements under which some functions of Government are transferred to agencies which can operate with greater freedom from central controls. We have been considering what scope there might be for those in defence matters. As my hon. Friend the Under-Secretary of State for Defence Procurement announced recently, the Meteorological Office will become a full "next steps"

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agency next year. That will be followed by an agency formed from the four major non-nuclear research and development establishments. Many support activities are an integral part of the overall military capability and may have important links to NATO allies. Clearly they must remain part of the Ministry of Defence. To obtain the benefit of the energy and enthusiasm that can come from the "next steps" approach, we are planning to designate a number of our support organisations as a new category of defence support agencies. They will be run internally on "next steps" lines but would remain within the defence chain of command.

We have identified five organisations that look suitable to become defence support agencies. The Hydrographic Office at Taunton is planned to start next April ; service schools in Germany, military survey, defence accounts and RAF training should start the following year. We are also looking at 10 more activities, ranging from naval stores to chemical defence research, as other possible candidates, and there could be more after that.

Mr. John Wilkinson (Ruislip-Northwood) : What does my right hon. Friend mean by Royal Air Force training coming under the "next steps" approach? Surely that is of great operational significance. Will my right hon. Friend clarify his remarks?

Mr. King : We will be looking at the training part of support command within the overall defence chain of command. We have identified ones that look suitable for defence support agencies. We will look at them very carefully. I hope that my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) agrees that there are great benefits in giving a greater feeling of authority and responsibility to people and for them to be recognised as discrete activities that should have a structure and a clear responsibility channel of their own, but there is more work to be done and we must take more careful note of my hon. Friend's point.

Mr. O'Neill : From what the right hon. Gentleman has said, is it right to believe that the training of apprentices will now be privatised? Is the right hon. Gentleman suggesting that the training of the young men who go into the Army will be taken over by private companies under some kind of agency structure? Is that what the "next steps" policy will be?

Mr. King : Some of it happens now in different arrangements with outside agencies in any case in terms of release schemes and block release schemes for the training of apprentices. We must consider several aspects when looking at the best ways in which that might be done. My hon. Friend the Under-Secretary of State for Defence Procurement will give the hon. Gentleman a fuller answer. I should like that matter to be looked at in more detail.

At this time, after many defence debates, we face a quite different situation. The confrontation between the Warsaw pact countries and NATO over many years appears to be changing, and it poses many challenges for us.

Mr. Flynn : Will the right hon. Gentleman give way?

Mr. King : if the hon. Gentleman will allow me, I will not give way.

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I am delighted that the House has such an early opportunity to debate such serious matters for our country. Although much has changed, so much of the debate is the same. I read the reports of last year's debate. I said earlier that there were two Labour party amendments, of which the Opposition Front Bench amendment was the minority one. We have exactly the same situation this year. Last year the hon. Member for Clackmannan (Mr. O'Neill) spoke against it and tried to prevent his backwoodsmen from voting as they did. It must have been a great sadness to him that they achieved a majority twice as big as he was able to achieve for the official motion. It is true that that motion was carried by 4.2 million votes to 1.9 million. It was more than a 50 per cent. majority. That majority involved a reduction of £5,000 million from our defence expenditure. I heard the comments that were made by the hon. Member for Clackmannan and by the Leader of the Opposition. They said, "Don't worry, it won't happen," but that is what the overwhelming majority of his party actually want to do ; there is no question about that. I looked at the Labour amendment which was tabled last year. It was more specific. Opposition Members were not quite so clever last year, because they actually spelt out the sum. They said, "Reduce expenditure by £7,000 million." This year they have tried to dress it up and say, "Reduce it to the average of the western European level of NATO countries," and it is just under £5,000 million. However, Opposition Members keep coming back to that point, and their party conference keeps overwhelmingly voting for it.

If that is what his party wants, what does the Leader of the Opposition want? [Interruption.] No, he knows exactly what he wants : he wants to get elected. He knows that the policy of leaving this country defenceless destroyed his chances in the general election, as it had destroyed his predecessor's chances, because the British people will not stand for such a policy. If he were elected, what would he do? What does he believe? Who trusts the Leader of the Opposition with the defence of our country?

The most telling remark in the Prime Minister's speech at the party conference was :

"if you aspire to serve your country in Downing street a good motto is : to thine own self be true."

What is the right hon. Gentleman's own self? There is a deep belief that, whatever he says, he is in favour of unilateral abandonment of nuclear weapons and is deeply in sympathy with the amendment of the hon. Member for Liverpool, Walton (Mr. Heffer). That is what motivates the anger of the right hon. Member for Chesterfield and his colleagues. Deep down they think that the Leader of the Opposition has betrayed them and that he used to believe as they believe. Deep down he continues to share their belief.

If we analyse why there is a better prospect for peace in the world and a chance of better relations between the great powers and between NATO and the Warsaw pact, is it not because at last there is a degree of trust and confidence between the leaders of the world? Confidence started with President Reagan and Mr. Gorbachev. From their entirely different political philosophies and perspectives they were able to do business. Mr. Gorbachev and our Prime Minister also have different philosophies, but an element of confidence and trust grew. That trust is important not just for allies but for potential opponents. If we are to make progress in reducing conventional arms,

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nuclear arms and chemical weapons, there must be some trust and confidence at the top about where individual leaders stand. The profound weakness of the Labour party and of the Leader of the Opposition is that there is no credibility, no trust and no assurance of where they stand. If anybody does not believe what I say, they should read the amendment. It is a pathetic cobbling together of a series of different Labour party aspirations as it tries to jump on one bandwagon or another. To offer that as an alternative credible defence policy for this country is absolutely pathetic.

What came out of the Labour party conference was a proposal carried by an overwhelming majority to slash the conventional defences of the United Kingdom and negotiate away our nuclear deterrent, leaving us defenceless. These defence estimates show clearly that we are not prepared to leave this country defenceless.

Mr. Andrew F. Bennett (Denton and Reddish) : Will the Secretary of State give way?

Mr. King : We are proud of what we have done for the defence of this country and of the role we have played in NATO and what that means for a better future in Europe and a safer world. That is why I commend these estimates to the House.

4.39 pm

Mr. Martin O'Neill (Clackmannan) : I beg to move, To leave out from "House" to the end of the Question, and to insert instead thereof : "believing that the Statement on the Defence Estimates 1989 has been overtaken by the superpower disarmament initiatives, and supporting those agreed at the 1989 NATO Summit, considers that Her Majesty's Government should undertake a Review to ensure that Britain is defended by properly supported Armed Forces and by the negotiation of verifiable disarmament agreements, to assess future commitments and priorities, to provide Forces and defence industries with a framework to plan future needs, and to examine the allocation of resources which could be released for social and economic purposes ; recognising that negotiated disarmament is now more probable, and welcoming progress towards a world-wide treaty banning the possession or production of chemical and biological weapons, calls upon Her Majesty's Government to support NATO in seeking to reduce short-range nuclear forces before complete implementation of any conventional force agreement and to delay a decision on the Lance replacement ; urges Her Majesty's Government to seek NATO's abandonment of the destabilising flexible response strategy ; demands that Her Majesty's Government indicates its willingness to participate in the next stage of the START process ; recognising the impact of government economies and the lack of an industrial procurement strategy on the Services and on major contractors now vulnerable to foreign takeovers, calls upon the Government to establish a Conversion Agency to employ the skills and resources of the defence procurement industry in the civil sector ; condemns the cowardly attacks of murderous paramilitary groups ; and demands that the Government ends the sacrifice of safety at military bases and establishments by the excessive dependence on private contractors."

First, may I welcome the Secretary of State to the Dispatch Box in his new role and to his new Department? A few months have intervened since his appointment, and I recognise that he has not had the easiest of rides. It may be less bumpy than his previous job, but many of the problems seem to take the same form as the ones that he had to confront before.

I share the Secretary of State's appreciation of the efforts of the Select Committee on Defence. The Select

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Committee is something of a double-edged sword to everybody : it is independent, it exerts its independence and it speaks with authority. We must listen to it. During the year, I hope that the Secretary of State will offer more time than his predecessor for discussing the Select Committee's reports, because the one report appropriate to today's debate is only one of the many that require more of our attention. If the worth and value of the Select Committee system means anything, we must debate such Committees' well-considered findings.

I welcome the institution of the centre for defence studies. However, as a Scot, I am not happy about the concentration of defence research institutions in the south-east of England, although I can understand the convenience of that for many of those who wish to avail themselves of the facilities. It is a welcome step and is in line with something started 20 years ago by my right hon. Friend the Member for Leeds, East (Mr. Healey) when he first established departments of defence studies at a number of universities, of which Bradford was one, although I believe that that was funded also by organisations such as the Quakers.

I advise the hon. Member for Colne Valley (Mr. Riddick) who was responsible for that silly and mindless attack on Bradford, that hon. Members are ill- advised to attack academic institutions, irrespective of whether they appear to be of one political persuasion or another because we in the House stand for the defence of academic freedom and for the considered judgments of people who should be able to operate without interference from politicians.

I hope that the easy applause that the hon. Member seemed to get from some of his hon. Friends will be reconsidered in the light of what I have said. Many of those institutions--indeed, all that are involved in defence research in this country--contribute to the debate in much the same way as the Select Committee, and the introduction to their ranks of another such institution is welcome.

As the Secretary of State said at least four times, this is an appropriate time for such a debate. It is now nearly six months since the publication of the Estimates. Perhaps the Secretary of State will consider trying to get the report out by the beginning of April so that the Select Committee can then produce its report and so that we can have a proper debate before the summer recess. We need to look at the report when the print on it is still relatively fresh and when some of its issues would have more relevance than they do at present.

The super-powers are finding a great deal more common ground and we recognise that the old order is changing. It would be remiss of all of us not to note the passing to another of Mr. Honecker's leadership in the German Democratic Republic. We can only watch that space with interest, because if the experiences of Poland, Hungary and the Soviet Union are anything to go by, we can look forward with some cautious optimism to what is happening in eastern Europe. The optimism that we all share presents us with a challenge because we do not really know how to respond to the changes. We do not want to frighten off the laggards. We want to be able to consolidate the achievements of those who are now enjoying new freedoms and who look to us for encouragement and assistance. We have had independent gestures followed by constructive responses from both sides. Most importantly, we see the prospect of a major change in the balance of forces in

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Europe. The NATO summit in May was too late to be considered in the White Paper but it must be regarded as the starting point for a new European order.

The response given by President Bush to President Gorbachev's United Nations speech was both timely and far-reaching. The manner of its presentation left its opponents little room for manoeuvre. Certainly, the Prime Minister and the former Secretaries of State for Defence and for Foreign and Commonwealth Affairs have had to eat their words. Their grudging support for the NATO summit communique and the Comprehensive Concept was not enough to prevent them from being isolated from the rest of our NATO partners. It merely served to confirm to the British electorate that in a changing Europe only our Prime Minister and her colleagues still want to live in the cold war-- [Interruption.] --a view that was endorsed in the European elections in June.

The Government's record over the past 12 months has been to rubbish any gesture made by the Warsaw pact members and to seek to stand in the way of changes promoted by the United States and our NATO partners. When faced with a fait accompli, as at the summit, they try to put a totally different emphasis on what has been agreed. On the question of the follow-on to Lance, the right hon. Member for Ayr (Mr. Younger) said on the BBC on 30 January :

"I hope that by the summertime, NATO will have made a decision with our help."

On Channel 4 on 27 April, the then Foreign Secretary was asked if modernisation could be put off until after the West German elections in December 1990, and said :

"I think that's a dangerous proposition."

However, the Comprehensive Concept, signed by the United Kingdom on 30 May, states in paragraph 49 :

"The question concerning the introduction and deployment of a follow on system to Lance will be dealt with in 1992."

On the question of the relationship between NATO and the Warsaw pact nuclear forces, the former Foreign Secretary was asked on "Panorama" on 3 April :

"How can NATO justify to Western public opinion and to Western German public opinion the modernisation of short range nuclear missiles based on West German soil?"

He replied :

"Most simply by the extent to which there has been taking place a massive modernisation of Soviet short range nuclear weapons". Yet paragraph 44 of the Comprehensive Concept, which was signed by the Government, states :

"the sub-strategic nuclear forces deployed by member countries of the Alliance are not principally a counter to systems operating by the Warsaw Treaty Organisation".

On the issue of the need for NATO nuclear forces to compensate for Warsaw pact conventional superiority, the former Secretary of State for Defence said on 12 May :

"As long as we face an enormous conventional threat, thousands and thousands of tanks facing us, we cannot afford to be without our nuclear shield".

However, paragraph 27 of the Comprehensive Concept states : "The Allies substrategic forces are not designed to compensate for conventional imbalances."

On the timing of the negotiations on short-range nuclear forces, the then Foreign Secretary, in a memo to the Select Committee on Foreign Affairs, stated :

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"the Government believe that after the INF agreement and the possible START agreement, the Alliances next Arms Control priorities must be a global ban on chemical weapons and the elimination of the conventional imbalance in Europe. Until these have been achieved, it would be dangerous to embark upon negotiations which might lead to any further reductions in nuclear weapons in Europe".

Mr. Edward Leigh (Gainsborough and Horncastle) rose

Mr. O'Neill : Perhaps the hon. Gentleman will let me finish my point.

Paragraph 48 of the Comprehensive Concept states that, once "a conventional force reduction is underway the United States, in consultation with the Allies concerned, is prepared to enter into negotiations to achieve a partial reduction of American and Soviet land based nuclear missile forces of shorter range."

Even after the Government signed the Comprehensive Concept, 14 days after the summit, the then Secretary of State for Defence said in the House :

"we do not think that it would be sensible to start negotiations for the reduction of nuclear weapon systems until the complete implementation of any reductions under the CFE."--[ Official Report, 13 June 1989 ; Vol. 154, c. 691.]

Not only did the Government not agree with the delay in modernising Lance, as accepted by the rest of NATO ; they disagreed with the reasons for the Alliance having those missiles, and even now refuse to believe that the timetable for their elimination is either sensible or safe.

In virtually every fundamental of the conventional forces in Europe talks, the Government are out of step with the rest of our NATO partners. On the biggest breakthrough of all--aircraft--the Government have shown themselves to be completely out of touch.

Mr. Leigh : Does the hon. Gentleman not think it ironic that there is a certain symmetry in history because 50 years ago in the 1930s--at the time of George Lansbury--the Labour party conference decided to ignore the conventional imbalance and to abolish the Royal Air Force and today, 50 years later, the Labour party conference voted by two to one to cut conventional defence spending by one third? Which part of the service, or which service, does the hon. Gentleman think should be abolished?

Mr. O'Neill : It is always annoying when a queston is asked that has no relevance to what we are talking about. If it could be guaranteed that the hon. Member for Gainsborough and Horncastle (Mr. Leigh) would be here until the end of my speech, I might wait until then to answer his question. However, I shall answer it now and then refer to it later in my remarks.

Several different resolutions were presented at the Labour party conference. The substantial document on the Labour party's policy on defence and foreign affairs was accepted without a counted vote, such was the overwhelming majority. That is the document on which the next Labour party election manifesto will be based and on which the defence policies of the next Labour Government will be decided.

Mr. Leigh : Will the hon. Gentleman give way?

Mr. O'Neill : No. I made the point clearly enough for the hon. Gentleman and for everyone else.

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Mr. Tom King : It would be helpful for us to clarify this point. What is the significance of the 4 million votes at the Labour party conference? Will the point be totally disregarded?

Mr. O'Neill : That point will not appear in the Labour party manifesto. I shall explain why in a minute.

I shall return to conventional forces in Europe, which is the form of disarmament that we have to consider now. It is a form of disarmament that owes little to this Government, especially in respect of aircraft. It has been clear that the Soviet Union has been pushing for a long time for aircraft to be included in the disarmament talks. The Soviet Union's aim was to secure the best agreement on both reductions and deployment of aircraft because it believed that it was one of the areas in which NATO superiority was most evident.

It was also one of the most sensitive questions involving definition, as no one could agree on either offensive or defensive air systems. Yet it was President Bush, a man whom many of us--and I must admit to being one-- considered to be merely a timid conservative, who took the bold step of calling for their inclusion. Will the Secretary of State tell us whether he stands by the words of his predecessor when he spoke to the Defence Select Committee on 17 May last? He said :

"I think the calculations on aircraft and types of aircraft and who has got what are still very far from clear I believe that trying to bring those in at this stage is very likely to bog down the whole enterprise and it would be much better to proceed on the agreed mandate which has been agreed by both sides on CFE to try and make progress on that."

Within a fortnight, on 30 May, the Government signed the summit declaration, which in paragraph 17 called for

"reductions by each side to equal ceilings at the level of 15 per cent. below current Alliance holdings of helicopters and of all land-based combat aircraft in the Atlantic-to-Urals zone." We welcome the outcome of the NATO summit and the proposals for rapid progress on CFE. We look forward to the first round of conventional cuts and share the enthusiasm of people such as Senator Sam Nunn and Congressman Aspin, the chairs of the Senate and Congress Arms Committee, and people such as Ed Rowny, who have been long- time ambassadors and arms control negotiators. They believe that cuts can go far below the levels that CFE presently envisages and that we could be down to cuts of about 50 per cent. by the early 1990s. Before anyone gets carried away, I must say that cuts in themselves do not bring stability. We can have parity, yet still have instability. We need not only changes in numbers, but new military doctrines, to take advantage of the reduced numbers I wecome the remarks of the Secretary of State concerning his discussions with Yazov and the Hungarians. I wish only that some of that could have been anticipated in the "Statement on the Defence Estimates". One of the gaping holes in the document is any possible consideration of changes in the military doctrines and strategies behind NATO thinking. I am surprised that some hon. Members have not already started raising questions about force to space ratios, the continued desirability of deep strike capabilities, albeit with far fewer forces, and the prospect of participating in what would be simply a small-scale blitzkrieg. It is depressing to read the defence estimates because there is no fresh thinking on strategic and doctrinal issues. If one speaks to German conservatives or German liberals, right across the political spectrum, one finds that they want to talk about different

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strategies and different doctrines. They want to take the consequences of the possible outcome of CFE and explore them, so that the next range of talks can proceed in a far more constructive way than the already successful progress we have made.

The question of the prospects for military peace in Europe is underpinned and underlined by what has already happened in the Soviet Union. The proposals made in the United Nations speech in December have been given rigorous analysis in the latest IISS "Military Balance" book, in which the editor, Francois Heisenbourg, writes that the short warning or surprise attack scenario is now barely plausible. Although he says that longer warning scenarios will be less affected, the necessary preparation time for the Warsaw pact will be increased and this in its turn should enhance NATO warning and preparation times.

The report stresses that a great deal has yet to be done and that false optimism should be discouraged. However, caution does not mean that we always have to move at the speed of the slowest. The most depressing part of the speech by the Secretary of State was perhaps the part where he said that we have to keep things roughly as they are now until we can consolidate on the progress that has been made. I understand the motivation behind that remark and I have some sympathy with the intention, but I must say, with great respect, that this is the wrong time to be putting such arguments. If we go forward too cautiously at this time, we shall end up on the side of the forces of reaction.

Mr. Julian Brazier (Canterbury) : Will the hon. Gentleman remind the House in which particular area the first major breakthrough in this decade took place in arms reduction talks? Will he remind the House that in that area--intermediate nuclear weapons--the breakthrough occurred precisely because the West had decided to be cautious--the hon. Gentleman may say over-cautious--by introducing its own weapons?

Mr. O'Neill : The intermediate nuclear forces talks and their success can be attributed to many factors. Caution was in some ways justified then. There was no record of constructive dialogue until then. However, since then we have had the success of INF and the progress so far in the START talks. We are reaching a clear understanding on where we are going in CFE. To compare the situation before 1986, which was when the INF business got under way after Reykjavik, with today is to ignore the changes of the past three years. The hon. Member for Canterbury (Mr. Brazier), in seeking to find a means of defending this Government's caution, wholly misunderstands the nature of the present circumstances compared with 1986.

There must be an awareness that the Warsaw pact reductions are driven as much by economic necessity as by a revision of East-West relations. Nevertheless, we can all see that it cannot be assumed that a Russian advance through Hungary, Poland and even East Germany would go as smoothly as it might have done some years ago.

Mr. David Shaw (Dover) : Will the hon. Gentleman give way?

Mr. O'Neill : No.

It is fair to say that, in the short term, when we get to the fruits of CFE, the United States and the Soviet Union will have to share the bulk of those fruits. I do not consider

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that the United States burden-sharing argument has any great weight, but I believe that it is important that we get the first round of CFE cuts through as quickly and cleanly as possible. It would be foolhardy for us to try to get a bit of the action, for whatever reason. I realise that there have been calls for the French and ourselves to participate, but although that is attractive, it must not be the highest priority. We should be able to try to ensure that the United States and the Soviet Union can benefit--initially at least--from the CFE talks.

I do not say that to give credence to American claims about burden-sharing. Probably only 60 per cent. of United States defence expenditure is accounted for by the expenditure on NATO--3.6 per cent. of the United States' gross domestic product. That percentage can be reduced even further, given that it includes expenditure on reservists who are based in the United States but can be used almost anywhere in the world.

Like Britain, the United States has a volunteer army. This means that service personnel must be paid at least the national average wage. A recent study carried out by the Swedish International Peace Research Institute, which was included in the institute's 1989 year book, suggests that, if countries such as France and the Federal Republic of Germany had a volunteer armed service, their expenditure on defence as a proportion of GDP would rise to about 4.3 per cent. and 3.5 per cent. respectively. The figure for the Federal Republic of Germany does not include expenditure on Berlin. If it did, there would be little difference between the German figure and the figures for the United Kingdom and the United States.

The other cost that is not calculated when considering the cost of conscript armies is that of the far higher proportion of the productive labour force that is denied to the civilian economy because of time spent in uniform.

This shows that it is difficult to make a comparison based on a simplistic criterion when talking about defence expenditure. These costs do not include the social and environmental costs in the Federal Republic of Germany of having the towns and countryside damaged by military manoeuvres. They do not take account of the problems associated with having 400,000 troops from seven countries conducting 5,000 field exercises and 600,000 sorties every year over German soil.

For the United Kingdom, we must take account also of our geostrategic position as an island on the rim of Europe. We have assumed, correctly, naval responsibilities far greater than those of any other European NATO partner. This requires considerable expenditure on capital assets such as frigates and aircraft as well as the most rigorous and expensive training programmes.

If the United Kingdom were to move to the average level of our western European allies--whatever that means--it would have to slash the pay and conditions of our armed services or introduce conscription. The Labour party will not go down that road. We will seek reductions and economies and pursue a value-for-money policy, but not at the expense of our responsibilities to NATO. No Government faced with the choice of spending money on the Health Service, education or defence will want to deny resources for social expenditure. The present Government

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