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Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): The Leader of the House knows the importance that my constituency and businesses in the highlands and islands attach to regular and frequent flights between Gatwick and Heathrow airports and Inverness. The pathetically inadequate guidance that the Department for Transport sneaked out today does nothing to protect that. Will the Leader of the House ensure that the Secretary of State for Transport comes to the House to answer questions or to hold a debate on that important subject rather than hiding behind a written statement?

Mr. Hoon: I can also offer the services of my right hon. Friend the Secretary of State for Scotland. The co-ordination provided to Scotland by a Secretary of State who is responsible for both Scotland and transport is important. As one would expect, he takes seriously the arrangements for Scotland and communication. I am sure that he will be willing to deal with the matter when the hon. Gentleman raises it with him.

Mr. David Chaytor (Bury, North) (Lab): In Iraq today, citizens will vote in their general election and they will not use the first-past-the-post system. In the United Kingdom, the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly do not use the first-past-the-post system. In 2007, people who vote in local elections in Scotland will not use that system. We have the unfinished business of the reform of the House of Lords. Whatever the elected element, no one argues for the first-past-the post system. Is not it time that we had a debate in the House on the merit of the respective systems for national and local elections in England?
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Mr. Hoon: My hon. Friend regularly asks me questions. It is fair to say that his scientific knowledge exceeds mine and I therefore have to make a stab at an answer. However, I feel on stronger ground on this subject, which has fascinated some hon. Members for a long time. I was once a member of a commission that examined the various arrangements that could be introduced for proportional representation and, if I had an hour or two, I could probably go through them all. However, there is a clear debate to be held about the principle. It goes on and the Government take it seriously.

Adam Afriyie (Windsor) (Con): While Windsor is a relatively affluent constituency, its population is relatively elderly. The complex tax credit and benefit system causes a great deal of stress and anxiety for the elderly, the least well-off and the most vulnerable in our society. One in 10 people suffer from dyslexia or some form of learning disability and one in three will suffer from depression at some point in their lives. May we hold a debate on the tension, stress, anxiety and effect on quality of life of the tax and benefit system because it is tantamount to torture for the most vulnerable in society?

Mr. Hoon: The hon. Gentleman rightly raises an important issue in so far as it affects the elderly in our communities. Perhaps he did not do his view justice when he failed to compare the tension, stress and anxiety to which he referred with that caused by poverty, being unable to afford proper fuel through the winter and having insufficient income to provide for oneself. The Government have made a difference to each matter, whereas those who spoke for the hon. Gentleman on the Conservative Front Bench in the past opposed each change. It is therefore important, when we discuss help for the elderly, that he acknowledges the significant improvements that the Government have made in our time in office.

Bob Spink (Castle Point) (Con): May we have a debate on rail passenger transport to show the importance of increasing capacity on the rail lines? Perhaps in that debate we could consider the disgraceful position whereby the rolling stock removed from the c2c line has still not been returned to it. That scandal means that people in my constituency have to stand on the train for more than 40 minutes every day, which poses safety problems and is inconvenient for them.

Mr. Hoon: I am slightly surprised that the hon. Gentleman is so critical of the rail network. More miles are travelled by train today than at any time since the 1940s and more rail journeys are made than at any time since the 1960s. Our support for rail transport has been remarkably successful in improving the number of passengers who use our transport system. I hope that he will give us credit for that in future.

Mr. Mark Lancaster (North-East Milton Keynes) (Con): The Leader of the House knows of the growing unrest throughout the country about the Government's attempt to impose their sustainable communities plan on our towns and cities. Will he consider a debate on a sensible way forward, whereby the existing population in places such as Milton Keynes can accept or reject the plan through a local referendum?
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Mr. Hoon: I must have missed the growing unrest in Nottinghamshire, but I shall certainly look around for people taking to the streets in protest against these proposals. I personally have not had a single letter about the changes. I see no reason why the decisions need to be taken by local referendums. If the hon. Gentleman checks his own party policy, he will find that that practice is not particularly approved of by the Conservative and Unionist party. Nevertheless, he is clearly a spirited member of the Opposition who is not in any way bound by party policy. There will be clear consultation on the proposals, and I am sure that he will have the opportunity to make the views of his constituents known.

Mr. Andrew Mackay (Bracknell) (Con): Returning to the season of good will, we must all try our level best to help and advise those in difficulties. Does the Leader of the House agree that it would be a good idea to have an early debate on decapitation? On the Conservative Benches, my right hon. Friends the Members for Maidenhead (Mrs. May), for West Dorset (Mr. Letwin) and for Haltemprice and Howden (David Davis) could give some excellent advice to the leader of the Liberal Democrat party when he is under attack from the Liberal Democrats.

Mr. Hoon: I was waiting for the punch line, and I am grateful to the right hon. Gentleman for finally delivering it. I said earlier that this is a matter for the Liberal Democrat party, but this is the season of good will and I hope that that is extended to its leader.

Mr. Andrew Tyrie (Chichester) (Con): A few moments ago, the hon. Member for Somerton and Frome (Mr. Heath) asked whether we could have a debate on extraordinary rendition. What we got from the Leader of the House was astonishing complacency. He said that all the questions on that matter had been satisfactorily dealt with. What we are talking about is people being kidnapped around the world and transported to countries that practise torture. Some of those people have subsequently been released, and they have described the horrific torture to which they have been subjected. Condoleezza Rice's assurances on this matter have been shown to be completely hollow by the legal community in the UK. The Foreign Secretary has given assurances that he has been looking at records and cannot find anything. Of course he cannot find anything; the Home Secretary told me in answer to a parliamentary question that records are not kept once a transit has been completed. No wonder there are no records; they are not kept. Surely it is time for the Leader of the House to find Government time for a debate on this issue, on which there is now widespread public disquiet.

Mr. Hoon: I have made it clear, and I repeat, that the Government have set out their position and the United States Secretary of State has set out the position of the United States Administration. The hon. Gentleman should accept those indications as a recognition of the very detailed research that has been undertaken both here and in the United States. He should also accept that neither the United States Government nor this Government accept the idea that people should be transported around the world to be tortured. I hope that he will think again and withdraw that allegation.
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Defence Industrial Strategy

12.43 pm

The Secretary of State for Defence (John Reid): With permission, Madam Deputy Speaker, I should like to make a statement about the defence industrial strategy, which I am publishing today and which has been laid before the House.

The men and women of our armed forces play a vital role as a force for good in the world. I know that the whole House—and every complexion of party in the House—is very proud of the work that they do, in dangerous and demanding circumstances, whether in Iraq, Afghanistan, the Balkans or closer to home. We recognise that three elements are required for them to be the best in the world: the intellectual element, involving training, planning and doctrine; the physical element; and the element of morale. All those elements are important. Our armed forces can be this effective only if the Ministry of Defence and industry work as a team to provide them with the best possible tools to do the job, particularly in regard to the second element, the physical component of our fighting power, which involves equipment and capability.

The defence industrial strategy, which we released today, is the product of five months of concerted effort by Ministry of Defence civil servants, the armed forces, other Government Departments, industry and the trade unions. It has at its heart the provision of effective and capable equipment to our armed forces. On a personal note, I should like to pay tribute to Lord Drayson, who has overseen the production of this substantial document.

The House will know that we are in the middle of a substantial transformation, enabled by the sustained growth in the defence budget that has been a feature of each of the spending reviews that have been conducted since the Government came to power. We are procuring a series of major new platforms, including future aircraft carriers—on which I made a written statement to the House yesterday—Type 45 destroyers, new medium-weight armoured fighting vehicles, the A400M, the Typhoon and the joint combat aircraft, among others. This transformation has at its heart the delivery of truly network-enabled capabilities, linking sensors, decision-makers and shooters in a much more integrated way.

We expect these platforms to have very long service lives. The future business for the defence industry in many sectors will therefore be in supporting and upgrading the platforms throughout what we believe will be their long service lives, rapidly and incrementally inserting technology to meet emerging threats, fulfilling new requirements and responding to innovative opportunities. That is what we expect of a large section of industrial effort, rather than immediately moving to the design and manufacture of the next generation.

This will require rationalisation within the defence industry, particularly of over-capacity in production facilities. In some cases, sustaining the skills, technologies and industrial capabilities that we need will be challenging. Change is sometimes challenging and painful, but the one thing that would be much more painful than not changing in a changing world would be to refuse to change, and to find that redundancy and irrelevance had overtaken the product. While we may
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look overseas to meet some requirements, we will need to ensure that we in this country maintain military freedom of action and safeguard our national security. This degree of change and transformation—and the respect for future planning capabilities and the maintenance of our strategic safeguards—implies the   need for a comprehensive strategy for how we engage with the industrial base.

The defence industrial strategy, building on the 2002 defence industrial policy, articulates a strategic view of our defence requirements going forward by sector, and the principles that will underpin procurement and industrial decisions in the future. It communicates for the first time to industry and the City those skills, technologies and industrial capabilities that are assessed as being required onshore in the UK in order to sustain the armed forces' ability to operate with an appropriate level of sovereignty. It recognises that this will be possible only if we have a healthy, profitable and internationally competitive industry capable of responding to our requirements.

The defence industrial strategy also investigates how we might with industry address mismatches between planned activity and the work required to sustain desired capabilities. It will give industry and investors a much clearer idea of our priorities, allowing them to plan more assuredly for the future, which will be of benefit to the management, shareholders and workers in industry.

I now turn to the impact of the analysis that we have conducted on specific sectors of the defence industry. In the maritime sector, the Government are investing in the biggest naval shipbuilding programme that the Royal Navy has seen for two generations. The highly capable expeditionary fleet that will result will offer significantly enhanced military capability, well suited to the demands of the 21st century.

However, we need to recognise that the industry is currently fragmented—different companies and facilities undertake submarine build, surface ship build and support, even though the skills required often cross over. We must also face the fact that current levels of work, although huge by comparison with the recent past, will not last for ever. Once we are over the hump of the major reinvestment in new ships in about 10 years' time—that is how far ahead we are looking at the shortest end of our horizon—it will not be affordable to sustain excess industrial capacity in the longer term. That means making plans now so that we can keep the required key skills onshore in the UK.

For submarines, we are committed to maintaining onshore the ability to design, manufacture and support through life all aspects of that capability, which is so important to our national security. Cost growth in the area, however, is a real and persistent problem. We must control cost. To improve productivity, a new structure is required.

As my announcement on the future carrier in a written statement to the House yesterday demonstrates, we need to sustain the ability to design and integrate complex surface ships and to support and maintain them through life. A stable and healthy programme of warships and other complex vessels will continue to be
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built in the UK, and that will maintain and grow the high-end skills that we need. However, we might look to outsource some lower-end manufacturing offshore. That makes sense, not least in order to avoid the boom-and-bust cycle of sustaining or creating capacity for which there is no medium or long-term demand. That is also a much better arrangement for employees, providing the basis for more security and stability to develop and enhance their skills in long-term structured and secure employment.

In the air sector, the Royal Air Force is in the middle of a substantial re-equipment programme, introducing into service the Eurofighter Typhoon and looking forward to the arrival in the next decade of the joint strike fighter. Both those aircraft will last for at least 30 years. Our current plans do not, therefore, envisage the UK needing to design and build a future generation of manned fast jet aircraft beyond the current projects—that is some 30 years away.

That has unavoidable consequences, in forward planning, for the medium-term shape of the aerospace industry. We need to retain, however, the high-end aerospace engineering and design capability required to support, maintain, operate and upgrade Typhoon and the joint strike fighter through life, so that they are capable of tackling new challenges as they come along and incorporating new technology and improvements to meet those challenges. That is key to operating our aircraft in the manner that we would choose.

The aerospace industry has a critical role to play, and there will be substantial business opportunities for BAE Systems and other companies such as Rolls Royce and SELEX. I am pleased to announce that we have reached an agreement with Rolls Royce to provide future through-life support to the RB199 engine on the RAF's Tornado aircraft.

As the focus shifts from designing and building new manned aircraft towards supporting them through life, industry will have to make that challenging transformation. We are, however, committed—this is enshrined in the defence industrial strategy—to working with industry to manage that transformation with foresight to our mutual advantage. To that end, we intend to enter into negotiations with BAE Systems in the new year with a view to agreeing how best to work together—and with the many other key suppliers in the sector—to ensure that the key skills and capabilities that we need are sustained in a cost-effective manner. That work will be complex and arduous and will necessarily take time. It is essential, however, if we are to maintain stability in a period of transformation.

This is an exciting, high technology industry with a healthy future. I am delighted to announce that we will invest in a significant technology demonstration programme for uninhabited combat aerial vehicles. That will help us to better understand the potential military benefits of uninhabited aerial vehicles—sometimes referred to as unmanned aerial vehicles, I have been instructed to say—including combat versions.

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