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the ones that matter, because the Ministry of Defence and the Treasury should make their decision according to them. After all, the House will judge any decision on that basis. The experience of the lifetime costs of the existing C130s should be taken into account. I will not believe that the RAF's revenue expenditure is under tremendous pressure as long as the university air squadrons exist in their present form. The overwhelming majority of people to whom those squadrons give flying training have no intention, let alone obligation, of entering the RAF. It would not want them if, later, they did decide to join. That flying training is very expensive as well as--to give away my interest in the matter--very noisy to some of my constituents. I am encouraged by paragraph 325 of "Front Line First" which speaks of civilian flying instruction at basic levels. I hope that that means that, in future, all the university air squadrons will confine their activities to organising civilian flying training for undergraduates who are expected to join the RAF. That could be done for a small fraction of the costs now incurred. Another financial argument about the C130, which surfaced briefly during the proceedings of the Select Committee and earlier this afternoon, is that the timing of a decision on it would mean that its costs would take up some perceived slack in defence procurement expenditure before the coming of the Eurofighter and so help to smooth out the cash flow from the MOD. That argument should be dismissed at once. It is a giant version of the one advanced by departments that stock up with paper clips before the year end, based on the logic that that will preserve their expenditure base line. That argument should not appeal to the Treasury.

As a Treasury Minister, I was recently involved in the long-overdue overhaul of Government accounting. For too long, crude annual cash accounting, long since superseded in commerce, distorted Government financial decisions. This summer's Green Paper on resource accounting, which is now out for consultation, marks the beginning of the end of that process.

The hon. Member for Warrington, North dwelt on the industrial factors involved in any decision. I agree that major advantages could be gained for British industry from ordering the FLA rather than more C130s. One can argue about the detailed figures, as the hon. Gentleman did, but there can be no doubt that far more high-quality work in particular is likely to come to Britain from a project that we help to manage than from permitting an effective world monopoly in the manufacture of this type of aircraft, based in the United States.

It is worth pointing out to the hon. Member for Warrington, North why the United States has had a monopoly for 30 years. We have travelled this route before, because in 1965 the Labour Government cancelled the HS681. That decision has left us at the mercy of the United States for the manufacture of such large military transport aircraft for the past 30 years. The excellent success achieved by Airbus Industrie has given us the chance to break out of that monopoly on military transport manufacture, just as Airbus has recently challenged the Boeing domination of civilian airliner manufacture, which seemed so complete.

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Allies are extremely important militarily. That has been said so many times in defence debates that it hardly needs to be repeated. We are all obviously in the debt, in so many ways, of the United States, through NATO and right back through history. We have industrial allies, too, and these days we need them just as much as we compete in the world. If we chose an American aircraft, our companies would be taken out of the front line of European aerospace co-operation which has been so successful recently, particularly through Airbus Industrie. Those who are concerned about the effective management of co-operative projects should be reassured by the fact that Airbus Industrie is involved with the FLA, because it has already been so effective in the Airbus project.

An apparently seductive option exists to postpone the difficult decision on this matter by ordering a few C130s now and leaving the decision about the FLA for a few years. Such a course would be in danger of leaving us with the worst of all worlds. In industrial terms, it would show a half-hearted commitment to the FLA and would mean that we ended up with a poor deal for our industry and had little involvement in the project. Militarily it would also mean that in about 10 years' time we would end up with some fairly newly built C130s, sized for the 1950s, with at the same time too few FLAs designed for the next century. Such a course would be an error militarily and industrially and I do not believe that it would save us any money. Therefore, Ministers should--and I am sure that they will--look very hard at that decision.

Lockheed naturally wants to push us into a quick decision if possible because it wants us as a launch customer with regard to its new C130. It does not have the American Government, so it would like us as a launch customer. That would be good for Lockheed, but it would have the important disadvantage, which has already been stressed, of meaning that a decision would have to be taken before the Euroflag study becomes available. It would be premature to take the decision at that point.

When all the factors are considered, it would be wrong to replace an aircraft that still has life in it with a more souped-up version of the same thing, and which is now so old, instead of waiting for the better plane to become available. It would also be a costly mistake in this case for us to buy American and to damage one of our own world-class industries.

6.50 pm

Mr. Menzies Campbell (Fife, North-East): Like others, I was much taken by the Secretary of State's reference to Hugo Young's article of 14 July 1994. Showing characteristic modesty, the Secretary of State forbore to tell us about the parts of the article which referred to himself-- [Interruption.] I see from the Secretary of State's response to that observation that he is aware that he featured to some extent in the article.

During a fairly iconoclastic look at these matters, Mr. Young said:

"When this year's public spending was being hacked over last autumn, the Ministry of Defence thought it might have to lose £500 million from its next three-year programme. In fact it was told to find more than double that. Mr. Rifkind emerged shattered from EDX, the relevant Cabinet committee. The horse-trading between ministers showed he had no friends. Chancellor Clarke, a notorious envelope man, was quite content to pin him to a figure that was little more refined than the residual of every other spender's."

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Mr. Young has the advantage of not having to make such decisions and not having to shadow those who have to make those decisions. It is therefore perhaps easier for him than for others to strike out in all directions.

What has emerged so far from this debate is a general recognition that there has been a substantial period of change for the armed services and for the defence industry and, in both sectors, there is now a considerable desire for a period of calm and stability. Accepting that, I do not believe that that precludes us from continuing to conduct the necessary exercise to match commitments with resources. I rather favour the view of those who argue that simply to call for a defence review in all circumstances is not an answer to some of the difficult questions that we are bound to face. Indeed, if a defence review is to have any value, it will provide not the answers but the questions. The answers will have to be provided afterwards. Such questions will have a point only if we ask them against the background of clearly stated foreign policy objectives. A review would have a point only if we were willing to increase resources if, on a proper review, we determined that our commitments required that.

To call for a review is simply only part of the necessary analysis if commitments and resources are to be properly matched. Ministers frequently say, "Well, we do this on an on-going basis." Many people--not least Mr. Young, as those who read his article might discover--are anxious about the fact that many recent decisions have not been predicated upon substantial long-term strategic thinking. To embark on a study of the costs of defence is entirely sensible. However, it is not sensible to say that the commitments for which that defence is provided should be excluded. What comparable organisation with a budget of £23 billion, anxious to ensure that it was obtaining value for money, would not consider the relevance of what it was spending money on as much as how that money was being spent?

In his announcement on 14 July, the Secretary of State proposed the joint rapid deployment force and the procurement of Tomahawk cruise missiles. They represent an enhancement of capability. They are clearly designed to meet a commitment other than that of home defence. We do not acquire additional capability without an analysis of the need for that capability. By parity of reasoning, it seems that one should not reduce expenditure or capability without analysis of need.

If, as the Defence Select Committee concluded--reference has already been made to this--the defence costs study proposals will result in reduced stocks and a reduction in manpower margins and will extend the service life of some vehicles, what guarantee can we have that capability will not be affected? I accept that the Secretary of State told the House a little while ago that the MoD would bring the upmost rigour to such matters. However, if he had been standing here in the summer of 1989 and not 1990 and the same point had been put to him about the state of our armoured divisions in Germany, I have no doubt that he would have responded in precisely the same way.

The truth is that one knows the extent to which capability may have been affected only when one creates the very operational circumstances, to which the right hon. Member for Bridgwater (Mr. King) referred, in the context of enhancing the ability of individual soldiers. As has already been said, we are all aware that the Gulf war

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showed up the very sorry state of the equipment in some of our armoured divisions. It showed that we had insufficient ammunition for the 155 mm howitzer, which gave rise to the rather undignified exchanges that we had to have with the Belgian Government on that matter.

As the Secretary of State properly recognised, the Defence Select Committee has expressed anxiety about the fact that the defence costs studies might become an annual exercise. The Secretary of State gave a round "no" to that. We accept his word. However, if another Secretary of State for Defence is subjected to something like an annual exercise, some hon. Members--I put it no more strongly than this--would be particularly disappointed.

There is an important test. Will all the identified savings be available to the Secretary of State for Defence to spend as he thinks fit? The Secretary of State was asked about that and I believe that I am correct to say that he was unable to give an unequivocal affirmative. He referred to the Tomahawk programme and the rapid deployment force as additional capability that could be found. However, he did not seem to be able to say that everything saved as a result of the defence costs studies would be ploughed back in some other form into the defence budget.

Like many hon. Members, I have received extensive representations about installations that are the subject of proposals in the defence costs studies. I do not want to deal with them from a constituency point of view because I am well aware that other hon. Members have a very keen interest in these matters with regard to their constituents. However, I want to refer to one or two installations because they raise larger questions.

Also like many hon. Members, I have received extensive representations about the Eaglescliffe royal naval stores depot. My question--this is a question which all hon. Members might want answered because it may be our constituencies next--is why did it apparently take approximately six weeks to issue the consultation document after the Secretary of State's announcement? Do not those whose jobs are affected deserve something better and more efficient?

Is not there a principle that, when decisions have such material consequences, it is essential that consultations should be seen to be more than simply ritualistic? As we know, the United States has an independent mechanism for determining such issues. It might be difficult to import such a mechanism into the United Kingdom, but any one of us may have to face a proposal with the same effect in his or her constituency. It is surely in the interests of all hon. Members and of our constituents that those matters are fairly and reasonably dealt with.

The Minister of State for the Armed Forces (Mr. Nicholas Soames): The hon. and learned Gentleman raises an important point as to the period of consultation and how long it takes to produce the papers. First, it is plain that if the papers are to stand up to the rigour of close examination, they must be properly put together. Some of the information is difficult to come by and it takes time to put it together. Therefore, because of the weight of work, some have taken longer than others.

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Secondly, we have been extremely flexible about consultation and we shall continue to be so. The whole point of that is that consultation should be an entirely genuine process. All views should be garnered so that Ministers may consider in full detail what they have seen.

Mr. Campbell: I hope that the hon. Gentleman will not think me churlish when I say that I am much more heartened by the second part than by the first part of his answer. If, on one view of what he said, those decisions were taken when the necessary information had not all been assembled, it would give substance to the apprehension that many people have expressed about the way in which those decisions were arrived at.

An overwhelming case has been made against the closure of Rosyth naval base, from an economic standpoint--a case marshalled by Fife regional council, supported by the Fraser of Allander Institute. I have no doubt that the hon. Member for Dunfermline, West (Ms Squire), in whose constituency that installation is to be found, will want to say rather more about those matters, but I approach them from the point of view of what I conceive to be the important strategic issues. I begin by ignoring the rather arid discussion in Scottish newspapers about whether a base without ships can properly be a base at all. What is important is the nature of the activities carried on in the installation.

It is clear that once the minor war vessels go from Rosyth, the remaining defence functions will not then depend on any particular locational characteristics that Rosyth possesses. That is to say that they could as easily be done elsewhere. If, as we know, the two dockyards at Devonport and Rosyth are to be privatised, those defence functions that remain at the base when the minor war vessels go could as easily be carried out in the neighbouring dockyard. If that were so, the case for the retention of the base, if it is entitled to that description, becomes severely weakened. There is no doubt that if the Rosyth naval base were to be closed, it would almost certainly never reopen.

That has operational implications for the Royal Navy because it would severely restrict its ability to fulfil its obligation to ensure the integrity of the United Kingdom's territorial waters, an obligation which is recognised in the defence estimates. I have in mind particularly the oil and gas installations of the North sea and, of course, the important fishing industry, of which part at least is located in my constituency.

Strategically, closure of the base would assume that never again would there be a need for substantial naval operations in northern waters. I do not feel qualified or, perhaps more important, sufficiently optimistic about the obligations that the Royal Navy might face to answer that question unequivocally in the affirmative. These are not matters dreamt up by those who are anxious to preserve the base at all costs; they are considerations which have been supported by Mr. David Greenwood, the director of the centre for defence studies at Aberdeen university, and they are also, of course, to some extent supported by the conclusions of the Defence Select Committee itself. The proposals for the base should be reassessed from both operational and strategic considerations.

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There is another important point in this period of rapid and sometimes difficult change. In some cases, the long- term consequences for defence-based communities will clearly be extremely damaging. It is only natural that those consequences are causing considerable apprehension. There is a feeling that the Government have no strategy, no policy for managing that change and are content simply to leave it to the market. I choose another example--no doubt the hon. Member for South Dorset (Mr. Bruce) will give a detailed account of it--a community such as Portland. How will the market cope with the economic and social consequences if the proposals for Portland are carried through? I find it difficult to conceive how that can be achieved.

Mr. Ian Bruce: The hon. and learned Gentleman has mentioned my constituency. Does he accept that it is much more sensible for the Government to use existing enterprise Departments such as the Department of Trade and Industry, the Department of Employment and so on? Although I shall always plead for more money and more help, since January our unemployment has been going down faster than that of almost any other area.

Mr. Campbell: If unemployment in the hon. Gentleman's constituency has been going down, that is something to be thankful for. I wish that it was true in Fife, of which my constituency forms part. I do not think that what he is saying is antagonistic to the view that, when there is a substantial closure with substantial economic and social effects, there should be a strategy for managing that change. In the United States, where capitalism reigns supreme, one of the first acts of the Clinton Administration was to establish an office for that very purpose. A further issue is dockyard privatisation, to which I have already referred. What assessment has been made of the economic and social consequences of that?

Reference has been made to Bosnia. I do not wish to detain the House long on that theatre of operations for our forces. Like the Secretary of State for Defence and, indeed, the Secretary of State for Foreign and Commonwealth Affairs, I think that any removal or relaxation of the arms embargo would be dangerous and would risk not only the achievements of UNPROFOR and, in particular, the British forces who have serve in it, but the whole achievement of the United Nations in that difficult area.

Of course, the Government have a weapon that they can use if the matter is raised in the Security Council--the exercise of the veto. So far, the public statement on behalf of the Government is that, although they disapprove of any relaxation of the embargo, if the matter goes to the Security Council their intention is to abstain and not to exercise the veto. I cannot help thinking that, if the strength of their opposition to the embargo is as great as it appears, it would be more logical to use the veto than simply to abstain. The performance of troops in Bosnia is conditioned to some extent at least by the fact that for 25 years our forces have kept a difficult and often dangerous peace in Northern Ireland. If there is a political settlement, which no doubt all hon. Members hope and pray for, it would obviously have the consequence of reducing the military obligation there, but I hope--I was encouraged to some extent by the Secretary of State's response to such matters--that it will not be regarded as an excuse for a raid on the defence budget. It would be an opportunity for

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us to make available to the United Nations the skills and techniques that we have learnt in Northern Ireland and about which the right hon. Member for Bridgwater was rightly eloquent. Our troops have become, perforce, probably the best

counter-insurgency troops in the world. Those skills and techniques are clearly much more likely to be sought by the United Nations than the full- scale armour-based confrontation that we saw in the Gulf. Therefore, as our effort in Bosnia has been so outstanding, it is legitimate to say that a relaxation of the commitment in Northern Ireland would permit us to contribute even more if necessary. The United Nations cannot be allowed to go on as it is without reform--here I echo to some extent the remarks of the hon. Member for South Shields (Dr. Clark). The United Nations requires better intelligence gathering, better organisation to provide military advice for the Secretary-General, a United Nations staff college to train in the techniques of peacekeeping, mechanisms to guarantee the quality of peacekeeping forces, assigned peacekeeping contingents from member nations which are able to move at short notice and, most important of all, security of funding. There have been occasions since 1990 when it has sadly lacked all of those.

Like other hon. Members, I continue to believe that, for the foreseeable future, the United Kingdom will be required to maintain an independent nuclear deterrent but that it should truly be a minimum deterrent. In accordance with NATO's nuclear doctrine, such weapons should be weapons of last resort. Their justification lies in self-defence against the use, or the threat of use, of nuclear weapons by others. We should bind ourselves to use them only in response to a clear nuclear threat and against military targets. We should say transparently that there will be no more warheads on Trident than the Polaris system which it is to replace--and, indeed, there may be fewer.

Perhaps the more significant nuclear issue that we must face in the short term is that of proliferation. There is a clear connection between the non- proliferation treaty and a comprehensive test ban treaty. Lord Carrington recognised that in 1982, when he pointed out that a test ban would curb the development of new warheads and demonstrate the good faith of those powers possessing nuclear weapons to those who had, under the nuclear non- proliferation treaty, surrendered the right to develop nuclear weapons. In that context, I do not think that one can pray in aid any more persuasive an authority than Lord Carrington, who was the Foreign Secretary at the time.

It will be for us to ensure that we fulfil our obligations under article 6 of the non-proliferation treaty, which binds us to negotiate to end the nuclear arms race. The comprehensive test ban treaty is an essential piece of the security architecture to help us towards that.

Different views on Europe were expressed in Bournemouth last week. It is worth reminding ourselves that, whatever those expressions of view may have been, the Maastricht treaty established a structure for a common foreign and security policy. Leaving aside political considerations, I am firmly of the view that economic considerations, as much as political ones, will drive this. The issues of interoperability, common procurement and force specialisation will be forced on to the agenda for financial reasons as much as political ones. They will not

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come about overnight; it will be a matter of evolution. If the Secretary of State for Defence was accurately reported in The Daily Telegraph on 10 May, the

"evolution of an EC defence policy was an inevitable consequence' of the Maastricht Treaty".

We already see illustrations of it in the Anglo-Dutch amphibious force and in the Euro corps, to which units from France, Germany, Belgium and Spain are now assigned. Indeed, one might argue that the combined joint task forces agreed at the NATO summit in January are a further illustration of the development of that European defence identity.

I shall conclude by saying a word or two about procurement. The support helicopter and the Hercules replacement are important not only in themselves but because of the contribution that they make to mobility and flexibility. Indeed, one could argue that the fact that our troops are deployed in Kuwait at present is eloquent testimony to the fact that mobility and flexibility will continue to be important criteria against which we determine our defence expenditure and, indeed, our procurement decisions.

I do not want to get into the extended debate about the future large aircraft as compared to the C130J except to say that the Select Committee on Defence carefully considered those matters. Indeed, the Chairman of the Select Committee, the hon. Member for Upminster (Sir N. Bonsor), may feel obliged to refer to some of them. I do not accept the view that we should simply cast aside the suggestion that we should procure some C130J aircraft now and wait until the future large aircraft comes on stream.

I hope that all hon. Members who have an interest in those matters will apply to the Royal Air Force for permission to fly in one of the existing Hercules fleet. I think that they will find that an extremely illuminating experience. The argument that the aircraft may have to be continued until the year 2002 or 2004, whether or not they are refurbished, will perhaps not be as strong at 5,000 ft as it is here in the Chamber.

The attack helicopter and the European fighter aircraft are important because they will maintain the quality of our capability. We have an obligation never to ask our forces to go to war without the best available equipment. The European fighter aircraft was supported by hon. Members on both sides of the House. Indeed, I was one of those who was dispatched to Bonn shortly after the last election--in high style, I might say--to lobby our political opposite numbers.

The European fighter aircraft is fundamentally important to the aerospace industry, but its importance for the Royal Air Force cannot be underestimated. Therefore, I hope that the Government will have taken to heart the robust observations of the right hon. Member for Bridgwater. Too many hon. Members have invested too much time and effort, and I suppose emotion, in the European fighter aircraft for us to allow it simply to slide off the scale because of some difficulties with cost overruns.

Since "Options for Change" in July 1990, the debate in defence has largely been a financial one. There has been little effort to look beyond the next public expenditure round. Perhaps that was inevitable in the light of the state of the economy. It could be argued that defence cannot be exempt from what is happening in the wider economy. However, we now need to look further ahead in the

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debate. United Kingdom expenditure in real terms should not be cut further, and we should recognise that Europe might have to increase its defence expenditure if its security is at risk. Much of the optimism of the immediate post-cold war euphoria has gone. That now needs to be replaced with realism and some long-term strategic thinking.

7.17 pm

Sir Nicholas Bonsor (Upminster): I am delighted to speak in this debate. I am particularly delighted that, for the first time in the two years or so that I have been Chairman of the Select Committee on Defence, I will not have to lambast my right hon. and hon. Friends on the Front Bench for their current policy.

I was pleased to hear that my right hon. and learned Friend the Secretary of State for Defence had read the Committee's report on the defence costs study, and I welcome what he said about it. I was less enthusiastic to learn that most hon. Members who have spoken so far, apart from the hon. and learned Member for Fife, North-East (Mr. Campbell), who is a member of the Defence Committee, appear not to have read the report on the Hercules replacement because the conclusions that they seem to have drawn are wholly incompatible with the argument put forward in the paper we have published and the conclusions we have drawn. I shall return to that matter briefly in a few moments.

The Select Committee has published seven papers that are relevant to the debate. I hope that hon. Members will take the opportunity to glance at them because they contribute in a way that I do not have time to do today. We have published the defence costs study report, the Hercules replacement report, a report on the defence estimates, and reports on Trident, the Eurofighter, the RAF and Operation Granby. All those things are relevant to what we are now discussing. Before I examine the highlights of three of those reports, I shall take up one or two of the points made by my right hon. and learned Friend. First, I shall refer to the NATO initiatives and in particular the partnership for peace. The Defence Committee has spent most of this year researching a NATO report which we hope to make available to the House by the end of the year. Our research has taken us to Moscow and Kiev, and we have met representatives from virtually all the states in the old CIS and their neighbouring countries. We have seen people from the Baltic states, Georgia, Hungary, Poland, the Czech Republic and Slovakia. I almost said Slovenia, but that is one country that we have not yet got round to meeting. I had the pleasure of skiing there last year, but that is not strictly relevant to the debate.

When we publish our report, we will certainly emphasise the importance of the partnership for peace on two fronts. First, it is a route into NATO for those countries that will eventually qualify for membership but have not yet reached that stage and, secondly, and at least as importantly, it will act in its own right as a link between NATO and Western European Union countries and those further to our east which are unlikely, for a variety of reasons, to be able to or wish to join NATO.

It is important that we do not extend the NATO cover in such a way as it threatens the feeling of security within Russia. We should not rush but move gently in the

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direction of extending NATO, while establishing a close rapport with Russia at least so long as it maintains the benevolent leadership that it currently enjoys. On that front, I welcome the joint military exercises that we are now carrying out with Russia and some other countries from that part of the world. I hope that we shall be able to extend that programme and increase it in the years to come.

My right hon. and learned Friend the Secretary of State made some comments about "Options for Change". Of course I welcome, as does the Defence Select Committee, the stability that has been announced and the fact that there will be no more major upheavals in the next--

Mr. Martlew: Wait and see.

Sir Nicholas Bonsor: I believe what my right hon. and learned Friend says. I have no doubt that we will now enter a period of stability in our armed forces for which we have called for a long time but which has not been available since "Options for Change" was first implemented. The forces have gone through traumatic change. I am sure that the House will wish to join me in congratulating them on the way in which they have handled those traumas and responded to the enormous demands that have been put upon them.

I do not believe--this is a personal view, not one that is necessarily unanimous within the Defence Committee--that the Opposition's proposal of a review would be remotely helpful at this time, for all the reasons that my right hon. and learned Friend the Secretary of State gave. It would be extremely disruptive to launch on yet another review just when a period of stability can be offered.

There is a good paper on defence reviews in the Library which I warmly recommend. All the history of reviews of that nature shows that they have been disastrous. On every occasion, the basic facts on which the review was based changed, if not by the time the review was published, shortly afterwards. In the present situation, a review carried out a year ago would not have taken into account a likely renewal of violence in Iraq. A review carried out three or four years ago certainly would not have anticipated the events in Bosnia. I should not like to say today what the position will be, where new conflicts might arise or what new demands might be made in three years' time when we have a similar debate in the House. I do not believe that a review of the type recommended by Opposition Members would be to the advantage of the country as a whole or the armed services in particular.

I now turn to the reports that the Defence Select Committee has published. First, as my right hon. and learned Friend the Secretary of State said, in our report on the defence costs study we expressed reservations about the possible consequences of some of the proposals on front-line capability, even though the proposals were aimed at the logistic follow-up. For example, we are worried about the potential risk of running down our stores too far and of lengthening the in-service life of vehicles. The life of vehicles might be taken to a point at which the vehicles ceased to be reliable. Although most of the vehicles in question are not front-line vehicles, some are and others are needed to supply the front line. It would not be safe to extend the life of those vehicles beyond a certain point. That will have to be watched

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closely. Likewise, the reduction in manpower margins could give cause for concern if it is not sensitively handled.

I bring to the attention of the House three other anxieties about SDE 94. The first is the emergency tour interval. It is clear to me--the conclusion drawn by the Committee as a whole concurred with my view--that originally the 24-month average, as it is now described, was intended by all those involved in drawing it up to be a 24-month minimum gap between emergency tours of service. Indeed, when my right hon. and learned Friend the Secretary of State gave evidence to the Defence Committee, he initially said that himself. Only when I received a letter a few days later was that corrected as an inaccurate reflection of the facts. I believe that my right hon. and learned Friend was right in the first place and that when his bureaucrats corrected him they were putting a slant on the proposal which the chiefs of staff had not intended when they agreed the policy. I should like to see 24 months introduced as a minimum as soon as possible. I hope that that will become possible in the next couple of years. Whether it becomes possible in that time depends entirely on whether we can run down our numbers of troops in Northern Ireland. That is impossible to predict at this time.

Secondly, the Committee was worried about the failure to reduce civilian numbers in parallel with military numbers. Although in senior ranks that is occurring, the vast bulk of the civil servants are either executive officer or higher executive officer grade and in those grades no cuts whatever have been managed. Indeed, the numbers have increased. The explanation given to the Committee was that the extra personnel were needed to manage the cuts elsewhere, but I was not entirely convinced by that argument. There is a real worry that the move forward into agencies and devolution and delegation of responsibility across the nation could lead to a plethora of new jobs in local staff and administration. We could end up, as happened years ago when we reorganised local government, with precisely the opposite effect to that intended and find ourselves with far more civilian personnel in management roles and executive back-up than we intended or need. We shall have to watch closely the tendency in any bureaucracy to spawn new jobs within itself. We shall have to make sure that they are reduced as currently planned.

My third complaint about SDE 94 is minor, provided that it does not reflect what is happening in other areas. For many years the "Statement on the Defence Estimates" included 2.5 per cent. of the defence costs for the security and intelligence services. However, there was absolutely no way of discerning that fact by reading the SDE reports. I hope that one of my ministerial colleagues will assure the House that no similar generic figures are tucked away in the current defence estimates which might be treated in the same way as those for the intelligence services. Apart from those matters, we welcome what is stated in SDE 94 and the defence costs study. I wish to say a few words about Hercules, as my hon. and learned Friend the Member for Fife, North-East (Mr. Campbell) suggested that I probably would. Those who have called for a delayed decision on the Hercules replacement so that the FLA can be fully evaluated are wrong. They are wrong particularly because that would not allow us to replace Hercules until 2002 or 2005 in

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reality. There is no doubt that the current Hercules fleet cannot be merely run on and continue to provide the fleet that the RAF requires without a massive mid-line update.

It is an unfortunate fact that in 1993 at least half the Hercules in service were not in service at all because they were not airworthy or in active service. That position will deteriorate by 1998 and would deteriorate further if we were to take no action then. By 2002, the position would be intolerable. Until the aircraft have been stripped down, it is impossible to say what will be the maintenance costs of merely keeping the aircraft going in their present state. All our experience shows that it is much more expensive to do so than originally anticipated. It would almost certainly be more expensive to do so than to replace half the fleet in 1998 with Hercules, leaving the option of buying FLA when they are available six or seven years later. I endorse that recommendation by the Select Committee because it is the only way in which we can satisfy the need for flexibility and mobility in our armed forces over the next decade. I am conscious of the time so I shall resist the temptation to cover the other reports or to add to the debate by speaking to the other issues that have been covered. I shall end by summarising what I believe to be the needs for the defence of the realm over the coming 10 years. As I have said, I welcome the fact that we are no longer on the downslip of cuts and that we can look forward to a period of stability. The armed services need that, and it is the most that we can ask of the Government at this time in view of the limitations on the amount of money that can reasonably be made available for our armed services.

However, the Committee has concluded--and I believe the conclusion to be correct--that the nation does not have the long-term defences that we are likely to require. At Bournemouth, my right hon. Friend the Foreign Secretary made two statements with which, sadly, I disagree. First, he said categorically that there will not be a third world war. That was a bold statement. I recall reading that the last time somebody made such a statement was in 1919 after the "war to end all wars". There is no real reason for us to feel confident that within our lifetimes this country will not be embroiled once again in a major war, and our defence policy should reflect that assumption. The Foreign Secretary was mistaken in his base for our foreign policy.

To secure our long-term future we need about 10,000 more soldiers. As General Sir Martin Farndale rightly said, if we had that increased number we should be able to flesh out units without having to denude other units to reinforce active ones. We had to do that recently and will probably have to do it for the foreseeable future. Secondly, such an increase would enable us to give our troops the brigade, divisional and specific role training in which they have been sadly lacking over the past two or three years.

As the House knows, we had to use Royal Artillery personnel in Northern Ireland, and they and other specialist arms were taken from their specialist role and trained for an infantry and peacekeeping role in Northern Ireland, after which they had to be debriefed and retrained for Royal Artillery roles. As a result, there have been virtually no divisional infantry, artillery and cavalry exercises over that period. I understand that none is planned for the immediate future, certainly not involving all three services. We need more soldiers so that that can

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be done and so that we do not need to cadreise, as we have had to do, some of our units. A regiment that should consist of two battalions should have two battalions and the current habit of cadreising down is not adequate for our long-term defence needs. The Royal Navy has 35 frigates and I congratulate the Ministry of Defence on fixing on that figure--even if it is far too low. As the House will recall, until now the complement has been "about 50" or "about" 45, 40 or 38. But the trouble with 35 is that only 24 ships are seaworthy at any given time. That is not enough, even for our peacetime needs, and it certainly does not allow the Royal Navy to carry out the role that it should fulfil of waving the flag around the globe. The value of the White Ensign to our trade and to the way in which our people are greeted in countries to which they go to sell our products cannot be overestimated.

We tend badly to underestimate the importance that people, and especially those in the far east where our trade will now grow rapidly, place on face, and a military unit from this country gives Britain face. My right hon. Friend the Foreign Secretary once described it as punching well above our weight. On that occasion he was right: that is what we can demonstrably do, and we must make sure that we broadcast it where we wish to be seen.

Last, but by no means least, I shall deal with the Royal Air Force. There is much high-tech kit that the RAF should have, for example in avionics, to enable it to defend itself against ground-to-air missiles. We cannot afford to fit our squadrons with such equipment at the moment, and they need to be given the extra resources to enable that to be done.

Most important, within the next 10 to 15 years we will face a serious ballistic missile threat. I am not necessarily suggesting that a missile will be fired at us, but I certainly suggest that people who are perfectly capable of firing one at us and who might be stupid enough to do so will be equipped with such missiles. At the moment, they are not so equipped. I am obviously thinking of Libya and some other unstable middle east countries as well as other possibilities. We must embark upon the installation of a ballistic missile defence system, and it must be done in conjunction with the Americans and with our European allies. We must ensure that, within the next decade, we are armed with such a system. We would grossly betray our duty to defend this kingdom if we felt, for whatever reason, that we had to make savings in that area.

There is still a great deal to be done before I can tell the House that I am confident that we have the defences that we need. However, I warmly congratulate my right hon. and learned Friend the Secretary of State for Defence on the way in which he has set about defence costs studies and on the way in which he has limited the damage that Treasury demands have caused to our defences. I assure him of my personal support and, I am sure, of the support of almost every hon. Member in his endeavours to ensure that we have a stable future during which we can rebuild to the levels that are necessary to secure our freedoms.

7.37 pm

Mr. Llew Smith (Blaenau Gwent): At the recent Labour party conference it was agreed that a future Labour Government should scrap Trident and link our defence expenditure to the average of other western

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European countries. That resolution is especially relevant to a debate on defence estimates of approximately £23,000 million. I shall give some estimates of my own. If we linked our defence expenditure to the average of other western European countries, we would make savings of about £8,200 million. As the Campaign for Nuclear Disarmament shows, with those savings we could build 11,375 council houses; run 910 secondary schools for a year; maintain 8,736 home dialysis machines; provide water supplies for 1,820 villages in Africa; pay 54,000 nurses for a year; pay 36,000 teachers for a year; pay 1,822 hospital consultants for a year; support 305,760 hip or similar operations; and support a health and literacy programme for more than 17 million people in India. That could be done with just one year's defence savings.

Putting aside those savings, which would result from linking our defence expenditure in the way that I described, what of the savings from the so- called peace dividend since the mid-1980s? For example, military expenditure in 1984-85 was 5.5 per cent. of our GDP. Some 10 years later, in 1994-95, that has been reduced to 3.5 per cent. If we had maintained spending at the 1984-85 level, we should now be debating defence estimates of about £28,000 million. Therefore, the peace dividend is worth £5,400 million in the current year and £27, 700 million over the past decade. What has happened to the peace dividend? It has gone the way of North sea oil--funding the unemployment programme.

Whether we are discussing our failure to link our defence expenditure to the average of that of other western European countries or our failure to benefit from the peace dividend, we have lost not only the opportunity to benefit from investment in the great services and projects that I have already mentioned, but all the skills, talents and creativity that have been used in preparing for war when they could have been used for peaceful purposes. For me, that was best summed up by General Eisenhower 40 years ago, when he said:

"Every gun that is made, every warship launched, every rocket fired, signifies in the final sense a theft from those who are old and not clothed. This world in arms is not spending money alone, it is spending the sweat of its labourers, the genius of its scientists and the hopes of its children."

The new Minister of State for the Armed Forces, the hon. Member for Crawley (Mr. Soames), seems to find that funny, but I hope that he will respond to my point. Will he tell us: what is the use of Trident and who are the missiles aimed at? Who is the enemy? At one time, we were told that the enemy was the Soviet Union, but the Government have now admitted that our missiles are not directed at Russia and Russia has admitted that its missiles are not targeted at Britain or the United States.

In chapter 2 of the 1994 defence estimates, the Government recognise that

"our defence policy must accommodate the continuing change in the strategic setting."

The Government are right and it should, but unfortunately they have not responded to that continuing change. For many years, they told us that the Soviet Union was the enemy and that it was planning a nuclear confrontation with the west. I never believed that--indeed, I never even regarded it as a possibility. It was simply an excuse to justify our nuclear build-up. But at least we knew then

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who the Government believed the enemy to be. Will they tell us who the enemy is today and who the nuclear missiles are aimed at? While the world has changed, the Government continue with the madness of nuclear weapons. Their defence policy has not accommodated the change in the global position. Does any hon. Member honestly believe that any country at this present time is planning a nuclear confrontation with the west? I have to say that even if that were to be the case, I could never accept the use of nuclear weapons because they are no defence, for they would destroy not only the so-called enemy, but the people and the environment that we were purportedly defending. Even if they were never used in anger, they have destroyed people's lives where uranium has been mined, by the fall-out from nuclear testing and from the cancers caused by the production and processing of nuclear explosives, such as at Sellafield and Aldermaston.

As far back as 1955, Robert Oppenheimer recognised the danger. When he was asked on American television whether it was true that humans had already discovered a method of destroying humanity, he replied: "Not quite. You can certainly destroy enough of humanity so that only the greatest act of faith can persuade you that what is left will be human."

What was true in 1955 is even more true today, with the tens of thousands, rather than hundreds, of nuclear warheads in existence. If anyone doubts the dangers of nuclear weapons or the devastation that would result from, for example, nuclear fall-out, he need only consider the problems of the Welsh farms that are still affected by the disaster that hit Chernobyl eight years ago and from some 2,000 miles away. However, tragic as that disaster was, it would be nothing compared with a nuclear war. For example, Chernobyl's effects were like the Doomsday neutron bomb. Now abandoned, it was designed to kill people, plants and animals, but to leave buildings standing. The detonation of even the smallest nuclear weapon in the world's vast arsenals would destroy all life around it, pulverise buildings and leave a haunted devastation. Let us not forget the psychological traumas still suffered by the survivors of the bombing of Hiroshima and Nagasaki in 1945. Even the grandchildren of the survivors are suffering trauma today.

The development of Trident also threatens the non-proliferation treaty. The all-party Defence Committee said in its latest report on what it called progress with Trident:

"Trident's accuracy and sophistication does--and was always intended to-- represent a significant enhancement of the UK's nuclear capability. We have invested a great deal of money to make it possible to attack more targets with greater effectiveness using nominally equivalent explosive power."

That makes a nonsense of the Government's claim that Trident is a minimum nuclear deterrent.

How can the increase in nuclear firepower that will be available with Trident be reconciled with the commitment in article 6 of the non- proliferation treaty

"to pursue negotiations in good faith on effective measures relating to the cessation of the nuclear arms race at an early date and to nuclear disarmament."?

In reality, Trident is a clear example of the proliferation of nuclear weapons and a violation of the non-proliferation treaty.

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Why should the 160 non-nuclear power states that have signed the NPT give the nuclear weapons states unlimited carte blanche to keep their nuclear weapons for ever, without being able to use any leverage to ensure that article 6 is implemented? Why do the British Government recognise in their defence estimates some of the emergent security challenges as a result of--and I quote from paragraph 204--the

"spread of conventional arms and weapons of mass destruction and large- scale environmental threats"

yet still involve themselves in the obscenity of the arms trade, promoting those very same weapons of mass destruction and threatening that very same environment?

The Government are violating not only article 6 of the NPT, but article 1. I want to quote that short article, which states: "Each nuclear weapons state, party to the treaty, undertakes not to transfer to any recipient whatsoever"--

and I repeat, "any recipient whatsoever"--

"nuclear weapons or other nuclear explosive devices or control over such weapons or explosive devices directly or indirectly." Yet Greenpeace rightly points out that about 30 per cent. of the Trident initial procurement costs are being spent in the USA and it lists five key areas where the USA has given direct assistance in the production of the Trident nuclear weapons system.

That is not the only violation of article 1 of the NPT. The Sandia nuclear weapons research laboratory in the United States has designed aiming-fusing -firing mechanisms for all UK nuclear weapons--according to an admission by the vice-president of the laboratory, who was quoted in the American publication "Inside Energy" on 9 May. The Government policy on non- proliferation and the NPT is riddled with hypocrisy. It is a policy which demands of others, "Do as we say, not as we do."

The Government still see their role as wanting to rule the waves; they still see leadership in terms of military power. That is highlighted in their defence estimates when they proclaim:

"The United Kingdom remains one of the world's most formidable military powers. Only the United States, Russia and France can deploy as broad a range of capabilities as the armed forces of the United Kingdom."

Surely there are other ways of being world leaders, as Norway's leadership showed in acting as honest brokers between the Israelis and the Palestinians. That is my estimate of the leadership that we should seek to emulate. That is the world role that we should play, not one based on nuclear weapons and a defence expenditure of £23,000 million. It is role and a defence expenditure which I shall vote against.

7.48 pm

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