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Mr. Nicholas Soames (Mid-Sussex) (Con): Correct.

Mr. Howarth: My hon. Friend is nothing if not fully conversant with the most up-to-date and modern technical gizmos. With an hour's briefing, I am sure that he will be able to fly the Typhoon.

The Galileo project represents a potential source of growing transatlantic discord. It has serious military potential. Ministers insist that they will resist any attempt by France to give Galileo a military application. On 7 June, the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson), told European Standing Committee A that it

Is that also the intention of the MOD?

Furthermore, the Minister will have seen last weekend's article by Christopher Booker in The Sunday Telegraph, which referred to a discussion at the Royal United Services Institute on 11 October when the
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question was posed whether, in the event of a conflict involving the US, the EU would agree to deny Galileo facilities to America's enemies. I understand that that is the case, as I have been told in a letter from Astrium. At that meeting, when EU officials replied that they would not be prepared to turn it off, US officials unsurprisingly responded that in such circumstances the US would be forced either to jam the Galileo signal or destroy Galileo's satellites.

There is a further cause of concern in that China has been admitted to the project as an equity partner. It will therefore have access not only to Galileo's facilities but to the technology, and is reported to have said that it will resist any US attempt to deny access to Galileo—whatever that means. These are extremely serious issues on which the country is entitled to know the views of the MOD, as well as the Department for Transport.

There are, of course, aspects of defence policy with which we agree, and we recognise that there are real difficulties with which the Government and their Ministers have to wrestle. However, they have chosen to deploy Britain's armed forces more frequently and in greater numbers than for decades. It is their duty to ensure that the men and women of our armed forces have the right equipment and that they sustain Britain's defence industrial base to ensure that we have security of supply. We believe that the overwhelming evidence is that they are failing to deliver. Their failure to invest in research will have deeply damaging consequences for Britain's defence industrial base in years to come, their reliance on new technology gizmos at the expense of numbers of tanks, ships and aircraft will expose our armed forces to real risk, and their inability to manage the procurement process has proved costly to an already stretched defence budget.

It is time for a new Government—a Conservative Government—who are committed to ensuring that our armed forces go into combat properly trained and equipped. That is what our superbly courageous and professional armed forces need, and that is what I hope that the people of Britain will ensure next year that they get.

Mr. Deputy Speaker (Sir Michael Lord): Order. Before I call the next speaker, I remind the House that Mr. Speaker has placed a 15-minute limit on all Back-Bench speeches, and that applies from now on.

2.55 pm

Mr. Bruce George (Walsall, South) (Lab): I came to the Chamber with three speeches. Plan A, if the Conservatives were forgetful of their failures over the years, was to repeat my classic A to Z of Tory procurement foul-ups. The hon. Member for Aldershot (Mr. Howarth) almost forced me to do so. Plan B was a run-of-the-mill speech on defence procurement. I am well able to give run-of-the-mill speeches, but I resisted that temptation. Plan C was what I would say if the Minister attacked the Defence Committee. So it is going to be plan C.

The Defence Committee's report on defence procurement was published at the end of July. It received considerable press coverage, although not as
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much as the Ministry of Defence's riposte, which was a little over the top. Having read it, I was reminded of the famous quotation of Robert E. Lee, who once said:

I shall therefore try to explain our motives and purposes.

In fairness, the extent of the current defence procurement programme and budget is formidable in terms of ensuring that our armed forces are among the best in the world. The cost of the top 20 projects for 2002–03 was in excess of £50 billion. I am very pleased about that. We have already heard about the joint strike fighter and Typhoon. In our much maligned report, we listed the top 20 projects; it is an impressive list. We welcomed the fact that the Government are spending more on defence. I do not believe the figures cited by the hon. Member for Aldershot. The Government are giving procurement a great deal of attention. Much of what they have done is to be supported, and we did so in our report.

The procurement of high-tech, cutting-edge equipment is not easy, but lessons from the past need to be learned and acted on. Some of our previous reports pointed to the risks if equipment programmes are not managed properly. Those reports go back years. I have been on the Defence Committee since 1980, and we have produced endless critiques of the defence procurement process. In our report on the strategic defence review, we discussed the major inquiries—the Gibb-Zuckerman in 1961, Downey in the mid-60s, and Levene in the mid-80s—and looked into smart procurement. Those were all serious attempts to do something that we have never done as a country—to produce defence equipment effectively, on time, and to cost.

We are still striving for that, and progress has been made. In our highly-criticised report, we said that the system is not yet succeeding—indeed, there have been several failures. The report was based on our own methodology. We have a full-time member of staff seconded from the National Audit Office, we undertake an annual review of the defence procurement process, and we read the NAO material and all sorts of documentation. Many of our criticisms came from the chief of defence procurement. How can we be criticised for citing the senior guy in the procurement process apart from the Minister? That is indefensible.

We pointed out that the top 20 defence procurement projects for 2002–03 had experienced in-year cost increases totalling £3.1 billion and that those projects had slipped a further 18 months beyond their expected delivery date, with nine months' slippage occurring in 2002–03. However, the report highlighted several good things, including the successful de-risking of the 2087 sonar radar project—2087 is not the projected in-service date. We complimented the decision to extend the assessment phase of the future carrier programme and the second tranche of the Eurofighter Typhoon aircraft to multi-role.

Despite claims to the contrary by the MOD, this was a fair report. We welcomed the fact that the MOD had recognised the importance of establishing an industrial strategy to sit alongside a defence industrial policy. We said that the decision to procure a Hawk trainer aircraft was sensible. However, we have a key role in examining expenditure, administration and policy, and we do that
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on behalf of the taxpayer. It is not our job to be a cheerleader for the MOD and to ignore poor performance where it occurs.

The Government's response, published in October, called our endeavours "misguided, disappointing and flawed". It accused the Defence Committee of being selective in its use of evidence and said that it had missed an opportunity to be constructive. What did we say? First, the performance of the Defence Procurement Agency in 2002–03 was "woeful". That was a slight mistake. The Clerk could not read my handwriting. I wrote, "The performance of the Defence Procurement Agency was wonderful." He is on his first written notice, and he had better learn how to read my writing. Secondly, we said that

We also said that the MOD had only recently taken action to improve performance on major projects and that a fear culture existed in the DPA. The Government's response, it is fair to say, did not accept those specific conclusions.

I intend to respond to some of the more extreme claims made in the Government's response in due course, but first I want to highlight the fact that in a number of areas the response agreed with what we were doing. The hon. Member for Aldershot, a good personal friend, despite his politics—he claims that he is to the left of me, but I deny it—commented on the ITAR waiver. He will remember that we lobbied very hard against the "buy American" Act, and for the ITAR waiver and the helicopter sale for the President, so we have been helping the MOD as far as we can.

The Government's response welcomed a number of the Committee's other conclusions, some of which were highly critical. When the Government introduced smart acquisition, their objective was to procure equipment faster, cheaper and better. The Committee welcomed that initiative and looked forward to the expected improvements. Some of those improvements have been obvious; others have not.

In addition to the poor headline performance figures for 2002–03, the most disappointing findings from our inquiry were the evidence provided by the chief of defence procurement, Sir Peter Spencer, head of the DPA. Sir Peter had commissioned an independent review of the DPA, referred to by the Minister, and specifically of the implementation of the smart procurement initiative. He told us in an evidence session that the findings from the review included the following: the underlying causes of poor performance were endemic; only one of the seven key principles underlying smart procurement had been implemented in full; there was a misunderstanding throughout the MOD as to what project leaders were expected to deliver; and some of the projects that had commenced following the introduction of the smart acquisition process were showing signs of problems.

If those were the findings of Conservative Central Office, we would quite rightly dismiss them, but they were the result of a report commissioned by the MOD. We are castigated for echoing some of those points. If we were selective in our evidence, as the MOD claimed, it is because we drew on the evidence provided by the head of the DPA, part of the MOD, and the findings of
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an inquiry commissioned by the MOD. Why are we considered to be the aberration? Why are others trying to be difficult with the MOD?

I shall give a few quotes. The first states:

Where did that come from? It came from the Public Accounts Committee's comments on the major projects report. It gets all its information from the National Audit Office. The second quote states:

Was that the Defence Committee? Was it The Daily Telegraph? No, it is the foreword to the DPA's annual report and accounts 2002–03.

One more quote:

Who said that? Was it the hon. Member for Aldershot? No, it was the chief of defence procurement in an interview published last week in Jane's Defence Weekly.

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