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Mr. Gerald Howarth: My understanding is that our European partners are awaiting a decision from the United Kingdom. They are all ready to go. I understand from BAE Systems that the price has been agreed with the Government. What is the hold-up? My right hon. Friend is right to say that the Minister must give us an answer today.

Mr. Jack: I agree. My hon. Friend underscores my point.

I should be grateful if the Minister explained why pen has not yet been put to paper on the subject of the Hawk order for the RAF. The hon. Member for Bolton, North-East rightly emphasised the importance of the United Kingdom's decision to purchase that aircraft, yet I understand that the plane has not yet been ordered. A decision in principle has been made, but it would helpful to know when the order will be placed.

Another notable omission from the Minister's speech was the Nimrod MRA4. That may be, from the Minister's point of view, in the "All too difficult" column, but let us spend a moment reviewing MRA4 and its importance to the UK aerospace industry. It is currently the largest British aircraft project. In fact, it is the only large British aircraft project in construction. I would be the first to acknowledge that the birth of MRA4, representing as it does nearly 95 per cent. of a brand-new aircraft, has not been painless. There are huge lessons to be learned from the way the procurement exercise was undertaken, but with the successful flight of the first prototype from Woodford to Warton in my constituency, we know the aircraft will fly. We know also that two other prototypes studying the mission system are under construction at Woodford.
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This aircraft is a world-beater. Its mission system, which Boeing has helped us to develop, is the envy of the world. A fair chunk of what Boeing has done is going into the American P3 replacement aircraft. It has, for example, a 14-hour loiter capability, one of the largest bomb bays of any military aircraft in the world, and the latest acoustic suite and electronic surveillance systems. It is one of the best aircraft of its type and yet it was not mentioned specifically in the Minister's speech. It is of crucial importance to the aerospace industry, with 1,500 workers at BAE Systems at Woodford, Warton and Brough combined involved in it. There are 2,000 more in the supply base, and many small and medium-sized enterprises depend on it. So far, the most that the Government have said is that they need, or think they need, approximately 12 of these aircraft to carry out the capabilities of the existing fleet of Nimrod patrol aircraft.

Given the investment that the Government and the company have put into the project, it merited at least a mention in the Minister's speech to give us some indication of how the Government will take forward the future assessment of the project and when, if ever, they will decide to buy more than one, two or three. I do not know, but in terms of the future of our maritime patrol capability, and possibly, as it is a world-beater, even selling the aircraft to others, we should at least have had a mention of it in his speech.

I had the rather surreal experience in the middle of September of standing in the middle of the joint strike fighter factory in Lockheed Martin at Dallas Fort Worth. That aircraft plant is over a mile long. It is the home of the F-16 and the F-22, as well as now of the F-35. The reason why it was odd to be standing there was that I was having a discussion with representatives of 230 of our own aerospace workers who were there. They were admired for their skills and they told me how impressed the Americans were by our engineering capability. They said that the Americans were in awe of the fact that when British-made components came together, they fitted. There were no shims, no adjustments, no nothing. They did what it said on the outside of the can. They talked about their contribution, but then they said that they had already put their technological jewels on the table and that that was what had got them into the joint strike fighter project. They asked what was the future of the British aerospace industry, where were the new technologies coming from, and what would keep the skilled teams of engineers and systems designers together. The most that we have heard on that score in the Minister's speech today is that he welcomed the desire to secure a long-term future for the aerospace industry, or words to that effect, and he muttered something about the defence industrial strategy.

I welcome the fact that there is a much better dialogue between BAE Systems and the Government. In fairness, there is both listening and discussion. But unless that exercise, combined with the work of the future offensive air system project is to mean anything, we must have a clear statement first, that the Government regard the aerospace industry in the same way that they do shipbuilding. Shipbuilding is on their list of strategic capabilities that they feel that the UK should have. That lines up, as I understand it, with nuclear weapons,
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nuclear propulsion and encryption. But aerospace does not currently figure on the list of strategic defence capabilities that we should maintain in this country.

I can see, from having seen the size of Lockheed Martin's plant at Dallas Fort Worth, that we will never be able to rival the might of the American defence industry. But, to pick up on the points made by the hon. Member for Bolton, North-East, we have world-beating capabilities that should in future put us at any table, anywhere in the world where there is a project of partnership that would be to the advantage of the United Kingdom.

The Government must now state with greater clarity what they are doing to develop new technologies. What are the new technologies? What work are the Government doing in the materials development field? Which new electronic systems and manufacturing systems will they support? After Eurofighter-Typhoon and other current projects, we will not have an industry.

In conclusion, I turn to the JSF. I wholly endorse all that has been said in this debate about technology transfer and welcome the efforts on the ITAR waiver, but now is the time for the Prime Minister to call in the cards. I know from my discussions with the Foreign Secretary and a question that I put to the Prime Minister in the House that they take seriously the discussion about that matter with President Bush. As America's most loyal ally, it is time for America to come to our aid and make certain that meaningful discussions to evaluate the RAND Europe report on the JSF in Europe are pursued.

I say that because the report offers the prospect of a final assembly and check-out line for the up-to-150 aircraft in which the Government have an interest. There is certainly the prospect of a maintenance and repair unit for those aircraft in this country, which is a necessity. In addition to servicing, such a unit could also undertake lucrative upgrades over the aircraft's potential 20-year lifespan.

The production run in the United States could exceed 2,800 planes, and when I visited Dallas Fort Worth, Lockheed Martin indicated that it might be subject to supply constraints. If that is the case, it is incumbent on the Government carefully to evaluate—perhaps on behalf of or in concert with other European countries which are interested in the aircraft—the possibility of locating the final assembly and check-out facility in the United Kingdom, hopefully at Warton. A facility to deal with maintenance and repair makes eminent sense in the long term. If technology transfer does not occur, however, all the possibilities for British industry and the JSF identified in the Government-funded RAND Europe report will not happen, because we will not get the required technologies.

The JSF is a vital project and we have embedded our best technology to date in it. Given that we may want to develop the aircraft in the future, I back the attempts to achieve technology transfer. However, I hope that the Government will indicate whether they will engage in meaningful discussions with the United States about the long-term planning for that aircraft.

I have briefly covered the major procurement projects that matter to BAE workers, not only in my constituency but across the north-west and throughout the country. Unless long-term decisions are taken in the
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context of the future offensive air system about where Britain's military aerospace industry is going when the JSF has been built, the Eurofighter has been delivered and decisions have been taken about the Nimrod MRA4, we will not have a meaningful aerospace industry in this country, which is totally unacceptable in military and, indeed, economic terms.

4.28 pm

Ms Dari Taylor (Stockton, South) (Lab): I take great pleasure in having an opportunity to contribute to today's debate, which I have enjoyed.

Appropriately, I shall start with the 2004 spending review. Although all hon. Members are concerned about how much we are spending and how effectively we are spending it, it is also important to remember that we are spending. The defence budget will increase by some £3.7 billion over the next three years, which is something to be satisfied with. I say to the Minister that I will always want more, but I am pleased that the Government have put the money up front.

We should acknowledge that the average real terms increase in spending of 1.4 per cent. a year, building on the additional investment in defence in the 2000 and 2002 spending reviews, gives us a sense of satisfaction and security. We are putting our money where it is required to achieve the best equipment and kit for our armed forces. That represents seven consecutive years of planned, real-terms growth—the longest period of sustained growth in planned defence spending for more   than 20 years. That is a record of which to be proud.

My knowledge of defence and the defence industry started with my membership of the Select Committee on Defence, which represented a tremendously valuable opportunity for me. During that period, I met many of our troops serving in the Balkans, in Kosovo and in parts of Europe where they were playing high-quality, creative and professional roles. I was never more proud than when I met them in Banja Luka and they explained how they were helping to maintain peace. To be honest, I often felt that I would love to be a member of the armed forces. My back went straight and I was always wanting to stand to attention, because although what they were delivering was not known about or acknowledged by many people in Great Britain, it was superb in terms of what it achieved.

I felt the same when I met our armed forces as members of NATO involved in partnership for peace. They were committed to involving others in working together in partnership better to deliver change and to understand one another, and working together better to achieve a peaceful Europe. That was very pleasing.

As we are talking about procurement, I shall lean on the fact that I was Parliamentary Private Secretary to my hon. Friend the Member for Kirkcaldy (Dr. Moonie) when he was Minister with responsibility for veterans—that was a tremendous experience—and to Lord Bach, Minister for Defence Procurement. That gave me a keen insight into the Royal Navy. That was not because they wear the smartest uniforms, although they do—many hon. Members have teased me about that—but because of the way in which they deliver a service. Through the Defence Committee, I gained
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knowledge of Portsmouth, Plymouth and Barrow, as well as keeping a sure and clear eye on my own River Tees and River Tyne.

I was staggered when the hon. Member for Gosport (Mr. Viggers) told the House that Swan Hunter had won the contract to build part of the aircraft carrier merely to provide it with work. That was a straightforward insult, and I hope that he will have the decency to come to the House to withdraw it. I had to ask him to repeat it because I could not believe it the first time. Swan's has 100 years of experience and a reputation as an excellent builder of naval ships. I got to know the men—the boilermakers and engineers—there when I worked in trade unions in the northern region. Whenever I went to Portsmouth or Plymouth or to parts of the world where commercial contracts were being put together, I was proud that men from the north-east regularly made themselves known to me. They were often in the majority among the construction force. Let nobody in this House say that we won the contract in order to provide jobs. I am not trying to fool anybody—of course I want jobs so that my community can work—but I would not want a contract for the Royal Navy to be built by sub-standard people, as was implied by the hon. Member for Gosport.

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