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Mr. Ingram: It is difficult in an intervention to deal with all the points that my hon. Friend makes, but I shall try to give him some assurance. He has been a very fierce campaigner for that project and has criticised some of the ways forward, and rightly so. The letter of intent has been signed. As the sole owner of DARA, I remain positive
about the way forward. This is a question not of dithering, but of trying to obtain certainty. We are examining the best solutions. Rather than moving forward on the heads of agreement at the meeting last week, I thought it better to complete the internal examination, which is also taking place, of end-to-end support for the RAF, so that it can better advise me on my ultimate decision. I well understand the anxiety; it is a matter of regret, but I hope to be able to give an early answer, and the solution will not be long delayed.
Mr. Smith: I am absolutely delighted with my right hon. Friend's intervention. What he says not only reassures me, but, more importantly, it will reassure the work force at RAF St. Athan and, indeed, the people of Wales, who look forward to the success of the project.
This has been a good debate, and we have covered many procurement issues. I believe that the Government are moving in the right direction. In reality, if people scrape away at the surface, they will find that there is much more bipartisan support for what the Government are doing than Opposition Members will let on.
I am sure that we are on the right path in trying to improve our procurement and logistics because of my experience some years ago, when it was decided that Defence Estates would simply carry out an audit of what the MOD owned in this country. No one had ever done that before. No one had ever sat back and asked, "What exactly do we own and what is it worth? The audit was fascinating. I understand that it found 600 horses, but no one quite knew what they had been used for since the abolition of the cavalry. It found a string of diesel locomotives, rolling stock and land worth millions of pounds. All that money could be saved by a simple auditing initiative. I tell the Government to keep up the good work.
9.3 pm
Mr. Ian Liddell-Grainger (Bridgwater): First, I must apologise to the House for my slight, forced absence in the middle of this debate.
I should like to talk about a very particular part of defence procurement—the procurement of explosives. There is one plant in this country that makes explosives to the standard and level that the British military needs—the old Royal Ordnance factory at Puriton in Bridgwater. It is important to consider this issue because procurement has not just begun but goes back over the ages. The point has been eloquently made that we are not very good at achieving some of our procurement aims.
The factory began work in 1939, and it was located in Bridgwater because there is lots of water—it happens to be below sea level. By the end of 1941, it had produced 20,000 tons of high explosive. It is best known for the bouncing bomb and many of the other explosives produced in the early part of the war. Since then, it has created some of the best quality explosives in the world. It cannot be beaten by anyone. Those explosives are required for our bombs, shells, missiles and so on.
The factory has been an exemplary employer and has done a phenomenal job. After privatisation in 1987 and because of the shrinkage in this country's defence capacity after the fall of the red army—the red peril—it
had to change. However, it is now under threat, but not because of what the Government are doing—it was taken over by BAE Systems. If hon. Members want to boo and hiss now, they may. That is a company that has one aim: to maximise profits. It may sound as if I am speaking for the wrong side, but I agree that a company whose activities put the interests of a country at stake should not just aim for the largest profit that it can make. It is, so far, a British company, and the nation matters more.Royal Ordnance has a 400-acre production site. It is a large factory capable of producing high-quality explosives on a site that could be a world-beater. It is a site that is out of the range of people. It is in a safe place: that is why it was put there. It is also away from prying eyes. As anyone who has been involved in the chemical industry knows, it is easier to mothball a chemical plant than to shut it down. If one shuts it down, the land clearing and sterilisation of the soil is a massive expense. I hope that Ministers will take that on board.
Puriton is now making RDX, TNT and HMX, which are explosives that we depend on for our military capacity. It also looks after other material that is vital to the defence of the nation, and that we cannot depend on the Americans to supply. Will the Minister address that point? Where will we get that extra material from if Puriton disappears? The United States Government have never said how we will obtain such material if it cannot be supplied from across the pond—I felt that I ought to repeat that to the House.
In terms of supply, from where will we get explosives for Sea Wolf, Spearfish, Sting Ray, BVRAAM and CASOM—I do not know what they stand for, but they all need a warhead that has something in the end that goes "Bang!"—[Interruption.] I am a Territorial Army soldier; I know what "out-of-date" means. We are here to try to save a plant that has done a great job over 60 years.
I received a letter from the Royal Ordnance trade unions—or from the Transport and General under Jack Dromey—which stated that the Defence Committee pointed out that
- "a long-term Partnering Agreement was concluded two years ago, which it hoped would provide the stability for Britain's Royal Ordnance factories"—
- "the Agreement 'has only served to give the firm the foundation it needed to close further plants'".
- "The Defence Committee then calls on the MOD to act, saying that Defence Ministers 'must continue to monitor more robustly the implications of ammunition plant closures, and indeed other Defence Industry rationalisation to be ready to protect re-supply routes for such essential support for our Armed Forces'".
- "the closure of the remaining factory manufacturing high explosives here in Britain . . . That vital and strategic capability should be preserved."
One of the biggest problems over the last few years has been the moving of explosive production out of this country to Germany, America and elsewhere. I shall deal with the American situation in a moment. One of our ammunition plants was closed to remove production to Germany. The Select Committee said that, unless we ensure that our war stocks are safely maintained at the necessary height, we will not be able to resupply in the short term. One can never set out what an emergency will be, as has been eloquently explained in the House by hon. Members. One can never foresee the unexpected—that goes without saying.
The three remaining plants are at Chorley, which does mostly civil work but makes the detonators and initiators, at Bridgwater, which produces high explosives, and at Birtley in the north-east, which assembles the shells and shell cases. We will lose all three plants if BAE Systems has its way.
One of the problems of the Bridgwater plant is that it has never had its own cost base. That may sound strange, but BAE Systems has always made it a part of other loss-making plants in this country. I refer not only to the ones that we know about, but to Glascoed and others. If a plant cannot prove to BAE Systems that it will make money, BAE will view it in a different way. If the plant was given the chance to be a cost-effective unit in its own right, it could prove that it could make money, as it continuously did when it stood on its own two feet for many years.
I asked the Under-Secretary what the Government's policy for ordnance production in the United Kingdom was. I was told that the MOD had
- "entered into a 10-year Framework Partnering Agreement with Royal Ordnance Defence, the United Kingdom's major producer of munitions. This agreement provides the company with a schedule of business and visibility of MOD's potential future requirements such that the company can provide the MOD with munitions at world benchmark prices."—[Official Report, 15 July 2002; Vol. 389, c. 20W.]
Lord Bach said that, if Royal Ordnance had not entered into such an agreement towards the end of 1999, the position would have been so bad that the future of the plants would have been under serious threat. I have raised this matter with the Under-Secretary before, and he rightly raises his eyebrows. However, I shall bang on about it until we go blue in the face.
The Holston military ammunition plant in Tennessee is on a site of 6,000 acres and it is the largest bomb-making factory in the world that is run by the British. It is now controlled by BAE Systems. Royal Ordnance has just been granted $163 million to run the plant, and it is looking to bring in world-beating products from all round the world. It has been given a 25-year extension to the contract to be able to do that, so this is its chance to use its muscle and the framework agreement set up with the MOD to move the production of ammunition to an American army plant in Tennessee.
The plant now has contracts worth $88 million for the production of the RDX and HMX explosives. That is strange, because those explosives are produced in this
country. The different types produced at the American plant are now being used in British warheads. A further $75 million contract will give Royal Ordnance the right to a 25-year exclusive contract to bring in production from around the world.Because we have signed the Ottawa convention, we have signed away our right to produce land mines. That is fine, but the American plant makes land mines. Does the Under-Secretary think that there is a contradiction if we buy ammunition, stores and facilities from a place that produces land mines? Are we not in breach of the convention that we signed? I ask the question, because I do not know the answer. I saw the effect of laying land mines when I sat by the Weser looking for the red peril.
I was a member of the Territorial Army, but now look at it from another point of view. It provides, and still provides, a battlefield replacement ability. It has been involved in the Gulf, Bosnia and most other places where the Regular Army has been. It will continue to do that. However, it has always faced the problem of obtaining the same equipment, training and back-up as the Regular Army. That creates problems, because the Territorial Army does not have the time to train soldiers unless there is a long run-in to an emergency. Emergencies tend to happen quickly these days and there is little or no preparation time to get our territorial soldiers up to a standard that allows them to replace units or participate as battlefield replacements. The same goes for replacements for engineers, doctors, nurses and any specialist. The majority of TA specialists look after 155 mm guns and many other things that the Army does not keep a corps to do. If we lose that capacity because people are not trained, that procurement system will disappear. We should encourage members of the TA to continue to perform that role.
I have just finished a book by Peter Hennessey, an academic, on the role of Whitehall from world war two to the end of the cold war. He argued eloquently that it is not possible to be over-prepared for civil defence. I suspect that we did not get it right in this country, but we never had to find out. We need to examine the future of home security much more closely. That means knowing about procurement and security and understanding where, say, ammunition comes from because we have only one chance to get it right.
I urge the Minister to defend the factory at Puriton. It is important to have a secure supply of ammunition. We must learn the lessons from the Gulf war when the Belgians would not give us ammunition. Those problems have not gone away. It only takes America to disapprove once and we will not get what we need to do the job of defending this nation.
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