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Mr. Jim Murphy (Eastwood): I am listening to the right hon. Gentleman's speech with great interest. For the purposes of discussion and clarity, could he identify where he would like United Kingdom defence expenditure to go in terms of its proportion of gross domestic product? Is it one tenth of 1 per cent. higher, is it in line with the French model; or if not, which country's example would he like to see us commit ourselves to?
Mr. Jack: It is important to consider the overall strategic demands on our forces and the equipment that we deem that we need, and then decide whether we can afford it. It depends on budgeting. Do we start with a cake of a given size and attempt to cut it into ever smaller portions, or do we recognise that the cake needs to be expanded? The purpose of a debate such as this is not to put Back-Bench Opposition Members on the spot to answer such detailed questions, but to determine in principle whether the cake is too big or too small. Much has rightly been said about the report by the Select Committee on Defence, which I think answers the hon. Gentleman's question very clearly. According to that, the cake is too small and it is being cut into ever smaller slices, which does not enable our forces to be properly equipped for the job that they have to do.
The central theme of the Secretary of State's remarks was modernisation. While he was speaking about that, I wrote down "but on an ever-reducing budget", something that he did not have the courage to say. At the same time as making ever-increasing demands on our forces, as typified by the word "overstretch", we must recognise that there is a resourcing issue to be addressed.
I should like to say, en passant, that I wish we could get back to talking in straightforward language about defence matters. In his speech, the Secretary of State mentioned the buzz phrases "security architecture" and "strategic landscapes". I do not think that they add a great deal and they do not clarify what is in the minds of Ministers.
When the Secretary of State talked about the smart procurement exercise, he mentioned the cost savings on Eurofighter, which is under construction by BAE Systems in my constituency. The United Kingdom has led the way in the project in making it affordable for Europe's air forces. I was intrigued to know whether the savings of £1.8 billion will be redeployed as net extra capital; or has that already been written into the Secretary of State's long-term expenditure plans, so that to sustain the present position, he must make savings of that order?
I was disappointed that the Secretary of State did not develop in a little more detail the rather sparse paragraphs at the start of the White Paper dealing with the strategic overview of the Government's policy on defence in relation to foreign policy. Some of my hon. Friends have touched on those points and I shall not elaborate on them at length. But the world changes; the threat changes. I had
hoped to have a more detailed assessment of how that threat is seen and where the priorities are so that we could judge with greater clarity whether the Government have hit the button regarding defence expenditure, and discern their strategic view.
The other point that was missing in substance from the Secretary of State's speech was anything much about procurement. It is noteworthy that it has taken contributions from Back-Bench Members on both sides of the House to tease out from the Government some key procurement issues. My hon. Friend the Member for Romsey is right to say that he would welcome a further debate on this subject. However, as we do not have one, we must make best use of the time available to us today to discuss these matters. They are about sustaining, maintaining and developing the industrial base that is represented by companies such as BAE Systems. It employs 6,000 people in my constituency, and in the north-west some 40,000 jobs depend on the success of the aerospace industry, much of it driven by defence considerations.
Although there are proper discussions about the relationship between NATO, the European defence identity and the transatlantic alliance, an answer to a recent parliamentary question from the new Defence Minister shows that 44 collaborative projects involve European allies. They range from projects on missiles to aircraft and sea-based systems--it is almost an Aladdin's cave of projects, which illustrates clearly the crucial role of co-operation and co-operative ventures. Much as some people like to think that we can be totally self-sufficient, that answer gave a totally different view.
Some procurement projects have been touched on, but I support those who have called for--as the White Paper did--a swift resolution of what air system will be deployed for strategic lift. I am a supporter of the A400M. It seems to make eminent sense that Europe should not only develop that capability itself but should give itself the opportunity to take a share of the lucrative market that will present itself in years to come as Hercules aircraft come up for replacement. I was pleased that the Secretary of State used the word "soon" when he was talking about the decision on strategic lift.
I draw the Minister's attention to an item that appeared on the BAE Systems website with the heading, "Government doubles its money as Airbus loan repaid". That illustrates clearly that Airbus, as well as being good for Europe's technology base, is good for Government business. Giving it the contract to produce the A400M seems to play to that tune. In the Defence debate last year, I described how the A340 aircraft had been delivered on time as a design to build for delivery to airlines, which trusted Airbus's ability to produce what they wanted. The same arguments can be deployed in respect of the A400M.
We should not also have to justify the contract in terms of jobs, but about 62,000 would depend on it indirectly. The industry already provides those jobs and 10,000 United Kingdom jobs are directly attributed to that exercise.
The aircraft is eminently well specified. It meets the staff requirement for heavy lift and it would certainly give us independence with our own strategic capacity, as well as a real commercial opportunity. I hope that what the Secretary of State means by "soon" is in the next few weeks.
Labour Members have pointed out that we seem to go from feast to famine with procurement exercises, which is true. There has been no mention from the Government of equipment for the Eurofighter beyond the visual range air-to-air missiles. That is another crucial question on which a decision is needed. There is no mention of the matter in the White Paper. Given the technology involved, if we are to have a weapons system that is properly defined for Europe's own fighter and is not dependent on diktat from the United States, in the event that the Government go the US route they will not only buy an inferior product but will risk the strategic opportunity of sales of the Eurofighter Typhoon to nations other than Norway outside Europe--although I am delighted that that country has shown an interest in the aircraft.
I do not knock the United States deliberately because it is playing a key part in providing the airborne avionics and radar systems for the Nimrod project. However, I visited Congress and the Senate in July, when they were playing games with the F22. Even internally, they can switch key defence projects on and off, and they could do exactly the same with the external use of that technology. We must be wary of that when we consider that missile system.
I was disappointed that the Secretary of State chose to say nothing either about Britain's role in the joint strike fighter project or the future offensive air system. The joint strike fighter offers us a major opportunity to participate in future technologies that will replace the Harrier aircraft. It will give us a chance to develop relationships with our American partners and the American industrial base. It has the potential for orders for the aircraft in the UK, but the Minister and, indeed, the White Paper remain silent on the subject.
The White Paper devotes only a few lines to the future offensive air system. However, no more important project is under consideration. Within FOAS lies the development of the solutions, the technologies and, eventually, the products that will be the seed corn for our future technological independence in Europe.
When the Minister winds up, it would be nice if he could talk about how the Government view that project. It is being run on smart procurement lines. It is a pleasure to visit Warton, to see all those companies and countries--Germany, France, Sweden and others--working under the same roof. Government and enterprise are working together. It is a tremendous project which merited more than one line in the White Paper. That did not demonstrate the importance that I and, indeed BAE Systems, attach to it.
The project illustrates the nature of the defensive threat that we face. When I asked, "Why FOAS?", I was told that we live in a world of uncertainty, where the target may be unplanned. The targets may all be different--they could be mobile. We have seen the growth of nuclear and other missile technologies. The challenge to our future systems is great. FOAS will provide us with a technological deterrent that matches NATO's organisational deterrent. Other people must fear what will be inflicted on them if they take on the western alliance. FOAS is crucial to maintaining technological deterrence.
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