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9.40 pm
The Minister for the Armed Forces (Mr. Doug Henderson): We have had what could be described as a thin attendance in the House. The upside is that hon. Members on both sides of the House have had much more time to make detailed speeches. I suppose that, for the Minister responding, the downside is that so many questions have been asked that I shall probably fail to answer them all tonight, but I shall endeavour to answer as many as possible, and commit myself to writing to those whose questions I shall not be able to answer.
I endorse what has been said by all hon. Members: we praise the skill, dedication and courage of our armed forces who are currently deployed in the Balkans. People--our soldiers, sailors and airmen and women, and the civilians who support them--are the most valuable resource that the Ministry of Defence has. I do not think that anyone in the Chamber would disagree with that.
Before I say anything else, let me make an announcement. This evening I awarded a contract to help the welfare of those serving in Macedonia, which will enable British service men and women deployed there to stay in touch with their loved ones at home. The contract will allow all 4,500 of our personnel in Macedonia to make one free 10-minute satellite call per week from one of the nine sites there, and will come into effect
immediately. I have been keen to do something about that, and I am pleased to be able to make that announcement now.
Mr. Wilkinson:
Will the Minister give way?
Mr. Henderson:
I promise to give way after I have made a little more progress.
The job that British service men and women are doing in the Balkans throws a spotlight on them, and on the impressive professional qualities that they bring to the difficult and dangerous job that they are there to do. They are making a major contribution to NATO operations in the former Yugoslavia, providing forces at sea, on the ground and in the air. The current operation, however, also throws a spotlight on us. We must ensure that the skill and dedication of our forces are matched by the quality of the equipment that we give them with which to do their job. That equipment must be capable, to give us a technological edge over our opponents; it must be robust, to stand up to the extraordinary rigours of combat operations; and it must be flexible, to provide for the variety of demands that we ask our forces to meet. We must remember that they are involved in three different types of operation in the Balkans: conducting air operations from bases in Italy and from on board HMS Invincible, preparing in Macedonia for the difficult and dangerous task of peacekeeping in Kosovo, and providing compassionate and caring support for thousands of refugees in Albania.
Mr. Wilkinson:
I am grateful for the Minister's statement about the telephone calls, which I am sure will be widely appreciated. Even more appreciated, however--especially by service men deployed to the Balkans from Germany--would be an upward adjustment of their overseas living allowance, which is budgeted for. Those service men were not to know that they would be sent to the Balkans, and their families could be in some difficulty. Will the Minister ensure that equity prevails in that regard as well?
Mr. Henderson:
I assure the hon. Gentleman that I want to make certain that our troops are looked after properly, and that their conditions are comparable with any others in the Balkans--as they are. Much has been made of the overseas living allowance. That is related to the cost of living, not to the job that our troops are doing in any part of the world. There has been no change in that.
The fact is that 12 per cent. of service men and women's salary is intended to be used to deal with the unusual conditions in which they have to serve. The cost of living allowance is a quite separate matter. It is based on the cost of living in a country in which people are deployed and determined by comparing that cost with costs in the United Kingdom. If people are coming from the United Kingdom and our costs are lower, an adjustment will be made.
The hon. Member for Salisbury (Mr. Key) made some points on defence budgets. I should like to reassure him that the defence budget based on the strategic defence review will be shown to be a good deal when compared with any other deal struck between any other Defence Ministry and Government in the world. Admittedly, over a three-year period, the Budget sets a 1 per cent. reduction
in real terms, but that is tied to a commitment that--when efficiency gains of 3 per cent. are made annually--any extra resources that are freed will be made available for investment in the priorities set by the Ministry of Defence and will not be taken back by the Treasury.
When we make the gains that we anticipate that we shall make--I am confident that we shall make such gains--additional real resources will be available to meet the demands placed on us in a changing world. That is the background against which any charges on Kosovo must be assessed.
There are standard procedures for dealing with additional costs accruing to the Ministry of Defence when forces are deployed, and the current procedures and regulations under the current Government are no different from those under the previous one. Procedures will have to be assessed in each Department incurring additional costs, and subsequent negotiations with the Treasury will determine how the costs will be met. In some cases, some of the costs will have to be dealt with under departmental budgets--including that of the Ministry of Defence--whereas, in other cases, there will be a charge on the reserve fund. The formula, which I believe is a reasonable one, has not changed.
Mr. Blunt:
On international comparisons, the United States's defence budget is rising by 10 per cent., and the President has asked for the equivalent of an extra £6 billion for Kosovo. Therefore, the deal in the United Kingdom is not the best that could be struck anywhere in the world. The Minister said that the efficiency savings programme is not necessary to sustain the programme decided by the strategic defence review, and that those efficiency savings will be translated into extra investment in our defence programme. That is a significant comment. I do not believe that that is the case. I should therefore be grateful if the hon. Gentleman made absolutely clear the position on the £2 billion-worth of efficiency savings targets to be achieved, and if he will reconfirm now that all the efficiency savings--down to the smallest ones--will be listed and given to the House and the Defence Committee.
Mr. Henderson:
I do not think that the hon. Gentleman was listening to what I said. I said that we anticipate that, annually, for three years, there will be 3 per cent. efficiency savings; that those have been taken into account in the budget agreed between the Ministry of Defence and the Treasury; and that gains above 3 per cent. will accrue to the Ministry of Defence. That is what I said. If there was any doubt about it, I have repeated it.
The hon. Member for Salisbury made much in his speech about the United States, as if, compared with other countries, it has dramatically increased the resources for defence. However, in the past four years--comprising two years under the previous Government, and two years under the current Government--the United States has not made such increases. In those four years, Britain has reduced spending by about 8.5 per cent., which has been the average reduction made by our European and NATO allies. In the same period, the United States has made a
17 per cent. reduction. Therefore, from 1994, the United States has been rebuilding from a much lower base--which makes a big difference in the calculations.
Mr. Menzies Campbell:
Will the Minister give way?
Mr. Henderson:
I said that only to put the situation in context. I am not saying whether the United States' actions were right or wrong. However, one has to bear in mind the context.
Mr. Henderson:
I shall not take any more interventions on the matter. I want to move on, as many questions have been asked.
We were asked whether our current commitments were consistent with the assumptions in the strategic defence review. The answer is that they are. We are committed to the proposals in the strategic defence review and we are implementing them. In some respects, their implementation is absolutely consistent with what is happening in Kosovo. The principles that we enunciated in that document anticipated the situation that unfortunately has arisen in Kosovo. There are no closed minds and there never should be, but we are firmly committed to that review. The total numbers deployed in Bosnia and in Kosovo and those that may be deployed in a peacekeeping force are absolutely consistent with what was envisaged in the strategic defence review. In fact, they are fewer than we estimated.
I hope that Conservative Members who doubt the wisdom of the agreement between the Ministry of Defence and the Treasury in respect of efficiency are not suggesting that we should not strive for efficiency and look for better and more modern approaches to defence. If they are, we want to know about it.
Mr. Campbell:
There is an important point about the relationship between the money provided for defence and the Government's commitments. I hope that we can avoid being partisan about the issue. A senior budget holder told me that a large part of his budget was already allocated through contract as a result of the privatisation of somuch of what previously had been provided in-house. Therefore, he must find 3 per cent. efficiency savings on his overall budget out of about 40 per cent. of thatbudget. How is that individual supposed to fulfil the Government's commitments against the background of having to find 3 per cent. efficiency savings every year?
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