Examination of Witnesses (Questions 340
WEDNESDAY 8 MAY 2002
WALMSLEY KCB, AIR
KCB, AFC AND MR
340. Yes, in relation to the front-line activities.
(Lord Bach) I am going to ask Sir Robert to start
off and then I am going to come in on this.
(Sir Robert Walmsley) I think characterising a military
capability as a provision of a service, by which I mean training
people and similar because that is the provision of a service,
providing a hosepipe in the sky is right at the other end of the
spectrum, that is the air tanker process, and providing you can
specify what you want the thing to do in terms of a service, you
have to think very carefully about whether or not you can PFI
it. I used to have a very simple rule which is that if it does
not move, you can always PFI it. If it moves a bit near the front
line, you can think about it and if it is in the front line, you
should not do it. That is sort of something you can explain to
thousands of people and they can get it.
341. Well, I am sorry, I might be a bit slow
because I do not get that! In terms of, for example, a fire service
which I think Mr Knight raised with you, the issue about whether,
for example, in deployed operations in Afghanistan, would it be
appropriate to have a private PFI delivery fire service which
is a front-line operation?
(Sir Robert Walmsley) I think what I said was that
if it moves, you have to think about it carefully, but if it is
in the front line, and a nuclear-powered ship would be a nonsense,
in my view, as a PFI proposition, and one reason was you could
(Sir Robert Walmsley) You could not specify it as
a service. What on earth did you want from it? This thing is full
of sailors, but what service are they providing? You do not know
and you cannot really specify what service they are providing.
343. It might be a cargo ship powered by nuclear
in the Arctic, and that is legitimate.
(Sir Robert Walmsley) I meant a nuclear-powered warship.
There are no non-warship nuclear-powered vessels in service today
that I am aware of. There have been.
344. There have been certainly.
(Sir Robert Walmsley) And they all fluffed it.
345. In terms of an operation, are you talking
about the delivery of fuel, for example? Obviously in a combat
situation where you have got fuel being delivered in any operations,
is that PFI-able on your criteria?
(Sir Robert Walmsley) Well, I think we have explained
that it did not work, so we tried it and it did not work. I say
that is something which is going near the front line, it was worth
exploring, industry thought it could work and as we looked into
it more and more deeply, we decided it could not and I think we
were right to stop, so the answer is we tried it and we did not
make it work.
346. So is that an example of one which you
(Sir Robert Walmsley) Yes.
347. I am not very clear yet as to what you
mean by front line.
(Sir Robert Walmsley) Fighting.
348. I am aware of that, but I mean in terms
of where the PFI line is drawn. In terms of, for example, again
the last point about fire services, would that be an appropriate
use of PFI, a private company, or let's give another example of
(Sir Robert Walmsley) There is no way I would contradict
what the Minister said on the fire service.
349. Let's change it slightly and let's say,
for example, catering services in Afghanistan or anywhere else
where there are operations.
(Sir Robert Walmsley) What I was trying to say was
if they are not in the front line, but they are deployable, you
need to think about whether PFI could be made to work. If they
never move out of the United Kingdom and they are brick buildings,
it is pretty obvious it is PFI. If it is right in the front line
and involves fighting, how do you specify that as a service? You
cannot, so we should not waste time trying to pretend that things
like nuclear-powered submarines could be provided by a PFI.
(Sir Robert Walmsley) Well, I just said we would need
to think about it and look at it in detail. The Minister opened
this morning by explaining the fact that
351. Wait a minute and answer the question rather
than actually trying to avoid answering it. The fact of the matter
is I accept what you are saying in terms of catering facilities
and things which never move out of this country. For example,
you know when you have deployed forces abroad, a large element
of extra support in there is catering. Would you, for example,
envisage a situation where you could deploy forces abroad and
the catering was provided under a PFI?
(Sir Robert Walmsley) It would depend what they are
deployed for. It is quite clear to me that static forces deployed
in buildings in countries, for instance, the United Nations forces
in Cyprus, there is nothing wrong with relying on contractors.
If you are going to say that the Royal Marines currently deployed
in south-eastern Afghanistan today can have a PFI contractor climbing
up the mountain and providing them with bacon and eggs, then I
find that preposterous.
352. Well, let's go back to Bagram air base
which Jim Knight mentioned. What about providing breakfasts at
(Sir Robert Walmsley) I just cannot answer it because
it depends on the circumstances at Bagram today. My own instincts
are that we would think pretty carefully about that. Cooks, as
is well known in the Army, are still capable of firing rifles
and defending themselves. The idea of private contractors being
near fighting I think is pretty dodgy.
(Lord Bach) Yes, I share that view and I think Sir
Jock wanted to come in.
(Air Marshal Sir Jock Stirrup) Well, I just say that
it is a complex issue and it is to do with geography and distance.
I might also say to you that it is to do with time. To take your
specific question about caterers, we absolutely have to have some
uniformed caterers to look after these people in those sorts of
circumstances and we have done a lot of work on that in the past,
on the numbers required, but we do not need them all to be uniformed
caterers. So, for example, you could deploy regular servicemen
at the start of an operation, but as it then becomes enduring,
then you could replace them with some kind of contract, perhaps
in theatre, and move them elsewhere to where they are needed and
that is precisely what we have done.
353. So the answer is yes.
(Air Marshal Sir Jock Stirrup) The answer is yes,
in some circumstances.
354. I think it is really a political issue.
We have heard Sir Jock and we have heard Sir Robert and we have
heard about his gut instincts which are usually quite good, but
it is not a decision to be made by Sir Robert Walmsley or Sir
Jock Stirrup; it is a political decision. As this issue is going
to crop up time and time and time again, I think it would be very
helpful, Minister, if you could drop us a rather detailed note
as to what you consider to be sort of value for money, appropriate,
what you consider the battlefield to be, what you consider the
distinction should be between those who are engaged in combat
and those who are not engaged in combat. It seems to me that in
the Thirty Years War, you could see pretty clearly who was fighting
and who was not, but in this modern era of war or non-war, because
we have not declared war for a hell of a long time now, it is
very indistinct and it seems to me that if it is indistinct, then
this gives opportunities for those who wish to see the private
finance initiative process pushed further the opportunity of so
doing. Now, I know you cannot give the definitive answer, but
certainly as there have been a number of private finance initiatives
where it has been questioned as to whether the private sector
is relevant for this programme, I think it would be immensely
helpfuldon't provide it nowif you could please give
it some thought and perhaps you could tell us the guidelines that
you are operating to and instructions you have given to Sir Robert
et al as to what is acceptable for the private sector to
be involved in and what is not
(Lord Bach) I think you are absolutely right, Chairman,
that this is a political question, although I am not sure that
I am convinced there is not a definitive answer to it, if that
is not nonsense, and I do not think it is. I think guidelines
is probably the best that can be done and we have to take each
case on its merits. You know clearly on the one side what is inappropriate,
I think everyone would, and we want on the other side what is
clearly appropriate, but it is that middle ground
355. Which is quite large.
(Lord Bach)which may be larger than most middle
grounds in this particular case, so I agree with you.
356. Absolutely, so if you don't mind, it would
be really helpful to us.
(Lord Bach) I hope it will be helpful and we trust
and intend it to be helpful and we will certainly do it, but I
am not sure that it will clear up all the questions.
357. And then also, if you don't mind, you can
tell us what value for money means because when you deal with
military matters, I can think that a lot of things cannot be addressed
in terms of value for money because fighting a war, defending
your national territory is not always amenable to an accountant's
(Lord Bach) Well, I would like to say something on
that, if I may. Value for money does not just mean, even if its
name implies, that all you think about is, to use an old-fashioned
phrase, pounds, shillings and pence. It means value. It means
you have to look in the round to see what is the best value for
British Armed Forces in a particular state and I do not want this
Committee to have the impression that all we are concerned about,
which is clearly not accurate, that all we are concerned about
is what pounds, shillings and pence we are going to have to spend.
It is not true.
Mr Jones: Can I pick you up on that point, and
I do look forward to this explanation and it will obviously be
some great, huge tome in terms of explanation because what we
have so far had is as clear as mud. In terms of value for money,
and you have said it is not just about pounds, shillings and pence,
there has obviously got to be a crossover between the Armed Forces
providing the service and obviously the interface with a private
contractor. If I can give you one example, catering again, but
don't get the impression that I am actually obsessed by catering
Chairman: I might be, but Kevan Jones
358. Can I mention one incident which occurred
last summer when Jim Knight and I were on HMS Ark Royal and one
of the issues which we asked a senior officer there about was
to ask him what were the main problems. He was saying that the
real problem is not recruitment, but retention. I think Jim asked
him what area of retention and he was talking about cooks and
I said, "Well, what is the real problem with cooks?"
and he said, "Well, we train them, and we can keep them for
so long, but we cannot keep them after a certain period of time
because you cannot rotate between ship and shore, as they used
to, because on shore a lot of the caterers are now PFI".
Is that not an example where on the accountant's bottom line you
might be saving money, but it is actually costing you more because
you are losing people from the Armed Forces and having then to
(Lord Bach) It might be an example of that, yes.
(Air Marshal Sir Jock Stirrup) I think I can give
a pretty direct answer to that which is that that was precisely
the situation, going back to my previous experience, that we found
in the Air Force and, as a result, what we have done is recruited
more service chefs and redressed the balance between servicemen
and civilians for precisely that reason.
359. That could occur in other areas though,
could it not, where if for operational purposes you need to rotate
people, you limit yourself by PFI? Should that not be something
that is taken into account before actually deciding whether you
have a PFI contract?
(Air Marshal Sir Jock Stirrup) It is, it is.