| Previous Section | Index | Home Page |
20 May 2009 : Column 469WH—continued
The third distinct issue is the one about which hon. Members on both sides are most concerned: our decision on the replacement for the R1 Nimrod and the question whether we can use these three potential MRA4 aircraft in that role. I shall not disguise from the Chamber the fact that, when I took over this job, many people said to
me that that was not a sensible or realistic prospect. However, I am determined to ensure that we do not exclude that prospect unless we have considered its potential very carefully and thoroughly.
I know that BAE Systems put in a bid some years ago for a new replacement for the R1 Helix system, and that it was not one of the companies selected to undertake an initial study. I do not want to go back over the past. Under international and European law, we are allowed to take a national view, from time to time, on defence procurement, and there will be moments when I will feel that it is right to do so. If BAE Systems can come up with a sensible solution, I would certainly prefer a British solution.
Sir Nicholas Winterton (Macclesfield) (Con): I apologise to you, Mrs. Dean, and to the Chamber for being a little late. The Divisions confused me about when this debate would begin. The Minister’s response is very constructive and helpful. However, what consideration has he given to the life cost and operational synergies between Helix and MRA4? Could a great deal of money not be saved? This airframe could be used. I agree that there are complications, but surely considerable savings could be made, particularly in having one aircraft carrying out both functions.
Mr. Davies: The hon. Gentleman is perfectly right that the through-life cost is the important issue in terms of cost and that cost itself is important. Cost has to be considered along with the other two issues that are most important to me—delivery time and technical risk. There have been far too many cases in the history of defence procurement in which we took on excessive technical risk and found that we were buying capabilities that did not work, or that we had taken far too long to acquire them, because we had had to solve all sorts of technical problems along the line. Historically, the Nimrod MRA4 project is a classic example of that, as too was its predecessor. We must be alive to those things.
The hon. Member for Macclesfield (Sir Nicholas Winterton) is convinced that if I were to consider the matter on a through-life cost basis, I would come up with an equation that points clearly in the direction of the MRA4. My hon. Friend the Member for Manchester, Central (Tony Lloyd) is also very confident that the MRA4 would come out ahead on all those criteria. I do not know. I have not received proposals either for the Rivet Joint or from BAE Systems—if we get one—for the MRA4 in the signals intelligence and R1 replacement role.
On 27 April, I told BAE Systems three things: first, that if it wants to bid, I would enable it do so by briefing it in full on the necessary, up-to-date information about our requirements—that has been provided during conversations over the past few weeks—secondly, that I shall consider the three factors just mentioned; and thirdly, that it might feel handicapped, because clearly its bid would involve adapting an airframe to a role for which it was not originally conceived, the production of a new missions system that has not been in service before and the integration of those two things. Those are the three different technical risks involved.
Mark Hunter:
The Minister is giving a very full response to our questions, and I look forward to the rest of his comments. According to our information, this is
an either/or choice—either Rivet Joint or Nimrod—and he has not yet denied that. As we understand it, the American project is a 40-year-old product. Does he share my concerns about the structural integrity of an aircraft that might have spent most of the past 40 years in a desert somewhere in the United States waiting for a buyer? Cost is a major consideration, but safety is also uppermost in all our minds, including his.
Mr. Davies: I did not include safety in my three criteria, because safety must be taken for granted before we take anything beyond the first stage. The hon. Gentleman knows that I am not an aerodynamist or aeronautical engineer, so I have to rely on the experts to answer these questions. If he asks them directly, as I have done, the experts will tell him that the critical thing is not necessarily the age of the design of the airframe. The original airframe of the Rivet Joint is the same as that of the Boeing 707—he and I might remember going on one of them in our childhoods. The design has proved to be extremely viable over those years. It is the age of the individual airframe, which may not be anything like 40 years old, and the number of flying hours that it has done that are the critical factors.
Let me turn to the US air force, which does not have a reputation for cutting corners on safety. One or two air forces in some parts of the world may not be paragons when it comes to good safety records, but that is not the case with the US air force. The US air force plans to use Rivet Joint, which is the existing system that it is talking to us about, until 2040. According to its schedule, it will start to withdraw the system from 2036 going on to 2043, so take an average of 2040—I think that I am within a year or so of being accurate. In practice, many of the systems will be extended a bit longer than the out-of-service date as foreseen 25 or 30 years beforehand. The US air force is pretty confident about the viability of the airframe. That is the best answer that I can give to the hon. Gentleman. I will not prejudge this whole competition.
Ann Coffey (Stockport) (Lab): When the Minister makes his considerations, will he also take into account the importance of keeping highly skilled engineering jobs in the north-west, because that will attract further investment and give vitality to the region?
Mr. Davies: The answer is, of course, yes. I was going to touch on that important aspect in my concluding remarks.
Mark Hunter: In the limited time that is left, I hope that the Minister will make some reference to the intelligence questions that I raised earlier in my speech. I am referring here to the sharing of information.
Mr. Davies: I am sorry about this, Mrs. Dean, but we are all confused about the way in which this debate has been running this afternoon for the reasons that we all know about. Am I right in thinking that I have another three minutes?
Mrs. Janet Dean (in the Chair): Will it help if I clarify how much time we have left? We started this debate early because the previous debate finished earlier than expected. We may have another vote. [Interruption.] My pager is buzzing away. We can go on until 5.24 pm.
Mr. Davies: I am grateful for that, Mrs. Dean. In anticipation that we cannot go on for that long because of the expected vote, I will try rapidly to answer that important question. On that matter, unlike on other matters, the hon. Gentleman is misinformed. If we were to purchase or acquire by some contractual mechanism—I leave that matter open for the time being—the capability represented by the Rivet Joint, it would be exclusively British crews who will operate the system. The intelligence will come through to us in the first instance, and it would be for us to share that with our very important allies, including the United States, or it may be just the United States. It will be a matter entirely for us. We retain complete sovereignty over the ownership of that intelligence. There is no danger of our losing that.
The hon. Gentleman raises the theoretical political risk—I call it political risk—that the United States will embargo this country, stymie our defence capabilities, order its nationals no longer to service our aircraft or deliver spares for the aircraft that we are utilising and so on. I cannot estimate in what time scale such US actions or sanctions might be effective, if ever they were applied. I rate very low the chances of such an eventuality emerging in the world of the future, even after our time. I cannot believe that there will be a situation of such enmity between this country and its greatest traditional ally, the United States. Although there is a theoretical risk, it is not one on which I will spend a great deal of time. If such a nightmare scenario were to take place, there would be so many other issues of great national importance that that would not be a concern.
I am looking forward to receiving any offers that anyone wants to send in. If BAE Systems decides that it wants to send us an offer, that is entirely its decision. I have not requested it to send in an offer; I have simply said that I do not want to prevent it from sending in an offer. I will facilitate it putting together an offer, if that is what it wants, and we will consider it very thoroughly and fairly. All the issues that have been reasonably raised this afternoon will be weighed in the balance when we come to make a decision.
Sir Nicholas Winterton: Our Prime Minister—I do not want to misquote him—has made it known that he would like, where possible, for purchases to be made of British products, because that will provide jobs for British workers in British factories and bring the maximum benefit. How will such a factor be weighed up? If the company provides assurances over design and reliability and says that there will not be the problems that have been experienced in the past, will that weigh heavily? Given that the trade union movement at Woodford has been constructive and co-operative with management on all occasions over recent years, I do not believe that it should lose out, especially as the Helix MRA4 would answer the requirements of the RAF.
Mr. Davies:
The hon. Gentleman talks about the Prime Minister. I agree with him that the Prime Minister is an excellent Prime Minister. I think that I said the same in more or less the same words as the hon. Gentleman. All things being equal, or not quite entirely equal, I would prefer this contract to go to a British company. I agree with everything that the hon. Gentleman has said about BAE Systems and its work force. I have had several meetings with representatives of the work
force and have been impressed with how well informed they are and how pragmatic and effective they are in their dealings with the management. When I went to Woodford on 27 April for what was an exemplary meeting, the management asked the unions to be present at most of our meetings—that has never happened to me before. I thought that that was splendid, because it showed that real teamwork was going on between management and the unions so far as that factory and this project are concerned.
Mark Hunter: Earlier, the Minister made reference, quite appropriately, to the dangers of building up people’s hopes and expectations. He made it quite clear that the Government are not interested in doing that unless there is real reason to do so. That being the case, will he confirm the timetable for that decision? As the Minister has been to Woodford and paid tribute to its work force and management, will he give us a more specific idea about the timetable? We have been told that a decision is imminent, but it is only fair to those who have livelihoods at stake at Woodford to know what timetable the Minister has in mind, so that they will have a better idea of when precisely their futures will be known.
Mr. Davies: It is a matter of a very small number of months. We have had conversations with two potential major bidders in this project. I do not want to start setting some arbitrary deadline. I want to receive the two offers, and I want the bidders to feel happy with them. However, what I will not do is delay the project to accommodate the offers. It is very important for us to see progress and people going forward in a matter of weeks. It will be a very small number of months within which we will need to have got on board, in a final version, all the facts. As I have said, there are many considerations in such an operation. I have tried to isolate three, because they are the essential ones on which everyone should focus—they are price, delivery and technical risk. I have not disguised from BAE Systems privately, and I do not disguise from the Members of Parliament who represent the people who are employed in the factory, that on technical risk, it is not necessarily an equal race. We have to compare a proven system with one that will be new in terms of airframe, mission system and the integration between the two. There are some real challenges, but I do not mean to say that it is hopeless or impossible. If I thought that, I would say so and cut off any chance of anybody bidding. We remain totally open-minded, and I look forward to making a decision on that basis.
My hon. Friend the Member for Stockport (Ann Coffey) made a good point about the future of the British aerospace industry and the engineering skills that we have at every phase in the design, development and production of aircraft systems. The Government do not get much credit for good news—nobody pays attention to it—but there was a piece of spectacularly good news the other day, when we confirmed that we are prepared to go with our partners on the European continent to negotiate part of the third tranche of the
Typhoon programme. That enormously important programme involves a lot of aircraft and work, so it was considerably good news, not least for the main contractors involved and their work forces and for the subcontractors. The livelihoods of some 16,000 people in this country depend directly on the future of the programme, and it is going forward. I hope that that answers my hon. Friend’s question.
BAE Systems is investing its shareholders money, which we appreciate, and the Government are investing—such joint investment is the way forward, as I have said in many different forums and contexts—in three new unmanned aerial vehicles and unmanned combat vehicles programmes. I will not go into the details or specifications of the projects, because, as the hon. Member for Cheadle will realise, such matters are confidential. I visited Warton, where that programme and the major contribution of BAE Systems to Typhoon tranche 3 are going ahead.
We are entitled to feel reasonably confident about the position of the aerospace industry in the north-west and its component manufacturers in other parts of the country, including the important Selex avionic systems site in Edinburgh. Every time I see the hon. Member for Moray (Angus Robertson) in a defence debate, I tell him that Selex’s long-term future would be menaced, if Scotland becomes independent. He must face up to those issues, which are important for the livelihood of his constituents and many people in Scotland. At the moment, they are nevertheless entitled to feel reasonably confident.
The future of the Woodford plant is a matter for BAE Systems; it is not for the Government to tell it what to do with its assets and plants, or how to structure its business, so we will not do so. However, my understanding is that Woodford will not remain an aircraft production facility much longer than a couple of years beyond the delivery of the nine MRA4s, whether or not we produce a contract to use the three test aircraft in a new role. In other words, instead of a 2012 deadline, we might be pushing a deadline of 2014. Two years is not nothing, but one could always argue that if bad news is coming and there is going to be some restructuring, it is better for people to have an early warning, so that they can change their lives aged 39 rather than aged 41 or 42. We can argue that both ways.
I was deeply impressed, both as an individual and as an engineer, by the chief engineer at Woodford, who has been there for many years, and by his team. The spirit at Woodford is magnificent. As long as we have real business and requirements for state-of-the-art avionics and aerospace in this country, which we will if the Government have anything to do with it, there will be prospects for the skills, dedication and track record, which have been demonstrated by the Woodford work force over the years, to find a continuing role in the industry, if not on that site.
5.23 pm
| Index | Home Page |