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Ms Julia Drown (South Swindon) (Lab): I congratulate the Ministry of Defence on selecting MAN ERF UK as the preferred bidder for the biggest defence contract in Europe for 25 years. However, does he agree that some commentators have misunderstood what is happening? They have referred to the German parent company, even though MAN ERF UK is a UK company. It will get the best vehicles for our armed forces, and safeguard thousands of manufacturing jobs in this country. The company will also expand those jobs through the 15 major UK suppliers that it uses, and also at its headquarters, which is in my constituency.

Mr. Ingram: My hon. Friend makes a very good point. As ever, we are subject to bad press. In any procurement decision involving competition there will always be some disappointed companies. As a result, counter-arguments are often stoked up. My hon. Friend played a considerable role in encouraging the final decision, and will know the quality of assessment devoted to this procurement stream. However, although parliamentary pressure is always welcome, we do not always bend to it—nor should we, as we have to take
 
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account of a range of factors when we make a judgment. She has alighted on some of the key factors that made this decision appropriate. They include the role that the MOD plays in the UK manufacturing sector, and the vitality and size of this particular procurement stream.

This was a very big decision. It was right to take time with it and to consider all the available options. As a consequence, some companies were disappointed, but I pay tribute again to the contribution made by my hon. Friend to that debate.

Mr. Gerald Howarth (Aldershot) (Con): In respect of the support vehicle contract, will the Minister say whether the decision took account of the need to provide offset to the Austrians for the potential contract for the Eurofighter Typhoon?

Mr. Ingram: I have no knowledge of that, but if what the hon. Gentleman says is the case, I shall make sure that my noble Friend Lord Bach, the Minister for Defence Procurement, communicates all the available information. However, the hon. Gentleman should be aware that there are many sensitivities in commercial projects. Some of them can be revealed if the companies so agree, but often they do not want that to happen.

I do not want to say that the issue raised by the hon. Gentleman was a factor in this matter, but revealing all the parameters of a successful bidder means that all the parameters of the unsuccessful bidders must also be revealed. Is that what companies want? I think not. My experience tells me that we should give competitors as much information as we can. That information then goes into the public domain. However, it is always better to treat commercially sensitive information with care, for fear of affecting share prices. A lot of factors have to be balanced in these matters.

I was saying that the procurement process was not easy, and that there was no simple formula for success. I explained some of the aspects of the problem, but it is worth looking at what we are doing in all three services.

We aim to give the Royal Navy an enhanced expeditionary capability. That involves providing two new large aircraft carriers, with the joint combat aircraft providing a more powerful air group than we have ever had before. We will also provide new amphibious shipping for the Royal Marines and, for the Royal Navy, type 45 destroyers—the most powerful air defence destroyers ever built. We will also provide a new submarine fleet based around the Astute class of submarines.

Mr. Peter Viggers (Gosport) (Con): How many ships are under construction today?

Mr. Ingram: I do not have an answer to that, as I am not a walking abacus or computer. It would be nice if that figure were immediately to hand.

Mr. Keith Simpson (Mid-Norfolk) (Con): My hon. Friend knows the answer.
 
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Mr. Ingram: He may know the answer, but it is easy to ask a question when one knows the answer in advance. No doubt an answer will be winging its way here as we speak—or it may sail here—but I am tempted to analyse what is meant by the term "under construction". The hon. Member for Gosport (Mr. Viggers) is probably not familiar with the MOD's new approach to these matters, in terms of smart acquisition and de-risking. A broad interpretation means that we could say that those factors form part of the construction process. That is why I hesitate about being too precise, but we shall try and get him an answer before the end of the debate, or in the wind-up to be delivered by my hon. Friend the Under-Secretary. However, I should be grateful if he defined precisely what he means.

Mr. Viggers: I am happy to clarify my question. By using the term "under construction" I wanted to know how much steel was being cut.

Mr. Ingram: The question could apply to the Astute submarines or the Type 45 destroyers, or to the LSD(A)s—the auxiliary landing ship docks. If the hon. Gentleman wants to talk about the number of hulls involved, I do not think that I could tell him off the top of my head, but we will try and get the information.

Jim Sheridan (West Renfrewshire) (Lab): Could my right hon. Friend give an estimate of how many ships would be under construction if we still had a Conservative Government?

Mr. Ingram: There would fewer than under this Government. That is not an unreasonable question, given the cuts that the Conservative party recently announced that it would impose on some critical and key areas of defence spending. All of that needs to be examined. It is not my job to speak for the Opposition on such matters, but I think that it is fair to say that a Conservative Government would be less successful in its approach to defence procurement. As a result, this country would not be making the progress that it is making, or building the largest warship since world war two. That is a very important element, necessitated by the fact that we have to catch up with many of the non-decisions and cuts made by previous Conservative Governments.

Richard Ottaway (Croydon, South) (Con): I want to bring the Minister back to his announcement a few minutes ago in respect of the new carriers and air defence destroyers. In the old days, airborne early warning was used to give advanced radar coverage for the fleet. It seems that that principle is being abandoned. Will that result in a decline in our operational capacity, and mean that there is less time for defence of the fleet to be implemented? If so, why?

Mr. Ingram: A range of factors was involved in the judgment on these matters, not least among them the decision not to upgrade the Sea Harrier. It was accepted that our approach to the defence of the fleet involved an element of risk, but that is always the case with our armed forces. As we move towards new procurement, we cannot always maintain the old approach. Legacy
 
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systems mean that maintaining the old procurement approach has some very large cost elements. We must strike a balance as we move forward.

In addition, it is worth listening to what the First Sea Lord had to say on these matters. He rightly identified some of the risks involved, but he also highlighted what the new Navy will look like. That new Navy will be better and more agile, and more able to deliver what is required of it as part of an expeditionary force.

Moreover, we believe that we would always work in alliance with other countries in any major conflict. That belief has informed our approach to uplifting the capabilities of NATO and the EU. We want to ensure compatibility and interoperability between naval fleets, and to ensure maximum protection for fleets required to enter dangerous environments

It is true that risks are associated with our approach; when he winds up the debate, my hon. Friend the Under-Secretary may be able to give more specifics. I have given the Government's general view of this matter, and hope that the hon. Gentleman will accept the general thrust of my remarks—that we have set in train the biggest programme of warship building since world war two.

Richard Ottaway: That is all right.

Mr. Ingram: As far as the Government are concerned, it is more than all right. We have made a major commitment, and it is one for which previous Governments should have argued in preceding years.

We are giving the Army a highly deployable, flexible and effective mix of capabilities. These include the future rapid effects system. The FRES will be the central pillar, providing a potent medium-weight system able to project power rapidly worldwide. The capabilities also include the introduction into service of the Apache attack helicopter, which will provide a step change in our ability to engage land targets with agility and precision and at range.

We are enabling the RAF to strike with accuracy and devastating effect, as well as to deliver our forces rapidly and in strength. We are now taking delivery of Typhoon aircraft. The RAF is delighted with its performance and reliability so far, which have greatly exceeded expectations. Additional C-17 and A400M capability will further enhance our strategic lift. Those are just some of the big-ticket items, and I will touch on many more in my contribution.


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