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Westminster Hall

Wednesday 8 December 2010

[Mr James Gray in the Chair]

Defence Spending (Wales)

Motion made, and Question proposed, That the sitting be now adjourned.-(Stephen Crabb.)

9.30 am

Mrs Siân C. James (Swansea East) (Lab): I am grateful for the opportunity to secure this important debate, and to the Minister for attending. Wales has a long and proud heritage with the armed forces, and is home to the British Army's most famous regiments, great ports, and RAF bases. Many towns are affiliated with Royal Navy warships and submarines. It is a world leader in the aerospace and defence industries, and from a strong cluster around Airbus UK in the north to GE Aviation, General Dynamics, NORDAM and British Airways in the south, manufacturers and suppliers employ thousands of highly skilled people in high-tech, highly paid jobs throughout the country. Wales is also an important recruiting area, and many young men and women in Swansea, and particularly in my constituency, join up.

That legacy dates back more than 300 years, and is strongly intertwined with our industrial past and communities throughout Wales. Indeed, the cenotaph at the heart of St Athan village is dedicated to the memory of

That is an enduring tribute to the link between our nation's proud coalfield communities, and the young soldiers who fought so selflessly to protect them. What gives that message even wider symbolism is the heartless graffiti and vandalism that has recently desecrated the memorial. Without wishing to make too blunt a point, it is difficult to ignore the parallels with the cruel disregard for St Athan shown by the coalition Government. They made an abrupt decision to scrap the plans for the St Athan defence academy, and I shall focus on that today.

The Government's decision is a huge blow not just to the Vale of Glamorgan, but to the whole of Wales. The project would have led to the creation of thousands of training, support and construction jobs, and would have provided significant opportunities for local suppliers and the local community. The coalition Government's decision to cancel the Metrix consortium project will mean losing up to 2,500 training and support jobs and up to 1,500 construction jobs, as well as the loss of a £700 million to £800 million defence technical college construction contract and the £60 million annual supply chain expenditure, and a £500 million annual boost to the Welsh economy from operational activities, and a large boost to local tourism.

Wales makes up 5% of the UK population, but contributes 8% of the armed forces. The Government pride themselves on fairness, so surely Wales should
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receive an equal proportion of military spending. South-east England receives £7.1 billion pounds and Scotland receives £1.5 billion, but Wales receives just £390 million.

Nick Smith (Blaenau Gwent) (Lab): Blaenau Gwent contributes many servicemen and women to our armed forces, and we have had some great armed forces days in recent years. My hon. Friend is absolutely right: according to statistics that I have seen, Wales receives just £380 million in defence expenditure. Surely that is not enough.

Mrs James: I agree with my hon. Friend. Wales received the second lowest military investment of any region in the UK. Surely that cannot be right. The decision in the summer to award Gwent-based General Dynamics a £500 million contract to help to equip the Army with a fleet of new Scout combat vehicles was very welcome, and that should have been followed with an annual £500 million boost from St Athan. Together, they would significantly have redressed that unfairness. Instead, the coalition dithered, and that has cost us dear.

Mr Wayne David (Caerphilly) (Lab): On the defence technical college, does my hon. Friend agree that it is bizarre that, at a time when south Wales is likely to lose many thousands of jobs in the public sector, that private sector development will not go ahead?

Mrs James: I agree, and there are many such examples; I will home in on that issue later.

Alun Michael (Cardiff South and Penarth) (Lab/Co-op): In addition to the issue of the unfairness, does it not seem that the coalition Government are determined to cut off their nose to spite their face, because they will lose the savings and efficiencies that the new academy would have created?

Mrs James: I agree with my right hon. Friend. Unfortunately, the Government cutting of their nose to spite their face does not help people in south and wider Wales.

The Parliamentary Under-Secretary of State for Defence (Mr Andrew Robathan): I am listening with surprise to the hon. Lady, because she seems to be saying that we should make defence decisions based on employment in south Wales, rather than on the needs of the armed forces and the nation. Is that right?

Mrs James: I cannot agree with the Minister. I am saying-I thought I had done so clearly-that there is a disparity, which would have been reduced if the Government had decided to go forward with the defence technical college. It is not rocket science; a decision to build the college would have provided more equality and fairness. It would not have endangered front-line services, but would certainly have helped our forces, who serve so valiantly in Afghanistan.

Mr David: On that important point, if the Government were concerned about the well-being of the armed forces, they would have ensured that the technical college went ahead. That point illustrates that the Government are not concerned about the long-term defence of this country.

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Mrs James: I thank my hon. Friend for that. What have we heard from the coalition? The Prime Minister and the Defence Secretary maintain that there is still a bright future for the area, and that a decision will be made in the spring. The Welsh Secretary insists that she is continuing to press the case for St Athan, but we have all witnessed the power that she wields in the Cabinet. There have been so many words, but so little action-there was the decision to close the Newport passport office, deferral of the electrification of the south Wales main line, and the fact that Wales was not included among the new superfast broadband pilot areas.

Chris Ruane (Vale of Clwyd) (Lab): Will my hon. Friend include cancellation of the north Wales prison on that list?

Mr James Gray (in the Chair): Order. Before the hon. Lady answers, I remind hon. Members that we are debating defence spending in Wales. It is not in order to discuss other projects that may or may not have been cut.

Mrs James: I thank my hon. Friend-and I include the north Wales prison on my list.

We are already witnessing the impact of the Government's dithering, delay and abandonment. Last week, business confidence in Wales dropped severely from 22.4 points last quarter to 6.3 points. Scrapping the St Athan project was mentioned explicitly as a "significant dampener on confidence". That is hugely worrying, and demonstrates the huge risk in the coalition's assumption that the private sector will provide jobs for those in the public sector who become unemployed. For Wales, the stakes are even higher. Public investment plays a greater role in our economy than in England, and our business sector is much more fragile. As our Labour First Minister in Wales, Carwyn Jones, has said, the spending review is clearly regressive. The human and social impact could be both devastating and wasteful, and the real cost could be with us for generations. It further demonstrates how the Government are pursuing cuts with a scale, scope and speed that risk Welsh jobs, Welsh growth and Welsh recovery, and puts the squeeze on the most vulnerable in our society.

Geraint Davies (Swansea West) (Lab/Co-op): Does my hon. Friend agree that a strategic investment of the magnitude that we are talking about would have a major multiplier effect on inward investment in Wales? I am talking about not just visitors and tourism, but the clusters of aero-industry, and encouraging early rail electrification, which has been delayed. Such measures work together in harmony for Wales, and without them the opposite applies.

Mr James Gray (in the Chair): Order. I am sure that the hon. Lady will not allow herself to stray when responding to that intervention.

Mrs James: Success breeds success, and if the scheme had gone ahead, we could be looking forward to a much brighter and more successful future. Wales still has a lot to offer British troops serving in the UK and overseas. Increasing the defence footprint in Wales will strengthen
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the Union and local communities. The benefits are wide and invaluable, but the matter is not being addressed by the coalition.

When asked about the equitable distribution of defence spending across the UK, the Defence Secretary stated:

And rightly so.

Simon Hart (Carmarthen West and South Pembrokeshire) (Con): That is good stuff, but will the hon. Lady explain why over the past 13 years, two military establishments in Carmarthen West and South Pembrokeshire have been gradually eroded, so that they are now approximately one third of the size that they were in 1997?

Mrs James: As we understand, things have been-and are-very difficult. There was an alternative, and under a Labour Government there would have been an opportunity for the defence technical college. As Welsh MPs, we lobbied long and hard for the defence technical college, because we knew that it would bring opportunities and investment.

Albert Owen (Ynys Môn) (Lab): One of the big success stories of the defence budget in Wales, and the UK, is RAF Valley in my constituency. It is a centre of excellence for fast jet training, and has had hundreds of millions of pounds of new investment. That is now under threat.

Mrs James: I agree, and I congratulate my hon. Friend on that; it is important that places such as RAF Valley continue to thrive and prosper. They add to the defence footprint in Wales and need to be enhanced.

Huw Irranca-Davies (Ogmore) (Lab): Does my hon. Friend share my regret that over the past few months we seem to have lost cross-party consensus on protecting the interests of Wales, particularly in terms of defence? I pay tribute to the work of those hon. Members who, under the previous Government, fought to persuade military chiefs and the MOD that south Wales was worth investing in. That support has been lost, and it bodes badly for the future that there will be only one or two parties in Wales to speak up for the interests of Wales.

Mrs James: My hon. Friend is correct. I was part of that lobbying group, and we worked hard to demonstrate how we could provide a service that would have been world-beating, and that would help ensure the safety and future of our brave young men and women.

When I talk about those brave young men and women, I am thinking about people in my community. When we talk to families about how well their sons and daughters are doing, they tell me about the problems and challenges that they face as individuals and as part of the wider community. They are troubled about their future, and given that more than 60,000 people face losing their jobs, the decision on St Athan means that many people have little hope for the future. Those families deserve to be rewarded for the great contribution they have made.

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The defence training academy is not only an economically sound investment, a socially beneficial plan and a strategically intelligent initiative, but fair. It is fair that a highly skilled work force should get the investment they deserve, and it is fair for our armed forces to be equipped with the best training and facilities possible.

Simon Hart: Are those brave young men and women the same brave young men and women who had to buy their own kit to fight in Afghanistan over the past few years?

Mrs James: We have heard such tales. I have been approached by families and relations, and I went to the bother of checking out every story. I found that such statements were just not true. There were opportunities for the families to do other things, but the troops had equipment of the highest standard. I can pass on letters that I wrote to Ministers and those I received in reply. I thank the hon. Gentleman for his intervention.

Chris Ruane: Why?

Mrs James: Well, the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) is entitled to his opinion, just as I am entitled to mine. It is fair that a community with a proud military history should continue its lasting legacy, and it is fair for Wales to get military investment to match its contribution to our armed forces. The Secretary of State for Wales repeatedly states:

and the Defence Secretary insists that the best decisions will be made for the defence of the UK. Neither has yet delivered on those promises, although that could change today.

Geraint Davies: Is my hon. Friend surprised that although Conservative Members complain about individual areas of underspending under the previous Government, they support massive cuts to the defence budget, particularly in St Athan? That is absolute hypocrisy.

Mrs James: I am not surprised; I think that is to be expected. The people of Wales know what is to be expected, as do people in other parts of Great Britain.

Mrs Madeleine Moon (Bridgend) (Lab): My hon. Friend says that the people of Wales know what to expect. Yesterday, I looked at the part of the Ministry of Defence website about defence in Wales. It said that the £14 billion investment in St Athan was still to go ahead. Would it be helpful if the people of Wales were able to look at that website and see accurate information? Perhaps when the Minister responds, he will announce that the website is in fact accurate.

Mrs James: I urge people to look at that website. We must have the most up-to-date information, and I hope that the Minister will give us good news today.

In my closing remarks, I will quote the memorial in St Athan. It says that the boys of the coalfield will

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I hope that the Minister will return to his Department and dedicate himself to completing this task for St Athan, the people of Wales and our brave soldiers.

Several hon. Members rose-

Mr James Gray (in the Chair): Order. A large number of people are trying to catch my eye. I intend to call the Front-Bench speakers at 10.40 am, and I appeal to all those who wish to contribute to do so as briefly as they reasonably can.

9.46 am

John Glen (Salisbury) (Con): I am grateful for the opportunity to contribute to the debate, Mr Gray, and it is a pleasure to serve under your chairmanship. As a member of the Defence Committee, although not a Welsh MP, I take a keen interest in these matters. As the hon. Member for Bridgend (Mrs Moon) will acknowledge, the Committee's report pulled no punches when it came to reviewing the Government's attitude to the strategic defence and security review, and in reporting its conclusions.

I agree with the concept of a defence training college. One of the critical challenges facing the armed forces is the need to avoid duplication and streamline training processes. When the Defence College of Electro-Mechanical Engineering-DCEME-was formed in April 2004, it brought together a number of separate service training organisations, all of which delivered different forms of engineering. The aim was to exploit synergies, improve training delivery and increase efficiency and effectiveness.

The notion of a defence training college is sound. There is a lot of training duplication across the three services, and anecdotally, there are many common factors to basic engineering training programmes, although that is not always acknowledged by the different services. It is clear that St Athan should play a key role in delivering a harmonised service.

In theory, a further rationalisation to one site could reduce costs and save money. That should bring areas of expertise and excellence together and lead to greater co-operation between the services. However, it is not clear whether the work has been done by the three services to align their training requirements. There are always good reasons to compromise, and different services have different needs. Such matters need to be ironed out, and we must be clear what we are aiming for in this investment.

Huw Irranca-Davies: I appreciate the fact that the hon. Gentleman is taking part in the debate. It is important to have members of the Defence Committee in the Chamber, because this discussion is not only about Wales but about what is best for the armed forces. I appreciate his train of logic, which steers us towards the rationale of having tri-service training on one site-we hope that it will be in Wales, but please let it be somewhere-for the good of the armed forces. However, the hon. Gentleman is approaching a compromise.

I do not want to digress from the subject of the debate, but when the decision was taken on Sheffield Forgemasters, there was an undertaking that discussions would continue. However, nothing has happened. We hear that the hon. Member for Vale of Glamorgan (Alun Cairns) is delighted that discussions are continuing
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on this matter, but yet we have heard nothing. Will the hon. Member for Salisbury (John Glen), or perhaps the Minister, illuminate us on what exactly the future holds for the tri-services and St Athan?

John Glen: I thank the hon. Gentleman for his intervention. I am confident that my hon. Friend the Minister will deal with that point; obviously, I am not in a position to verify it. However, I will point out that the defence academy at Shrivenham is a good example of successfully bringing together different service needs in delivering training. That defence academy has proved a resounding success. The majority of training there is postgraduate, with accredited civilian qualifications the result for many people.

Geraint Davies: The question was asked: where is the hon. Member for Vale of Glamorgan (Alun Cairns)? Given that this issue is so strategically important for his constituency and that he is the new MP for the constituency, and if he is saying things about discussions, why is he not here? Where is he?

John Glen: I thank the hon. Gentleman for his intervention. I understand from colleagues that my hon. Friend is working in the Vale of Glamorgan today. Obviously, I cannot account for the movements of other hon. Members.

The concept of St Athan was good, but it was decided that the project was undeliverable by the Metrix consortium. It is clear that a huge number of courses across the services need harmonising.

Alun Michael: I am a little puzzled about the decision. What the hon. Gentleman refers to was clearly decided-he is right about that-but it does not seem to have been decided on the facts, which demonstrated savings for the armed services as well as efficiencies from the proposals, which were assessed very carefully before the decision to go ahead was made. So why was the decision made to change that? It had all-party support. There was careful examination of the benefits to the services. Where did the decision come from?

John Glen: I thank the right hon. Gentleman for his intervention. No doubt the Minister will want to deal with the point about the logic of the Government when they made the decision.

What is confusing to me, as someone who has taken an interest in defence matters, is the extent of the investment at St Athan. Let us say that three services are coming together and, for example, work is being done on ship engines. How reasonable and cost-effective will it be to get engines from Portsmouth to St Athan? Is that the right option? To what extent will all that work be cost-effective? Presumably it would be helpful to have a driving range for tanks if people wanted to test the tanks on whose engineering they had been working.

How does the Minister reconcile the fact that, as the hon. Member for Swansea East (Mrs James) said, Wales receives the second lowest "investment" from the MOD with the arguably bigger imperative to achieve value for money for the MOD as a whole and for UK defence as
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a whole? Looking to the future, I am clear that defence training needs to be harmonised. That issue needs to be considered on two levels. Where would be the best place to site such a college from a UK defence perspective? In addition, such a decision should not be wholly based on relative under-investment in one region of the country or another.

Jonathan Edwards (Carmarthen East and Dinefwr) (PC): Will the hon. Gentleman give way?

John Glen: No, I shall make a little more progress and come back to the hon. Gentleman in a minute.

If the best place is St Athan, there is a need to bring certainty to the decision and clarity on the time scale and scope of the project. However, I do not believe that money should be spent in Wales just because it needs the investment. That is just one part of the decision. It is critical to ensure that any consolidated training college addresses the broadest possible needs.

Mrs Moon: I am extremely pleased to see my colleague from the Select Committee on Defence here today and I pay tribute to the work that he does as a Member for whom I have a great deal of respect. However, what he is suggesting today is that the Ministry of Defence has failed over the past three years rigorously to examine the proposal for St Athan. He is suggesting that civil servants and Ministers have neglected to consider all the issues that he has raised. That is just not true.

John Glen: I thank the hon. Lady for her intervention. I have a great deal of respect for her and her knowledge of this subject, but it was her party that was in government for several years and had an opportunity to bring this matter to a conclusion before the election. I wonder why it did not do so.

For me, the challenge remains the need to rationalise defence training and spending across the three services to the broadest possible extent. Let us consider leadership and management training. There are a huge number of locations throughout the UK. There are separate leadership schools and centres of excellence. There are vast numbers of adventure training establishments and music schools. I am frustrated that there is not enough clarity about taking the process that I have described to the furthest extent and perhaps giving greater scope for initiatives such as those that I am discussing.

Huw Irranca-Davies: Will the hon. Gentleman give way?

John Glen: Yes, but this will be the last time; I have nearly finished my speech.

Huw Irranca-Davies: I worry that what we have here is a softening up. The hon. Gentleman serves on the Defence Committee. Surely he has the ear of the Minister and speaks to him in the corridors, as we try to do as well. Our suspicion is that discussions will continue about St Athan till the cows come home on the pastures of St Athan and that we are being softened up for the tri-service academy not going ahead in any shape or form that we recognise. It will be dispersed somewhere else in the UK or to various other sites in the UK. That is what the hon. Gentleman is hinting at.

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John Glen: I thank the hon. Gentleman for his intervention. Obviously, not being the Minister, I do not have the ability to make those decisions. I am just flagging up the wider defence interests that are at play. A serious examination is needed of what is right for UK defence interests as a whole and the efficient delivery of tri-service support. I am making the case for that to be as broad as possible and for the right decision to be made for the UK.

Mr James Gray (in the Chair): I call Mr Jonathan Edwards.

9.56 am

Jonathan Edwards (Carmarthen East and Dinefwr) (PC): Diolch, Mr Gray; it is a pleasure to serve under your chairmanship. I congratulate the hon. Member for Swansea East (Mrs James) on achieving this very important debate about defence spending in Wales. The reality is that the trajectory of Government policy in recent years has seen a reduction in defence spending in Wales, and it is very important that we have a discussion about that. Hon. Members are here largely to express their concerns about the ending of the Metrix proposal for the defence training college at St Athan, about which the hon. Member for Swansea East spoke eloquently. It was cancelled in October by the new Conservative-Liberal Democrat coalition Government in Westminster.

As with other areas of defence, such as the £10.5 billion contract with AirTanker Ltd, the Public Accounts Committee has pointed to the flaws in defence procurement and the difficulties in keeping a lid on projects paid for under private finance initiatives. Indeed, the estimated budget for St Athan, even before work really commenced, had increased substantially, from an original estimate of £12 billion to £14 billion, and that at a time when the recession hit and the necessary capital from land sales was not becoming available as expected.

We shall see in the spring whether St Athan will be successful again, depending on the new criterion being announced for defence training by the UK Government, which will of course have changed in the light of the strategic defence and security review and the downsizing of the number of UK troops who will require those training facilities. However, we can be sure of one thing: the scheme will not go ahead as previously envisaged.

While I am on the subject of St Athan, I need hardly remind everybody that the number of staff working at the site is falling, with 339 job losses having been announced this time last year. Further to that, a response to a parliamentary question a fortnight ago from the hon. Member for Vale of Glamorgan (Alun Cairns), whom I notice is not here today, concluded that no further work would be done using the super-hangar to maintain and repair RAF aircraft at the base after 2010. Make of that what you will.

However, the topic of today's debate is defence spending in Wales, and it is good that we can have a debate about that, because those figures have been made available to us. Thanks to the "UK Defence Statistics" annual publication for 2010, published on the Defence Analytical Services Agency website, we can see that the number of jobs as a result of defence spending in Wales under the last Government fell from 8,990 in 1997 to 4,900 today-a drop of 42%. In terms of service personnel, that is a
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drop of 13% from 3,300 in 1997 to 2,930 this year. In England, the figure has risen by 3%. For civilian personnel, it is a far more substantial drop of 62%, from 5,100 in 1997 to 1,970 today. In England, the figure has fallen by only 30%, which is less than half the fall that happened in Wales. The south-east of England has the largest number of service personnel, with almost 45,000, or, in other terms, 15 times the number of service personnel based in Wales. In percentage terms, those figures might be more striking. Although Wales has 5% of the UK population, only 1.7% of service personnel are stationed there and only 2.8% of civilian Ministry of Defence jobs are in Wales. Meanwhile, of course, almost 20,000 service personnel remain in Germany-seven times as many as in Wales-and there are almost as many service personnel stationed in Cyprus as in our country.

Unfortunately, this year's figures do not include those for the estimated UK regional direct employment that is dependent on MOD expenditure, which were included in previous editions, such as, "UK Defence Statistics 2009". In the past, those figures were provided through the MOD by DASA according to country, so that we could see what was taking place-a concentration of defence spending in England, away from Wales, Scotland and the other Celtic nations. The figures in last year's statistics show that 92% of MOD employment is in England, which has 84% of the UK population, and that 1% of the employment is in Wales. There has been growing centralisation, with that figure rising from 89% of employment in England in 2003-04.

The figures are true for both equipment expenditure and non-equipment expenditure. However, our ability to be aware of those figures and scrutinise them is under threat. Instead of the Government's being accountable for changes in policy, manpower and spending in different parts of the UK, they will simply no longer publish the statistics relating to them, and, indeed, they have already stopped doing so. That was the subject of a Westminster Hall debate in July secured by my friend, the hon. Member for Moray (Angus Robertson), after the Minister for the Armed Forces initially said on the Floor of the House that such country and region statistics would continue, only for a later note to confirm that he had misspoken and the series of statistics would, in fact, be discontinued. This is a matter of freedom of information, as much as anything else. In the United States, such statistics are available to state level, and in Canada, a Commonwealth country with a similar military and parliamentary system to our own, the Department of National Defence produces similar statistics, down to provincial and even constituency level. The simple fact is that we must have open books.

The coalition agreement says

There are two specific commitments in the deal, first:

and, secondly,

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It seems almost self-evident that that transparency and openness necessitates continuing the series of national and regional data in the defence industry, so that we can easily see and scrutinise the amount of spending in the defence sector, inside and outside the UK. If we cannot see the effect on our countries of UK defence spending, how can we, as Members of Parliament, be effective judges of it? I hope the Minister will confirm that the UK Government intend to maintain the series of statistics in accordance with the spirit of their coalition deal. Diolch yn fawr iawn.

10.3 am

Simon Hart (Carmarthen West and South Pembrokeshire) (Con): It is depressing for the second time in a fortnight to listen to one or two Opposition hon. Members talking down the Welsh economy in this context. I listened with interest in the Welsh Grand Committee the other day, and nothing much has changed. Let us look at the context, and the Opposition may take some credit for this: 180 companies currently dependent on the MOD in Wales, 25,000 jobs, £220 million of expenditure and £250 million put into the local economy.

I am a beneficiary of that expenditure in Carmarthen West and South Pembrokeshire; we have a great but small MOD establishment at Castlemartin camp. I am hoping for some good news, as the closure of certain tank training ranges in Germany might bring some positive benefits to the area. We have a small MOD establishment at Penally, upon which the local community heavily depends. We have an independent weapons training centre at Pendine, which is crucial to MOD development, not only in Wales but across the UK, and we have at least one very decent Territorial Army unit based in Carmarthen.

I should declare a slight interest in that I served in the Territorial Army for a number of years, and very good years they were too. I acknowledge the comments made by the hon. Member for Swansea East (Mrs James) about the colleagues I used to deal with back in those days. What a different place it was then-the most dangerous place I ever went to in the TA was Warminster. Now the regiment with which I served goes to a lot more dangerous places than that. Not only do the local soldiers contribute to the Territorial Army in west Wales, but so, too, do their employers, which let them off work without concern for what effect it might have on their businesses, day after day, week after week, and weekend after weekend. In the interests of the nation, they gladly let these guys go off to train. Those are all positive things, which the MOD and wider armed service community bring to our local area.

Geraint Davies: I am bemused. Surely the hon. Gentleman should be calling for greater investment on behalf of his constituents to bring jobs and prosperity to his constituency rather then supporting cuts. I cannot understand this.

Simon Hart: I thank the hon. Gentleman for his intervention. He troubles me, because, surely, defence of the realm is the most important thing on which to base our decisions in this context. Delightful though it is, this is not a job creation scheme. This is about defending
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the nation in the context of an extremely complicated and rather depressing financial background and the £38-billion black hole in defence procurement spending, with which we were left.

Chris Bryant rose-

Geraint Davies: Is it important today to back the deficit and cuts generally, ignoring the difference between investing in our strategic interests for the future to defend our country and spending? Clearly, this is all about cuts and not the interests of the hon. Gentleman's constituents.

Simon Hart: I could not disagree more, the point I made about Castlemartin is valid in this context. Of course I have been in touch with the Secretary of State for Defence and the Minister about the future of that depot and others.

Chris Ruane: Will the hon. Gentleman give way?

Simon Hart: No. It is simply not possible to have this conversation as if the UK economy did not exist. We have to operate within the context of the wider economic circumstances in which, for whatever reason, we have been placed. That is where we are. Of course the decisions have to be taken with local interests in mind, but, ultimately, as the Minister said earlier, surely this has to be about defence needs in that wider context.

Albert Owen rose-

Chris Bryant rose-

Simon Hart: The choices are almost too tempting. Who was first? I believe the hon. Member for Rhondda was the patient one.

Chris Bryant: I had almost given up on the hon. Gentleman, but now I am on my feet I am grateful to him for giving way. He referred to the completely fallacious figure of £36 billion-or he may have inflated it to £38 billion. The National Audit Office made it clear that if there was a gap at all, it was of £6 billion. He should not perpetuate these myths.

Simon Hart: The hon. Gentleman will be pleased that I am able to quote. The black hole of £38 billion in unfunded procurement commitments to which I referred is from an MOD brief, post-SDSR defence SB, from 19 October 2010. If that is good enough for the MOD, it is good enough for me. I am sorry that it is not good enough for the him.

Mr Robathan: My hon. Friend is making a very powerful case. The figure is not fallacious; the MOD budget was projected to be overspent by £38 billion over the next 10 years.

Chris Bryant: Drivel.

Mr James Gray (in the Chair): Order.

Mr Robathan: It is not drivel. My hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) knows that the previous Labour Government
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were planning cuts across the board, throughout Government spending, of 20%. Hearing people defending such matters does not go down well.

Simon Hart: I thank the Minister for his intervention.

Let me turn briefly to St Athan. It is not my normal habit to come to the defence of my hon. Friend the Member for Vale of Glamorgan (Alun Cairns), but he is actually in the Vale of Glamorgan today, where he is working hard on behalf of his constituents.

Chris Bryant: How do you know?

Simon Hart: Like my hon. Friend the Member for Salisbury (John Glen), I am not, sadly, in possession of the diary of my hon. Friend the Member for Vale of Glamorgan. [Interruption.] I wish I had not bothered to do this. However, nobody can doubt my hon. Friend's commitment to the future of St Athan. [Interruption.] I would love to continue, but if anybody wishes to intervene, they can do so.

Chris Ruane rose-

Simon Hart: I am sorry that it took such a long time to give way to the hon. Gentleman-it is nothing personal.

Chris Ruane: What could be more important to a Member than defending a £20 billion investment in their own constituency?

Mr James Gray (in the Chair): Order. Before the hon. Gentleman answers, let me say that it is a long tradition of the House that we do not discuss Members who are not present in the Chamber unless we have given them notice that we intend to do so. This particular discussion is not necessarily central to our debate on defence spending in Wales, and I suggest that the hon. Gentleman returns to the main topic under discussion.

Simon Hart: Absolutely, Mr Gray. I apologise for coming-unnecessarily, as it turns out-to the defence of my colleague.

Huw Irranca-Davies: Will the hon. Gentleman give way?

Simon Hart: No, I want to make a wee bit of progress. Fun though these exchanges are, they will come to an end in the very near future.

The facts are these. As I said earlier, one of the depressing features of the Welsh Grand Committee-I will be reprimanded again in a minute-is the extraordinary denial about the past 13 years; it is as if they never existed. The truth is that Metrix simply could not deliver what we hoped on time or on price. If there is a difference between the previous and the current Governments, it is that the current Government are not prepared to go down the road of signing off, willy-nilly, contracts that we can justify neither financially nor in the context of defence.

Huw Irranca-Davies: I genuinely thank the hon. Gentleman for his clarity and honesty, because we are seeing a complete volte-face from the Conservative party's position before the election, when there was
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cross-party sign-up and support for the Metrix bid and the MOD's analysis of it. The hon. Gentleman has now made it clear that the bid did not stack up-not in terms of the MOD's priorities, but in terms of spending, and that is a tragedy. We now know that if we argued for the Metrix bid for St Athan, we would not have the Conservative party's support.

Simon Hart: I thank the right hon. Gentleman-I think he is right honourable-for his contribution.

Huw Irranca-Davies: I would like to be, but I am not right honourable yet.

Simon Hart: It is only a matter of time. Despite that, I do not agree with a word that the hon. Gentleman said. The Government faced some extremely difficult choices-hon. Members have heard that expression before-in the context of not only defence spending, but every other form of inward investment in Wales. The evidence speaks for itself, and the Minister will no doubt put us right. We should also not allow ourselves to be tempted into believing that this is somehow the end of the road for St Athan, because it has been made perfectly clear that it is not. However, we will hear more about that, and I do not want to steal the Minister's thunder.

I said that this would be a brief contribution, although it has been slightly longer than I had intended. However, as an ex-serviceman on the very fringes of the military, I think it is simply nonsense to believe that decisions can be taken on the basis purely of local need or local economic considerations, rather than the nation's overall defence needs in the overall context of the UK economy.

Mrs Moon: Will the hon. Gentleman give way?

Simon Hart: No. I am coming to an end.

We are holding the telescope to the wrong eye if we think the nation can proceed in that way economically or in a defence context. I am delighted that we are facing up to that issue, because Labour Members have not done so before. That depresses me, and every intervention by a Labour Member has simply confirmed my fear that they are prepared to take decisions with no possible concern for the economic, local or defence consequences.

Mrs Moon: Will the hon. Gentleman give way?

Simon Hart: No. I will finish now. I am sure that the hon. Lady will then have the floor.

To end on a lighter note, there is one decision on which I commend the previous Government: they ensured that the Welsh Guards regimental goat, William Windsor, survived their various assaults on the armed services in Wales. However, it is all very well the hon. Member for Swansea East referring to the many letters that she may have received from satisfied servicemen's families. I do not know what world she inhabits, but I can assure her that, in the world that I have been inhabiting, I have had personal contact year after year, month after month, and day after day with people who are in the service of our country abroad who have been begging for some small improvement in their lot. They are deeply frustrated by the inactivity or incompetence-I do not know which-that, I am afraid, epitomised 13 years of Labour rule for those who happened to be armed servicemen.

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Several hon. Members rose-

Mr James Gray (in the Chair): Order. A further seven or eight hon. Members are trying to catch my eye. According to my elementary arithmetic, that means that they will have three or four minutes apiece. It would be courteous if hon. Members could keep the length of their contributions down to something of that order.

10.15 am

Albert Owen (Ynys Môn) (Lab): It is a pleasure to serve under your chairmanship, Mr Gray. I want to distance myself slightly from something that the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) said. This is a serious debate, and Labour Members do not see it as fun. Wales is strategically important for defence training and the security of the whole United Kingdom, and Labour Members are proud of the investment that has gone into enhancing that capability over the past 10 years. The best pilots in the world are trained in Anglesey, and they are there because of the strategic importance of its RAF base. Those facts do not bear out any of the hon. Gentleman's points.

I pay tribute to the Welsh personnel who serve in the armed forces and who serve overseas. Like my hon. Friend the Member for Swansea East (Mrs James), whom I congratulate on securing the debate, I think it is important also to mention those behind the scenes who are involved in setting up operations. Similarly, it is important to mention the Territorial Army, and that is one thing on which I agree with the previous speaker; Wales makes one of the greatest contributions of volunteers, and I pay tribute to them. I am sure that the Minister will join me in that.

Defence spending in Wales is vital to defence training in the whole United Kingdom and to the important role that that plays in NATO. The United Kingdom is part of NATO, and plays an important defence role in that context. However, we need commitment and sustainability for the future, and that is what the debate is about.

I am concerned that the strategic defence and security review was conducted in a hurry. It was done just before a comprehensive spending review and was, frankly, caught up in it. I would rather that decisions had been made in the cold light of day, based on strategic defence requirements, than in the heat of a comprehensive spending review. The strategic defence and security review must be bolder and look at broader issues. It must look at least a quarter of a century ahead. I welcome the Government's five-year review, which is important, because things change. The threats to the United Kingdom change considerably, and we do not know where they will come from in the next three to four years, let alone the next 25 years. I therefore agree with the idea of a five-year review.

It is important that the Minister tells us what impact the departure, in my constituency, of 5,000 air personnel from the RAF would have on defence spending and defence personnel in Wales.

John Glen: Will the hon. Gentleman give way?

Albert Owen: I will give way briefly, but I am aware of the time constraints.

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John Glen: If the hon. Gentleman is so supportive of a regular review of defence spending now, will he tell us why there was not one between 1997 and 2010?

Albert Owen: Actually, I have lobbied on these issues. If the hon. Gentleman knows me, he will know that there is no difference between my criticisms of the Labour Government and of the current Government when I think that they are wrong. I think the current Government are wrong to have carried out the review so quickly. There is a window of opportunity to review things in five years, but that might be too late-that is the risk. We should have taken about 18 months to have a proper defence review. Whichever party was in office, the comprehensive spending review would have had to be done, and there would have had to be cuts, but we could have seen things in the cold light of day and had those strategic defence reviews in the future. That is my point.

I am conscious of the time, and had wanted to speak a bit longer than I will now be able to, because the subject is very important to Wales and my constituency. As the Minister knows, RAF Valley is in my constituency and is a centre of excellence for fast jet training with Hawks. There has been huge investment there in the past 10 years. Only last week a new building was opened, which will house the new Mk 2 jets. They are fantastic equipment and I am proud that they are British and will be part of our defence training.

The search and rescue headquarters is also based at RAF Valley. I was not 100% keen on the decision of the previous Government about part-privatisation, but I did understand the need to harmonise Navy and RAF helicopters, and, indeed, the Maritime and Coastguard Agency search and rescue, and bring them together. That decision-with billions of pounds of private investment coming into it-has been put on hold, and that will have a considerable impact on defence expenditure in Wales and my constituency. I am concerned about it and would like the Minister to clear up the matter of whether we shall continue with a part-privatisation, or whether there will be full privatisation. The uncertainty is affecting the morale of people employed in my constituency, who include a very famous member of the royal family, Flight Lieutenant Wales; that has got some attention.

The base is strategically important for search and rescue. If the part-privatisation had gone ahead, RAF Valley would have been the first base for such training in the whole United Kingdom. That would have been massively important to the local economy of north-west Wales, and the rest of Wales. I want some answers from the Minister about that, if possible. It is hugely important, and the base is there not because of job opportunities but because of Anglesey's strategic importance to the United Kingdom. The base has an excellent record.

As to the strategic defence review itself, the impact that the loss of 5,000 personnel from the RAF alone will have on Wales is important. I do not believe everything that I read in the newspapers, but I was very concerned-I want the Minister to deal with this if he has the opportunity-to read an article in The Sunday Times of 28 November with the headline "Cuts leave RAF with fewer jets than Sweden". I do not know much about Swedish defence, but I know that Britain trains and provides the best fighter jet pilots in the world, and I
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want that to remain the case. The article continues to say that many of the smaller NATO countries-and on the graph we are one of the smallest NATO countries with military fighter attack-would use a NATO base in Texas. I am happy to acknowledge the contribution of the Americans, but I do not think that their pilots are as good as ours. We need European and British involvement in NATO, and I cannot see why we cannot enhance our bases here, and get more Americans and Canadians. Canadians, Indians and Saudis come to RAF Valley now to train.

Billions of pounds have been invested in strategic defence. Hundreds of millions have been invested in the past 10 years in RAF Valley. I want that to continue. There are 1,500 personnel there, both civilian and military. It is top quality. It is a centre of excellence, not just in this country, but in the world. The search and rescue headquarters has people coming from all over the world, including Hong Kong, to see what we do, because we do it best. I am concerned that the strategic defence and security review, coupled with the comprehensive spending review, could undermine that and have a huge impact on strategic defence, and on local economies in Wales.

10.23 am

Oliver Colvile (Plymouth, Sutton and Devonport) (Con): I am grateful for the opportunity to speak in this feisty and entertaining debate. I thank all hon. Members who have taken part and congratulate the hon. Member for Swansea East (Mrs James) on securing it.

As hon. Members can probably tell, I am not a Welsh speaker or, for that matter, a Welsh Member of Parliament. I represent Plymouth, Sutton and Devonport, one of the finest naval bases in the country. I am struck by the fact that no one seems to have mentioned at any length during the debate the financial position that the coalition Government found they were in when they came to power. [Hon. Members: " Oh!"] I know that it is something we would all like to try to ignore, but unfortunately it is an issue that must be tackled. Whether hon. Members believe it or not, when the Government came to power they found that they had a £38 billion shortfall in the Ministry of Defence budget. At some stage that had to be dealt with. I realise that there are some who may feel that we do not need to tackle that issue at this stage of the game, but the civil servants who gave the coalition Government advice are the same ones who were in post prior to the general election, and they gave that advice to the Labour Government.

Albert Owen: I think that we need to kill this myth. We are talking about strategic defence for the next 25 years, not an economic cycle. Is the hon. Gentleman honestly saying that the Government are setting their priority for the defence of the nation within that five-year cycle?

Oliver Colvile: I wrote, during the run up to the strategic defence and security review, my own submission, in which I said that we certainly needed to re-order our priorities, and that defence was No. 1 of the two issues that I thought were important, along with long-term care for the elderly, which I still think is a very important issue for us to deal with. However, we are where we are. None of us came into the House to vote to cut defence expenditure. I for one will continue to campaign to ensure that my constituency stays firmly up in its position alongside other such places.

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Before I go any further I pay tribute to the Welsh servicemen who have served in Afghanistan and Iraq, and those who have served in the Falklands, along with many Royal Marines from my constituency; no one should underplay the contribution they made.

Plymouth, Sutton and Devonport has, in the past 10 years, had similar concerns about what would happen to it to those outlined by hon. Members. Frigates were potentially to be moved to Portsmouth-

Mr James Gray (in the Chair): Order. That is not about Wales.

Oliver Colvile: If I may say so, Mr Gray, there is a similarity with some of the issues that affect Wales.

Mr James Gray (in the Chair): Order. Similarity is not enough. The debate must be about defence spending in Wales, and not about Plymouth, Sutton and Devonport, close as it is to the hon. Gentleman's heart.

Oliver Colvile: The issue of where in the United Kingdom public expenditure will go must be taken as a whole.

Nick Smith: With respect, the hon. Gentleman is the second Government ringer who has been brought into the debate this morning. We need to talk about the defence of this country in Wales, and not to hear about his constituency.

Oliver Colvile: Fine. What I will say is that Wales has a significant part to play in the defence of our country, as have other parts of the United Kingdom, including my area. I should be interested to hear from the Minister not only what action he will take on issues to do with various bases in Wales, but what activity there will be in Wales to ensure that there are combat stress facilities, and similar things. We should not be talking just about investment in defence procurement and infrastructure. We need also to ensure that our servicemen and women, who have done such a good job for our country, have the opportunity to be well looked after, when they have done their time with the services. I ask the Minister to consider that and set out what is being done.

Debate on the subject will continue for some time, and I welcome the decision to have regular reviews. I will be fighting from my perspective, and I have no doubt that Opposition Members will do so from theirs. It is up to us to see who shouts loudest and puts forward the best case for the Government to listen to.

10.29 am

Chris Evans (Islwyn) (Lab/Co-op): I congratulate my hon. Friend the Member for Swansea East (Mrs James) on securing the debate. Even in a debate about defence spending, we cannot talk about defence without paying tribute to our brave men and women fighting overseas. I stood, like many other hon. Members, at cenotaphs in St Fagans, Pontllanfraith and Cefn Fforest in my constituency, and Maes-y-cymer, where we paid tribute to our war dead. We should always keep them in mind when we talk about defence.

I want to focus on the effect of defence spending on the wider economy. The defence footprint in Wales is massive and hugely underestimated. I often liken it to
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the car industry. There is no Welsh car but our supply chain, which manufactures components for cars, has a massive effect on the car industry. About 2,300 people work in defence in Wales; £250 million is spent by the Ministry of Defence with firms in Wales. My hon. Friends the Member for Swansea East (Mrs James) and the Member for Ynys Môn (Albert Owen) discussed St Athan, the training college, and made an important point about RAF Valley. A delay in one thing has a knock-on effect on the economy. With the promise of an MOD contract, firms ask to borrow money from banks. The bank manager will ask when the contract is arriving. They wait and wait, but still nothing. What happens is that the firm goes to the wall, the contract is eventually awarded by the Government, but there is no firm to produce the components needed.

That strikes at the heart of the problem with this Government at the moment: a real lack of understanding of economics. The idea that the public sector and the private sector should be separate is absolutely wrong, and if anywhere that can be shown to be the case, it is in the defence industry. Ian Godden, the chairman of ADS, the British aerospace and defence industry body, has warned that the British defence industry will halve in size from 10% to 5% of the UK's manufacturing output. The main customer for the defence industry is the Government, who have the power to shrink or grow the sector. Unfortunately, they have made the decision to shrink it. It is not about cutting an aircraft carrier or a tanker; it is about cutting investment for the future. That is the problem with defence cuts.

Guto Bebb (Aberconwy) (Con): The hon. Gentleman appears to be making the case for defence spending to be used as an economic development tool, which contradicts the comments made about the need for a strategic defence view of the world. In the context of arguing for defence spending as an economic development tool, can he justify why for the past five years-between 2003-04 and 2007-08-defence spending in Wales was less than 1% of the total under the previous Labour Government?

Chris Evans: I will come to that point when I discuss General Dynamics in my constituency.

This is about the knock-on effect on the economy. If a major defence contractor comes to a constituency-as we have been lucky enough to experience in Islwyn with General Dynamics UK-the knock-on effect is amazing. GDUK came to Islwyn, because Government encouraged it to invest in the community, and we are glad that it is there. If we look at the knock-on effect, a ground-breaking innovation centre-the EDGE facility at Newbridge-has been set up to enable small and medium-sized enterprises to transform innovative ideas into products fit for market. The centre acts as a springboard for new IP-intellectual property-providing a collaborative environment where the MOD, Britain's leading universities and high-tech SMEs are able to conduct rapid testing of new advances in technology.

That is the reality of defence. GDUK is a Welsh success story. The battlefield communication, Bowman, was developed in my constituency. The company has sent technology all over the world and has invested in upskilling its workers. The company takes the view that
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that would have been impossible without the support from Government for its successes. The fact is that once the technology is cut, it never returns. That is what we need to see when we are talking about defence. I have kept my comments short in order to allow other speakers an opportunity to make a speech..

10.33 am

Mrs Moon: It is highly appropriate that you are chairing this Committee, Mr Gray, given your knowledge and experience in the field of defence.

As a newly appointed member of the NATO Parliamentary Assembly, I have recently discussed with Members across Europe their view that the British defence and security review was rushed. That is not just an impression in the UK, but across NATO, where there is concern at the result of the cuts for European defence.

We are here to look specifically at the impact on defence in Wales. I recall a statement of my mother's that she threw at me many a time: "Decide in haste, repent at leisure." That is the situation with the strategic defence and security review-a decision that is going to impact dramatically on our sovereign capability, our skills capability and our financial-

Oliver Colvile: The Labour Government were in power for 13 years yet, after the initial period, they failed to produce a review. Why did they not have a review much sooner, as the coalition Government have had?

Mrs Moon: The Labour Government held a number of reviews, but not full defence and security reviews. There was a constant review of our capability, which had to take place because of our involvement in Afghanistan. I do not think anyone can say that the Labour Government failed to review and assess constantly the needs of our armed forces.

I want to focus on the issues of sovereign capabilities and skills capabilities in the defence industry in Wales. I am particularly concerned that we are not looking at the impact of cuts on our long-term capacity to protect our troops with the equipment and the platforms that they need. Prime contractors are represented in Wales, as colleagues have mentioned. Defence manufacturers based in Wales include EADS in Newport, General Dynamics in Islwyn and Thales Optics in St Asaph. For every job created by the industry, 1.6 jobs are created elsewhere in the economy. It has been calculated that a £100 million investment in the industry creates 1,885 jobs throughout the UK economy, 726 of which will be directly in the defence industry.

I want to focus on the role of SMEs in the defence sector in Wales, and to make the case for supporting and nurturing them in the months and years ahead. According to research from the Defence Industries Council, there are more SMEs in the UK defence industry than in the French, German, Italian and Spanish industries combined. Interestingly, General Dynamics-in the constituency of my hon. Friend the Member for Islwyn (Chris Evans)-said in evidence to the Select Committee on Defence:

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The Bowman programme is based in south Wales. In the same evidence, GDUK stated:

We have to remember that the impact of the growth of General Dynamics will rely strongly on 70% of SMEs being financially capable of surviving the current round of cuts and insecurity around contracting coming out of the MOD.

Guto Bebb: It would appear that we are again receiving a lecture about the role of defence spending in economic development. I am bemused by the fact that between 2003-04 and 2007-08, defence spending in Wales fell from £430 million to £390 million under the Labour Government.

Mrs Moon: The hon. Gentleman is trying to turn the whole debate. I am frightened by the debate, because the Government seem not understand that our defence capability relies on the defence industry being able to provide the equipment, and on our having the skills and the sovereign capability to provide our troops with the ability to defend this country.

John Glen: Will the hon. Lady give way?

Mrs Moon: No, I am not giving way again; our time is severely limited and I want to make progress.

I have made contact both with SMEs that form part of the supply chain of equipment to the MOD and with the large companies that I mentioned earlier. In my constituency, I have TB Davies, AMSS Ltd, Spectrum Technologies and TES Aviation, all of which are not only vital to the economy of Wales and of my constituency but provide the skills base that allows the MOD to provide the platforms needed by our armed forces.

It would be irresponsible not to consider the implications that the loss of the skills of the SMEs based in Wales would have for our prime contractors; we should remember that 70% of the work of those main contractors is allocated to SMEs. If we do not protect those SMEs, if we do not consider that skills base, if we do not consider our sovereign capabilities, we will put the defence of this country at severe risk.

10.41 am

Mr Russell Brown (Dumfries and Galloway) (Lab): I congratulate my hon. Friend the Member for Swansea East (Mrs James) on securing this debate. I put on record a point that has been made by Members on both sides of the Chamber: we should continue to pay tribute to our armed forces personnel for the job that they do, often in extremely difficult circumstances. Of course, they are backed up and supported by civilian personnel, who provide their own area of expertise.

We had a full debate on the strategic defence and security review on 4 November. The last thing that we want this morning is a re-run of that debate. That is not what today is about. It is a real opportunity to show just how much defence spending means to Wales as a nation. I hope that Labour colleagues, at least, will accept that
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as a Celt, I recognise what defence spending means in Wales, and in Scotland and every other part of the United Kingdom.

Nick Smith: Does my good friend agree that what we heard from Members on the Government Benches today was a shameless misrepresentation of Labour's position? Labour in Wales is standing up for the defence of our country, while recognising that employment is important to our constituencies. All that we had from the other side was a couple of defence ringers, who did not properly recognise our emphasis on our country's defence.

Mr Brown: I thank my hon. Friend for that intervention. I hope to cover some of the points that have been raised this morning, and I shall comment on that.

It is pretty clear that military establishments and bases are dotted across the entire UK. It must be recognised that those facilities become part of day-to-day life in those communities, whether through a sense of pride in being associated with the defence of our country, or simply because of the employment opportunities that they may bring. Frankly, whatever the reason, it all matters.

I want to quote from the debate of 4 November, because comment has been passed on the manner in which the strategic defence and security review came about. The quotation, from Hansard, is:

Many of us, including all Labour Members, have said that it was far too quick. The previous full review under the Labour Government took some 15 months to complete.

Chris Bryant: I hope that my hon. Friend will make it clear that there has been another loss of opportunity in relation to the St Athan defence technical college. We supported it not primarily because we wanted investment in Wales but because we wanted to improve training for our armed forces. So many of our young men and women go into the armed forces, and we wanted to make sure that their lives were protected and that they had the best training possible.

Mr Brown: Absolutely. I shall come to that later, but I have to say to my hon. Friend that I could not have put it much better. Until now, at least, there has been more than a fair degree of consensus on what was to happen at St Athan. It is somewhat disappointing that we are not getting the same feeling today.

Mrs Moon: Is my hon. Friend aware that the Select Committee on Defence carried out a full and thorough inquiry into the proposed training academy at St Athan, and felt that it was the right place for it, and that it was the right activity to carry out there?

Mr Brown: My hon. Friend is an extremely knowledgeable member of the Select Committee, and is exactly right; indeed, the hon. Member for Salisbury
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(John Glen) indicated the same thing at the start of his speech. It basically made sense, and the Select Committee gave it full backing.

John Glen: I said that the Defence Committee's report was pretty clear about the SDSR being undertaken in the wrong circumstances. I did not mention the report on St Athan.

Mr Brown: I clearly picked up from the start of the hon. Gentleman's contribution that St Athan, and what was previously proposed on a cross-party basis, made sense. However, Hansard will show what was said.

We see uncertainty in the questions that are being tabled, whether on departmental redundancies, rescue services or the level of savings. This morning, in contributions from both sides of the Chamber, we have heard that that uncertainty still exists. We need to be clear about where we are going with St Athan. I am not convinced that the Minister will be able to tell us today, but indications are that we might hear in the spring. For all concerned, I sincerely hope that we will have a clearer idea by then.

A question was asked about what that uncertainty does for communities. The debate is about defence spending. It is about investment. It is about the future of our armed forces, and what we are best able to do to serve those who serve the nation in difficult circumstances. They do not need uncertainty. My hon. Friend the Member for Bridgend (Mrs Moon) made the valid point that small and medium-sized enterprises in many communities play a vital role. Uncertainty about where we are going can destroy SMEs, a point made also by my hon. Friend the Member for Islwyn (Chris Evans). Delays lead to economic uncertainty.

The figure of £38 billion was mentioned once again. I wish to make it abundantly clear that that sum was never to be found in any document. The figure that was spoken of came from page 22 of the MOD major projects report of 2009, which mentioned £6 billion over 10 years. The only way that that £6 billion could become £38 billion was to assume that there would be no increase in Britain's defence budget until 2021. That was never going to be the case under a Labour Government, and I sincerely hope that it was never going to be the case under any coalition Government. In fact, there was a 10% rise in defence spending between 1997 and 2010. In this country, defence spending consistently formed 2.5% of GDP-one of the highest levels in the world, so it is not that we scrimped at all.

I appreciate that I need to allow time for the Minister to speak. I am only sorry that I cannot give him more time. Members on the Opposition Benches have been clear this morning: they want more certainty on the matter. Let me finish with something that was said by the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile)-he and I sat together at a dinner a couple of weeks ago. There was almost an admission from him that this rushed strategic defence and security review was financially driven; it was not in the best interests of our country, our defences or those who serve in foreign lands.

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10.51 am

The Parliamentary Under-Secretary of State for Defence (Mr Andrew Robathan): This is the first Westminster Hall debate to which I have contributed in the past five years. It is a pleasure to be here and to be under your chairmanship, Mr Gray. I congratulate the hon. Member for Swansea East (Mrs James) on securing the debate. She spoke about the effects that choices on defence spending can have on regions of the United Kingdom, and I hope to return to her words shortly.

There has been some suggestion that the Government are, in some way, anti-Welsh; that they have their daggers out for Wales. That is absolutely not the case. Let me give my own credentials. My great-grandfather and great-great-grandfather were doctors in Islwyn, in Risca. My grandfather was headmaster of Llandaff Cathedral school.

Chris Bryant: So what?

Mr Robathan: I am just saying that I am not Welsh [Interruption.] Rather,I am not anti-Welsh. The name Robathan is Welsh. In fact, in Islwyn, there are many Robathans in the telephone book. I had a great-uncle in the Welsh Guards, and another great-uncle who was killed at Gallipoli.

Chris Bryant: That has nothing to do with it.

Mr Robathan: The hon. Gentleman is always full of hot air. If he could listen for a bit, he will hear what I have to say about some of the comments that have been made. I also had a great-uncle in the Welch Regiment who was killed at Gallipoli. I would rather not be accused of being anti-Welsh. I can promise that I have spent more time on the Brecon Beacons in the driving rain and snow and in Sennybridge than most people in this Chamber, possibly with the exception of you, Mr Gray, and my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart). I have also climbed from Capel Curig adventure training camp. Those are all the military assets in Wales that I have used in my life. I would rather not hear the suggestion that we are anti-Welsh. This is the first Welsh debate in which I have taken part, because I am not representing Wales.

Let me pay tribute to all the civilians who work for the MOD and in defence projects in St Athan and elsewhere in Wales. I should also like to pay tribute to all the armed forces who are based in Wales or who are from Wales. Indeed, I support anyone who supports the defence of the United Kingdom from wherever they come.

I have been surprised by this debate because I have found it extraordinarily narrow and partisan [Interruption.] Did the hon. Gentleman say because it is Welsh? I find it astonishing. The hon. Member for Swansea East compared the desecration of war memorials in her constituency with the fact that we are not preceding with the Metrix bid at St Athan. I can see no relationship there at all; I do not believe that her constituents or people outside will, either.

Hon. Members have spoken about the SDSR, but let me be quite clear about it. Across Government, we have faced the worst financial and economic crisis that anybody
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in this room has seen in their lifetime. [Interruption.] It is no good groaning. The hon. Member for Rhondda was a Minister in the previous Government and he knows that it is true.

We are currently borrowing £143 million a day. In terms of defence in Wales, that would buy, every week, three Type 45 destroyers. [Interruption.] Do they never go to Welsh ports? It is not fallacious, as the hon. Member for Rhondda said-[Interruption.] Gosh, he witters. It is not fallacious that defence budget was overspent by £38 billion; it is true.

Let me turn briefly to some of the remarks that have been made. First, the hon. Member for Swansea East quite reasonably wants to hear about St Athan. One of the biggest decisions that the Ministry of Defence had to take was on the defence training rationalisation programme. We have heard at length about its cancellation. Put simply, that project, in the guise that it was in, was never going to be made affordable. Despite strenuous efforts by the Department-under both the previous and current Administrations-it became clear that the bidder, Metrix, was unable to deliver an affordable, commercially robust proposal within the prescribed period. On that basis, the Defence Secretary decided to terminate the project.

We continue to believe that individual technical training co-located on fewer sites, as my hon. Friend the Member for Salisbury (John Glen) mentioned, remains the best solution for the armed forces, but not necessarily for St Athan. The SDSR committed the Government to continuing to look at options from pre-training across the services.

Chris Bryant: This is a serious point. Many of us believe that bringing together all the forces for technical training is an important part of what was suggested in the past. It has worked extremely well at Shrivenham. Who would ever have thought that the Royal Navy would be prepared to leave Greenwich? It has, and it has worked. Is the Minister still saying that he wants to achieve purple training in, we hope, St Athan or elsewhere?

Mr Robathan: As the hon. Gentleman will understand, I have to be very careful not to commit myself to things that we are reviewing at the moment. None the less, we do see a need and a sensible way forward for more purple training on some issues. Some of that may take place in St Athan and some elsewhere.

I can assure hon. Members that St Athan is still being considered; a substantial amount of training continues at St Athan.

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Geraint Davies: Will the Minister give us some indication of the time frame in which we will get clarity over whether there will be a joint establishment and where it will be? Will it be in a year, two years, three years, or does he just not know?

Mr Robathan: The review does not have an end date, but I expect it to be within the next few months.

I appreciate that the cancellation of the DTR was not something that the hon. Member for Swansea East or the people of south Wales wanted to hear. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) pointed out the rocketing costs of the DTR in St Athan. He said that in two years they had gone up from £12 billion to £14 billion. He mentioned the job losses. He said that almost half the people who were employed by the MOD 13 years ago are now not employed. He also talked about the Red Dragon hangar. The previous Government decided to build that hangar. It cost £107 million and it was to accommodate the refurbishment of 48 Tornados and Harriers. The repairs and refurbishment were cancelled before the hangar was completed in 2004; it was a complete waste of money.

The hon. Member for Ynys Môn (Albert Owen) talked about the Metrix decision being made in the context of the SDSR. He is wrong. It was separate from the SDSR and not part of our overall view. He also talked about RAF Valley. I can reassure him that RAF Valley plays a very important role in pilot training-fast jet training. If there are changes, we will keep him informed. He is also welcome to write to me, and I will write to him if changes come up.

The hon. Gentleman talked about Texas. I have to say that the weather is generally better there than in Anglesey.

Albert Owen: Will the Minister tell us the position with regard to replacing Sea Kings with Sikorsky helicopters? The £7 billion contract is important.

Mr Robathan: I am afraid that I do not have the time, but I will write to the hon. Gentleman.

In conclusion, the previous Government let down the United Kingdom. They let down United Kingdom defence and they let down Wales. I was told today that Labour was standing up for defence. It has not been standing up for defence in Wales but for narrow partisan interests. Frankly, it is a scandal. We will not make defence decisions based on regional party political advantage, or on the advantage of the Principality; we will make a clear-headed assessment on what is best for our armed forces, the United Kingdom-including the Principality-and its defence.

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Football Grounds (Regulation)

11 am

Nic Dakin (Scunthorpe) (Lab): It is a real pleasure to have this debate under your chairmanship, Mr Gray. When I submitted my request for this short Westminster Hall debate, the title had the words "Keep Scunthorpe Standing" in it. The Table Office informed me, in its own inimitable way, that that was sloganeering and would need to be improved. Hence the title that we have today. Nevertheless, it is on Scunthorpe United that I wish to focus my attention. I should certainly declare my interest as a season ticket holder at Glanford Park, albeit in the seated Grove Wharf stand.

Before I go further, let me take the opportunity to praise all associated with Scunthorpe United. It is a small club that, despite a recent run of results that we would rather forget, is punching above its weight. It has, in Steve Wharton, a chairman who, like his father before him, has run the club sensibly and in a businesslike manner that some might say could be a model for other clubs up and down the land.

Scunthorpe United is not a club that changes its manager every five minutes. Instead, it grows managers out of its coaching personnel. It has been well served by Brian Laws and Nigel Adkins, and it is now being well served by Ian Baraclough. They have built good teams out of scarce resources, and the players are to be applauded for their achievements in recent years. Having said that, the "team" of a football club includes all the other staff who work day-in, day-out, to make all the backroom activities happen, and those other staff at Scunthorpe United are also brilliant.

Scunthorpe United is a club rooted in its community that does excellent work in education through its "Study United" programme, and it takes on apprentices each year as part of an ongoing commitment to sports development. It also has loyal and dedicated fans, such as David Beverley and his colleagues, who have been working with the Football Supporters Federation on the "Keep Scunthorpe Standing" campaign.

Currently, the rules state that once a club has been in the championship for three years, its stadium must become an all-seater stadium. Everyone fully understands the awfulness of the Hillsborough stadium disaster of 15 April 1989, and the recommendations for all-seater stadiums were a key component of Lord Justice Taylor's excellent report into the disaster. There have been many significant strides forward in ground safety since that time. Thankfully the world-in terms of stadium safety-is a different place today.

The hon. Member for Bath (Mr Foster) made an excellent speech yesterday introducing his ten-minute rule Bill, in which he very ably set out all these issues. As he explained, it is perfectly possible for the United Kingdom to have safe standing in the same way that the Bundesliga does.

Mr Tobias Ellwood (Bournemouth East) (Con): I am very grateful to the hon. Gentleman for bringing this issue to the House. AFC Bournemouth is doing very well in the first division at the moment, and this issue concerns AFC Bournemouth, too. There is a change in technology, which I hope the hon. Gentleman will recognise, that makes things very different from how
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they were at the time of the terrible events at Hillsborough, to which he referred. I hope that that change in technology is something that we might be able to embrace, and I hope that we will say, "Can we actually introduce this now?"

Nic Dakin: The hon. Gentleman is absolutely right, and I compliment AFC Bournemouth on the good season that it is having. He is right to draw attention to changes in technology and stadium management, and more modern methods of properly policing football grounds and ensuring fans' safety. Those are the issues that we need to look at. The rules on all-seater stadiums need to be revisited for modern times. There should be no compromise on safety, but there should be common sense. If Scunthorpe's standing capacity has been safe for all these years and appropriate safety management is in place, there is no strong argument for replacing it with seating.

Jim Shannon (Strangford) (DUP): Does the hon. Gentleman agree that, although it is very important to have safety, it is surely not impossible to marry safety with the finance available? Finance has to be a key factor for any football club and any football ground at the present time.

Nic Dakin: I absolutely agree with the point that the hon. Gentleman is making. Safety is crucial and should never be compromised, but there also needs to be a sensible way forward. In these difficult financial times, that is very important. The Glanford Park terracing has stood for more than 20 years. It is under threat solely because the football team has been successful. It is my contention, and that of the Football Supporters Federation, that Scunthorpe United and its supporters should not be penalised and lose the safe standing option because of the club's success.

If the current rules are adhered to, a very small club will have to spend significant amounts of money during these difficult financial times to convert the safe standing area into seating. That would mean that the club would have the invidious choice of paying even more for a larger seating area, to maintain the maximum ground capacity of around 9,000, or reducing the ground capacity significantly.

Seating the Doncaster road end would reduce Glanford Park's capacity by about 1,000. That would mean fewer tickets would be available for big games, such as the recent Carling cup game against Manchester United or the forthcoming FA cup visit of Everton. In turn, that would mean more disappointed fans and less revenue for the club. There is a danger that such a move would harm the club because it would be forced to divert its limited financial resources and energy into redeveloping the stand; that money would be better spent on improving the team or enhancing the experience of supporters.

Andrew Percy (Brigg and Goole) (Con): I congratulate the hon. Gentleman on securing this debate and, as he is obviously aware, Glanford Park is in my constituency and I am delighted to work closely with him on this issue. However, is there not an even more important issue here? We talk about localism a lot; this issue is about what the fans want, and what the fans of Scunthorpe
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United are saying very clearly is, "Let us make our decision about what we want, and let us keep our terraces."

Nic Dakin: The hon. Gentleman is exactly right in many respects. It is important to listen to what local people and local fans are saying. However, we would not and should not compromise safety. Nevertheless, it comes back to looking at this issue in the modern circumstances of today and recognising that Scunthorpe United's stadium is a 9,000-capacity ground, with average crowds of 5,000. I will just make a little more progress now before taking any other interventions.

The Football League, in its letter to the Minister for Sport and the Olympics of 22 October, stated quite clearly:

That is a very helpful statement.

Mr Ellwood: I am grateful to the hon. Gentleman for being generous in taking interventions. It is important that safety is stressed. Cost is also critical. AFC Bournemouth is in dire straits, as are many other football clubs. The solution of allowing standing by using new technology would help. However, the point that I wanted to underline-I want to ask the hon. Gentleman if he agrees with this-is about the atmosphere that would be created by having standing capacity. Every time that a goal is scored or play builds up towards a goal, everybody ends up standing up anyway. There is a sense of atmosphere in standing areas that will encourage more people to come through the gates, which will help the gate receipts and the running of the club, from a cost perspective.

Nic Dakin: The hon. Gentleman makes a good point about the atmosphere in grounds, which is an important part of the football experience. Scunthorpe United is a well-run football club, which stays very carefully within its means. The club moved to the purpose-built Glanford Park in 1988, where the affectionately named "Donny road end" has always been a safe standing area.

That small club, with a ground capacity of just over 9,000 and average gates of around 5,000, is being caught up in safety rules designed in another age for much larger grounds. If the club remains in the championship for another year, the safe standing capacity will have to be removed and replaced with seating. That will cost money at a time when resources are scarce; it will reduce the ground capacity, and it will take away choice and enjoyment, as the hon. Member for Bournemouth East (Mr Ellwood) has pointed out, from those fans who prefer to stand. Moreover, once the ground has become all-seater, it will not be able to revert back to having a standing area, even if the club spends the rest of its life in the lower divisions.

Cardiff City was allowed to retain standing for six years in the championship league. Why should Scunthorpe United, the smallest ground in the league, not be given a similar dispensation? There are much larger grounds in the lower leagues, such as the Carlisle United grounds, that are not affected by the rules. Will the Minister examine the experience of safe standing in other parts
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of the world, including Germany, and review the current requirements for all-seater stadiums in the premiership and championship leagues?

Steve Rotheram (Liverpool, Walton) (Lab): I congratulate my hon. Friend on securing this important debate; it is only right and proper that the issue should be debated fully. Will he explain or tease out the assurances regarding ground safety that he outlined that will ensure that we never return to the circumstances that resulted in the Hillsborough disaster of 1989?

Nic Dakin: My hon. Friend asks an important question. Lord Taylor's report was thorough and found many causes for the problems that occurred. Standing was not one of them, but none the less, all-seater stadiums were seen as an important part of the solution. We must consider the experience around the world, particularly in Germany, whose strong record of safe standing demonstrates that it can be done. I agree with my hon. Friend that there should be no compromise on future safety in the interests of standing; we should ensure that any standing is safe standing. However, I draw attention to the fact that Scunthorpe United's ground has always had standing and has always been safe.

Justin Tomlinson (North Swindon) (Con): The hon. Gentleman has secured an excellent debate. I echo his comments about Scunthorpe club being a role model. On the point just raised, I have every sympathy with what he is saying, but I am extremely nervous. Since Lord Justice Taylor's report, safety in grounds has been improved and transformed. The prospect of a change makes me nervous.

Nic Dakin: As I have said all along, safety should never be compromised, but we need only look across to the Bundesliga to see an example of how one of the best leagues in the world manages safe standing alongside seating, using modern technologies. I agree with hon. Members' comments. I welcome the point made by my hon. Friend the Member for Liverpool, Walton (Steve Rotheram) that this is the right debate to have, but in no way should we prejudice safety in this debate. That would be wrong.

My second question to the Minister is this. Will he review the requirements that apply to small grounds such as Glanford Park, and allow the Football League to use its discretion, where local circumstances and common sense allow, to provide dispensation for small clubs such as Scunthorpe United to retain some safe standing capacity? Scunthorpe has had safe standing for its whole history, during which three England captains have played for the north Lincolnshire side: Kevin Keegan, Ray Clemence and, of course, Ian Botham. I thank everybody who has attended and contributed to this debate. Up the Iron!

11.13 am

The Minister for Sport and the Olympics (Hugh Robertson): I congratulate the hon. Member for Scunthorpe (Nic Dakin) on securing this debate and on how he has conducted it. I pay tribute to him for his work on a number of football issues since his arrival in the House, and I join him in paying tribute to his club, which has done exceptionally well. It is a proper community club in every way, and he is absolutely right to pay tribute to the current chairman and his predecessor for their
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running of it. It is an example of the sort of football club that we all want to encourage, and I wish Scunthorpe the best of luck for the remainder of the season.

Having said that, I remind the hon. Gentleman, as well the hon. Member for Bradford South (Mr Sutcliffe), that the Minister's powers in this area are limited. I can ask the Football League to re-examine the issue, but I could not sign an order forcing it to, even if the hon. Gentleman convinced me to do so today. The issue concerns not only many of his constituents but supporters up and down the country. As he correctly stated, the current rules go back to the Taylor report, published in the aftermath of the unnecessary loss of life at Hillsborough. He is absolutely right that that tragedy is the backdrop to this debate, and as he will know, many in his party as well as mine feel strongly about the issue. The Minister for Sport who preceded the hon. Member for Bradford South was among those who felt strongly that there should be no return to safe standing.

Having considered the basics of the case, I think that it is now generally accepted that most football grounds, for a vast number of reasons, are safer and more comfortable than they were 15 or 20 years ago, although I understand why many supporters miss the tradition, the feel and the atmosphere that some grounds had before. I checked the injury statistics for the past few seasons collected by the Football Licensing Authority. They suggest that spectators are less likely to be injured at all-seater grounds than at those that retain standing accommodation. I am aware that those statistics rely on self-reporting, which is always a dangerous statistical basis, and therefore might not provide a wholly reliable indicator of the relative injury rates, but I think that it is generally accepted across football that standing still presents a greater risk of injury, although the extent of that risk is open to debate.

Seating also offers higher standards of comfort, as is probably self-evident, and provides spectators with their own defensible spaces, which can only contribute to encouraging families and increasing the diversity of those attending football matches in recent years. I am sure that we all support that. I know that no one is suggesting that we should return to the arrangements in place 15 or 20 years ago, but I am not convinced at this stage that a compelling case has been made to change the policy on standing areas.

Mr Ellwood: I am grateful to my hon. Friend for the tone in which he is responding to this debate and for acknowledging that the power does not lie with him, but I hope that he will also acknowledge that there were other factors leading to the 1989 Hillsborough disaster. Yes, seating was one, but there were also crowd control issues, and there were no spill-over areas. The many changes that have been implemented and are now displayed every Saturday or Tuesday night mean that standing or seated, we can avoid what happened on that day. I hope that new technology might allow clubs not in the premier or championship leagues to consider piloting that idea in certain parts of the stands.

Hugh Robertson: I do not believe that the presence of all-standing areas was the contributory factor at Hillsborough; that is self-evidently ridiculous. A basket
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of factors contributed to that disaster, including crowd control, as my hon. Friend says. He is also right that technology has moved on considerably during that period. That said, there are also new elements of technology that rely on fans being seated-the police, for example, say that crowd control via CCTV is much easier if fans are seated than if they are standing-so the argument cuts both ways.

As the hon. Member for Scunthorpe knows, our coalition partners previously agreed a conference motion asking for the provision of some safe standing areas to be considered. I remember that the hon. Member for Bradford South and I kicked about the issue, if that is not an unfortunate pun, a year or so ago when we were on opposite sides of the House. At the urging of the hon. Member for Bath (Mr Foster), I have reconsidered the issue, as I promised in opposition we would. I have written to all the football authorities, and we are in the process of collating their responses.

I say gently to the hon. Member for Scunthorpe that he was right to quote the letter from the Football League. As he correctly said, they replied:

But the next sentence reads:

There is a balance to be struck. We are in the process of collating football authorities' responses. I am keeping an open mind, but to be honest, there is no groundswell of opinion from the football authorities in favour of a change. I think that they are just as scarred by the Hillsborough experience as many of us who are or have been in government. That is a powerful backdrop and should always be so. There is considerable nervousness about moving, giving that backdrop.

Steve Rotheram: I think that the Minister would agree that this country has had an exemplary record since the Hillsborough tragedy, but that is not necessarily the case for the rest of the footballing world. Because of all-standing stadiums, there are tragedies all too regularly in which people are crushed to death, and it is obvious that that fear is the backdrop against which my hon. Friend the Member for Scunthorpe has put forward his proposals.

Hugh Robertson: I thank the hon. Gentleman for his intervention and, once again, for the excellent debate on football that he secured in this Chamber a few months ago. He has put his finger exactly on the issue. The matter is characterised less by people being at either one end of the argument or the other, and more by a balance of risk somewhere in the middle.

I absolutely accept the arguments that the hon. Member for Scunthorpe has put forward, and many people feel that the risk could be safely managed in such a way that retains the traditional feel of football clubs. On the other hand, a considerable body of opinion on the other side of the line would argue that there are a number of reasons why that should not happen. On the balance of opinion, therefore, and given the backdrop of Hillsborough, we must do nothing that could in any way lead to such a tragedy. That, in a nutshell, is the argument about balance that I am trying to sum up.

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We have looked at the experience of other countries and will continue to do so. I am aware of the arrangements in Germany, funnily enough, because I attended football matched there when I was serving in the forces in the early 1990s. I am also aware that things have moved on considerably in the 18 or 19 years since then. The hon. Member for Scunthorpe might be interested to know that the Culture, Media and Sport Committee is planning to look at the matter in the new year as part of its wide-ranging inquiry on football governance and intends to visit Germany to look at the experience there, so the matter remains current and is being examined.

With regard to the hon. Gentleman's football club, to which I once again pay tribute for its achievements, the difficulty is that it has had three years to comply with the requirement. I understand why it does not welcome any sort of financial outlay in the current economic situation, particularly to make a correction that it does not feel is necessary on grounds of safety. However, since Hillsborough there has been a set of basic criteria governing the regulation of football. That has been lifted only once, for Cardiff City, because of a particular set of circumstances.

I can promise the hon. Gentleman today that we will most certainly keep the experience in other countries in the forefront of our minds. It is not a matter that we will review once and then drop. The fact that the hon. Member for Bradford South and I discussed that at considerable length when he was in government and I was in opposition should give the hon. Member for Scunthorpe confidence that it is something that the Government keep permanently under review. There are also pressure groups that ensure that we keep it permanently under review, and we will continue to do so. I will wait until I have received all the responses and then have some proper police advice, so for the moment I am keeping an open mind.

However, it would be dishonest not to tell the hon. Gentleman today that in my view the judgment will very much relate to the balance of opinion, and there is not a groundswell of opinion, from either the football authorities or the police, that would support a change in the legislation. For the moment, I simply congratulate him on securing the debate and for the way in which he has raised the matter. I appreciate the sensible and constructive way in which he has brought the problem forward. Most importantly, I wish his club good luck; it is a fantastic example of what we are looking for in community football. We will keep the issue under review, but I am afraid that I do not think that there is a compelling case at the moment for altering the rules, set against the backdrop of the Hillsborough disaster 20 years ago.

11.24 am

Sitting suspended.

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Seaside Towns (Regeneration)

[Mr David Crausby in the Chair]

2.30 pm

Laura Sandys (South Thanet) (Con): It is a great privilege to serve under your chairmanship, Mr Crausby, and to see so many colleagues from all parts of the perimeter of this country here today.

I am sure that the Minister was as pleased as I was when the Prime Minister described tourism as one of the best and fastest ways of generating the jobs that the country so badly needs. For too long, it has been the Cinderella business sector. It has been ignored for many years, but the Prime Minister put it on the pedestal that it deserves.

No one would be here today if they did not recognise the value of tourism to their constituency. In Thanet alone, it is valued at £162 million a year. We want to ensure that the tourism sector grows, that the small businesses in it thrive, and that new businesses are created in our coastal regions. Tourism and the associated economic activity are critical to our future.

Coastal communities are what I call pocket economies. They do not always react in the same way as the rest of the country; they often behave counter-cyclically. When the rest of the economy was thriving in the 1980s, seaside towns, and Thanet in particular, were suffering. During the Brown boom, Thanet did not benefit from the economic vibrancy of the rest of the country. Deprivation increased, worklessness was not addressed, and property prices rose only modestly. Coastal communities lag behind the rest of the economy and, in some instances, are passed by altogether.

Coastal communities have much more in common with one another than with their prosperous neighbours. If we compare Thanet with Canterbury, which is a mere 20-mile drive away, in Thanet, average salaries are £60 a week less than in Canterbury, there is double the number of jobseeker's allowance claimants, and vacancies are 25% of those available in Canterbury. There is no guarantee that our pocket economies will necessarily benefit from any upturn in the general economy. We also have high levels of public sector jobs, and few, if any, large company employers. Currently, my constituency is the 64th most deprived district in the country-not exactly the profile one would expect in the south-east.

On a positive note, perhaps the lack of modernisation and development can deliver a unique proposition. Cloned high streets have passed us by, large hotel chains and restaurants prefer more central locations, and developers have looked for easier pickings. We are unusual and quirky, and we have personality and character-a rarity in the world which should offer us a competitive edge. Thanet has 26 miles of sandy beaches, cliffs like those in the Algarve, walks suitable at any time of the year, and architecture that rivals any in the country. It is an historic mecca: from the Romans to the Beatles, we have had it all, with every invasion other than the Norman conquest and every major war fought from Thanet's shores, and we have all the sights that go with those great British triumphs.

Two weeks ago, Thanet was nominated as one of the 12 most desirable locations in the world-can hon. Members believe that? We were celebrated in the same
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breath as Rio de Janeiro, Santiago in Chile, and Stockholm. This week, one of our local hotels was named the best small hotel in the country, and we have many more hotels and bed and breakfasts like it. However, we need a step change. We need to change the way in which our coastal towns are perceived and marketed. Traditionally, seaside towns have been marketed as locations for the sunny summer months but, to maximise the opportunities and great visitor experiences, we need clear strategies to increase significantly our out-of-season business.

Mr Mark Williams (Ceredigion) (LD): I congratulate the hon. Lady on securing this debate. I represent what is perhaps an unknown part of the country in west Wales-the Ceredigion coastline. The hon. Lady is getting to the point where she is really talking about responsibility for the branding of our respective areas. I applaud local initiatives such as the Cambrian Mountains initiative, and I have hopes for the promotion of Cardigan bay. Who will be responsible for branding? Will we rely on local initiatives, or do we expect-and, I hope, anticipate-more of a lead from the centre, in particular VisitBritain?

Laura Sandys: Those are certainly questions for the Minister, but I think that what we need to do centrally more than anything else is to change the perception of seaside towns. The view is that if we put a beach on the website, the tourists will come over the summer months-and they do. Certainly Thanet does not need as much input for the summer months. However, we need to ensure that people appreciate the area whatever the time of year. I was walking on a beach with snow on it, and it was stunning. We have to understand that there is an all-year-round marketing opportunity.

Further to what my hon. colleague rightly said, we need a Minister for out-of-season marketing. Last weekend, I looked at the VisitBritain and VisitEngland websites. In many ways, they do a great job promoting this country, but it took six clicks to reach one seaside resort-Eastbourne-and no other. Under "things to do", there is no mention of seaside towns. In the packages that they present for Canterbury and Lincoln, there is no suggestion that visitors extend their stay by a couple of days to visit the beauty of Thanet or Skegness, only a few miles down the road.

I accept that this is not an obvious time to visit our beaches, but I would like to ask the Minister what he thinks about the beaches in Weston-super-Mare at this time of the year. Would families not love to visit the SeaQuarium in Weston-super-Mare on their way to Wookey Hole? We need to ask our tourism marketers to be more creative about the opportunities that they offer to extend the season in areas that have been wrongly pigeonholed as summer locations, to think creatively about how they can add economic value and play a part in the regeneration of our coastal communities with taxpayers' pounds, and not just be offered as window dressing for locations that are already international household names.

Extending the season is crucial for us all. If we could achieve that, we would increase revenues by 15% to 25%, increase employment, which is currently seasonal, and support our high streets and small retailers. That
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must be a crucial objective for us all. We need to be on the main websites all year around-that is fundamental-so changing the mentality of the marketers is crucial.

We must also look at what other countries do very successfully, not least social tourism, which is a concept not well understood in the UK; frankly, it is not understood at all. It is about offering out-of-season opportunities to people on lower incomes, people with disabilities and older people. The models range from those that involve public subsidy to those that cost the Government nothing. The Belgian tourism body will not register a hotel or holiday establishment that does not provide free or discounted holiday nights out of season. At no cost to the public purse, it incentivises accommodation owners to ensure that they provide discounted offers. In Spain, the Imerso scheme, which offers senior citizens off-peak holiday breaks by the sea, has led to a 10% increase in tourism revenue and a 16% increase in tourism employment. In France, 135,000 establishments accept vouchers available for those on low incomes, generating €3 billion for the French tourism economy every year. That system costs the Government nothing and is an incentive package that companies offer their lower-paid workers. I am sure that many hon. Members in the Chamber would like to establish a working group with the Minister's Department to see if we can create a sustainable scheme that would generate such revenues for our seaside towns out of season.

There is one final issue on which I should like the Minister's support. Many of us who spoke, or who wanted to speak, in the debate on the Daylight Saving Bill on Friday were a little disappointed. The measure would support our weaker pocket economies in coastal areas at almost no cost, and if they adopted it, the Government would increase Thanet tourism revenue by 10%. Nationally, the measure would boost tourism revenues by £3.5 billion and generate about 80,000 jobs -quite an impact for just one measure. The fact that the Government did not even want to investigate what measures could be put in place was particularly unhelpful. Even the Scottish nationalists, who are against the proposal, conceded that perhaps there is a case for putting back the date when we revert to Greenwich mean time. Even an extension to the end of November would make a serious difference. I hope that my hon. Friend, as Minister responsible for tourism, will make further representations to other parts of Government to consider this issue again.

I urge the Minister, who is a great champion of tourism and heritage and who represents a seaside town, to support us in this push for greater marketing out of season, for consideration of social tourism or other mechanisms to ensure that we can get the most out of our exceptional accommodation on the coast and for daylight saving to be regarded as a priority for the regeneration of our coastal communities. That is not just for our benefit. It would benefit the Treasury in increased taxes. The Minister could put a smile on the face of the Department for Work and Pensions by reducing unemployment in some of the most intractable parts of the country, help the Department for Business, Innovation and Skills increase the number of new business start-ups in coastal towns and help us break the cycle of deprivation and economic stagnation that so many of us face locally.

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2.43 pm

Dr John Pugh (Southport) (LD): I congratulate the hon. Member for South Thanet (Laura Sandys) on giving a focus to this debate by analysing with great skill many of the problems in seaside towns.

I apologise if I do not sound like my usual cheerful self, Mr Crausby. I have a disease that I am trying to throw off. Were I in the sun-kissed environment of Southport, I am sure that this would not be so. I represent Southport, which some people say is only technically a seaside resort, because we have so much beach that it takes some time to get to the sea. None the less, it has regenerated itself successfully in recent years and I am proud of what has been achieved there.

It might help new hon. Members if I rehearsed some things that were done in the previous Parliament. There has always been a group of Members of Parliament from seaside resorts who have got together to co-ordinate their efforts and put pressure on the Government to deal with their specific concerns. In the previous Parliament, we were helped by a report on coastal towns from the Select Committee on Communities and Local Government. I sat on that Committee and I assure hon. Members that it was not easy to get Committee members to consider that matter, because they thought that it was a marginal issue and perhaps not sufficiently substantive to occupy a serious Committee. But that was done, and it was a surprising success.

Initially, the Government response to that report was fairly negative and bland. Phyllis Starkey, then Chair of the Committee, asked the Department to consider its response again and, to our surprise-there might have been a change of Minister-the second response was a great deal more positive. "Sea Change" funding appeared, which was to be administered by the Commission for Architecture and the Built Environment, and there was a clear cross-departmental focus on the problems of seaside resorts, which was wholly helpful. At about that time, regional development agencies were given responsibility for tourism and asked to look specifically at the regeneration of seaside towns, in addition to other topics that they are more familiar with, such as urban regeneration.

We found from the Committee's report that it was hard to generalise about seaside towns, because they are all so different; they are not only in different parts of the country, but are different in character and history. Some concentrate on fishing and others on fairgrounds. There really are quite stark differences between many resorts. Skegness is not the same as, or anything like, Brighton, although it happens also to be on the sea.

A cluster of problems can be found in most seaside towns. They normally have an interesting past, but equally they have a rather uncertain future, and sometimes an uncertain view of where they should go. I visited Margate with the Select Committee, not too far away from the constituency of the hon. Member for South Thanet, and found a town torn in two directions. People wanted to go different ways. Some wanted the old fairground back and wanted Margate to become a place of pleasure rides, and others wanted to build on the Turner heritage, and the light of that area, and have a more aesthetic development. I am not sure which direction that area went in, but that difference of opinion
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crystallises a general view that I have formed, which is that all seaside resorts, if they are to go anywhere, need some view of what they are essentially like.

Southport has been successful because it has not tried to rival Blackpool and has a concept of itself as a classic resort, which is distinctive, and it plays to its strengths, such as Lord street and, generally speaking, the Victorian environment-and as a market brand, it works. But like many other places, it also has problems with its housing stock, particularly the hosts of large houses built for the days when thousands of people trooped there regularly to fill out boarding houses. That means that such places end up with a skewed housing stock. In some towns on the Kent coast, that housing stock is filled with a disproportionate number of benefit claimants. There are genuine housing problems. Sorting out seaside towns' problems is not just about attending to tourism, but about attending to housing and transport, which is a huge issue for most seaside resorts because they are often difficult to access, having been built and grown up in the days when trains were the way forward.

In making changes and developing the character of these places, we should consider that often seaside towns are blessed with a disproportionate number of retired people. That has a good effect, in so far as it ensures that there is a relative level of prosperity in the town. However, in respect of implementing change, as people get older they possibly do not welcome change in the same way as people do when they are young. In resorts that we Committee members visited, we often found contentious political divisions about the character of development in the town. An additional problem is generated by the fact that a lot of people living and working in seaside towns work in the public sector and will feel the impact of public sector cuts.

Sorting out the problems of seaside towns is not something that should just be thrown at the door of the Minister with responsibility for tourism; it should be thrown at the Government as a whole, because it is a matter of cross-departmental working. The previous Government recognised that.

Laura Sandys: I totally agree that the issue of coastal towns is a multi-departmental one; I do not detract from that, but I feel strongly that we in coastal communities have to address the each of the issues with each of the Ministers, and then bring that together through the cross-departmental committee. It is crucial that Ministers with responsibility, who can have an impact on our communities, understand that we face many challenges and find out what levers they can pull to assist us. The fact that the Under-Secretary of State for Culture, Olympics, Media and Sport, the hon. Member for Weston-super-Mare (John Penrose), has responsibility for tourism and is the MP for a seaside town is a great asset for us.

Dr Pugh: Absolutely. I do not disagree with that analysis. Tourism genuinely helps in an extraordinary way. Too often in our tourist propaganda, we forget that our coasts are a fantastic asset. We tend to think of London, Edinburgh and bits in between, such as Stratford-upon-Avon. International publicity does not stress a strength that was well illustrated by the BBC programme. We have a fantastic coast, which is a fantastic asset, and we should make more of it. When I was at an embassy in France, I picked up propaganda for the north-west of
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England, hoping to find references to Southport, or at least Blackpool, but there were none. I found Oswaldtwistle, but I do not even know what it is, and I have lived in the north-west most of my life.

VisitBritain-I have said this before-has something to learn, but we must all learn how to deal with our new environment. If regeneration of seaside resorts is to progress, we will presumably have to work hand in hand with the new local enterprise partnerships, which will be centred predominantly in urban conurbations and will not have a natural feel for the problems of seaside resorts. They will need to be advised, instructed or directed not to leave out places that will, in most LEPs, be on the margins or the coast.

We must also recognise among ourselves-the community of coastal MPs-that whatever prospects we thought there were, before the time of austerity, of new transport links being delivered overnight have probably receded, and that that will not happen any time soon. We must work hard for our salvation. Most seaside resorts, their communities, and councils who understand the state of play recognise that. I believe that there is a role for the Government-this was the theme of the speech of the hon. Member for South Thanet-in sewing the pieces together and ensuring that good practice is spread, and in ensuring that when resorts have a clear vision of their own destiny and are prepared to pull themselves up by their own bootstraps, they are given every encouragement to do so.

2.52 pm

Brandon Lewis (Great Yarmouth) (Con): I want to focus briefly-I know that other hon. Members want to speak-primarily on the economic importance of tourism to Great Yarmouth and other coastal towns. We know that tourism is one of the largest employment industries in the country. I think it is the fifth biggest, involving more than 200,000 people. In Great Yarmouth, it is the biggest employer by quite a long way-the NHS is second-with 5,600 people involved. To put that in context, tourism is one of the largest industries in Norfolk, where there are about 11,000 people working in it. More than half of the entire county's employment in tourism is in Great Yarmouth, so its importance to our economy is massive.

Tourism is driven primarily by local, private, often family-owned businesses, such as hotels and providers of bed-and-breakfast accommodation, and the tourist authority is very active. We are talking about 30% of the entire work force of Great Yarmouth, and half of that 30% work in seaside-related tourism. Those are the figures, and Steve Fothergill's work on that is to be commended and should be read by everyone who is interested in coastal towns, but in a town such as Great Yarmouth, it is probably more like 80% or 90% who are tied to the coastal attraction. Our only other areas of tourism that do not have the seaside link are the broads, a third of which are in Great Yarmouth.

It is important when moving forward to consider how to market our coastal towns, and it is absolutely correct that we must consider how to develop them in the 21st century. Tourism in many of our coastal towns is that classic British archetypal postcard idea, but things
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have moved forward. Apart from the fact that there is more competition, because people can travel abroad more cheaply and find guaranteed weather more easily, we all demand more value for our money, particularly in times of austerity. It is important that coastal towns recognise that.

Great Yarmouth has done some excellent work in developing and improving tourism. Some independent and family companies, such as Potters, a family holiday resort, have upgraded to become five-star resorts, and that has a positive impact on the entire area, as does focusing on attracting people and explaining that there is more than just the seaside. There are zoos and the broads. We must be clear about that.

It is extremely beneficial to all tourism areas, especially coastal areas, to have a Minister who really understands the issues. He is methodical and careful about ensuring that he is briefed on the entire range of issues affecting tourism towns. I look forward to welcoming him to Great Yarmouth next year, and I hope that that will be when the weather is just a bit warmer.

It would be hugely beneficial to consider how marketing is carried out, particularly through VisitBritain and VisitEngland. At the moment, much of that marketing is funded through the regional development agencies, and a complaint that I often hear is that the RDAs, particularly the East of England Development Agency in the eastern region, do not understand or focus on what coastal towns want. We need a body that understands and focuses on tourism, and a body that our tourist authorities and local authorities can better understand, instead of the quango system. That would be a more logical way of moving forward.

There are opportunities, and their economic value is huge. In Great Yarmouth we hope to have one of the large casinos. That would bring the benefit of up to 1,000 jobs, and bring a different type of person to the town. The best we can achieve from debates such as this, and from the Government, is help to raise our profile nationally, and to show people the importance of tourism. Much tourism in coastal towns focuses on independent businesses and small and medium-sized enterprises that need extra motivation and support to ensure that they can develop. Many areas suffer from a limited season, including Great Yarmouth, where one of the most deprived wards in the country has unemployment of 16% and, in some years, 18% just because of seasonality.

We are moving forward. We are developing the energy industry and considering how, with the casino and other developments, to extend the season, but we need extra motivation and support. If we can find some economic drive, and courage to change the way in which we market such towns, that might help to stretch the season. We must incentivise independent business people to understand that they should invest further, and persuade some of the bigger organisations and companies who invest in coastal and tourism towns throughout Europe to look at the benefit of investing in British coastal towns. When they understand that even a town that is not the biggest in the world, such as Great Yarmouth, has a tourism industry that is worth around £500 million a year with more than 5 million visitors, they will see that there is a huge amount of business for people, and that will bring a real benefit to the British economy. I recommend that the Government support that as much as they possibly can.

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2.57 pm

Mike Weatherley (Hove) (Con): I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing this debate. Just as tourism is often the reason for the existence of our seaside towns, it is often key to the ongoing regeneration and growth of those communities. The leisure and business facilities that attract inbound visitors also improve the economic and cultural lives of our residents. Anchor attractions, quality hospitality, retail facilities, festivals and events are key drivers in regenerating seaside towns, revitalising the image and refreshing the offering. I want to highlight a few ways in which the tourism sector can be a driver for the regeneration of seaside towns for the benefit of residents and visitors alike.

The first is cultural tourism. The reputation of seaside towns as backward and tacky is turned on its head when a more inspirational offering is added to the mix, such as has been done in Brighton and Hove. Recent years have seen a huge increase in the popularity of festivals and events, and Brighton and Hove can probably claim the title, "City of Festivals", with its year-round calendar of major events incorporating music, arts and theatre, food and drink, sport and outdoor pursuits, fashion and retail, and many more.

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