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9.28 pm
Mr. John Spellar (Warley, West): May I, first, apologise to those hon. Members whose speeches I shall be unable to cover in the short time that I have to wind up? It is fair to say that the debate has been slightly more low key than last year's but, then again, so was the trailer at the Tory party conference. However, some things did not change. We still had a lot of shouting, bawling and unparliamentary language from the Minister of State for the Armed Forces, but we excuse him for that. He was probably still disoriented by the Prime Minister's recent attack on the old school tie.
Ministers and Conservative Back Benchers seemed to spend more time on the Back-Bench amendment than the selected amendment. They also seemed slightly out of touch with the current decisions of the Labour party conference. It is rather like the newspaper editor in "The man who shot Liberty Valance" who said, "If you have to print the truth or the legend, always print the legend."
That is probably why, for most of the debate, there were more Opposition Members than Conservative Members in the Chamber. It is also probably why the Secretary of State did not spend too much time at the Tory conference talking about his stewardship of the nation's defences. It is not surprising. He might have had to explain how in one year the Government have spent £500 million on redundancy and £100 million on recruitment and, as has been demonstrated in a number of speeches tonight, still got the figures wrong. It takes a special kind of genius to achieve that.
Let us consider the figures for the Grenadier Guards, for example. They are 84 short on their complement, yet they have had 40 redundancies in the past three years. Is that an effective way to keep the troops up to strength? Is it not a considerable cost to the budget?
At the Tory conference, and again today, the Secretary of State talked about possible Labour cuts. He has definitely learnt the value of diversionary tactics from the military. As Secretary of State, or in his previous incarnation as Chief Secretary to the Treasury, he has been one of the cutters-in-chief. During the 1992 election, as my hon. Friend the Member for South Shields(Dr. Clark) said, the Government claimed that Labour would cut defence spending by 27 per cent.--yet they have cut it by 31 per cent.
Since 1990, personnel numbers are down 27 per cent. for the Army, 30 per cent. for the Navy and 42 per cent. for the Royal Air Force. Perhaps the Secretary of State, or the Minister in his reply, can tell us what further cuts the Treasury is demanding for next year. As the Secretary of State is well aware, it has been rumoured in the press that it will ask for £400 million. That is why the concluding paragraph of the Defence Committee report, which was amplified today by its Chairman, the hon. Member for Romsey and Waterside (Mr. Colvin), and by the hon. Member for Wyre (Mr. Mans), is so relevant and weighty.
It was remarkable that a number of Conservative Members attempted to dissociate themselves from their Treasury, as though it was a Ministry from another planet. Let us be quite clear--we have a Tory Treasury and a Tory Chancellor and they cannot escape responsibility for that, valiantly though the hon. Member for Salisbury(Mr. Key) tried.
It is not as though our commitments are reducing. As has been said, a bigger percentage of the Army is involved in operational commitments than at any time since the second world war. In spite of the bluster of Ministers, we need a strategic review of the relationship between our capability and our commitments. In reply to the question posed by the hon. Member for Wyre, it is self-evident--it has been said by Conservative spokesmen--that such a review can be undertaken only when in government with access to the relevant information. In such a sensitive Ministry, that information can be available only to Ministers.
At all levels, and from a number of hon. Members, in the debate tonight we have heard of the problems of overstretch. Let us be frank; it is also widely reported that the Chief of the Defence Staff is incredibly worried about sustainability. Maintenance capability is a part of the problem. The hon. Member for Cardiff, West(Mr. Morgan) mentioned the Tornado accident off Blackpool. Thanks to the skill of the pilots, no one was injured. In spite of initial denials, it appears that it was one of the Tornados that had been damaged by the botched contract of Airwork Services. That is a salutary reminder that neither the work force nor the House have yet had a satisfactory report of the full cost of that fiasco.
We are also concerned about the continuing accident rate for our aircraft. Frankly, it is regrettable that the Ministry of Defence still appears to be considering each crash separately rather than having an overall inquiry. We have raised that matter before. By investigating each accident, it becomes all too easy to ascribe the cause to pilot error rather than to question other factors, such as lengthening training cycles and overstretch of personnel and machines. Rather than analyse those factors, the fundamentalist zealots in the MOD are plunging ahead with yet more privatisation and contractorisation.
It seems that the Government have adopted the simple mantra of their American Republican cousins: the Government sector cannot run anything. Nothing, and especially not the facts, will deter them. That runs disastrously contrary to the service tradition of our armed forces and of the civilians who work with and for them, yet still the Government plough on. RAF Valley has already been contracted out; Sealand, which has been mentioned several times by my hon. Friend the Member
for Alyn and Deeside (Mr. Jones), and St. Athan are in turmoil because of new tranches of privatisation. I reiterate what I said in the RAF debate on 6 June.
Sustainability also affects the defence industry. Unfortunately, neither the defence estimates nor the Secretary of State's speeches to the Tory conference and tonight recognise the need to back British industry in the way that our competitors back their industries--but what can we expect from a Government that considered the Austrian alternative to the Land Rover for the Army field ambulance and when Metropolitan police Volkswagen vans are parked in New Palace yard?
I was at Land Rover last Friday and the only problem there is getting round the site for the number of contractors' vehicles there because of all the building work that is going on. Huge investment is going into Solihull from the new owners. Is not it a shame that its German owners seem to have greater faith in Land Rover than did the MOD? Was not it also a great shame that there had to be such a campaign to ensure that the orders finally went to Land Rover? It is a world-class product and we should have been backing it.
Mr. Arbuthnot:
We did back it; we bought it.
Mr. Spellar:
It required a Tory Back-Bench rebellion, Land Rovers parked in New Palace yard, uproar in the west midlands and consideration of the number of marginal seats there. What the hell were the Government doing even considering the Austrian alternative? No one else in the defence industry understands it.
Mr. Mans:
Is the hon. Gentleman suggesting that we should buy military equipment without competitions?
Mr. Spellar:
There was no proper alternative to the Land Rover. The hon. Gentleman should consider the practice of industry, which negotiates on the basis of preferred supplier status and works on partnership and open books. That happens increasingly in the defence industry around the world. It is happening with procurement policies in several other countries that actually back their industries and work in partnership with them. The Levene proposals have reached the end of their shelf life and we must find a new mode of defence procurement. The Government will not do it because they are attached to dogma. A Labour Government will do it because we will be looking to back British industry and work with it to get the best result.
The Secretary of State's speech at the Tory conference--he repeated the same formula today--employed a clever use of words. He rightly praised our
world-class armed forces and equally rightly said that they should have world-class equipment, although whether his procurement policy will achieve that is another matter. He very clearly did not say that it would be British industry that would provide the world-class equipment. Once again, he slipped away from the key commitment that British industry and defence workers are seeking: that the MOD will back Britain and buy British first. That is what they want to hear, but they are not hearing it from Tory Ministers.
What about the extraordinary scenes that surrounded the award of the contract for the replacement maritime patrol aircraft--the RMPA--and the 1236 and 1238 missiles, which were referred to by the Secretary of State? I do not know whether to congratulate those on the Front Bench on having snatched the decision from their Tory Treasury colleagues at the eleventh hour or to castigate them for having let the situation deteriorate to such an extent. What I am sure about is that if we had not had a campaign in the country and rows in Parliament, the situation would have been allowed to drift and that contract would have dominated our debate today.
It is reassuring to know that pressure in the Chamber, not only from the Opposition but from Conservative Back Benchers, is able to have that effect, but it was extremely unsettling for the industry and the armed forces, not to mention the unfortunate Minister for Competition and Consumer Affairs who got caught in the crossfire right at the end of the Session.
We have to look for a better way to undertake contracts and procurement. There are a number of lessons to be learnt from the RMPA and other recent contracts, the most significant being recognising the need for a shift in the system of defence procurement. Indeed, the right hon. Member for Northavon (Sir J. Cope) suggested some of the areas that we need to examine in his thoughtful speech. Whatever one's view of the Levene reforms, it is self-evident that they have reached the end of their shelf life. The joint report of the Defence and Trade and Industry Committees pointed clearly towards a reformulation of policy, but the Government's response still fudged the issue. We need to take on board that report and what is happening in the real world. The Government are starting to edge towards doing that, but they cannot match their rhetoric. The replacement orders for Fearless and Intrepid had to be undertaken on a NAPNOC--no acceptable price no contract--basis because the Government recognised that mergers and reduced competition mean that we must bring about a change.
The defence estimates talk in fairly bland terms about Project Horizon, the common new generation frigate referred to by my hon. Friend the Member for South Shields. It is a joint programme with France and Italy but clear problems seem to be emerging. Britain still seems to be committed to 12 ships, but the French and Italians now seem to be down to two each. What does that do to the viability of the project? What about the delays, which are getting longer and longer? Can the Minister confirm that the first vessel is now due in 2006? Can he also confirm that the first type 42 destroyer that it is due to replace is scheduled to go out of service in 1999? What will be the effect of that gap? What extra maintenance costs will be incurred? Will those ships need a refit? What will be the consequences if that programme slips? Does the Minister recognise the great difficulties that have
arisen with the project? Is it not time that serious consideration was given to a fallback position? We await his answers tonight with interest.
Before the recess, we had the drama of the married quarters housing, which was glossed over by the Secretary of State today in just a couple of sentences. The Government business managers down the Corridor were so worried that they dragged out the biggest attendance of backwoods Tory peers this Parliament--a scene described in The Times as
The members of the Burma Star Association whom I met last month were not very impressed with the Japanese landlords of defence housing. I note that, in addition to Nomura, extra funds will be raised in New York. I simply ask, what is wrong with the City of London? Why are we having to bring in money from abroad? What is the secret agenda? Is it to bolster up the balance of payments and massage the figures? Will that money be included in the figures for inward investment? Was it a good deal for the services?
During the debate in July, Tory Back Benchers justified their ignominious retreat by referring to the £100 million to be spent upgrading the property to grade 1 over five to seven years, but last year alone the Ministry of Defence spent £165 million on married quarters works, of which £40 million was spent on upgrading--£40 million a year over five years amounts to £200 million, which is double the allocation from the sale. Clearly, there is no guarantee of additionality from the Treasury. The housing budget is part of the defence budget as a whole and is not negotiated separately--we cannot know whether we are getting extra money. It is a pot of gold at the end of the rainbow--fool's gold--and there is no guarantee that the money is in addition to the budget.
We are not sure how much the Ministry of Defence will pay. The rental is linked to assured shorthold tenancy rents, which have rocketed up recently. The Minister believes that in future the rentals will grow in line with house prices. That is an unpredictable measure, which could claim an escalating share of the defence budget--all in the name of dogma and helping the Chancellor to balance his books in November. The capital value has gone to the Treasury and the unpredictable revenue charges will fall on the Ministry of Defence. That seems like a defence cut by any other name. There will be constant upward pressure on the rents paid by service personnel, which have already rocketed by between 10 and 25 per cent. in the past year alone.
"We firmly believe that any decisions on contracting work must be determined by pragmatism not dogmatism. We shall impose a moratorium on new contracts while we evaluate the schemes that are currently in the pipeline."--[Official Report, 6 June 1996; Vol. 278, c. 745.]
My hon. Friends the Members for Crewe and Nantwich (Mrs. Dunwoody) and for Rother Valley (Mr. Barron) mentioned air traffic control services. We understand that the RAF shares the concern about privatisation and the proposals to cut the number of control centres from two to one. Will the Minister say what is the attitude of the MOD and what the proposals would mean for military and civil air safety and for Prestwick in Scotland? The people who work there, and the RAF, deserve a reply tonight.
"An Iolanthe-style parade of hereditary peers."
In that debate, regular attending peers from all parties shredded the Government's argument, but Ministers won the day with those who never heard or listened to the debate. We know that, in this House, the Whips' pressure broke the resistance of Tory Back Benchers. I wonder if, on reflection, they think they did the right thing.
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