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Mr. Hoon: Let me bring the hon. Gentleman back to some degree of reality. He will know that that kind of planning process is routinely undertaken by NATO, as there is no NATO standing force. NATO consistently undertakes similar planning processes to deal with the scenarios that it might face. That is precisely the process that is being advocated for the headline goal. The hon. Gentleman really is making heavy weather of his Euro obsessions when he tries to see some structure lying behind the clear words of what has been agreed between EU nations.

Mr. Duncan Smith: That is precisely at the heart of the issue. If, as he keeps trying to do, the Secretary of State plays down the idea until it is not about organisational structures, but is nothing more or less than what NATO gets up to, the big question is: why in heaven's name have we embarked on it in the first place, if it is already available and capable of being done within NATO?

I shall take the Secretary of State down that road in a moment, as I hope that he will intervene again later. What is the reorganisation for? That is the key question. The suggestion is that it is just an ad hoc arrangement but, given the existence of NATO, why do we need to create, through the EU, the structure that has been described? It would include states that have not been aligned militarily with us or with our allies, but exclude a number of states that have shown their commitment to the defence of western Europe even though they are not part of the EU. There is no logic to that, and the proposition makes no sense.

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What will the restructuring achieve that NATO cannot? The Secretary of State referred endlessly to the use of NATO assets, as do all the documents, but what are those assets? The right hon. Gentleman said that they could be used as and when required, but only in EU operations. However, under the terms of the reorganisation, they would be entrusted to nations that were not members of NATO. Do those assets include the US heavy-lift capability, or tanker aircraft, or access to US satellite information--even though not every NATO member country gets that information? Do they include US electronic warfare capabilities or air defence suppression aircraft?

In military terms, such questions go to the heart of the purpose of the restructuring. The point has to be reiterated that a false assumption is being made about the foreign policy dimension. It is that the world view shared by Britain and our EU partners will allow us to operate militarily with them, but will also--somehow--separate us from the USA. The question remains, however: how would we square that? What purpose would it serve, if we are not going to intervene in situations such as those in Kosovo or the Gulf? If we are going to intervene in such situations, where would it leave us? For example, we operated not with France in the Gulf, but with the US.

Mr. Wilkinson: My hon. Friend is touching on an extremely important matter. The proposal is predicated on a difference of view between the European members of NATO and the US. Key US assets would be essential to the prosecution of an independent European operation. However, if the US authorities did not believe in the cause, why should they permit those assets to be drawn down?

Mr. Duncan Smith: That is much the point that I am trying to make as I bring my comments to a close. NATO is sustained because it is a practical option. As events in Kosovo showed, NATO can deliver military force where it is needed and produce results in a military context. If NATO were no more than an ad hoc political arrangement, it would never have got past first base in Kosovo, as the Secretary of State knows.

What in heaven's name is the proposal about if it does not achieve the same status as NATO, but remains merely the ad hoc arrangement described by the Secretary of State? That is the problem. If what is created does not become a big structure, it will remain no more than a political smokescreen. As my hon. Friend the Member for Mid-Sussex (Mr. Soames) noted, such a smokescreen would hide the fact that European nations would continue to cut their military budgets, thus reducing their capability. That in turn would place great strain on the NATO alliance, and would not solve the real problem, which is that more needs to be done, and done better.

Mr. Donald Anderson: I do not agree that the proposal is a smokescreen. The hon. Gentleman makes a caricature of what has been proposed. There has never been any suggestion that the European component, in the foreseeable future, would be able to take over a matter as large as the Kosovo conflict. The US has exerted constant pressure for burden sharing in NATO and for Europe to assume a greater role. It is accepted that there will be problems at the edge of Europe, perhaps in the Balkans. For good reasons, the US would not wish to be committed

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there, but Europe could play a role by taking on a so-called Petersberg task. Such an operation would be relatively small, and the key element is that NATO will always have first refusal on it.

Mr. Duncan Smith: I thank the hon. Gentleman, who has made my point for me. Why is Kosovo always quoted as the lesson that we have learned, when what we are saying behind our hands is that there is no talk of resolving the Kosovo problem? The issue at the heart of the nonsense peddled by the Government is that, in reality, a political solution is being applied to what is essentially a military problem. That is deeply dangerous. We will see how the proposition divides NATO, which is concerned with military solutions.

The Secretary of State mentioned Europe's defence failings, but why cannot they be resolved in NATO? What problem exists that prevents strengthening the European arm of NATO? Why is there any need to go outside NATO? The proposal excludes some nations whose commitment to the defence of western European is not in doubt, and includes others that have never been allied with NATO. Why do we need to go outside NATO to achieve something that the Secretary of State believes can be done in an ad hoc manner anyway?

Mr. Anderson: The answer is simply that, in many theatres, the US may not wish to be involved.

Mr. Duncan Smith: That is nonsense, as it has been made clear within NATO that there may be occasions on which the US may not wish to be involved. For example, as with Kosovo, it has always been the case that not all members would want to be involved directly or militarily in an operation that NATO wanted to mount. My point is that such matters can be resolved in NATO, and that, contrary to the Government's apparent ambition, there is no need for alternatives outside NATO to be prescribed or created.

In reality, the Government have opened a door to those who consider NATO to be the problem rather than part of the solution. That is the dangerous aspect of the proposal, and the Government are busy telling everyone not to worry. They have told the Americans that the proposal is about improving capability. They have told the French that it is about improving European defence and having greater control over it. They have told the House that it is about nothing, really.

Mr. Hoon: The hon. Gentleman is allowing his anti-European obsessions to affect his process of reasoning. The important lesson for this country from Kosovo was that European countries were not organised in such as way as to allow them to respond rapidly to that conflict. The reorganisation is designed specifically to deal with that problem. Subsequent events have demonstrated that Europe can get forces in the field over a period of time. For example, about 80 per cent. of the forces currently in Kosovo are European, but the question is how we address that rapid deployment capability. That is where the relevance of Kosovo lies. If the hon. Gentleman had studied carefully the initial publication

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made by my predecessor last October, in which the lessons learned from Kosovo were set out, he would have seen that relevance clearly. That is what he is missing.

Mr. Duncan Smith: Oh no I am not.

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. Perhaps I might suggest to the House that interventions should be brief. I know that hon. Members are talking about a highly technical matter, but interventions must be brief.

Mr. Duncan Smith: I take your advice, Mr. Deputy Speaker, and my answer to the Secretary of State's intervention will be brief: the right hon. Gentleman is wrong. He has confused the real lessons from Kosovo with the so-called solution that he has put together. The lessons from Kosovo were very simple. As my hon. Friend the Member for Mid-Sussex said earlier, the nations of Europe have allowed their defence capability to fall below a level that allows them to work and co-operate with the best in NATO.

What is the point of being able to deploy troops to a theatre of war if they are not able to fight when they get there? The Secretary of State keeps on using the Kosovo argument, but if the European initiative that he has set out is not designed to deal with Kosovo, why in heaven's name does he use Kosovo as the relevant example? The key point is that the restructuring is really a political device, and the Government have released a tiger that will create huge problems.

The second strand of my argument has to do with sustainability under the strategic defence review--our ability, in military terms, to sustain operations while maintaining the objectives of the SDR. I want to consider the problem of overstretch, but not simply on the basis of figures. I want to consider how the Government are dealing with the problem and whether their actions have made things worse.

The key issue is the relationship between the regular forces and the reserves. The defence review made a commitment to increase the size of the Regular Army by 3,300 while reducing the Territorial Army by 18,000. Since that reduction, it has become clearer every day that it was wrong-headed. In every NATO nation of any significance--even some of small significance--the ratio between the regulars and the reserves is far higher than ours. That is especially true for America and Australia--although Australia is not a NATO nation--both of which have professional forces similar to our own. The logic for them is clearly that with smaller professional forces one needs to be able to access well-trained reserves--for obvious reasons.

Those ratios compare unfavourably with the Government's--on paper, a full strength of 111,000 to 40,000 in the TA. As my hon. Friend the Member for Salisbury (Mr. Key) recently discovered on a visit to Texas, the US army reserve has almost as many men as the US Army. If the national guard is added, the US can put together a force that is nearly twice the size of its regular force.

The picture is much the same in France, Germany and Canada, where the number of regulars and reserves is broadly equivalent. For example, Italy can apparently mobilise 240,000 reserves to its army of 160,000.

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Although we might debate the effectiveness of its regular army, that ratio is important for its operation. By contrast, our Territorial Army, under the review, does not even make up half the numbers in our Army.

The real problem is that our professional Army was forced to make a choice between it and the TA--of course, it chose the TA. Even if I accepted the Government's logic--that to increase the Army we had to reduce the TA--we must consider how bad things are in reality. Let us forget the paper and look at actual numbers: we are 6,000 men under strength. If the Adjutant-General is to be believed, it will take about 31 years, if all goes well, to get us up to strength, so surely the Territorial Army must play an even greater part in taking up some of the slack.

That is the key criticism. The Government's action on the TA has made matters worse and the situation will get progressively worse over the next few years. There is no slack and the TA will be unable to assist because the pressures on it are beginning to mirror those on the Regular Army. I want to highlight the fact that I am not engaging in a stupid debate about overstretch. We know that that is occurring--it happened while we were in office; that is fully accepted. We must deal with reality. How do we tackle the problem in the short and in the long term? In the short term, the reserves are critically important.

Equipment is also important in any discussion of sustainability. The forces that we put in the field need the right equipment, and enough of it, to sustain that deployment. That is the key to our future success. Recently, there have been several leaked reports. About a week ago, a leaked report from the Public Accounts Committee seemed to back up internal MOD reports about the Kosovo operation, leaked at the beginning of the year. The reports dealt with the problems of sustaining our initial and subsequent involvement in Kosovo.

When I talk to members of our armed forces, I find that they are deeply concerned about that matter. When they talk about support and spares, they all refer to what--rightly or wrongly--they believe to be the supermarket ethos of the MOD. They talk about the just-in-time concept. Many of them told me that when they went into Kosovo they experienced great problems in getting the right spares to the right place at the right time. Those comments seem to have been borne out by the reports. As a result of those problems, far too many tanks and armoured vehicles were off the road simply for want of a track or a bogey wheel that could not be supplied because of the limited spares support. Our commanding officers are worried about those serious problems; they believe that they are reaching crisis proportions.

The matter is critical. The Kosovo report will sound a wake-up call to the Government and to all politicians. The problems have gone too far and we need to think again. If we put our troops in the field, we must be able to sustain their action in both easy and difficult circumstances when they are opposed for some time. That will create an even greater problem.

We should also consider the future. Where are we going under the smart procurement programme? That was supposed to give our troops the right equipment to help them to operate in the manner envisaged under the

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strategic defence review. The two latest big procurements are the BVRAAM--the beyond-visual-range air-to-air missile--the short-term heavy lift, and the long-term commitment to tranche two heavy-lift replacement. It is time that decisions were made on those matters.

I hear that decisions have been made in the MOD, but we also hear--perhaps the Secretary of State can confirm this--that the Chancellor has taken control of those decisions. Apparently, he has his own view on the strategic and tactical requirements of the MOD. I was not aware that the Chancellor was such a military expert--he is now capable of deciding exactly what is required for the operation of the SDR. Will the Secretary of State remind his right hon. Friend--I am sure he has already done so--that, in the SDR, smart procurement laid a requirement on the Government? They were to stick to their part of the bargain--to make the decisions in time so that industry could produce the equipment for our troops to undertake their SDR requirements. Any further delays by the Chancellor will make a mockery of what he calls smart procurement--I would call it stupid procurement on a grand scale.

The MOD is in a difficult position. It is trying to operate under the SDR requirements and according to its view of what is happening throughout the world. However, as we proceed, we realise that some of those important assumptions were wrong and that the review itself was thus fundamentally flawed. That flawed review has led the Government into making incorrect assumptions, with the result that our armed forces are in difficulties. They face greater commitments, with the likelihood that the quality of their equipment is not as good as it might be. The Government need to review the matter immediately and rapidly. In so doing, they should also review their strategic requirements in the light of future threat. Unless they make a decision on ballistic missile defence and on their stance in that debate, and unless they lead that debate, I fear that we shall expose ourselves to a future threat to which we have no response. Then, of course, it will be too late.

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