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It is important that people in this country who talk loosely about what happens on the ground in Afghanistan think about the effects of their words. It is easy to comment on how deficient our armed forces might be
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and what problems we might have in supplying them, but that language needs to be measured, because although in the UK it may represent a political skirmish, on the ground it can have a material effect that causes real damage to people in theatre. People in this country need to think clearly about that.

It is a shame that the right hon. Member for North-East Hampshire (Mr. Arbuthnot) is not in his place, because I wanted to pay tribute to him as Chairman of the Defence Committee over this Parliament. I served with him throughout that period and it has been very interesting. I shall tell a story about his courage, because in his speech he made the point that sometimes we have a bit of fun, and some events are humorous for the wrong reasons. I remember being in Basra with him and we were sat talking to some local politicians and sheikhs. There was a mortar attack, and he had obviously absorbed all the training that he had received, because he donned his flak jacket and helmet and lay under the radiator while still trying to conduct the meeting. It is a picture that I have in my mind. I know that what goes on tour should stay on tour, but I simply assure the Ministry of Defence that he is an absolute devotee of its training, which he carries out to the letter.

Mr. Jenkin: Does the hon. Gentleman recall the other part of the story, which is that the Iraqi guests on the British base went to the window to watch the attack?

Mr. Havard: The hon. Gentleman is correct. That is enough Defence Committee anecdotes, but that story is an example of the right hon. Gentleman's courage and tenacity, and all Committee members will want to put it on record that his chairmanship of the Committee has been of great value.

The right hon. Gentleman remarked on each area of the MOD and made a point about the Department overall, but I make it clear that when the Committee has remarked on the MOD, we have not meant the individuals who make up the Ministry. A lot of courageous people work there, many as civilians. Indeed, people in the Ministry are not trying deliberately to get questions wrong; that in itself is wrong. However, there are deficiencies in how it performs and how it is organised. The Gray report was of great importance in evaluating some of those deficiencies, and the question of how we spend money is crucial, because we are clearly spending it inefficiently. Everyone knows and agrees about that but Parliament's job is to find out how we can avoid it, stop it and put it right.

Like all Defence Committee members, I think it is for us to try to find out what is really happening. Party politics does not reside in the Committee in that sense, because it is in no one's interest to develop a false analysis of the situation. The prescription for what one might do next is where the politics comes in, and that is different, but if one does not understand where one really is, whatever decisions one makes, they are likely to be deficient, because they will have been based on a false premise.

There is a problem with obtaining the information that the Committee requires to undertake such inquiries. We conducted an inquiry about the renewal of Trident that went against the MOD's wishes. It did not want to do that inquiry then, but we did not ask the MOD's permission to start it. To start a debate, we thought it
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important that Parliament obtained important information on what the MOD was going to do about Trident; it was not for the MOD to dictate to us that we should not start an inquiry, so we carried on and conducted an inquiry without any co-operation. That changed as we went along.

Currently, there is a difficult question about ex-chiefs of staff who make statements that they did not make when they were in uniform. They sat in front of me and I asked them directly, "What was the condition? When will FRES be available?" I remember Michael Jackson telling me, "Its first in-service date is 2009." The programme was a shambles. It was not that the chiefs of staff did not have the money; they could not decide among themselves how best to spend the money. That is what they are paid for-that is their job-and it is no good saying to me after the fact that in some way or another, "It was very difficult, Dai, and we did not have the money." If they had come to me at the time, and I had been the Chancellor of the Exchequer, heaven forfend, I would have said, "When you can properly spend the money I am already giving you, and you can show me you are, I might give you some more." That is the guts of the argument. Bernard Gray makes the same point in his report when he says that there is no magic bullet. Nobody has got this process right, whether it is the Americans, us, the French, or anybody else. We will probably never get it arithmetically and perfectly correct, but we can try to make it as efficient as possible.

For some time, I have been asking questions about how to do this because process is important, and I am disappointed. A document called "The Defence Strategy for Acquisition Reform" has recently been published, alongside the Green Paper. It contains a lot of initials and acronyms, as one would expect, and has at the back lots of descriptions of various programmes, with something called "PACE", and the so-called terms of business agreement process, and this, that and the other. It looks like more McKinsey to me-more management-speak and buzzwords.

I spent 25 years as a trade union official and I went into numerous companies. I would ask simple questions such as, "Your company's in trouble and you want to make redundancies-who in this company is given the responsibility for maximising profit out the door?", and be told, "We don't know." I would respond, "There we are then-it is obvious why you're not making money, isn't it? It's because you've got all these fancy consultants coming in, they're giving you all these fancy descriptions and programmes, and all your little workers are beavering away filling in all the boxes and giving you the forms, and the system is not working." Of course it was not working-such an approach will not solve that sort of problem. We need a different way of looking at it, and the Gray report suggests how that might be done. The strategy document sets out a mechanistic process that, frankly, will not do the job that the Minister and everyone else wants done.

Whatever happens as regards kit, what is important is the people. We all know that; everyone will nod and say that it is absolutely correct. We have everyone from reservists, who do a fantastic job and are often not properly recognised, through to young people-teenagers-whom we are trying to equip while asking them to do hugely sophisticated jobs. I have spoken to young guardsmen who are 19 or 20 years of age: boys
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from the valleys who were probably not the best academic students at school. They have gone into the military and had really good training, but now we expect them to exercise heroic or courageous restraint-whatever the new doctrine is called-in deciding whether to shoot the bandit in front of them on the basis of whether there would be an effect on the associated civilian population. That is a highly sophisticated, graded decision for them to make, especially when somebody is throwing rocks at them. That is the level of what we are asking these people to do, as well as physically carrying round all the kit and running about in the warm or the cold.

Training is crucial for that purpose, and that is where the investment has to go. I hope that the training academy in St. Athan comes off, not because it is on my patch-it is not, although there would be an associated effect on my local economy-but because there needs to be a process that trains these people in all the different skills that will be required for the future. In deciding what to do about defence expenditure, let us not lose the people in the discussion about the toys. It is obviously important to discuss some of the big-ticket items because they cost so much, but it should be possible to put a lot of investment into training the people, because at the end of the day they will operate the hardware and have the material effect. More importantly, they are the people who engage with the enemy-not just in a kinetic way, but directly, face to face, in talking to them and trying to win them over to a different position.

How we do all this in the next Parliament is an issue that has popped up in several speeches, probably because we are all thinking about it. Whether hon. Members have decided to leave Parliament or not, they have an affinity with it, and they know that it needs to reform itself and do things better. As regards scrutiny, we need, for example, a way of dealing with previous chiefs of staff. If we could get better answers at the time, we would not need to deal with the problem later on. There are ways in which we could do that. The Defence Committee could take evidence in private: not everything has to be revealed to the enemy. Parliament had the confidence to do that before, when it gave the Defence Committee the responsibility of conducting a review about the capture of our boats on the river between Iraq and Iran. There are different ways in which we could do this as a Parliament, and that is the debate that we need to have. It is possible for these people, when they are in the job, and without being disloyal to Ministers or to the chain of command, to give a graded response so that Parliament can know where it really stands, because unless it knows that, it will make a mistake about where it goes afterwards.

7.25 pm

Mr. Bernard Jenkin (North Essex) (Con): If I may take this liberty, Mr. Deputy Speaker, let me say what a pleasure it is to be called by you once again. You will possibly have a few more stints in the Chair. You are a worthy occupant of that Chair. You stood for Speaker, and you would have been a wonderful Speaker. There was much competition. As you pass out of the world of politics and into the other world, you will be missed by many in this Chamber.

It is a pleasure to follow yet another of my colleagues from the Defence Committee, the hon. Member for Merthyr Tydfil and Rhymney (Mr. Havard), who was
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highly commended by the Chairman, my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot), who is not in his place.

I congratulate the hon. Member for Bridgend (Mrs. Moon) on her thoughtful, and indeed courageous, speech. It is more difficult to make a personal speech in this House, and she made a very personal speech. She brings a thoughtful touch to some of the issues that we face on the Defence Committee. Her remarks about the relationship between conflict and what those involved in conflict suffer, and have to deal with, are very timely just a few days after Combat Stress launched its 90th anniversary appeal. It is worth putting on record the fact that Ministers and Opposition spokesmen seem to be working together very effectively to address some of those issues. With 180,000 personnel having served in Afghanistan and Iraq over the past nine years or so, we can expect as a result some 8,000 cases of post-traumatic stress disorder and 50,000 to 60,000 cases of mental illness involving people who have been exposed to conflict in those two countries. That is a very considerable challenge, to which I hope that she will have the opportunity to return in the Defence Committee in a future Parliament.

I wish to return to the comments of the hon. Member for Merthyr Tydfil and Rhymney about the vexed question of the role of the defence chiefs in the defence debate. They have extraordinary responsibilities, and they are placed in a very difficult position, under politicians who are necessarily political. I have enormous sympathy with what has been said about the need for the Select Committee to be able to operate effectively on the basis that we are being told the truth, and the whole truth. This is an issue that we need to address, but there are no instant solutions, because we do not want to politicise our armed forces; I agree with the hon. Member for Bridgend about that. One could argue that these people have been politicised because they have felt compelled to pursue a particular "line to take" as opposed to pursuing their own line, and I fully understand the perception of those on the Labour Benches that they have been politicised in the other direction for other reasons.

We have to have a rational discussion about this problem, which arises from the subject that I am going to address-the state of the defence budget and the state of the Ministry of Defence-and relates fundamentally to the old story of the quart and the pint pot. All the problems arise because for a considerable period, decisions about the allocation of resources and priorities have been based on trying to produce more effect than we have been prepared to pay for.

If we are to have a debate about defence in the world, it should be about our global role. The real question that lurks behind the earlier exchanges between Front Benchers is whether we can afford a global role. It is about money: the question is whether we allow this single fiscal crisis to relegate the UK for all time. In one matter we have no choice: rebalancing the public finances and reducing the annual deficit must be the first priority of the next Parliament. The strategic defence and security review, as I prefer to call it, must redefine the UK's strategic priorities, but in the context of the fiscal crisis that the next Parliament will inherit.

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The recent interventions of the chiefs of staff and former chiefs of staff are profoundly depressing, not because they betray division and dissension within government but because those people all seem to accept that massive cuts are inevitable. Let us thank them for one thing: they are confronting us with the truth, which this Government and the increasingly dysfunctional Ministry of Defence have increasingly been denying for years.

I agree with the hon. Member for Merthyr Tydfil and Rhymney that there are many good people in the MOD, and there have been many good Ministers under this Government, but Ministers, civil servants and even senior serving military officers have become inured to the permanent state of crisis in the Department. The present state-crisis in the MOD-is now regarded as normal. However big the black hole in next year's budget, it can always be tided over. In that way, "normal" in the MOD has become more and more divorced from reality. That is what Government and Opposition must face as we plan for the future.

The chiefs of staff are telling us that, as we hear about whether we should scrap this or that project, or even whole services, the truth is that the MOD is bust. It cannot balance its books, and its outgoings exceed its income. A larger and larger deficit of one sort or another has been rolled forward and accumulated. The choice is not whether we can maintain the status quo or find some savings and limit our global role for a while. The situation is far more serious. In defence, there is no status quo to defend. I am reminded of Ronald Reagan's quip that

That is an apt description. The status quo, or trying to muddle along for a few more years on the present basis, will simply not be an option. The crunch is now. The money in the MOD has run out now. An attempt merely to stand still financially will have dramatic consequences in the forthcoming review.

The Royal United Services Institute recently published a chilling paper by Professor Malcolm Chalmers, and Doctors Paul Cornish and Andrew Dorman of Chatham House have made the same analysis. Chalmers sets out how, even if the defence budget were maintained at present levels in real terms over the lifetime of the next Parliament, and assuming all the natural defence costs such as inflation and 1.5 per cent. annual unit cost growth, there would still have to be dramatic cuts in capability. He forecasts that the number of trained military personnel would have to fall by 8.5 per cent. from 175,000 today to 160,000 by 2016, and that ground formations would have to be cut from 97 to 89, major vessels from 57 to 52, and available aircraft from 760 to 700.

Those are rough and ready calculations, but in fact capability would probably fall away faster than that. Fighting vehicles, helicopters, other aircraft and ships have been used so intensively on operations in recent years that their serviceable lives will inevitably be shorter. For example, in July 2008 the UK armed forces had 522 helicopters. According to parliamentary answers, the MOD projects that by 2020 there will be only 303-a cut of 42 per cent. That takes account of the 62 Future Lynx and 24 Chinook helicopters recently announced. What effect will that have on operational capability, and our global role?

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Defence could yet be in a far worse position, whoever wins the election. On the basis that the structural deficit must be halved in four years-that is what we have all voted for in this place-while health and overseas aid are ring-fenced budgets, the MOD, along with all other Departments, is in line for a cut of 11 per cent. between 2010 and 2016. According to Professor Chalmers, that will mean a 19 per cent cut in military personnel, to just 142,000, and cuts in ground formations from 97 to 79, in major vessels from 57 to 46, and in available aircraft from 760 to 615.

Mr. Keetch: Why should health and international development budgets be ring-fenced and not the defence budget? Surely, given the state of the economy, an incoming Government of whatever political persuasion ought to look at the books as they are and decide on the priorities. I understand the importance of health and international development, but does the hon. Gentleman agree that the provision of equipment to servicemen on the front line ought not to be sacrificed?

Mr. Jenkin: You will be pleased to hear, Mr. Deputy Speaker, that I will refrain from being drawn into a debate about international development or health. The figures that I gave are illustrative, but the point is that the defence budget is in a terrible mess and there will be renewed pressures on it. I shall come later to what I think should be done to it.

Mrs. Moon: We have heard in the debate that our defence procurement is not a model example, but it is not as bad as that in many other countries. We are also not unique in being in financial difficulties following the recession. Given the need to address security, is it not even more urgent that we share procurement with our allies and have greater integration of budgets, so that together we can prove a more powerful force?

Mr. Jenkin: I share the hon. Lady's view, and the Defence Committee heard telling evidence from the director of Abbey Wood that multilateral projects are politically very complicated and tend to run hugely over budget, whereas bilateral projects, perhaps with other countries opting in without having control of the project, are a much better way forward. I am all in favour of bilateral projects with France and the United States, and we cannot afford not to have them wherever it is practical to do so.

Mr. Davidson rose-

Mr. Jenkin: I think I know what the hon. Gentleman is going to say. It is a matter of record that he never stands up in the Chamber without mentioning the aircraft carriers, but I will indulge him.

Mr. Davidson: I am grateful. In fact, I was going to ask the hon. Gentleman whether he agrees that it is important in such discussions for people to use precise language. Usually if there is mention of procurement with our allies, people such as my right hon. Friend the Member for Rotherham and Brussels, West (Mr. MacShane) suggest that that should mean a Europeanisation of the whole exercise, as distinct from bilateral arrangements, which can be between a number of countries on different issues, and represent a much
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better way of proceeding. I was not going to mention the aircraft carriers-but since the hon. Gentleman invites me to do so, I would welcome his views on that subject

Mr. Jenkin: I think the hon. Gentleman knows that we are on record as having supported the aircraft carriers for as long as they have been in the programme.

I do not want to get too involved in this, but bilateralism is different from integrating budgets. It is integrated budgets that gave us A400Ms, Eurofighters and complicated multinational programmes that inevitably become extremely expensive. Those are not the model for procurement that we want-nor do we want to share technology with other countries that are not prepared to invest in technology.

I was talking about the inevitably huge cuts in capabilities-in ships, aircraft, ground formations and so forth-that would follow from flatlining or cutting the defence budget. If that fails to drive home the state of crisis in the Ministry of Defence, let us open Bernard Gray's "Review of Acquisition", published last year, which says:

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