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Mr. Wilkinson: I am sorry to intervene yet again, but could the hon. Gentleman explain a little more clearly how he imagines that defence PFI contracts can be internationalised? They are, of their essence, already extremely complex financially. To organise them nationally is hard enough, so how will that be achieved multinationally? Can the Liberal spokesman enlighten me?
Mr. Breed: I am certainly not saying that that will be easy. The experience of the initial stages of the PFI in this country is one of enormous complication, and a good deal of money was expended for no purpose whatsoever. However, the maturity of those schemes nationally has enabled us to move forward. Greater trust has been shown by both sides in such contracts. In fact, the arrangements have meant that contracts have been more possible, and there has been a proliferation of PFI projects. I do not believe that that excludes the opportunity to conclude international PFI projects. Such projects will be more difficult to establish, but unless we can begin to crack the practical difficulties, we will not obtain the sort of savings that many of us want to achieve, so ensuring that our defence expenditure remains high and that we get real value for money.
In conclusion, of course procurement policy could be improved, and the budget available will reach its limits at some point. I do not know what are those limits and we do not know what value for money calculations are undertaken for each project, but it is right to call on the Government to examine in detail radical ways to find cheaper options, and they should do so soon. That is important not only for the sake of value for money—that is obvious—and maintaining capability, but to forestall future battles that will, no doubt, ensue over priorities for the defence budget. Currently, the tasks undertaken by our armed forces are principally those of nation-building and peacekeeping. Keeping enough troops under arms and keeping them well trained, supplied and well looked after is a priority in that effort, but that priority should not suffer in the future because the MOD refused to think innovatively about its procurement programme now.
3.16 pm
Laura Moffatt (Crawley): It is incredibility important that we are talking about the resources and the equipment that our armed forces need and deserve. This subject is of particular interest to me, as I was a member of the Defence Committee in the 1997–2001 Parliament, when the whole idea of smart procurement was first mooted in the strategic defence review. Of course, we now know it as smart acquisition. It has been incredibly interesting to see that process not only from the House's perspective but in relation to the way in which companies in my constituency have risen to the challenge of smart acquisition. There is no doubt that it is a challenge to them, but it is a challenge which, for the most part, they relish. They enjoy better relationships with others in the industry and with the Government. That has to be the way forward for the British defence industry, and those companies completely understand that and know that that must be part of their thinking in ensuring that their products are of the highest quality.
I want to say a little about the enormous strides that have been made in the defence industry. Hon. Members on both sides of the House take defence seriously. We may argue about defence budgets, but Labour Members know that the defence procurement budget has served us extremely well and will continue to do so, although we have to consider extremely carefully what sort of equipment we will need in future, and to be very much aware that this is a changing scene.
We know, too, that our most precious defence commodity and asset is the people in the armed forces themselves. When we talk about the equipment that they need to do their job properly, it is important that we recognise their commitment. That was brought home to me just last week, when Lieutenant Colonel Paul Mitchell, the commanding officer of 103 Royal Electrical and Mechanical Engineers, Territorial Army centre in Crawley gave me a briefing on the more than 60 members of that TA centre who are or have been in Iraq in the past few months, and described how those people—both men and women—are responding to the enormous challenge. In fact, they do their procurement themselves, since the REME are, of course, involved in recovery and engineering. They have been working closely with the Iraqi people and the Iraqi forces that are able to work with the allied forces. They are recovering an enormous amount of the equipment and vehicles that have been left behind by Saddam's forces, and getting them on to vehicles back to Basra to have them refurbished, made good and made ready for a new Iraqi force. That our forces are assisting in that process in Iraq today is an incredibly powerful thought, and it was a privilege to hear of their work. Having gone through testimonials of people who are there and looked at photographs, it struck me that they did not complain about their equipment: they were comfortable and happy, and felt that they were being treated properly. Certainly, from the perspective of my Territorial Army centre, that was important.
I want to say a little about equipment for the TA and reserve forces. We often become understandably obsessed with big procurement issues and vital, major projects involving our regular forces. It is essential, however, that our reserve forces have the equipment that they desperately need to do the job we ask of them. Their role has changed so much over the years—they are
now very much at the forefront, working alongside our regular armed forces, and they need equipment and training. Procurement must refer to them and to making sure that they have all that they need. I hope that the Minister will respond on that issue, because we must recognise the role of our reserve forces, and that procurement of the equipment that they need is as important as it is for our regular forces.We would not be doing our jobs properly as Members if we did not stress—as the hon. Member for The Wrekin (Peter Bradley) did powerfully—the importance of defence jobs in our constituencies. I want to talk about a couple of programmes that are very important to the well-being and livelihoods of my constituency of Crawley. Thales, a company of which everyone here will be aware, has 2,500 of its 12,000 UK jobs based in Crawley. That company is doing much of the important work of which many Members will be aware—procuring major projects such as the future strategic tanker aircraft, Watchkeeper, and the simulated vehicle training system. It therefore has an enormous interest in ensuring that the Government make the right procurement decisions, and I hope to spend a few minutes putting the case.
Thales is very important in Crawley. People may ask what is the need to try to secure more jobs and to consolidate jobs in communities in towns like mine, which have very low unemployment rates. Members who are in the same position in their constituencies will completely understand. Given that these jobs are related to good apprenticeships or degree entry and provide a wide range of employment opportunities for our young people, I hope that Ministers will appreciate why we fight like alley cats to ensure that they come to our constituencies. In Crawley, which has Gatwick airport within its boundaries, it is easy to see how much the south-east relies on that airport. Those are good jobs, too, but they are related to the retail and service industries industry. If we do not have a wider range of opportunities, our region will inevitably become over-reliant on one area of investment and economic activity, which is huge mistake. That is why it is incredibly important that we support companies in our constituencies that produce what are excellent materials for our armed forces.
One thing that I would say without hesitation is that our armed forces want the very best they can get. The Minister was correct to reiterate that it would not be right for us to do favours to companies in the UK. The reality, however, is that the British defence industry is now one of the best, and there is no question but that it can rise to the occasion. I firmly believe that the smart acquisition process has made that happen and has pressed it to the challenge, and it is important that we reward it for the work that it has done. It is easy not to appreciate exactly what the industry has gone through. It has gone through enormous change, in terms of accepting the risk, and is now able to say that it is truly partnering Government. As I mentioned that members of the reserve forces from the south-east region are in Iraq, it is also important to say that people from Thales are in Iraq and have been there since day one of the offensive. At the beginning, there was huge nervousness about having such a partnership deal to supply our armed forces. The Defence Committee was nervous that it would not work, and that the people concerned would
not have the military ethos to rise to the occasion. I am told from all quarters, however, that the partnership has been extremely successful. We need to thank those people who are not members of our armed forces but who are doing such a good job for us in those scenarios.We must respect and understand the fact that the industry has responded. We desperately need an active and lively defence industry in the UK for our economy as a whole, and particularly the south-east. We need to support the companies that produce top-of-the-range equipment for the armed forces whom both sides of the House support, and for whom we need to ensure that the very best equipment is available.
This is an incredibly important debate. It is right and proper to make our stand for our constituencies, but we must understand that today's procurement process is leading to a much better system of making sure that we get the best equipment for our UK forces, which must be right.
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