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Lord Williams of Elvel: My Lords, the House will be grateful to the noble Earl, Lord Howe, for introducing this debate. It allows me to congratulate him on his new office. I am sure he will fill that office with the dignity associated with his family name. I also join with him in taking this opportunity to express our appreciation of our Armed Forces and the way they serve our country. This has been particularly true, as the noble Earl said, in Bosnia and in other parts of the former Yugoslavia. They have had, and are having, an exceptionally difficult task, but by general agreement they are discharging it with skill and distinction and we are immensely grateful to them.

We are all the more appreciative, if I may say so, since the problems that have been encountered there in the past three years are not of their, or indeed our, making; and this leads me to wonder, in this, the 50th anniversary year of the United Nations, and particularly in the light of events of the past few days, and indeed the past few hours, whether now might be the time to consider the reform and enhancement of the UN's military capability. I realise the problems involved, but I know your Lordships are reluctant—and quite rightly reluctant—to send British troops into operational areas without a clear mandate and a clear remit to protect themselves as far as is possible under the circumstances prevailing. I have to say that I am far from convinced that this is the case in Bosnia today. The situation changes, as the noble Earl said, from hour to hour and even as we speak the French initiative is being considered. We look forward, perhaps even by the end of this debate, to hearing whether there is any further news on what might be happening.

Having said that, let me turn to some of the broader issues raised by the Statement on the Defence Estimates. With your Lordships' leave I will first address the nuclear problem; I will then comment on the performance of the Ministry of Defence after the Defence Costs Study exercise; I would like to say something about defence industrial policy; and finally I will offer our views on where we should be going, as it were, from here.

The commitment under Article 6 of the non-proliferation treaty has been reasserted, and now for an indefinite period of time. More than that, the programme of action to which the Government put their name in May calls for,

There was also a commitment to negotiate a comprehensive test ban treaty "no later than 1996". We now await with interest the practical steps that the Government will

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be proposing to meet those two commitments. It seems to me at the moment that the negotiations in Geneva have run into the sand.

I recognise that that is not going to be an easy task. Indeed, the immediate problem seems to be how to prevent nuclear proliferation and what to do when it has occurred. There are, however, two things not to do: the first is for any nuclear weapons state to increase its nuclear firepower; and the second is for nuclear weapons states to resume testing. The consequences of both are obvious. Further strengthening of any nuclear arsenal means deepening suspicions among non-nuclear weapons states, and the consequent heightening of the risk that they themselves will go nuclear, making the task of eliminating all such weapons even more difficult. As for large-scale testing, the commitment to a comprehensive test ban treaty—if that goes on—is totally undermined.

Now, of course, both these things are happening. The Government are proposing, for no obvious reason, to double the number of nuclear warheads deployed on Trident compared to Polaris. China is still testing, and now France, unless there is a last minute change of mind, is going ahead with a renewed testing programme. The British Government, as I understand the position, have not yet ruled out the possibility that, if the Nevada testing ground is open to them, they may also resume testing; and if the Nevada site is open, that means that the United States has started testing again as well. At that point I think we can say the chances of negotiating a comprehensive ban are slim indeed. Furthermore, there is a suspicion that the Ministry of Defence and the Pentagon, and indeed the French, favour a treaty which would still allow small-scale nuclear testing, particularly hydro-nuclear experiments. Again, it does not seem to me that such an attitude is in the realm of practical politics if non-nuclear weapons states are to be persuaded to sign such a treaty.

But it is not only on the nuclear issue that we have doubts about the Government's position. On chemical weapons, for instance, they have yet to ratify the chemical weapons convention. The Government still have not introduced the enabling legislation. Why have they not done so? They refuse to ban the export of anti-personnel land mines despite this September's United Nations' inhumane weapons conference. They are apparently indifferent to laser-blinding weapons. Again, why is that so?

I have heard doubts about the Government's motives in all this and we have further doubts about government performance. We were told, and we have been told again, that the Defence Costs Study had rooted out waste and diseconomy in the Ministry of Defence. Of course, there never was a satisfactory answer to the question of why such waste and diseconomy had survived for so long and under so many Conservative Secretaries of State, but I will let that pass. We were told—the noble Earl has told us again today—that a new slim-line MoD and a new thinned-out back-up for the front line would be put in place. What has happened? Leaving aside the accommodation for senior officers

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which we all know about, there is the matter of the nuclear bunker beneath the MoD, to which presumably Ministers will repair while the rest of us fry.

The original estimate of the cost was £50 million, the outturn was £130 million. Then there are the MoD dog kennels, costing £54,000—expensive kennels! They may provide dogs to allow senior officers to go foxhunting, for which, we now find out, they use Army transport and drivers during duty hours.

Then there are the cost overruns and delays. The Eurofighter aircraft is running at about £1 billion over budget. The Tornado GR1 update is nearly £300 million above budget and nearly five years behind schedule. The Sea Harrier jet is nearly £40 million above budget and is already five years late. So it goes on, much to the dismay of the National Audit Office and the Public Accounts Committee. In truth, it is a pretty sorry tale.

Are we not now entitled to ask Ministers the simple questions: "When will you get your act together? When will you be able to come to us and say that you are running an efficient shop?" They tried last year, and we nearly believed them. However, since then the evidence has been accumulating that costs are running out of control.

The same questions can be asked about the defence industries. It cannot be said too often that any country's defence industrial base is crucial not only to defence but also to its high technology manufacturing base. It is therefore of the highest importance that we put in place a policy which actively encourages those companies where the technological spin-off is the greatest. For social reasons we must also help defence-dependent communities to adjust to defence cuts.

All this means an active policy from government. Instead, we have had, and still have, a policy towards the defence industry which, in the words of a recent study of leading industrialists, is,

    "perceived as uncertain, fragmentary and inconsistent".

Or, to put it even more bluntly, as the Defence Manufacturers Association did recently:

    "it is apparent that the MoD's uncompromising pursuit of competition largely excludes concern for the social and long term economic or political penalties occasioned by an unstructured rundown of the national defence industrial base".

We must ask Ministers: "When will you do better?"

One of the problems of any serious policy towards the defence industry is the long lead times associated with defence procurement. We understand that. It almost seems too obvious to state. However, given that problem, we need to have a reasonably clear idea of where we are heading. It is all very well telling the Armed Forces that they are there to protect our security, but we need to know, and we need to tell them clearly, what our security really means—in other words, what they are there to protect.

In our view, that cannot be achieved without a politically acceptable and militarily sound assessment of the threats the country faces, the interests that it must protect, the alliances it must build on and the resources which are available to meet commitments in an effective manner. We have to recognise not merely that the world is a dangerous place, as the noble Earl reminded us, but

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that as a medium-sized power we will need to share the burden of providing a comprehensive and viable defence structure with our European NATO allies. We may still be able to lead, but it will be leading with others rather than leading on our own.

At the moment we do not have that strategic assessment. All we have, despite the noble Earl's assurance that the Government understand our role in the world, is a checklist of military tasks produced by the Ministry of Defence, which is a simple statement of Britain's current commitments. There is no underlying vision of the future security needs of the country, no strategy for the Armed Forces to carry them into the next century. It was, I believe, Sir John Nott, a former Secretary of State for Defence, who described the Ministry of Defence as being like,

    "a huge super-tanker, well captained, well engineered, well crewed, its systems continuously updated—but with no-one ever asking where the hell it is going".

There we have it.

Security is not about defence alone. That is only one element. There are economic factors—oil, for example, connected with the rise of nationalism and fundamentalism, or continuing third world poverty which could at any moment break into armed conflict. There are environmental factors—the deterioration of the world's climate, for example, which could lead to mass population movements with consequent instability. All these factors have to be taken into account in the assessment of what constitutes the security of the United Kingdom, and consequently what our Armed Forces will be asked to defend in the next century.

What the results of such a review will be I know not. As the noble Lord, Lord Gilmour, said when he was defence spokesman for the party opposite in the late 1970s,

    "a detailed and fully costed defence policy ... can be carried out only after full consultation with the Services, with our Allies and with industry".

In other words, to do it properly—and it has to be done properly—you have to be in government.

Your Lordships will be aware from what I have said that the noble Earl and I seem to be talking a completely different language. There is no evidence to suggest that the Government are even starting to think along the same lines as us. There are no signs in the White Paper that they realise that there is a problem. Their policy seems to be to list current commitments, and then accept Treasury inspired cuts until their Back-Benchers cry "Enough is enough", and then they stop. That is no way to face a modern and dangerous world. The way to face it is not to look backwards to imperial grandeur, not to pretend that we are still a great power, not to pretend that we can lead by ourselves, but to make a rigorous analysis of our strengths and our weaknesses and to construct a defence architecture on that base. That is what we intend to do and, in a few months' time, that is what we shall do.

11.36 a.m.

Lord Mayhew: My Lords, on these Benches we warmly welcome the noble Earl to his new position. He referred to the quick turnover with his predecessor the

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noble Lord, Lord Henley. There has been a rapid turnover of government spokesmen on defence in recent years. When the noble Earl spoke with such enthusiasm about the need for a period of stability in the Armed Forces I could not help wondering whether he had his own fate in mind.

The noble Earl's main task will be to try to keep his Secretary of State in line with government policy on matters such as the common European defence policy. It is not an easy task. If I may give an old man's advice to the noble Earl: do not try to satisfy your Secretary of State at the risk of falling foul of the Leader of the House, otherwise the rapid turnover of military spokesmen on the government side may continue.

This morning we all have in mind particularly the events in Srebrenica. However, first I should like to say a few words about the noble Earl's speech and the contribution of the noble Lord, Lord Williams.

I wish to associate those of us on these Benches with what the noble Lord, Lord Williams, said about the Government's attitude to non-proliferation and the comprehensive test ban treaty. It is a tragedy that a few months ago consensus was reached in the discussions on the extension of the Nuclear Non-Proliferation Treaty. Remarkably—and we praised it from these Benches—consensus was reached between the non-nuclear powers and the nuclear powers on the indefinite extension of the treaty. No inkling was given to the conference that as soon as that consensus had been recorded the nuclear powers would start testing again. If that had been known I do not believe that the consensus would have been reached. The non-nuclear countries would have said, "No, let us revise this treaty from time to time in order to be sure that the nuclear powers keep up the affirmations and the undertakings that they have given us". Instead, we now have the situation where faith has been lost in the nuclear powers by the non-nuclear countries and the prospects for getting a comprehensive treaty on testing have very much weakened. That is a serious blow to the whole possibility of disarmament.

The noble Lord, Lord Williams, made other points which voiced the views on these Benches. There were one or two aspects in the speech of the noble Earl which will have evoked strong feelings on this side. For example, he referred to the announcement yesterday by the Ministry of Defence of, I think, £180 million being spent on cruise missiles for submarines. I was reminded that many years ago, before it was too late to change our nuclear deterrent, the Liberal Party, with its allies the Social Democrats, recommended that while Britain must, of course, maintain a nuclear deterrent, Trident was not the most suitable weapon; and that submarines armed with cruise missiles with nuclear warheads would be a much better option for the future. I wonder sometimes whether the Government regret not taking the advice of my party on that. When one thinks of it, the option would have been more flexible; it would have been less dependent on the Americans; and it would have been many billions of pounds cheaper than the Trident fleet.

As it is, when we consider the Defence Estimates White Paper, we see the strange contrast between conventional arms and nuclear weapons. As the noble

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Earl pointed out, on the conventional side the Government adapted our forces—remarkably and sensibly in my view—to the new situation after the Cold War. On these Benches, we did not oppose that approach, or at least not nearly as strongly as noble Lords opposite opposed it at the time of Options for Change, Front First Line, and so on. There is the contrast in the White Paper between the Government bringing up-to-date the conventional weapons and continuing with exactly the same deterrent policy as they have always had. As I say, I believe that they must now regret not having accepted the advice of my party eight, nine or 10 years ago.

Not only that, but regarding the deterrent they maintain again a Cold War approach. It is the same structure—the four submarines, vastly powerful, sophisticated, and able to destroy the anti-missile defences of Moscow, as though that were a credible target at the present time. I believe that the anti-ballistic missiles around Moscow depend for their function on the good will of the Baltic states and the Ukraine. However, we have this massive deterrent—and it is massive—when it would have been much better to have something more flexible, less dependent on the Americans and many billions of pounds cheaper than the Trident project.

The noble Earl also mentioned the Westland contracts, which I am sure will at least please the very able and industrious local Member of Parliament for Yeovil.

The main point, however, that I wish to make today concerns the situation in Bosnia. I endorse every word that the noble Earl said about the wonderful work of our forces there. I agree, too, with what the noble Lord, Lord Williams, said.

Last Wednesday the new Secretary of State for Foreign Affairs, Mr. Rifkind, endured for over an hour a massive questioning session on the subject of what needs to be done in Bosnia. I am bound to say that he showed remarkable endurance, articulateness and skill. I do not propose for a moment today to put the same questions to the noble Earl as were put repeatedly to the Secretary of State. We all know the facts. We all know the frustrations, the humiliations and the horror of the present situation. Yet if we think hard, worse seems quite likely to happen. The prospect which should surely command all our attention is the possibility of the final catastrophe of Sarajevo suffering the fate of Srebrenica, on a much more massive scale.

Those who call for the withdrawal of the United Nations forces are presumably reconciled to the horrors that would follow that. However, do those who are not calling for a withdrawal but for the continuance of the present mandate—to stay as long as we can without excessive risk to our forces, which is government policy—hope that with that policy Sarajevo can be saved? What reasons do they have for that? On the surface it seems, sadly, impossible. Perhaps the noble Earl will try to reply. Do we assume a change of heart by the Bosnian Serbs? What assumptions do we make that give us confidence that the capital city can be saved?

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Desperate needs call for desperate remedies. Should we not at least ask ourselves this question? Granted that we do not have the military capability to impose a settlement, or to defeat the Bosnian Serbs, or to prevent ethnic cleansing by one side or another in many parts of Bosnia, or even to protect the existing outlying safe areas, does it mean that with some redeployment and reinforcement we could not defend the capital city?

I noted the following answers on Thursday from the Secretary of State. He stated:

    "In the judgment of Her Majesty's Government and other Governments, that prime responsibility for the aggression—including the present situation facing the people of Srebrenica—lies with the Bosnian Serbs".—[Official Report, Commons, 12/7/95; col. 959.]

He also said:

    "I know that the force commanders have been looking at ways of using the Mount Igman route [to Sarajevo]. If they conclude that that is a realistic way to deliver aid, we shall be happy to support them".—[Official Report, Commons, 12/7/95; col. 955.]

There was, too, a thoughtful article in The Times yesterday by Mr. Lawrence Freedman which concluded:

    "The best response to the Srebrenica fiasco is to expedite the deployment of the rapid reaction force, and to put it to work on the siege of Sarajevo, which remains the critical test. If it fails this test, the UN force will not deserve a future".

There was a time when Berlin was an oasis of civilisation, cut off and blockaded by Stalin's armies. Nothing seemed so absurd, at that time so quixotic, as to think of saving the city by feeding it from the air. I attended the final meeting of Bevin and the chiefs of staff at which it was decided to go ahead with the airlift. Someone gave us a rundown of the difficulties: climatic, the weather, visibility, the time of turnround of aircraft, and so on. It all looked pretty knife-edged. Then someone said, "Of course, Secretary of State, this does not apply to winter conditions". And I remember Bevin saying, "We'll take that 'edge when it comes". The airlift had immense psychological and political consequences and was a turning point in the whole Cold War.

The military commanders in Bosnia today may conclude that the Mount Igman route is not feasible and that the capital cannot be defended. If that is their conclusion, then that is that. But if there is a way—and it is bound to be difficult with the odds against it—then, bearing in mind what is at stake in terms of human suffering and the future of world order, we expect our political leaders to make an attempt. So much is at stake, but this could be a turning point: a vigorous and successful defence of the capital.

Whatever the outcome in Bosnia, there are hard lessons which the United Nations must learn. Some of the many reforms in United Nations peacekeeping, which we have talked about in this House and which have been urged upon the United Nations from many countries and many sources, must now be implemented. But we must not allow the United Nations to give up its responsibility for world peace. Humiliation is not the same as dishonour. There is nothing dishonourable about the United Nations efforts in Bosnia. Hundreds of thousands of innocent lives have been and are being

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saved. Despite the humiliations heaped on them, those who are achieving that should feel proud of themselves and they deserve our gratitude and support.

11.51 a.m.

Lord Chalfont: My Lords, I begin by joining in the congratulations to the noble Earl, both on his new appointment and on the clear and confident way in which he introduced the White Paper today. As other noble Lords have said, there is a temptation in the light of current events to concentrate on Bosnia and the former Yugoslavia. But we should resist it for a number of reasons. Perhaps the most important is that, if we do not, we may fall into the familiar trap of the "something must be done" school of foreign policy. Once again in the former Yugoslavia we are in danger of allowing media images to set the agenda—instant images without instant understanding. The impact upon public emotions is a powerful and volatile mixture. It can lead political leaders into unwise decisions; into believing that activity is a sufficient substitute for deep thought about problems.

Speaking personally, I can only say that it is a tragic mess in which we should never have become militarily involved. All the principles governing the use of armed force in the pursuit of foreign policy seem to have been ignored. What is happening now in the specific context of British forces ironically seems to take no account of the criteria set out in the White Paper which we are discussing today.

I assume that what is happening to the British forces now in Yugoslavia is happening as part of what is known as "Defence Role Three", mentioned on page 27; that is:

    "to contribute to promoting the United Kingdom's wider security interests through the maintenance of international peace and stability".

If that is so, we have only to look two pages further on to find that there are a number of factors which the Government seek to take into account in contributing military forces for the purpose. I wish briefly to quote them (from page 29). The first is:

    "The degree to which our national interests are directly engaged".

There must be some doubt there.

    "The interests and involvement of those organisations of which we are a member, and of our major partners".

One has only to look at the total disarray in the Western European Union, in the United Nations and in NATO to recognise that it is difficult to find any common interest. The document continues:

    "Whether the use of military forces represents the most suitable response to the crisis".

That is dubious, to say the least.

    "Whether there are clear and achievable objectives".

The noble Lord, Lord Williams of Elvel, has sufficiently answered that:

    "whether there is a political process to which the parties are committed which offers a reasonable hope of resolution of the crisis".

There is no such consensus in Yugoslavia.

    "Whether the mandate of the operation is precise and finite".

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I say, no. Finally:

    "Whether we have confidence in the safety and security of our personnel".

How can we possibly say that we have confidence in their safety and security after what happened to the soldiers of my own regiment only a few weeks ago?

I have said that we should not spend much of this debate on Bosnia, but it is close to the hearts and minds of most of us. It may be a minority opinion but I shall nevertheless express it: I believe that the only intelligent and wise course is now to extricate ourselves militarily, in as orderly and deliberate a manner as we possibly can.

Let me move on to the White Paper itself. The document under discussion raises much deeper, wider and longer lasting issues even than the issue of the former Yugoslavia. First, I wish to congratulate the Ministry of Defence on an excellent publication. It is clear, informative and, unlike many other White Papers, readable. I have become something of a student over 50 years in the Army, the Foreign Office and the House of Lords. I might even say that I have become a connoisseur of Defence White Papers. Unlike the noble Lord, Lord Williams of Elvel, I believe that this is one of the best Defence White Papers in my experience. That is not to say that all of the content is of the best, but as an informative exposition of government policy I believe it to be in a high class. I shall not attempt to cover the whole sweep of the paper.

I still believe, and say again, that the reduction of our capability has gone too far and too fast since the end of the Cold War. The world is a more uncertain and perilous place today than it ever was in the days of the superpower confrontation. But, given that the Government have made their decision, based presumably upon good intelligence and mature thought, it is fair to say that they have begun to implement it in a positive and systematic way. As is evident in the Defence White Paper, we have moved from a threat-based Army, Navy and Air Force—a threat-based defence establishment which reflects our concept and analysis of the threat from the former Soviet Union—to capability-based Armed Forces which are clearly being designed to meet the new threat environment around the world.

Perhaps in order to save too much exegesis of the White Paper I should refer noble Lords to the issue of Jane's Defence Weekly of 15th July. It contains an extremely clear, well informed analysis of current United Kingdom defence policy. Much of it, I have to say, is more upbeat than the somewhat sombre picture painted by the noble Lord, Lord Williams.

I have said all that I want about such things as overstretch, morale, higher formation training and all the other matters which we have talked about in previous debates in your Lordships' House. In the brief time left at my disposal, I wish to take up the issues raised by the noble Lords, Lord Williams and Lord Mayhew, on a matter with which I was once directly concerned as a Minister in Her Majesty's Government. It is what the Defence White Paper has to say about the nuclear element in our defence arrangements. As I am no longer

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responsible for the construction of the Trident submarines in Barrow, perhaps I may now speak without necessarily declaring an interest, except strategic and intellectual.

I begin with the non-proliferation treaty, which in the 1960s I had a considerable part in negotiating. At the outset I should like to correct what is becoming a widely disseminated fallacy. It was not, I have to say, further disseminated by the noble Lord, Lord Williams, or the noble Lord, Lord Mayhew, today; nevertheless, it is gaining currency. It is the belief that in some way the non-proliferation treaty commits us as signatories to nuclear disarmament. It does not.

Article VI of the treaty—and I had some part in the long negotiations that went on over the drafting of that article—states that the signatories are required:

    "to pursue negotiations in good faith on effective measures relating to cessation of the nuclear arms race and to nuclear disarmament, and on a treaty on general and complete disarmament under international control".

That is what the article says. That is all that it commits us to. It is my contention that those negotiations have taken place and are taking place in good faith: the strategic arms reduction talks; the strategic arms limitation talks; the comprehensive test ban talks; and the chemical weapons convention have all been undertaken in good faith.

What is much more important is that the non-proliferation strategy, as important as it may be, has manifestly not worked—or at least not worked effectively. As the Defence White Paper very clearly states (on page 25), the:

    "current assessment is that some dozen countries ... have or are developing ... weapons [of mass destruction and] ... most also have ballistic missile programmes".

The clear implication is that, whatever may have happened to the superpower confrontation, with that degree of proliferation going on it is vital that the United Kingdom retains its own minimum nuclear deterrent. That is what I believe it is doing. I do not believe that it has any commitment or obligation under any international agreement to do anything less.

I believe also that we should continue to take a lively interest in the development of ballistic missile defences. I know that the famous star wars project of President Reagan is now perhaps only of historical interest, given the disappearance of the superpower confrontation. But ballistic missile defence is a different matter. We should continue to take an interest in it. I am delighted to note that the Defence White Paper takes a robust line on both the maintenance of a deterrent and the pursuit of the ballistic missile defence project.

This leads almost automatically—certainly it leads logically—to the comprehensive test ban treaty. I would counsel against an excess of enthusiasm for this measure. It has become an article of faith that the comprehensive test ban treaty is a good thing. I doubt it. I believe that it is an approach to arms control that is indeed a remnant of Cold War thinking. It needs to be approached with some caution.

It seems to me logical to propose that any nation that includes nuclear deterrence as an element of its defence policy needs to retain the ability to test the weapons that lie at the heart of its nuclear deterrent. Testing in

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laboratories and by computers is all very well so far as it goes. But it is not a substitute for the testing of weapons—not just new weapons but the weapons that are already in service—to ensure that their viability remains. The French clearly know this, and have behaved not only in consistency with international law but in full consistency with their view of their national sovereignty and security. A comprehensive test ban treaty, if signed, and if it came into force, would mean that we should be resting one of our central defence elements upon untested weapons systems. I do not believe that that is a responsible position for a government to take.

On the other hand, the argument that a comprehensive test ban treaty would help to prevent proliferation of nuclear weapons does not stand up to close examination. Israel, South Africa, India, Pakistan and North Korea have all arrived at their present position of nuclear capacity—I do not seek to suggest what that is, but we can all make our estimates—without testing at all. Those countries may be prepared to rest their defence policy upon untested nuclear weapons systems, but that is no reason why we should. Indeed, not only would it be dangerous to this country in terms of its own security, but it would pose a massive danger in the broadest sense. The very thought of people resting their defence or deterrent policy upon an untested weapons system is a recipe for a form of nuclear anarchy.

There are many other aspects on which I should have liked to comment: the cut-off convention, chemical and biological deterrents and so on. But there is clearly no time for that. Therefore, having made those points in reply to the noble Lords, Lord Williams of Elvel and Lord Mayhew, and having taken what is clearly a very different view from theirs about the nuclear elements of our policy, I conclude with a quotation from the Secretary of State's introduction to the Defence White Paper that we are debating:

    "we can set a steady course for the future and inject a period of stability into defence planning and funding".

The noble Earl himself quoted that introduction. I believe this to be a matter of primordial importance. Our Armed Forces have had more than enough of reductions, redundancies, reorganisations and rationalisation. They have borne a long period of uncertainty without any disastrous loss of morale and efficiency. I hope that the Government can now give a firm guarantee that the Armed Forces will be left alone for a while to do the job that they do so well.

12.7 p.m.

Lord Boyd-Carpenter: My Lords, I, too, congratulate the noble Earl the Minister on his appointment; and perhaps I may also congratulate the Government on acquiring a Minister of such obvious ability as my noble friend has demonstrated in his speech today. I hope that my noble friend will exercise his influence to persuade those who arrange the business of this House of the importance of defence matters.

Defence is the most important issue of all. If our defence arrangements fail, then it is of very little advantage to us that we have, or have had, a perfectly

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good economy, excellent social services and all the other aspects of government. The whole preservation of our country and its way of life depends upon an adequate defence system. Therefore it seems to me very wrong that the opportunity to discuss defence is presented to the House on a Friday at the end of the Session. It is an indication that the usual channels are not very interested in the subject. Therefore I hope that my noble friend the Minister will assert himself, and that next year's debate will be held at some time in the centre of the week, and that the subject will receive a full day's proper discussion in appreciation of its importance. I hope that it will not be pushed off, as it has been pushed off today, into the tail-end of the Session at a time when it is perhaps increasingly difficult for noble Lords to attend.

I also venture to differ from the view of my noble friend the Minister that the situation today is so much safer than it was a few years ago. With very great respect, I doubt that. The dangers are different, but whether the elimination of the Russian Communist threat is offset by the new developments with which we are faced seems to me to be another matter.

I strongly agree with the noble Lord, Lord Chalfont, that in fact we live in a very dangerous world. For that reason I shall express one or two doubts about the adequacy of the defence policy of the Government. The White Paper is rather grandly entitled, Stable Forces in a Strong Britain. No doubt they are stable forces and no doubt it is a strong Britain; but it is a Britain that has reduced and cut back on its defence forces to quite a considerable degree. In the situation with which we are faced today, I wonder whether that is wise.

Twice in my lifetime, once under a Liberal Government and once, I am sorry to say, under a Conservative Government, we allowed our defences to be diminished, to the point that when it came to war we very nearly indeed were defeated. That was in 1914 and in 1939-40. Surely the lesson that we should have learnt from that is that it is extremely dangerous in a dangerous and difficult world to cut back on our defences. When my noble friend comes to reply, I hope that he can give some reassurance that the Government have at least brought to an end their cutting back of defence forces and are perhaps prepared to consider instead some expansion.

There is no need for me to repeat that this is a dangerous world. I shall not say anything about Bosnia. Enough has already been said about it. We know that our troops are now in a position of some danger and the question of whether it was ever right to send them there raises doubt in many people's minds. But there is danger all over the world. Nuclear weapons are now possessed by a very large number of countries. A nuclear weapon can do enormous damage, regardless of the strength of one's own country.

I wonder, too, whether it is realised that we are under pressure from all kinds of directions. The Argentine still nibbles at the Falklands and Spain still nibbles at Gibraltar. The slightest sign of weakness on our part in either of those directions would result in those British territories being taken from us by force. Therefore, the need to maintain the defence forces and strength of this

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country is as great as it ever was. As I said, I strongly quarrel with my noble friend's statement that—to use his own words—the situation now is "immeasurably safer" than it was a few years ago. I believe that in some ways it is more dangerous. In many ways it is more complicated and I hope that the Government do not delude themselves into believing that they are looking after this country in a safe world. Their responsibility lies in a very dangerous world. It is in that light that I raise one or two questions about what they have done.

I am somewhat disturbed at the way in which they have cut back on the number of infantry. I see no reason to stand down the second battalion of the first three senior regiments in Her Majesty's Guards. I declare an interest, as I served in one of them. It is interesting to note that the Government have come up against a very real difficulty. Guards regiments have to do two quite separate jobs. They have to be operationally very effective and they must also perform their ceremonial to perfection.

Until quite recently, that was a quite useful system. One battalion would be doing ceremonial work and another would be doing operational training or indeed undertaking operations. Now, there is only one battalion, although the Government have been forced, somewhat surreptitiously, to introduce for ceremonial purposes some composite battalions. Indeed, I should be very interested if my noble friend the Minister, when he comes to reply, would say exactly what has been done in that way. I gather that the Government have had to face the fact that a Guards regiment cannot simultaneously do two things: train for and conduct operations and at the same time conduct the magnificent ceremonial that is carried out. Therefore, I should be interested to know whether the Government have had to go back on what I consider to be their unwise decision to do away with the second battalions.

Also, I should like to hear—I have heard nothing so far—the Government's intentions with respect to the Gurkha regiments. They are magnificent troops. We have had a long connection recruiting in that part of the world and recruiting some of the finest soldiers who are to be found anywhere in the world. I know that we have cut back on the Gurkha regiments. But can I have an assurance from my noble friend not only that there will be no further cutting back of Gurkha regiments but indeed that the Government are seriously considering recruiting more troops? They are excellent troops. They are particularly effective when operating in tropical countries and countries with difficult terrain. They are very fine professional soldiers. I hope that my noble friend will be able to give some reassurance that, by way of economy or reduction, he does not intend to cut back on the Gurkha regiments.

Finally, there is the question of missiles. I had intended to say a good deal about that issue but, frankly, what I was going to say has been said much better than I could say it by the noble Lord, Lord Chalfont. I shall only add that I hope that the Government pay attention to what he said a few minutes ago about the development of missiles. We must maintain an effective missile weapon and we must, of course, be able to test it from time to time. No weapon, particularly a complex

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weapon of that kind, is reliable if it is not tested. To allow those who agitate against nuclear testing to cause us possibly to undermine our best and most powerful weapon would be a very great mistake.

Like the noble Lord, Lord Chalfont, I feel that the example of the French—as so often with the French—is one of extremely good sense and certainly extremely good understanding of their own interests. I hope that we shall not allow those who try to raise emotional criticism of nuclear testing to cause us to abandon the necessary preparation of that most effective weapon. Unless we continue to possess effective nuclear weapons, in this very dangerous modern world, we shall be vulnerable. But the knowledge that we possess and, if necessary, are prepared to use those weapons and can use them effectively, will serve to preserve our whole position, preserve our safety and enable us to help preserve the peace of the world.

In a world in which there is so much danger and in which so many powers have acquired nuclear weapons, we require a strong Britain, as the White Paper suggests. But I suggest with humility to my noble friend the Minister that we require a rather stronger Britain than is outlined in that White Paper.

12.20 p.m.

Lord Bramall: My Lords, I do not doubt that the Government will have felt a certain smug satisfaction that through those catchily-named exercises—Options for Change and Front Line First—they have been able to find all of the money required, nay demanded, by the Treasury, and to do so without undue rumpus in Parliament or in the country. In some ways it is a testimony to the impeccable loyalty of chiefs of staff as public servants.

Now we have another glossy, well-presented White Paper full of righteous and quite unexceptionable aspirations and with enough selected statistics to deter (particularly on a Friday with a rail strike) all but the most avid and determined rooters-out of what would actually happen on the ground if the balloon ever went up. It is all designed, of course, to lull everyone into feeling that somehow sophisticated, supposedly modern management methods and significant cost-cutting invariably equate with efficiency and that, in our changing world, all is still well with the Armed Forces and they can still do everything required of them.

But it is not the contents of the White Paper which provide the cause for concern. Indeed, many noble Lords would welcome the recognition—here I shall be quoting from it exactly—of the uncertain world we face; of our determination as a country which,

    "remains...economically and militarily, in the first league";

and, as a member of the Security Council,

    "to be a major participant in world lead...rather than to follow".

And all that fully justified, so the White Paper says, by the considerable assets that we can bring to bear for the benefit of others as well as ourselves, not least our first-class professional Armed Forces.

It is all rattling good stuff, but the key question is simply this. Have we left ourselves enough of that class and professionalism to carry out those emphatic

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responsibilities? In that regard I share some of the misgivings of the noble and very experienced Lord, Lord Boyd-Carpenter. No amount of packaging, nor indeed of generous—yes, generous—recognition that a number of changes have led to genuine improvements, particularly in the field of equipment where the outlook is brightest and where I warmly welcome yesterday's announcement about the much-needed attack helicopter.

But none of that should be allowed to conceal the fact that damage has undoubtedly been done to the ethos and stability of the forces and risks taken over their operational effectiveness in crisis situations; and certainly we have one now in Bosnia of the most serious proportions. But let me be specific and I am sure the noble Earl the Minister, whom I warmly welcome to his new job and congratulate on his clear and impressive opening speech, will correct me if I draw any wrong conclusions.

First, with over 30 per cent. of the Army currently on operations and away from their home bases; with 11,000—virtually a division—already in Bosnia, and still more promised as part of the United Nations Rapid Reaction Force (whatever that may now mean) the Army is still overstretched and undermanned with the norm of 24 months between unaccompanied tours by this year—constantly promised to this House—seeming unlikely to be met, despite the easing of tension in Northern Ireland. So I would hope that the undertaking given in paragraph 507 of the White Paper, to keep manpower under constant review, will be honoured; because clearly, with the present tempo of operations, let alone what the uncertain future may hold, the 104,000—the capacity of Wembley Stadium—mentioned not long ago by the noble Lord, Lord Henley, as a projected manpower ceiling for the Army, is likely to be totally inadequate to cover sustainable operations for the planned contingency forces and an acceptable training organisation which has recently had to suffer considerably. Particularly, and most urgently, the infantry—the primary arm—is significantly under strength, even from a largely inadequate establishment which invariably itself requires reinforcement. The Minister may like to confirm how great that shortfall is and why our truncated recruitment arrangements have not been able to correct it.

Happily, there is at least an immediate palliative, if the Ministry has the will to use it—this connects to what the noble Lord, Lord Boyd-Carpenter, said. Starting this year a large number (over 1,000) of absolutely first-class Gurkha soldiers, of all ranks, fully trained in many specialist skills, including parachuting, and most eager to serve, are to be made redundant because of the absurd 60 per cent. reduction in the Brigade of Gurkhas—as absurd as the ridiculous 45 per cent. reduction in the Brigade of Guards. That is the Brigade of Gurkhas in which the noble Lord said there was no problem of recruitment. There could be no quicker or more efficient way of keeping British battalions up to strength for operations than by temporarily attaching to them a company, or even a platoon, of Gurkhas until such time as British recruiting can close the gap. It is easily done; it would save money on redundancy and be a thoroughly

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cost-effective and militarily-effective solution. I hope the Minister will confirm that that will be looked at urgently inside the Ministry.

The next area of concern is sustainability. The Front Line First exercise sought to give the impression that the front line was both sacrosanct and would be fully preserved. But what is the front line? Surely it must include the extent to which combat units can be sustained for the requisite period of operations; for without the proper engineer, logistic and medical support the planned contingency forces would soon become impotent and have to be withdrawn. Yet in every cost-cutting exercise it has been the so-called "tail" rather than the "teeth" on which the heaviest burden has fallen, so that now the length of time an operational formation can be sustained, let alone reinforced and replaced, has become very limited indeed and the Regular Army is more and more dependent on limited reserves. Even in easier days the Falklands campaign only lasted 14 days once the troops were ashore, and the Gulf War, even more fortuitously, only 100 hours. Had the latter lasted 100 days it might have been a very different story, with neither the regulars nor the reserves adequate for the purpose.

The Army Medical Services are in a particularly parlous state, with no reason to believe that the National Health Service would be able, or prepared, to provide (through the Territorial Army and in all eventualities) all the consultants, surgeons and anaesthetists who would be needed in any conflict because the Royal Army Medical Corps can no longer provide them.

All that has influenced our tentative approach in Bosnia and it is now given additional urgency by the deployment of 24 Air Mobile Brigade. One wonders what that brigade, so slowly and laboriously assembled, is now going to do when the United Nations and others do not seem to know (quite literally) whether they are coming or going. Had it been despatched, together with other European contingencies, in what I might describe as the "hey day" of General Rose, and had he then had freedom of action in its use, it might just have been possible to make the safe havens truly safe and demilitarised and the situation sufficiently stabilised for political talks to have a chance.

Now the situation looks very different. Surely we must by now have learnt the obvious lesson—obvious for ages—that to threaten tough action without the strength and political will to stand our ground if put to the test means absolutely nothing. There is also the downside of not doing this. As the noble Lord, Lord Mayhew, said, Goradze and Sarajevo may be the Rubicon, but if you cannot stand the heat of having to do that, you should stay out of the kitchen! In this case, of course, by "kitchen" I mean at least any areas of contention. Otherwise, we only raise, in those who look for protection, expectations which cannot be realised and that brings disillusionment, contempt and untold consequences for the future. We must avoid making tough noises and then not being prepared to go through with it. And here I believe that the noble Baroness, Lady Thatcher, had an unanswerable point, that if we cannot protect the citizens of a country we had recognised as a sovereign state we should not stand in the way of their

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arming themselves to carry out their own protection. So perhaps the Minister will try and tell us, in the light of what he thinks this brigade can still achieve and what I said earlier, how long it could be sustained and whether in due course it could be relieved. For in a situation as uncertain and unpredictable as Bosnia it would surely be irresponsible to deploy it if it could only be sustained for a limited period and could not then be replaced. Indeed, it would put a question mark over the whole of our contingency forces, of which we speak so proudly in the paper.

Finally, may I briefly express a general concern over what is described in the White Paper as the "management" of defence. Great play is made of this as if it were somehow an end in itself! One of the problems is that there is so much mumbo-jumbo written about it and so many ghastly catch phrases that one begins to wonder whether those who write this stuff really understand what the Ministry of Defence should be trying to achieve, other than somehow increasing bureaucratic and Treasury control—a point picked up, I may say, by the Bett Report—and the cutting of costs. Certainly no clear objective shines through, as in the Mountbatten reorganisation of 1963-64. Instead, there are inconsistencies and contradictions emanating from this myriad of recent studies.

For example, while on the one hand there seems an almost obsessional desire to devolve budgets to almost every Tom, Dick and Harry, including a lot of new functional agencies, on the other hand the freedom of action within those budgets is still strictly limited. Certainly up to now there has been far too much centralised control of the budget holders, with the service boards and the professional heads largely sidetracked.

Of course, if the noble Earl the Minister can now tell me that in what the White Paper calls,

    "the programme of change underpinned by the new management strategy",

there is somehow an admission that the exclusively civilian "office of management and budget" has, as a focal point of budgetary control, been a disaster, and that that function is now being brought back into the supervisory orbit of the chiefs of staff, then I would recognise this as an important improvement, or rather a welcome correction.

Moreover, if one of the paper's basic assumptions is that all future operations are likely to be on a joint service basis; a premise justifying first a joint staff college, then what noble and gallant Lords in this House, with some experience in these matters, would consider a largely cosmetic, expensive and wholly unnecessary new joint headquarters (we have, after all, run highly successful operations under the existing system and the effectiveness of our intervention is invariably, as must seem obvious, more dependent on political will and the quality of our forces than on thinking up some new command organisation) and a new permanent Rapid Reaction Force, which I shall leave to my noble and gallant friend, surely against that background it makes little sense to send the naval personnel department to Portsmouth, the Army's to

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Netheravon, the Air Force's to Bath, and even less with the same thing happening to the logistic staff. That is what I mean by "inconsistency and confusion".

But perhaps the most serious aspect of all is the attitude of mind that so many of these studies and new management cultures may engender in the Armed Forces. If higher headquarters are encouraged to think of themselves as "head offices" and every commander as a "manager", with cost accounting held to be his primary responsibility and whose key to advancement lies just as much in coming in within or below his budget than it does on his ability to stir the hearts and minds of flesh and blood and get that bit extra out of them, in fair weather and in foul, then, I suggest, we are in real trouble. For if you are looking for cost accountants and cautious managers, that is exactly what you are going to get in the officer corps. And then where will be your Nelson touch and from where will come our front line leaders and commanders, who can make all the difference between success and failure when the pressure is on, right up to, in recent memory, the "H" Joneses, the de la Billières and the Roses?

So I do hope that the new Secretary of State, when he is deciding how and where to apply his undoubted talents, will appreciate some of these fundamental truths, will listen to his professional advisers and will realise that with the Prime Minister's assurance that the Armed Forces have had their cuts and will now be left to their devices, he has a real opportunity, by correcting a few things that have been got wrong and by leading from the front, to build up morale and professional effectiveness and ensure that the Armed Forces are always fully able to undertake, with honour and distinction, all the tasks imposed on them. I wish him well.

12.35 p.m.

Baroness Park of Monmouth: My Lords, no one could follow that act easily! I welcome my noble friend the Minister very warmly and wish him very well. Andrey Kozyrev the Russian Foreign Minister, addressing the federation council on 6th July, said:

    "Russian diplomacy considers NATO to be an instrument left over from a different era".

The OSCE, on the other hand, was a pan-European instrument to which all states of Europe belong on an equal footing. President Yeltsin, on 28th June, identified the priority tasks in the sphere of national security as including the completion of the formation of a collective security system in the CIS countries; the recognition that Russia's special geo-strategical position in Eurasia dictates the Asian thrust of Russian foreign policy and the creation of an effective security system in the Asian Pacific region; and, finally, participation in the creation of a comprehensive European security system of which an important component must be constructive co-operation between the Russian Federation and NATO.

Russia had recently joined the Partnership for Peace and was prepared for a deeper dialogue with the alliance on all questions of European policy and security. However, Russia did not yet consent to NATO's eastward expansion, taking in the countries of central and eastern Europe. NATO, he stressed, must transform

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itself from the West's military bloc into an instrument of all European security, and, moreover, of a political nature. He went on to say that Russia must have a fundamentally new army and navy and priority must go to the preservation and development of strategic nuclear forces. Now that industrial production was rising and the economy becoming more stable there would be a real possibility of halting the reduction in military spending. The proportion of expenditure on national defence would remain at the 1995 level and there would be military reform. Grachev on the same occasion said that the army now had to deal with peacekeeping not only in the CIS but also beyond its borders.

I am not alone in arguing that defence and foreign policy are two sides of the same coin. Ever since the Russian Federation came into being its objects have been to neutralise NATO, to restore the Soviet Union's position of power in eastern Europe and to reconstitute the Soviet Union in a leaner, meaner version. It has succeeded in the first and third aims and, as NATO continues to bow to the Russian veto on enlargement and communists return to power in central Europe (quite apart from the practical difficulty for central Europe of disengaging from the Soviet defence industry and finding the money to buy Western hardware), it is well on the way to restoring its power and influence in the former satellites.

Meanwhile, Russia is also, having reached agreement with China in areas ranging from military high-tech to ethnic policies, energetically expanding its power in Asia. (I have spoken before of the degree of India's dependence on Russian weaponry and nuclear collaboration and on sales of aircraft to Malaysia and China.) She is also building a nuclear station for Iran and preparing to enter into joint ventures in oil with Iraq as soon as she can persuade the UN to raise the embargo and withdraw it. She is reviewing her links with Libya and selling sophisticated weapons in the Middle East.

It will be said, and with truth, that pay in the Russian armed services is in arrears, that morale is poor and that large sums are owing to defence establishments and the defence industry. There is a degree of chaos and incompetence in the ground forces and for the moment money is short, and so are resources.

It is argued also that the series of military disasters in Chechnya, the inept leadership of the forces engaged there and the quality of the Russian troops demonstrate that for the foreseeable future Russia presents no military threat. It is worth noting, however, that the forces engaged were almost entirely drawn from the Border troops, the infamous OMON formations under MVD command (who were used in the Baltic states) and the internal forces. They were not, with the exception of some raw recruits drafted in at one stage, from the regular armed forces, which did not wish to become policemen. Any external conflict would involve the strategic rocket forces and the other élite formations, but they were not, and never would be, used to suppress internal revolt as the OMON and the other internal troops have been in Tbilisi and Nagorno-Karabakh in the past. But perhaps Grozny was a nasty shock to the

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KGB, the MVD and the FSS because, for the first time, the media were there, and for once I can praise the media.

The Russian threat may not be there tomorrow, but what about the day after? Russia now has bases in virtually every former country of the Soviet Union. It is building a single CIS air defence system. It has airfields in Armenia; it has forced Georgia back into the CIS; it is challenging the CFE Treaty on the grounds of troubles on the North Caucasus border. It is looking for new relationships with all the former satellites. It has military agreements now with Bulgaria and Romania; and even the Poles are looking for a new relationship with Russia.

Much more important, there is plenty of evidence that the leadership (and this will not change with a change of president since it is composed of the KGB, the nomenklatura, the defence industry and the army) while it has developed some economic strengths, sees one of its prime tasks as the restoration of Russia as a world military power. This is how they expect to make the Russian people walk tall again. This is why the airborne troops and the strategic missile forces will be supported, why Kokoshin, the deputy Defence Minister, whose chief concern is the military budget, has said that major state and non-governmental investment must be channelled to the development of aviation, missile and space equipment, stressing the importance of ensuring the country's defence capability. The S300 PMU-1 air defence system is no doubt part of that.

On 6th June, Grachev, visiting the Zhukovsky complex, was shown,

    "a new, multi-purpose fighter aircraft of the 21st century",

and much work is being done to modernise and modify existing MiG fighters. Russia still has 40,000 tonnes of chemical weapons—the draft law to dispose of them has not gone through—and has repeatedly lied about her continuing biological research, lies which have caused the US Congress to halt the programme of help to dispose of nuclear missiles.

Does all this sound like what the MoD would no doubt call the configuration of a peaceful, unthreatening neighbour in the years ahead? The country whose solution to any internal problem is to send in the OMON troops—which presents itself as a UN peacekeeper in Abkhazsia and Tadzhikistan and in Nagorno-Karabakh, where the OMON had their finest hour of butchery in the 1980s—is of course the same country which told us at the time of the Serb hostage-taking that the bombing of the Serbs' position by NATO aircraft was, "a mistake which had produced retaliatory strikes". "The Serbs were forced to retaliate", said Yeltsin in Halifax, adding truthfully enough that, "historically, we have supported the Serbs".

Russia's relations with the West are a classic case of the Russian military doctrine of Refleksivnoe upravlenie (reflexive control)—Soviet parlance for manipulating your opponent. Thus the Russians are now within G8—the economic doors are open. That is good. But they are also now inside NATO, not merely as Partners for Peace (and incidentally most of the CIS countries, a new Russian defence bloc, are also there and helping us to dissipate our limited resources). But what does Kozyrev have to say about NATO's role? On 1st June, after

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signing a partnership programme, he said that the issue of NATO expansion eastwards is no longer on the agenda. Russia had:

    "found a formula to normalise the relations with NATO, and as a result NATO expansion to the East becomes no longer as acute or political and is no longer on the agenda".

It would now be a routine issue discussed among many others at the level of expert.

It is interesting that the day before his deputy, Krylov, said in Kaliningrad (where the US Senate is uneasy about the build up of Russian troops):

    "in having a considerable military contingent on this territory, Russia is not violating any international treaty".

Sauce for the goose is evidently not sauce for the gander. Perhaps, too, Kozyrev's relaxed approach to a NATO that Russia is on the way to neutralising as a defence force, leaving only a PR exercise, may have been helped by the proposal made by Klaus Kinkel, the German Foreign Minister, on 26th June, that an agreement to hold special consultations and a pledge not to use force could be included in a charter to be signed by NATO and Russia. That would indeed sit well with Russia's plans to neutralise NATO and turn it into a defence eunuch.

Having Russia inside if she will not call the Serbs to heel, as she could well do, seems rather a waste. Russia is a master of double standards. On the one hand, Karasin, Churkin's successor, says virtuously, speaking of the Bosnian conflict, "forcible methods are counter-productive". On the other hand, Kozyrev himself, speaking to the CIS Foreign Ministers, referred to the UN resolution to support Russia's peace efforts in Tadzhikistan and added that,

    "it is impossible to resolve the problems of ethnic minorities by diplomatic methods alone".

How true. No doubt he also had Chechnya in mind.

Russia's aim is to phase out NATO and substitute for it that wholly harmless animal, the OSCE—53 nations who will no doubt effortlessly match the UN in its capacity to pass unwinnable resolutions and substitute conferences for action. The OSCE has been "monitoring" in Chechnya and Nagorno-Karabakh for some time now with no effect whatever on what the Russians, the Azerbaijanis and the others wish to do. The latest great proposal from the OSCE, made last year, is for a force of 2,000 to go to Nagorno-Karabakh—presumably 40 people from each country!

I see from the Estimates, however, that we actually wish to strengthen this organisation and credit it with developing a crisis management and peacekeeping role. Heaven help us if our unfortunate and splendid armed forces are to be asked to serve yet another toothless monster.

What I am trying to say, as I do every year, is that we cannot hope to keep the peace in a dangerous world unless we maintain NATO's power and will to deter and we can only do that by maintaining our own Armed Forces at a realistic level to deal with the unexpected, as well as assessing the expected more realistically. We cannot afford to continue universal multi-hatting.

I am sure that much work has gone into the document which we are debating and there are good things in it. My admiration for the forces themselves is unbounded.

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I believe, too, that the Bett Report, when it has been fully discussed, will prove useful. But when I read the paper through, I thought of what it does not say about the serious demoralisation of the men and women who serve this country so faithfully and who joined a service and not a business.

Much though I welcome the paper, I cannot help feeling that Stable Forces in a Strong Britain is, with respect, a travesty of the truth as far as the Armed Forces are concerned. Reading it, I thought at times that it was a report from a struggling supermarket chain to its board of directors with its talk of "flattening management structures" and,

    "a lack of horizontal transparency in what is primarily a vertical management system",

of customers and budget holders; of project capital—naturally, a Treasury initiative—designed to,

    "focus management systems on the delivery of outputs and the lateral links in the organisation through the customer-supplier chain".

I quote again:

    "Under the Department's Competing for Quality programme, we exposed some £286 million worth of activities to potential private sector involvement ... The work has identified potential annual savings of over £90 million, and will assist us in the task of accommodating planned defence expenditure reductions without reducing our fighting capability".

I ask my noble friend the Minister how that sits with the contracts with Airwork in 1993 which resulted in major damage to 16 Tornado F3s and significant damage to several Hercules aircraft, and which, had the disgracefully botched work on some of the Tornados not been discovered at RAF Leeming by RAF ground crews when they were due to fly to Bosnia, would have led to loss of pilots and crews as well as aircraft?

I raised the question of Airwork and its Tornado and Hercules contracts in our debate on the last Defence Estimates in 1994 and I gave warning to the Minister that I would do so again today. I raise it again today not only to establish that recourse to the private sector and to the lowest bidder on grounds of saving money alone has in this instance (and in how many others?) not only cost more money and resources, given the cost of each Tornado and the fact that most, if not all, of the 16 Tornados have been out of service ever since, but it has put lives and already limited operational capacity at risk. That, I submit, suggests that money, not the defence needs of the country or the morale of the services, drives policy.

It is not good enough to say that the warning time for a credible strategic threat emerging can now be measured in years. If the present policy of ideological privatisation continues, there will be little point in the JIC one fine day announcing that there is now a credible threat discernible on the horizon. By that time I have little doubt that, in the interest of saving money, because it is "business" and because it is the service tradition to say nothing, our Armed Forces will be run by Group 4. It will be too late then to rebuild our Armed Forces—not least our defence industries. Russia understands that. I beg the Minister to convey to the new Secretary of

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State our very grave anxiety about the state of morale in the services and about the creeping privatisation that could turn a magnificent fighting regime into a failing business. The men and women of the services joined a service, not a business.

We can still do something. Russia needs us still politically. We should lean on Russia and take the political offensive. It is the only offensive that we now have the resources to carry out. I just hope that the Secretary of State is a good poker player.

12.51 p.m.

Lord Kennet: My Lords, I feel confident that I speak for all noble Lords on this side of the House in most heartily endorsing the last three or four minutes of the speech just made by the noble Baroness, Lady Park of Monmouth—perhaps not her last sentence, but up until then.

There is a potential danger looming over us ever closer since I first spoke about it a year ago. It is concealed in that reassuring-sounding acronym BMD, ballistic missile defence. The time cannot now be far away when the Government will have to take decisions, and if they take the wrong decisions the world may lose any hope of rational and peaceful development for another half century or more.

It is attractive to think that you can defend yourself against incoming missiles without incurring any danger of side-effects, but you cannot. The nutshell is this: the closer you get to 100 per cent. invulnerability, the closer you also get to an invulnerable first-strike capacity. The current BMD programmes in the United States, which are part of the Counter-Proliferation Initiative, are quite open about that. The ability to destroy someone else's missiles and military capacity in general on the ground is an accepted part of the whole programme—that is, naked aggression in peace time. I speak, mark, of ability, not of intention.

As anyone reading official US statements will know, this is a scheme for the global deployment of weaponry capable of the pre-emptive destruction by means of conventional warheads, lasers or otherwise, of all and any weapons of mass destruction together with their launchers, platforms, silos, transporters, stores, factories, etc., including those in underground bunkers. It would do all this when the targets are identified as proliferatory by space-based sensors, and all would be automatically triggered by computers without further human input, whether military or political. The resemblance to Reagan's old Star Wars programme is striking. The only difference is that instead of being aimed against Russia alone, this one is potentially aimed against everybody except Russia. And once again all thought of mutual deterrence is abolished: the deterrence is one way only.

In this programme, we are by now quite heavily committed. The British designer of Chevaline, which was the Polaris modernisation carried out in secret by the government of my noble friend Lord Callaghan in the 1970s, is now working on BMD in the US. That is a commitment; he is there to programme in our 20 year-old attack designs to run against the US defence

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designs, since Chevaline stands in very nicely for the technology likely to be used by the third-world aggressors we now fear so much.

Moreover, according to the Director of the US Ballistic Missile Defence Office, General O'Reilly, the British taxpayer has contributed just under half the foreign investment in it. The work is done under the old SDI Memorandum of Understanding, I believe. I have asked Written Questions about the cost to us, and have had wriggly Answers. The expenditure is not all in one place. It is here; it is there; it is everywhere. But we are today debating a Defence White Paper, and I ask the Government again: what have we so far spent on this, the most important military project in the world, and where is it in the Defence Estimates?

Let us suppose that all this might work: that it might actually provide the US and some of its allies with the impenetrable dome that Reagan dreamed of. What would be the effect on the rest of the world? It would for generations divide the countries of the world into three classes: first, the United States, which had the ability to destroy anything it thought fit at any moment anywhere on earth or sea with complete impunity; secondly, its allies, who might or might not "benefit" (if that is the word) from the US controlled system, and thirdly, everyone else, who would just have to lump it. These last would perceive it as a grievous and fearful oppression, and would of course make enormous military efforts to catch up, whether by increasing their own penetration ability or by their own BMD, so as to achieve a new deterrent balance. This is a new arms race, imposed by the rich on the poor. The rest of the world is just beginning to understand this, and the reaction will not be long in coming.

Now who are the countries whose missiles the US so greatly fears? What do we mean by those "unstable regions", as the euphemism has it? We mean Libya and Iran, though they are actually stable enough, and Iraq, and North Korea. Those countries fear the US, and therefore look askance on us too as the henchman. All of them have one or two quite justifiable reasons for fearing the United States. We all know of the hostile acts performed by those countries against the US, and we must continue to condemn them. But we must also remember the other side. The US bombed Tripoli, from British bases, killing Gaddafi's young step-daughter. They did this because he had proclaimed that the Gulf of Syrte was Libyan territorial waters, and sent gunboats out among the American Fleet which was off his shores.

Iraq feared the US long before the second Gulf War because its client state Israel bombed and destroyed the Iraqi nuclear facility at Osirak in 1981, with US connivance. Reagan is reported to have said, "Boys will be boys".

Iran fears—even hates—the US for a rather less well-known reason: some time after the revolution which deposed the American-backed Shah, the new government discovered that in the north of the country the US was still secretly operating an intelligence gathering station which surveyed the Soviet Union, without their knowledge. This was bad enough: but worse was that the Americans were secretly paying qualified Iranian citizens to operate it, including military

14 Jul 1995 : Column 1971

personnel. They were suborning soldiers in the Iranian Army. They also remember their civil airliner which was shot down, and all were killed, by an American warship, and that the American captain was then decorated.

North Korea fears the US for reasons which are also little known in this country. During the Cold War the Soviet Union was North Korea's nuclear guarantor, as the United States was South Korea's. It was because of the active and tangible Soviet guarantee that North Korea signed the NPT. With the loss of its guarantor, North Korea was left alone to face the United States' enormous military build-up in South Korea and its ceaseless succession of nuclear-capable military exercises, which mimic invasion of the north. When the United States stated it had removed its nuclear weapons from within South Korea—not from the area as a whole—there was no question of the north, or even the United Nations, being allowed to verify the claim. The military build-up and the exercises in South Korea continue, and South Korea now believes itself to be the United States' largest weapons customer in the world.

Sooner than join the "Airstrip One" world of American BMD, we should be turning our diplomacy to removing the reasons for which those countries, and many others, fear us and our special relationship with the US, as we proudly used to call it. There are legitimate grievances out there, not blind menace.

Those are the geopolitical reasons for thinking that automated defence against ballistic missiles is a bad idea. And of course it may not work. But even if it were not a bad idea, and even it if worked, it would still be a useless idea. The studies now being carried out for the MoD, and there are quite a lot of them, cover ballistic missiles only. They do not cover cruise missiles. Nor do they cover pedestrians with suitcases carrying small nuclear weapons, or indeed small conventional bombs which if left to go off in nuclear installations, chemical plants or biological labs, would also cause mass destruction. Nor do they cover small tins of sarin, as in the Tokyo subway.

It is a commonplace that people need enemies, and I suppose most people at the end of the Cold War wondered how long it would be before we all found new ones. It has been six years: quite a long time, really. We should have used that long lull to repair damaged understandings. But we, or at least the US, have made bogeymen of the third world instead. Which way will China and Japan go in this new scission? It needs thinking about.

I end with a general point about sovereignty. We are not in danger of losing it to Brussels, because we understand what we are doing, and discuss it daily at the tops of our voices. And nobody wants our sovereignty off us in Brussels. But we are already losing it, and fast, to Washington, because we allow ourselves to be boxed into American weapon systems and the strategies they dictate. A few days ago, when I asked which department in MoD did long-term political forecasting, and assessed the political contexts in which we would operate new equipment, the Answer came: none, because the international political situation is unpredictable and because the MoD wants capabilities

14 Jul 1995 : Column 1972

which offer flexibility, mobility and utility across a range of likely military tasks. The answer went on about considered on their merits, the most important being total cost to public funds, operational effectiveness, and such technical aspects as performance, reliability and compatibility with our existing weapons systems. Full stop: nothing whatever about the geopolitical implications of weapons procurements. Nor of course, about the national interest in maintaining a sufficient industrial and technological base.

The Defence Estimates White Paper admits that

    "it might take two decades"

to bring a "major system" into service, and then it could

    "remain in operation for thirty years".

That is realistic. We all know that. It is a total of 50 years. Are decisions on major weapons systems really being taken without benefit of political thought? All the decisions being taken now, for Apache and Tomahawk today, for the Tornado and Harrier replacement tomorrow, and for space equipment, all tie us to the apron strings of the United States, because apron strings are all the United States offers. British sovereignty drips away: we do what we are told. In Europe, on the other hand, we are sovereign among sovereign equals, and can collaborate in the real geographical and economic interests which we have in common. And that is what we should be doing.

1.5 p.m.

Lord Vivian: My Lords, I thank my noble friend for giving us the opportunity to debate the Defence Estimates. At the same time, I congratulate him on his clear speech and on his new appointment at the Ministry of Defence, which I am sure he will enjoy.

I shall not speak on Bosnia for I have nothing to add to what your Lordships have already said. I should like to address my remarks to aspects of the Defence White Paper. The title of Stable Forces in a Strong Britain given to this year's Statement on the Defence Estimates is, I believe, a somewhat misleading one. Stability is required in our organisations and in planning times, and it can be achieved only by preventing the imposition of further changes on already exhausted Armed Forces organisations which are reeling and overwhelmed by so much recent change.

On the other side of the coin, the fighting units—the actual armed forces in each of the services—need their swords to be finely honed, razor sharp and wielded frequently. They do not wish for the sort of stability which is so essential for command organisations and structures. No proper sailor, soldier or airman in fighting units joins his service to sit in a tied-up ship, remain in a barracks without training or operational commitment, or stay on an airfield with grounded aeroplanes.

The statement,

    "We believe we can now inject a period of stability"
—provided it does not interfere with the operational capabilities of fighting units—is broadly welcomed. However, the statement that,

    "we have stability of funding"

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is rather more suspect. How can stability of funding be achieved when competing for quality in all three services continues? For it is well known that competing for quality is destabilising.

I do not agree that when the restructuring of our Armed Services is completed our front line forces will be configured correctly for today's uncertain world. For instance, cuts in the Army have been too deep, and to reduce tank regiment establishments from 54 tanks to 38 tanks is a matter of serious concern and questions whether a 38-tank regiment, reduced from four sabre squadrons to only three, will still be a viable force and able to manoeuvre with sound tactics for the future. A similar situation exists with infantry battalions which, some years ago, were reduced from four rifle companies to three, making them unsuited for operational deployment.

Those problems could be overcome easily by an immediate increase in manpower, giving the Army considerably greater flexibility and meaning less separation for families. The current strength of the Army, as at 1st April this year, less 16,000 trainees, was about 118,000 personnel. An increase of 10,000 troops would achieve a better configured Army. I ask the Government to expand the Army by at least those 10,000 troops.

The statements in the Estimates that,

    "There will be no cuts to our front line, even if our commitments reduce",


    "for our Servicemen and Women it will mean more time for their families, more time for training and more time to apply their expertise and professional skills on the global stage"

are most warmly welcomed.

The Statement on the Defence Estimates sets out clearly the three defence roles of the UK. To my mind it covers future threats from fundamentalism and any resurgence from Russia, among other threats. A full explanation of the 50 military tasks is included.

The Defence Costs Study identified the requirement for a permanent joint headquarters. That is again included in the Estimates, giving a justification for that new headquarters. I ask my noble friend to look at this project again. I have not heard very much support for this permanent joint headquarters. Our recent operational commitments in the Falklands, the Gulf and Bosnia have been, and are being, conducted by a single service headquarters with tri-service personnel attached. Is it not morally wrong to be seen to be spending large sums of money in refurbishing parts of an existing headquarters and manning it with an additional 400 or so personnel when for so many years all three services have been instructed to make large financial savings? Can my noble friend confirm that the Chief of the Defence Staff and the three single service chiefs of staff are content with the proposal for a new permanent joint headquarters?

I should like to make a few observations on the Bett Report, which is a fairly complex document and is another report which is causing concern and uncertainty to our servicemen and women. Reading the report, one is left with the impression that the Armed Forces have

14 Jul 1995 : Column 1974

been regarded as a mere additional business organisation. Our military services are not mere businesses but highly professional Armed Forces of the Crown and very skilled at their specific duties. I believe that there is no justification whatever to recommend that age-old systems, such as the rank structure in the services, should be changed and some ranks abolished. Why tamper with a system that has worked well for a very long period? Secondly, I do not agree that the entire report should be taken as a package; but rather those recommendations that are good for the Armed Forces should be implemented and those that are bad ruthlessly thrown out.

I now turn to training in the Army and once again bring to your Lordships' attention the concern about the lack of all-arms training and joint service training. It would seem that these types of training are glossed over with no significant emphasis apart from the permanent joint headquarters, which I have already mentioned, and the joint rapid deployment force, which I believe will be covered by other speakers. According to Figure 7 in the White Paper, which shows major NATO exercises, the majority of exercises conducted have been based on command post exercises with the exception of an airborne forces exercise, an amphibious exercise and some partnership for peace exercises.

Likewise, Figure 8 shows exercises outside Europe and, apart from battle group training in Canada, the majority of battalion and company level exercises would appear to have been outside an all-arms concept and not on a joint service basis. Emphasis has been placed on the retention of the Army's ability to mount or contribute to high intensity operations and on all three services working together in a cohesive joint force.

Unless all-arms high intensity training is conducted and carried out on suitable training areas, preferably at brigade level, low intensity operations in which this country is involved to a great degree in Bosnia and Northern Ireland may be carried out less effectively and efficiently in the future. Battle simulation and tactical trainers, although helpful with aspects of training, cannot replace the reality of all-arms field training at brigade level. Will my noble friend inform your Lordships of where the armoured brigades within the 1st Armoured Division in the Allied Rapid Reaction Force can train realistically in Germany or reasonably close to it? For instance, are there any large training areas available to the Army in France?

I now turn to the defence medical services. In 1993 a report estimated the need for 1,500 beds and in a more recent report this was halved to 800. This reduction is of immediate concern because a loss of beds of this magnitude leads to a reduction in the number of surgeons, specialists and nursing staff who can practise their skills in peacetime and so be available for localised conflicts or all-out war.

I have covered the closure of military hospitals in the United Kingdom in a previous debate but consultants have been reduced from 169 to 112 and it has now been proposed that the four Army field hospitals should be reduced from four to three with the fourth retained at cadre strength. The number of surgical teams, the vital element of any field hospital, will be reduced from

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42 to 24, allowing only eight per field hospital. Army field hospitals are the front line of the medical services and in view of the policy that front line units should receive no further cuts, will my noble friend agree to re-examine this front line reduction?

I cannot summarise better the situation regarding the defence medical services than by quoting the conclusions reached by the Select Committee on Defence in another place. It stated:

    "The reductions in the defence medical services are on a relatively dramatic scale. Numbers are to be virtually halved from their 1990 levels. There is to be just one core service hospital, at Haslar. The cuts in the level of front-line medical support are at least as great as, if not greater than, the reductions in the fighting arms.

    "In common with our apprehensions that those reductions may have gone too far and too fast, we fear that the major reduction in the Defence Medical Services will reduce the ability of the United Kingdom to generate military medical support for the front line in the event of serious hostilities short of all-out war, as well as reducing to a bare minimum the training and skills base for all the military medical disciplines. We are not confident that the proposed medical establishment allows properly for medical casualties in time of war. Peacetime opportunities for command, administration and logistical support of medical services have been severely pruned. They could be further reduced were there to be changes in the pattern of secondary medical care in Germany or Cyprus, which would also leave medical personnel required for military purposes without the opportunity for peacetime medical experience. Recent deployments in Bosnia and elsewhere have underlined the importance of having military medical manpower and resources readily to hand in peacetime, to support a number of scattered deployments in potentially threatening circumstances".

I now turn to equipment. Highly capable equipment and weapon systems have been designed and are being produced to give the Armed Forces the fighting capability they require. The Royal Navy's Sea Harriers should be being updated; progress continues to provide an amphibious helicopter carrier and the two new assault ships; further orders should be issued for the Type 23 frigates; and studies on a collaborative basis with the French and Italian Governments continue for the production of a common new generation frigate to replace the Type 42 destroyers. Their helicopter fleet is now being enhanced by the introduction of the EH101.

The Army is being issued with a further 259 new Challenger 2 tanks, and if there has been a delay in delivery dates will my noble friend explain what has caused that delay and when regiments will receive their new Challenger 2s? The delivery of the AS90 gun has enhanced the capability of the Royal Artillery. The decision made to purchase the Apache attack helicopter will enhance the Army's anti-armour capability and the high velocity missile will enhance the Army's air defence capability.

The Royal Air Force will benefit in the future from the introduction of the Eurofighter 2000; the update of the Tornado GR1 fleet; the refurbishment of the Chinook helicopters, which should be nearing completion; the procurement of additional support helicopters; the purchase of some C130J Hercules, and the introduction of improved weaponry will enhance the fighting capability of the Royal Air Force.

In conclusion, the United Kingdom is fortunate to have the finest Armed Forces in the world; Armed Forces that are very professional, highly skilled and well trained. They are carrying out an exceptionally difficult

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task in Bosnia and it is very much hoped that Her Majesty's Government are not interfering with the commanders on the ground whose views and decisions should be respected. Once committed to tasks, the Armed Forces implement their plans to the highest standards, setting examples of fine leadership. We have become accustomed to these traditional hallmarks from the Armed Forces of the Crown. However, their skills and professionalism may fade if we do not allow them to exist with sufficient personnel; if we prevent them from training properly and realistically; and if we deny them the weapons and communication systems they require. I am sure that your Lordships will agree that we owe our Armed Forces a large debt of gratitude.

1.19 p.m.

Lord Craig of Radley: My Lords, perhaps I may add my welcome to the noble Earl in his new appointment and in dealing with the issues of external threats to national security, which for him is no doubt a change from dealing with the internal dangers of organophosphates.

The Government, the noble Earl tells us, are now proposing a period of stability. But even more explicitly the White Paper in Chapter 2 says that the Government intend,

    "to maintain a global outlook and to play an active role in international affairs ... Living up to this sense of responsibility is a deliberate act, explicitly recognised in our defence and security polices".

Those are important policy statements. They indicate that the Government still want to punch their weight and more in the international arena. But for that to be credible, we need to be seen to have the ability to do so, not only to reinforce our political and diplomatic skills, but to give us the status and the strength to remain a full and accepted member of the Security Council.

While seeking to support the United Nations, the Government are right to stress that action in the security and defence field should be inter-governmental, based on co-operation between nation states. Commitment of our Armed Forces to battle must remain with our elected Government who alone must accept the ultimate responsibility for their use in action.

Against that policy background, how are we measuring up? Clearly the Government recognise the importance of a period of stability which has been strongly urged on them by the Chiefs of Staff. But it is still more of a promise than reality. For example, for the Royal Air Force, reorganisation and redundancy programmes will be major preoccupations for the rest of this decade. When I left the post of Chief of the Air Staff, the Royal Air Force had over 90,000 regulars. By the end of the decade the number will be little over 50,000. RAF uniformed manpower will have been almost halved. The RAF frontline forces have also been subject to many major cuts, in some areas by between one-third and even one-half. The Royal Air Force will soon be shedding completely its nuclear capability. In no way are they ingredients of stability.

Nevertheless, stability is clearly a sensible concept after upheaval and turbulence. But it will take determination and follow through by the Government

14 Jul 1995 : Column 1977

for a number of years if it is to be anything other than a semantic trick. Stability of funding, to which several noble Lords have referred, has, as we all know—sometimes from bitter experience—never been easy to deliver no matter how well intentioned are the promises. Meanwhile the calls on our forces could well increase dramatically if Bosnia really flares up or Her Majesty's Government want to put their finger in the dyke of some new UN disaster.

To support our security interests, the Government claim that they intend to strengthen our existing capability to project power quickly with a new joint rapid deployment force. That is a sound concept if we are to be able to fulfil the roles envisaged by the Government. But much remains to be done to give our three services the wherewithal to respond as a joint rapid deployment force and, in the words of the White Paper, to be capable of answering growing calls upon the United Kingdom to respond to a range of crises, potentially world wide.

It is worth dwelling for a moment on those three key words: rapid, deployment and force. I turn, first, to the word "rapid". The three services have long had, in some measure, a capability to respond very quickly; for example, the Spearhead battalion and some RAF squadrons at notice to move in a matter of hours. All such units must be fully manned and trained for the intended operation. There may be no time to undertake special work-up training before they move to theatre and into action. There is no room for caderisation, for only partly manned units, if the response is to be rapid. If the Government want to be able to commit well-found joint forces rapidly in future, will the cost and other implications of that proposed stance be provided for?

Secondly, I shall deal with "deployment". The global reach envisaged and the heavy logistic support needed for joint forces which may be operationally engaged, call for readily available air and ship transport. Support of rapidly deployed "teeth" and other arms cannot always be met by taking up ships or aircraft from trade to augment our existing ship and air transport lift. Are we doing enough (quickly) to prepare ourselves for high speed deployment of sizable forces?

Thirdly, I turn to the word "force". Gunboat diplomacy, and air policing like the RAF practised so successfully between the two world wars in the Middle East, have had their day. Today, even unsophisticated opponents have access to modern lethal anti-armour and anti-aircraft weapons. Worldwide exposure by the media to every twist and turn in a confrontation often serves to diminish the deterrent value of a small, uncommitted force. If such deterrence fails and force must be committed, it must be employed overwhelmingly, with overwhelming speed and/or overwhelming weight. The evident will to order in full military superiority, signals a very important political message from a democracy. It says in effect: judge us not just by our words, but by the strength of our actions too.

Recent experience in Bosnia has yet again taught that tit-for-tat and gesture operations no longer achieve sensible, political, let alone military, objectives. Rather they leave the way open to, "I dare you" challenges, to

14 Jul 1995 : Column 1978

acts of escalation and to the surrender of the initiative to the opposition. We can all understand the public and political worries about being seen to use more than a minimum proportionate force; about co-lateral damage, if large-scale force is employed; and the possible cost in men and matériel on our own side. But the use of Armed Forces has always carried with it those heavy obligations. Smart weapons and advanced technologies do nothing to lessen or obliterate the consequences of shooting, and of shooting to kill. Indeed, it is the show of strong political conviction, which commitment of large-scale force implies, that gives the best gearing for the use of armed force where that is judged to be essential to contribute to the overall political objectives.

If force cannot contribute to those objectives, is it right to expose our forces to the risk of frequent attack, of hostage taking and of fatalities; or to commit them to ill-defined operations in a half-hearted way? We have allowed the political heart to rule the head for too long in Bosnia, with almost weekly, and now daily, the awesome consequences of that misjudgment of reality coming home to haunt and shame us and the United Nations. What foolishness has gripped the Security Council during the past few hours to ask the Secretary-General to do in Srebrenica that which he clearly and patently cannot have any hope of achieving?

While initially widely welcomed, if not by the Bosnian Government themselves, the move of the UK rapid deployment force to the former Yugoslavia has yet to demonstrate that the Government have provided the necessary resources to have fully manned and trained operationally ready units, with the mobility resources immediately to hand, to get them and their essential logistics support into theatre. If we are to match the fine words of the defence White Paper, we have to be able to get our highly professional soldiers, sailors and airmen into theatre, backed for offensive action with the full logistic support that they will need. If we cannot afford to do so, let us for heaven's sake cut our foreign policy to the size and shape of our remaining much reduced forces and what they can support effectively.

No doubt when the Minister winds up he will be able to explain why the move to Bosnia of the so-called rapid reaction force is taking so long. Preparation has taken over two months and there have been other delays. Indeed I doubt that all the delays can be laid at the door of diplomatic negotiations to clear the way for our forces' arrival and basing in theatre. I heard a rumour the other day that the Croatians wish to charge an import tax for every single member of the rapid deployment force who is to pass through their hands. I wonder whether we have also negotiated what the export tax might be.

The command arrangements too, should our forces be committed to fight, still seem to me to be untidy. Will these enable the Government to take full responsibility for our forces' actions? Is the United Nations' authority committed to the use of strong and overwhelming force, if force is necessary to secure objectives? Newspaper reports and indeed recent events give a different impression about United Nations' resolve. Perhaps the Minister can reassure us

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on these points when he replies. Our Armed Forces are the best in the world. They deserve the very best political support that the country can muster.

1.32 p.m.

Lord Ironside: My Lords, first of all I should like to congratulate my noble friend on taking up his new post. He is fortunate in that he arrives with Apaches and Tomahawks flying, so he has made a good start. I wish him luck. Commentators will no doubt judge the Statement on how well it is written and the noble Lord, Lord Chalfont, has already given his seal of approval to this effect. However, I believe we should judge it on the outcomes, based on the Government's intention to maintain world class Armed Forces on which we can draw in building security in the uncertain world we live in.

The low risk of global warfare has been replaced by greater risk of small scale conflict, but what matters in the long run is the maintenance of international peace and stability and, by keeping in the first league militarily speaking, we can influence world affairs and stay in the first league economically speaking. The noble and gallant Lord, Lord Bramall, wonders whether we are doing enough militarily to be confident of saying anything about this and shouting the odds. My noble friend Lord Boyd-Carpenter has spoken of the weaknesses and possible lack of preparedness. We are conscious of what happened in the 1930s. However, I believe that the Government have the military balance right in quality for certain, but of course quantity needs constant review. The balance is between deterrence and rapid reaction as well as between forces structured and trained for high intensity conflict and forces equipped for effective response to peacetime crises.

I see that great care must be taken to demonstrate the military value of filling gaps in defence capability and to assess the impact that the chosen solution will have on the defence industrial base, and through life support structures. I congratulate the Government on keeping up a substantial forward equipment programme while the structures and characteristics of the Armed Forces are changing. There are some difficult decisions to take when the benefits to trade and industry of operational advantage and of other practicalities have to be threshed out. Do we custom build? Do we collaborate or do we buy off the shelf? If we have time to look ahead, we can plan to our advantage, but, when the replacement cycle is out of step with the development cycle—the CJ130 Lockheed Transport is a good case, the Future Large Aircraft development not having come forward—we are often faced with the commercial expedient of buying other nations' products. When this happens we must remember that the offset fallback is now worth much more to the giver, who wants to keep his market position and lead, than to the receiver, who has to accept a sub-contracting role which has rather doubtful value, particularly in marketing terms.

I hope therefore the Government will heed the advice of the CBI and make more powerful use of offset leverage. I would encourage the Comptroller and Auditor General to look at how effective offset has been over the years and at ways in which it can be made to work better. In the order book now is the Attack helicopter, and the Cruise missile

14 Jul 1995 : Column 1980

is in the pipeline. We have been through many decision gates with CJ130, Challenger 2, AS90, Bridging for the Nineties, the Sandown mine counter-measure vessels and Tornado, as well as the helicopter carrier and the assault vessels. Some choices are easier to make than others. I have been briefed by all the contenders for the Attack helicopter and by the Army Chief of the General Staff and by 24 Airmobile Brigade, now in Bosnia. I of course wish they had the Apache with them now.

However, the Army must take credit for having made a convincing case to meet operational need, and this has been substantiated in the combined operational and investment appraisal, with the result that a robust decision has been made to go for a platform and weapons system which, first, meets the operational requirement, while then putting the supply base into the hands of our one and only helicopter company, Westland. Government policy to reduce bidding frequency and the number of bidders, and to have longer contracts to reduce procurement costs, does, I believe, produce better value for money, but it is a natural outcome of loading more risk on to contractors, who see the trade off for this being longer term contracts.

Criticism has been levelled against the Government from the Opposition for some time now for being unwilling to set up a diversification agency and to follow the US lead with dual use technology initiatives. However, I welcome the lead now taken by government in setting up the Defence Evaluation and Research Agency, which brings the minds of MoD researchers closer to industry, and which I believe goes the right way about making the best use of civil research and reaching out into industry with defence technology.

There was at one time a craze for spin-off from defence, but most big technical steps forward, such as transistors and chips, were spun into defence from civil research. I am glad to see the "spin-along together" effect which is now being generated by the Defence Evaluation and Research Agency. If diversification funds are needed, surely the European Union KONVER programme is the right source for getting these funds. The defence technology enterprises body was a brave attempt to exploit MoD research. However, my experience is that, if a development is a winner—and the MoD has produced carbon fibres, for example—it spins naturally. If not, it is a loser and cannot be made to spin however hard one tries. Besides, I do not think that the bankers working with the DTE at the time really understood the risk factors.

The Trident programme has considerably enhanced the underwater warfare capability of the Royal Navy. Ten years from start to in-service date for the "Vanguard", despite all the safety contingencies which were imposed on the project from the Sizewell inquiry and the mid-term management changes, is a noteworthy achievement.

I welcome the Government's declared intention to preserve the nuclear deterrent, which is the ultimate safeguard against the CIS strategic arsenal and the strategic and sub-strategic derivatives which are under Russian control. It is also a safeguard against the development of new ballistic missiles to which the noble Lord, Lord Chalfont, referred. It would be folly for NATO to drop its guard in this respect.

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Following on from that, we must be clear about how Defence Role 2 develops for us after Maastricht, giving the Western European Union the dual role of being the defence component of the European Union while it is also the European pillar of NATO. Rolling up the WEU into the common foreign and security policy of the European Union will be seen only as another loss of sovereign influence. I am sure that the Government are right to keep the WEU out of the tentacles of the European Union, where the Commission has no expertise. Nor does the European Parliament, unless one includes security and disarmament in that category.

Already the Bertelsmann Foundation in Germany is calling for majority voting on the common foreign and security policy while it makes it clear that it wants to see Germany as of right take 11.5 per cent. more voting power on the Council of Ministers than France or ourselves. At present the voting power is 10 votes for Germany, 10 for ourselves and 10 for France. The foundation wants to see that increased in the future after 1996 to 28 for Germany, 24 for ourselves and 24 for France. The moment for springing that proposal on the European Union would no doubt be at the Inter-Governmental Conference review. I do not believe that my noble friend and his right honourable friend the Secretary of State should be surprised that amber lights are now flashing strongly not only in this Chamber but in many other places in this country.

I hope that the Government stick to their proposal for keeping the WEU as a distinct entity which can deal with the Petersburg tasks through inter-government arrangements with or without the American leg.

Finally, I should like to say something about the home scene. The Procurement Executive move to Abbeywood near Bristol is justified. The Joint Staff College decision to home in on Camberley is, I believe, the right choice. Despite the fact that I was born there, I can assure the House that I have no prejudice in this matter.

I believe that the report of Sir Michael Bett, on which we are now told we can expect a decision in the spring, must be carefully studied to ensure that the change is for the better conduct of the Armed Services and not a market testing exercise breaking down the high standards and ethos of service life. The noble and gallant Lord, Lord Bramall, my noble friend Lady Park and my noble friend Lord Vivian drew attention to the fact that there are dangers in Michael Bett having too much of his own way. It is worth noting that two out of the eight Field Marshals are serving on full pay. The case for removing the mythical baton from the knapsack has not been convincingly made. We owe a great deal to our Armed Forces and I hope that they will have a career structure and a future which will inspire them.

1.45 p.m.

Lord Annaly: My Lords, I join other noble Lords in congratulating my noble friend on his recent appointment and wish him well. I do not propose to mention the situation in Bosnia, which has already been widely debated today.

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I welcome the statement by my right honourable friend the then Secretary of State for Defence in another place and reaffirmed by my noble friend today, and also referred to by the noble Lord, Lord Chalfont, that we can set a steady course for the future and inject a period of stability into defence planning and funding. All our Armed Forces have gone through a prolonged period of change and uncertainty since the end of the Cold War, and a period of stability in defence planning is now essential, not least for reasons of morale throughout the services.

I also welcome the assurance from the Government that if in the light of recent positive developments in Northern Ireland we are able to reduce the Armed Forces' commitment to operations in support of the Royal Ulster Constabulary, that will not be matched by cuts in fighting units and there will be no reductions to our front line.

The confirmation in the Statement that,

    "a credible military capacity will often be a crucial underpinning to diplomatic or economic action, and remains an insurance against the re-emergence of a strategic threat",

needed to be said. I regard this as being as essential to this country now, and likely to remain so, as a household insurance policy is for any household.

It is reassuring to know that the Government consider that NATO is now and will remain the bedrock of our defence. While I understand the need for Europe to have the capability and organisational structure to mount European-led missions, the number and geographical spread of the various international organisations gives me some cause for concern. While it makes sense for us to establish links and for our forces to train with countries throughout Europe with the aim of improving security within Europe, I wonder how that would work in practice with a spread of organisations over and above NATO, the European Union and the Western European Union, which includes the Organisation for Security and Co-operation in Europe, the Partnership for Peace and the North Atlantic Co-operation Council.

I note that the role of our reserve forces is likely to increase in the future. Can my noble friend the Minister give an indication of what measures, if any, are going to be taken to assist Territorial Army volunteers as regards their civilian employment prospects in the light of these changes? If reservists are likely to be on a higher state of readiness and are more likely to be called out to undertake new tasks, what compensation is there likely to be for their employers? The loss of a reservist from a specialised civilian job in a large or especially a small business could make life very difficult for the employer. The net result might be that TA volunteers are considered a risky bet by employers, particularly if they are on the Higher Readiness Reserve. Perhaps my noble friend can explain how many units or personnel within units it is proposed should be in the Higher Readiness Reserve. Does he agree that there is a good case for some members of all four fire support battalions to be added to the Higher Readiness Reserve?

With the withdrawal of troops from Germany there will be, if there is not already, increased pressure on the defence estate and in particular on the Army field training centres, not to mention the areas where fast jet

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low-flying training takes place. Apart from the development proposals at Catterick, Salisbury Plain and Otterburn, will my noble friend give an indication whether there are any plans to open new training areas in this country and, if so, is he able to say where?

While we are living at a time of increasing environmental awareness, it is worth making the point that the Ministry of Defence retains the stewardship of probably the finest estate for wildlife in a single ownership in the United Kingdom. This would not have been the case to anything like the same extent if the landholding had not been used for MoD training purposes over the years, something which is sometimes forgotten.

In the past few months I have been fortunate to have visited RAF Cranwell and two other RAF stations, the Royal Marines Training Centre and the MoD Police Headquarters. Without exception, the standards of training which I and other noble Lords saw on our visits were impressive and brought home to me once again that our three armed services are this country's greatest national asset.

Last, but by no means least, I refer to Her Majesty's Yacht "Britannia", which may not appear relevant to the Statement on the Defence Estimates but does in fact appear in it. Several noble Lords made a visit to Her Majesty's Yacht "Britannia" shortly before her departure for South Africa for the recent historic royal visit to that country. Can the Minister say whether the Government are any nearer making a decision about a replacement for the Royal Yacht, bearing in mind that "Britannia" is due to be decommissioned in 1997? Does my noble friend agree how important it is for this country that there should be a replacement? The revenue which the Royal Yacht brings in for us through the Seadays held on board around the world makes the running costs of the yacht pale into insignificance, and the commercial spin-offs would simply not arise if it were not the Royal Yacht.

An important point is that all efforts should be made to avoid the dispersement of the experienced Royal Yacht crew, many of whom have sacrificed seniority in the mainstream Navy by choosing to remain as part of the crew, where there is justifiably great pride. The loss of expertise and experience in this special role will occur in the event that there is no replacement ready before Her Majesty's Yacht "Britannia" is decommissioned.

1.52 p.m.

Lord Monkswell: My Lords, the debate gives us the opportunity to pay tribute to our Armed Forces, to look at the Statement on the Defence Estimates and to make some comments. I join with others in paying tribute to the professionalism of our Armed Forces. I would say that the Clegg case raises serious issues, but I do not believe that this is the right occasion on which to debate those since they affect various different departments as well as the Ministry of Defence.

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There are some interesting points in the Statement on the Defence Estimates. Some are worth highlighting. Others raise questions to which we must ask the Minister to address himself. The first point I pick up relates to paragraph 213 on page 14. It states:

    "The major challenge we face is that of completing the construction of a wider Europe".

The paragraph continues:

    "Our vision must encompass the Europe of nation states stretching from the Atlantic to the Urals and from the Arctic Sea to the Mediterranean".

That raises a question as to whether the Secretary of State for Defence will accept the direction of the Prime Minister and the Deputy Prime Minister in that endeavour.

On page 32 in paragraph 271 we have a rather curious phrase. The paragraph states:

    "Our National Contingency Forces, and within them the Joint Rapid Deployment Force, are thus intended to provide a 'golf bag' of forces".

That reminded me of the situation a year or so ago when the leader of our party, John Smith, highlighted the problems of the Government's economic policies as being a "one club" situation. I must admit that I found the phrase "a golf bag of forces" rather curious.

There is a reference on page 72 to projects in study phase. It appears that we are investing in a CALF—that is a Common Affordable Lightweight Fighter. One of the questions that we must ask is: how much are we investing in this CALF? It is worth pointing out that if one feeds a calf it turns into a rather larger beast than was originally intended.

On page 82 our defence expenditure is expressed as a percentage of GDP. According to the figures, we are spending 3.3 per cent. of GDP on defence. I did a quick calculation recently and the European average is 2.7 per cent.; it is a rough calculation. But I am pleased to note that a later section of the White Paper reports that by the year 1997-98 we shall be approaching a figure of 2.8 per cent. of GDP on defence. Bearing in mind my party's commitment to expenditure on defence as the average of our European colleagues, I think that the Government are working creditably to achieve our policies; and I thank them for that.

On page 100 there is reference to private finance initiative. I wondered whether that was a reference to buying a private army; and whether the reference to the Citizen's Charter in the following paragraph referred to the right to carry a gun. But on reading the paragraphs I find that that is not the suggestion.

However, is the introduction of private finance as a risk-bearing element an issue that we should seriously consider in terms of our defence establishments? It is useful to read in the Citizen's Charter paragraph that the time taken by headquarters in London to answer the telephone is within an average of 15 seconds.

But on a more serious note, on page 103 we note only two small paragraphs relating to merchant shipping. It has been a constant refrain, virtually throughout the period of this Government in office, for the past 15 or so years that we have witnessed the decline in the size of our merchant fleet. We have continually raised our concerns about the effect on our defence capability as a

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result of that. To have that matter referred to in only two small paragraphs of the Defence Estimates does not lend weight to the seriousness of the problem with which we are faced.

It is interesting to note on page 113 that we station a Gurkha battalion in Brunei, the full costs of which are met by the Sultan. That is very good of him. However, on page 135 we note that in the cash plans there is a figure of £1,525 million as a contribution to the costs of the Gulf conflict. But there is no reference to a figure advising us as to what the Sultan of Brunei pays us for the mercenary forces that we supply to him.

These Defence Estimates raise a number of questions, as I have highlighted. Other noble Lords have raised other matters. I suspect that the Minister will not be able to answer them all this afternoon; and I suspect that we all should become rather bored if he tried to do so. If he cares to write to us later, I am sure that we shall accept that.

I now turn to the more general comments which we are all entitled to make in the debate. I must pick up something highlighted by the noble Lord, Lord Williams, and it is a central feature of government policy which gives us a major problem with defence. The Government's presumption is that this country is a major player in the world and that we are one of the top nations. We must realise that for many years we have been a medium-sized nation, a medium player in the world. Unless and until we accept that and shape the policies that we adopt to that reality, whether it be in defence or other fields, inevitably we shall make mistakes. I am talking about us as a nation.

Let me give a few examples. One is the adherence to nuclear status. It has the unfortunate effect not only of requiring significant expenditure but also of shaping our defence posture. We think of it in terms of that being the final solution. One unfortunate thing which militates against the policy of building a Europe from the Atlantic to the Urals is that, having got the nuclear weapons capability, we then have to find a use for it. The only use is to direct it towards the Russians. We have had a number of contributions this afternoon suggesting that there is a continuing Russian threat. It seems logical that if we are to build that Europe of nations from the Atlantic to the Urals, rather than having within our defence scenario a weapon specifically directed at one of our colleague nations within the European dimension, we should seek to build a sensible relationship.

I made a joking reference to the CALF, the common affordable light fighter, which we are studying in conjunction with the United States of America. Surely it would make much more sense for us to think in terms of collaborative projects of that nature, if there is a need for them, with the Russian Federation. The federation has a strong capability in modern aircraft, and it may be useful not only militarily to build common structures but also it would benefit both our economy and the federation's. It is the economic stability that will provide us with the peaceful future that we need. That is one of our problems. We spend money over and above what we can afford comparatively. What do we get back for

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it? We hire ourselves out as a mercenary force, whether it is in the Gulf or Brunei. Do we not sell ourselves a little cheaply?

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