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The Parliamentary Under-Secretary of State for Defence (Mr. Don Touhig): I welcome the hon. Member for Forest of Dean (Mr. Harper) and congratulate him on his first Front-Bench performance. He mentioned at the start of his remarks that my right hon. Friend the Minister of State made a statement today. Yes, he made a written statement on the conclusion of the consultations on the Defence Aviation Repair Agency. As all hon. Members will know, he came to the House, faced hon. Members and answered questions when he announced the changes a while ago.

This has been a valuable debate. The House has dealt with the complex issues of defence procurement in a very different context from previous years. My right hon. Friend the Minister of State opened the debate by describing how the nation no longer faces the dangerous but relatively predictable threat that we faced in the cold war. The new threats facing our armed forces are no less dangerous. We are justifiably proud of our armed forces and the work that they do throughout the world. We ask them to take on major new challenges, including fighting international terrorism, and in doing so many of them, as we have seen in the past few days, pay the ultimate price for the service that they give to our forces and our country. I am sure that every hon. Member joins me in paying tribute to them.

The defence industrial strategy outlines a range of measures to safeguard the critical capabilities of the armed forces, now and in the future, thus ensuring that
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we deliver lasting improvements to the defence procurement programme in conjunction with industry. I have mentioned the context in which we are doing so, and I shall look at the record that we inherited in 1997, to which my right hon. Friend referred in opening the debate.

In 1997, the year when the Conservative party was last in government—it will be a long time before the Conservatives are in government again—the NAO found that their top 25 defence procurement projects were likely to cost over £3 billion more than originally forecast. We take no lessons from the Opposition on the problems of defence procurement. That is the shocking legacy of incompetence that they left us. This week, we launched the most powerful destroyer in the history of the United Kingdom—the most powerful destroyer that we have ever built. All they launched when they were in government was a raft of cuts.

The defence industrial strategy will deliver reform across the entire defence procurement system, building on smart acquisition principles. We want to ensure that we can respond to the rapidly changing strategic and operational environment by exploiting the opportunities offered by technology and innovation.

Mr. Jack: Will the Minister give way?

Mr. Touhig: I will not give way. I hope that the right hon. Gentleman will forgive me. I would normally do so, but I have very little time to respond.

A number of important contributions have been made, and I will try to respond to as many as I can. The hon. Member for Aldershot (Mr. Howarth), who led for the Opposition, was rather tetchy—which is unusual for him—when he got to his feet at the opening of the debate. We need no lecture on procurement, when our record is compared with that of the Conservative Government. I thought he was a little thin-skinned today. Perhaps we could adjust the defence industrial strategy procurement policy to buy him a thicker skin; he might then be happier to come here in future.

The hon. Gentleman went on to say that the Conservative party wanted to spend more on defence research. I am very glad about that. He stood at the last election with a manifesto commitment to cut £2.6 billion from the defence budget. What would that have done for defence research?

Mr. Gerald Howarth: Will the Minister give way?

Mr. Touhig: Will the hon. Gentleman please forgive me? I am trying to respond to all the hon. Members who have contributed to the debate.

Mr. Howarth: All I would say is that we gave a specific undertaking that we would have spent at least an extra £50 million on defence research.

Mr. Touhig: As the Good Book says, by their deeds "ye shall know them." We know the Conservatives' record when in government.

The hon. Gentleman referred to Qinetiq and said that there may be a problem in not getting a good deal for the taxpayer. Taxpayers are benefiting from our decision to
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dispose of part of Qinetiq. We will get the same stake as Carlyle. The MOD owns almost twice as much as it does, so our income will be twice as large as a result.

My right hon. Friend the Member for Edinburgh, East (Dr. Strang) spoke for the whole House when he paid tribute to Rachel Squire. She was well thought of and well respected. There was a great deal of affection for her on both sides of the House, and we certainly mourn her passing.

My right hon. Friend spoke about the Eurofighter. He was particularly concerned about Typhoon tranche 3. The UK has entered into international arrangements to order 232 Typhoons in three tranches. That undertaking remains unchanged. A decision on the third tranche is not required before June 2007, and will be the subject of the MOD's main gate approval process.

My right hon. Friend also spoke about the problems of information and technology transfer. We are working with the US Government to improve the flow of technology transfer in equipment and research programmes. The Administration certainly support that approach, although someone has recently commented that the same is perhaps not true of Congress.

The hon. Member for Berwickshire, Roxburgh and Selkirk (Mr. Moore), who spoke on behalf of the Liberal Democrats, welcomed the defence industrial strategy and recognised its importance and the contribution it will make. He said that some issues remained unresolved, although I am sure that we will return to them. He mentioned transparency issues, especially those relating to Typhoon. The estimated cost of the Eurofighter Typhoon programme has been classified as commercially sensitive to protect our ability to negotiate on subsequent purchases of the aircraft.

My hon. Friend the Member for Bolton, North-East (Mr. Crausby) welcomed the launch of HMS Darling, which he described as an exciting beginning—

Dr. Julian Lewis: Daring!

Mr. Touhig: I thank the hon. Gentleman very much. I said "Darling," but will go for Daring. My hon. Friend the Member for Bolton, North-East thought that the launch of HMS Daring represented a great start for the defence industrial strategy. He spoke about a wide range of defence procurement matters, which showed what a valuable contribution he makes to the Defence Committee. The Chairman of the Committee, the right      hon. Member for North-East Hampshire (Mr. Arbuthnot), endorsed that view when he said that my hon. Friend made a cracker of a speech.

The Chairman of the Committee made the important point that defence is important to our economy and our country—I absolutely agree, and defence procurement is the core of that. I welcomed his comments about my noble Friend Lord Drayson, the Minister with responsibility for defence procurement. I know that the Committee is doing further work on the defence industrial strategy and I am sure that its report will help to inform the Government about any future changes that we need to introduce.

My hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Havard) does not sit on fence, does he? He left no one in any doubt about his views, and I am
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sure that they will be taken into account by others who read comments made in the House. The right hon. Member for Fylde (Mr. Jack) raised several detailed questions that deserve a detailed reply, so he will get a letter from me in the post.

My hon. Friends the Members for Vale of Glamorgan (John Smith), for Portsmouth, North (Sarah McCarthy-Fry) and for Plymouth, Sutton (Linda Gilroy) mentioned small and medium-sized enterprises. When my noble Friend Lord Drayson launched the defence industrial strategy, he stressed that it was for everyone in industry. He also pointed out at the time that just over half the Ministry of Defence contracts in 2004–05 were let to SMEs at a cost of £7.5 billion.

The hon. Member for North Dorset (Mr. Walter) wanted to tempt me down the route of the defence training review. Two bids are being assessed and my decision will be based on the delivery of optimum training and the most effective technical and military solution for our forces. It will not be based on any regional considerations whatsoever, and the military ethos will be maintained at the heart of our defence training review.

My hon. Friend the Member for Chorley (Mr. Hoyle) made several powerful points. I do not doubt that those in the United States who monitor proceedings in the House will have heard his views across the Atlantic. I also have no doubt that his views are shared by a great many hon. Members, so it was right that they were expressed.

The hon. Member for Colchester (Bob Russell) made several important points about clothing research, so I will consider them and write to him. The hon. Member for Harwich (Mr. Carswell) did a good job of book promotion—perhaps he will show us the book at the end of the debate. He recognised that there have been procurement problems when both parties have been in government, so the problem is not exclusive to this Government.

My hon. Friend the Member for Telford (David Wright) made an excellent case on behalf of the civil servants employed at Sapphire House. No decision will be taken until the spring. My right hon. Friend the Minister of State listened to his points and is quite happy to meet him and the trade unions as a result.

The hon. Member for Na h-Eileanan an Iar (Mr. MacNeil) spoke on behalf of the two nationalist parties. I welcome the fact that their Members have recognised the importance of UK defence to their local economies. I have no doubt that we will take on board several of his points as the debate continues in the future.

The hon. Member for Basingstoke (Mrs. Miller) demonstrated an understanding of the problems of defence procurement that is shared by hon. Members on both sides of the House. I must tell the hon. Member for Bournemouth, East (Mr. Ellwood) that the Government are changing our armed forces to make them more usable and adaptable and ready to face the challenges in the world today. I hope he accepts that that aspiration is shared by Members on both sides of the House.

My right hon. Friend the Minister of State made it clear that we are engaged in a significant modernisation programme that is delivering world-class procurement
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for Britain's world-class armed forces. In stark contrast to the shameful legacy of the previous Government, we are delivering. Our innovative programme, which is based on the emerging defence industrial strategy, will continue that delivery. As the challenges with which our brave servicemen and women deal grow and multiply in the 21st century, we will ensure that they have the technology, equipment and support that they need to counter the threats that they face. The Government give that commitment to our armed forces and the country.

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