Skip to main content


Volume 82: debated on Monday 8 July 1985

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Motion made, and Question proposed, That this House do now adjourn.— [Mr. Durant.]

12.39 am

The subject of this Adjournment debate is the future of Westland, but first the House may want to know of another future, which was established not many hours ago. I am told that at 10.20 this evening the wife of my hon. Friend the Member for Orkney and Shetland (Mr. Wallace) gave birth to a daughter, Helen Grace. I am sure that the House will wish to assure the hon. Member, his wife and Helen Grace of its best wishes.

I am grateful for the opportunity of this debate. I am also grateful to the Minister for Information Technology for his attendance, particularly in view of his past contact with Westland as Minister for Defence Procurement, and to other hon. Members who have agreed to take part in the debate and join me in supporting Westland. The hon. Member for Weston-super-Mare (Mr. Wiggin) may seek to catch your eye later on, Mr. Deputy Speaker, from the Government Benches, as may the hon. Member for Kingston upon Hull, North (Mr. McNamara) from the Labour Front Bench and my hon. Friend the Member for Isle of Wight (Mr. Ross).

It must be very nearly unprecedented to have so many hon. Members take part in an Adjournment debate. I hope that the Minister will recognise the cross-party support for Westland that this indicates. What is also, I suspect, practically unprecedented is to have such a degree of outside interest taken in such a debate at such a late hour. Nearly 40 of the Westland work force travelled up especially from Yeovil and elsewhere after work today to attend this half hour debate and to show their support for their company and their belief and pride in the work that they do.

Order. The hon. Gentleman knows that he should not refer to strangers in the Gallery.

I apologise, Mr. Deputy Speaker, for referring to anybody who may or may not be in the Strangers Gallery. I merely wanted to show that there is support for Westland outside the House. I am sure the Minister recognises that their effort demonstrates the kind of commitment that is one of the greatest strengths of Westland.

This is at once the most difficult speech that I have made in the House and perhaps the most important. Westland is not only the pride of my community, and of others in the west of England; it is also the source of much of our prosperity. But more than that, Westland has served Her Majesty's forces as one of the nation's principal defence industries, with exceptional distinction, most recently in the Falklands, where our helicopters were recognised by all, from the Secretary of State for Defence to the ordinary Royal Marine in the field, to have been one of the principal causes of our victory.

Westland is our only national helicopter manufacturer and our only hope for major participation in the European collaborative helicopter projects of the 1990s. Westland is one of the key components of Britain's aerospace industry. It is one of our nation's first centres of the new technology. Its work force, from specialised design teams to those using the newest technologies on the production line, is loyal, skilled, committed, proud of its work and confident that, as a team, it can keep Britain at the forward edge of world skills in the future.

In short, Westland is not just vital to Yeovil. It is vital to Britain. The first thing, the chief thing, that I want the Minister to do tonight is to say just that: to say to those listening outside that the Government believe that Westland is an important national asset and that they are committed to playing their role in maintaining the overall integrity of the company.

I know, as the Minister knows, that the Government have a confidential report confirming the importance of Westland. I know also that the Minister's Department has shown its confidence in the company by investing in the development of the W30. I know that, whatever the Ministry of Defence does, his Department will want to take whatever steps are necessary to ensure that that investment is not lost.

Why is it, then, that throughout the recent crisis we heard not one word from the Government to strengthen the company's position? Why is it that the Government stayed silent and allowed those in City boardrooms a free hand to play fast and loose with a great company's reputation and the livelihood of thousands of workers? Let the Minister tonight make good that deficiency. He knows the company's underlying strength. He knows that its long-term prospects are excellent. He knows that we have a new chairman in Sir John Cuckney. He knows that there is now, throughout Westland, a grim determination to do all that is necessary to ensure the company's future. Let the Government make their contribution tonight by committing themselves, in terms that cannot be misunderstood, to playing their part with the work force and the management to ensure that future.

Let the Minister recognise that one of the chief ways in which the Government can show that commitment is to make a decision soon about the AST404. Is it not the case that Westland has put in the most effective bid for this order? Did not its submission for an uprated W30 meet that specification in detail and in full? Is it not the case that Westland was the only British participant in the competition, and that in purchase price and running costs it was cheaper than the others by up to 30 per cent.? Is not the W30 300 series the best aircraft of its sort in the world, with considerable foreign sales potential? Is it not the case, for example, that Spain, Scandinavia and Australia are almost certainly ready to buy the Westland aircraft as soon as the British Government make up their mind?

The Minister knows that these facts are true. Why, then, just at the moment when Westland was about to put the ball in the net, have the Government allowed the Army and the Ministry of Defence to move the goal posts? Is that an appropriate way to treat a great company which has served Britain so well? I ask the Minister to give us an assurance that he will use his best endeavours to ensure that the AST404 decision is taken soon and in favour of Westland. He should realise that his answer can make a great contribution to a great company, can help sustain prosperity and jobs in the west of England, can support one of our nation's key sectors and can strengthen Britain's defence.

Westland is not seeking charity, nor special treatment — it needs neither. We are asking for a fair chance to do what we do best—make the best helicopters in the world for Britain's defence. All the ingredients are there to ensure the company's future: the product is excellent; the work force is dedicated; the management has a new look; and the determination is evident. All that is missing is a clear commitment from the Government to join us to secure that future. I ask the Minister to provide that tonight.

12.46 am

I thank the hon. Member for Yeovil (Mr. Ashdown) and my hon. Friend the Minister for allowing me to intervene briefly. I initially questioned the desirability of debating this subject tonight, but I am sure that, given the all-party agreement about which the hon. Gentleman spoke — I agreed with almost everything that he said — we can produce a positive message.

My hon. Friends the Members for Wells (Mr. Heathcoat-Amory) and for Dorset, West (Mr. Spicer) have been assiduous in supporting the view that I shall put across. I think that there is all-party agreement on the fundamental necessity for impressing upon the world Britain's confidence in its single helicopter manufacturer.

Let us be frank — Boeing, Bell, Sikorsky, Aerospatiale, Agusta and MBB have had great difficulty in selling new helicopters. Westland is no exception in supplying a product to an overcrowded market. There has been a baring of the cupboard, and that is all. There has been a revelation as a result of a well-intentioned bid, adding substantial sums of private money to the company's resources. As is the wont of the financial journalists in the City, there has been a slight fluttering in the dove cotes. That is all.

Westland is paying its bill and wages and producing the goods today as it was eight or 10 weeks ago before this incident. The company has grasped this nettle and is having a financial spring clean. There is nothing wrong with that. Westland will not be the first company to examine itself. At the moment, its bankers are standing by it, and that is good and proper.

There is no better person than my hon. Friend the Minister, with his previous experience, to know the ins and outs of the matter and the problems and benefits of Westland helicopters. They are a fine product, and the company has a fine record and fine work force. It will continue to have those advantages. I believe, from my experience, that the services do not understand the helicopter's merits. In previous speeches I have pointed out the relative views taken by other countries of this weapon.

It is all very well for Ministers to say that the services know best. I remind the Minister that the tank was devised by the First Lord of the Admiralty, who was a politician. The British Army went to war on horses in 1939, and 16 of our ships were hit by second world war aeroplanes during the Falklands war. There are moments when politicians sometimes have to know best. I could say that AST404, which was well understood for many years in the Ministry of Defence, is really a bad story of changed minds by senior people at the last minute, which leaves British industry wringing its hands. Furthermore, I pull the leg of my hon. Friend and ask: if the W30 is unsuitable for the British Army, why not offer it to South Africa? I feel that might cause troubles, and then the argument might get turned on its head.

I hope that the Indian order still comes through. It is not impossible. There are uses for this helicopter; it could be bought. There is just one small problem.

I hope that my hon. Friend will spell out a message of confidence in this great company tonight. That is all that it asks. It asks its principal customer, the Government, and its principal investor, the Government, to have confidence in Westland.

12.50 am

I thank the hon. Member for Yeovil (Mr. Ashdown) for giving us all the opportunity to take part in the debate, and the Minister for Information Technology for conceding some of his time for it.

I join the hon. Member for Yeovil in congratulating his hon. Friend the Member for Orkney and Shetland (Mr. Wallace) on the birth of a daughter. I assure his hon. Friend that, although she might be a delight now, as girls grow older they become more troublesome, until they get married, and I am told that after that they are always a delight.

Westland is a company of which this country should be proud. It is at the forefront of aerospace technology and is the country's only helicopter and hovercraft manufacturer. Nearly all the helicopters which saw service in the South Atlantic campaign were provided by Westland. Without its products there would not have been a victory, and this country owes a great debt of gratitude not only to the people who flew and fought with the helicopters, but to the work force which backed them up.

Since 1982, about 600 or more jobs have been lost, 500 in the last year, and 300 at Yeovil. About one quarter of Yeovil's work force — members of the Transport and General Workers union, the Association of Scientific, Technical and Managerial Staffs and, the Amalgamated Union of Engineering Workers, the Transport Aircraft Servicing Specialist and other unions — have been employed on the W30 on the strength of anticipated orders from the Ministry of Defence. But now the goalposts have been moved, and we have not really been told why, although some vague, strange reasons about the changes in the Army's demands have come forward.

I put it to the House that the real problem is Trident. The demands made by the Trident programme are affecting every purchase and procurement by the Government. The Royal Air Force is seeking to shed some of its responsibilities because of its £400 million overspend. I notice that it has already passed its responsibility for the Super Harrier to the Navy, and it is doing the same with the tactical transport helicopter to the Army.

We have to ask, as did the hon. Member for Yeovil and the hon. Member for Weston-super-Mare (Mr. Wiggin) why the Government have taken no interest whatsoever in the bidding that has taken place for the future of the company. At £50 million it is a snip for whoever wants it, as Flight International said, yet no major British company has come forward to seek to buy it. Is it because the Government are not prepared to confirm orders to give the company a chance to meet the technological needs of the Army and of the industry and to maintain our own independent service? Is it that they are just not bothered, or is it, because of the pressures on the Ministry of Defence, that they are prepared to buy things off the shelf from the Americans or from other suppliers rather than go forward and maintain what is important for our own strategic employment industries—our own separate and independent helicopter industry? We are talking not just about the future of a number of planes, important though they are, but about the maintenance of an important strategic industry in the country.

We have been told that pressure is being brought to bear to use the Chinook instead of a smaller lighter helicopter, but this does not appear to make any military sense in terms of strategic interest, particularly on the central front. I grant that Chinook is important for its lift capacity, but its primary purpose is as a heavy logistic transporter. It is the battlefield bus, as opposed to the battlefield taxi. It is what the Army is, and was, looking for until the pressure came to bear on the Ministry of Defence.

Heavier helicopters are much more vulnerable to ground fire, which was responsible for the loss of so many helicopters by the Russians in Afghanistan. We have to expect our new helicopters to meet the challenge of the light, quick tactical helicopters on the central front which the Russians are developing. We must be in a position to meet that challenge. It does not make sense to develop a heavy helicopter capable of carrying 44 men when one wants to deliver a platoon of about a dozen or so to important tactical positions on the western front or to confront a terrorist attack.

To deny the Army a tactical transport helicopter is to deny our Army the flexibility and manoeuvrability needed to counter changes in Soviet strategy. That is the important point which we must bear in mind. It is the nature of the helicopter about which we are concerned, its importance to the Army and its role therein, rather than looking for a heavy large helicopter which is vulnerable to ground fire and attack. We should address ourselves to proper military needs instead of acceding to the Ministry of Defence's desire to buy off the shelf in dribs and drabs as it thinks money is available. In so doing it is not recognising the importance of maintaining our helicopter industry.

The Government should say that there is a need to maintain our interest and control over Westland so that we can maintain the industry for the country's defence and maintain the work force at the frontiers of high technology, in which helicopter design and manufacture have a prominent place. Whatever happens, the Government must maintain our control of Westland m Britain. It must not be allowed to pass out of existence or into foreign control.

12.55 am

The Minister for Information Technology has had a long day, because he has already had his ear bent by two senior executives of British Hovercraft Corporation during his visit to my constituency about 12 hours ago. I wish to support everything that has been said so ably so far in the debate. I remind the Minister that Westland is the largest industrial employer on the Isle of Wight, with a work force of about 1,500. Anything up to 200 subcontractors of various sorts on the island look to the company for much of their bread and butter. I remind the hon. Gentleman also that in February the average unemployment rate on the island was 17·3 per cent.

The skills of the work force at Westland are undoubted. There is £60 million worth of orders on the Isle of Wight from BHC, Shorts, Boeing and De Havilland among others. That bears witness to the ability and the skills of the work force. The work is mostly in the composite sector and it is carried out in works which were only recently modernised at a cost to Westland of about £5 million. It is referred to as a centre of excellence and I believe that to be right.

Hovercraft orders are few and far between but that is hardly the fault of Westland, which has tried everthing that it knows to persuade the Royal Navy of their importance in mine counter-measures work. The principal message that both management and men at East Cowes wish me to convey to the House is the need to keep the firm together. Please do not hive off parts of what is, by common consent, a highly successful company, because of a hiccup over a particular helicopter order. The flexibility within the firm is its strength from the point of view of BHC.

12.57 am

The hon. Member for Yeovil (Mr. Ashdown) has initiated an important debate that is reflected by the extremely high attendance in the Chamber. The House will be grateful to my hon. Friend the Member for Weston-super-Mare (Mr. Wiggin) and the hon. Members for Kingston upon Hull, North (Mr. McNamara) and for Isle of Wight (Mr. Ross) for their contributions. I know that Westland receives tremendous support from many hon. Members, especially from my hon. Friends the Members for Wells (Mr. Heathcoat-Amory), for Dorset, West (Mr. Spicer), and for Wiltshire, North (Mr. Needham), who are all present in the Chamber. The same can be said of my hon. Friend the Member for Somerset and Frome (Mr. Boscawen), whose position as a Government Whip does not allow him to participate in our debates. My hon. Friend is in his place and he gives considerable support to the company.

The concern for Westland that has been expressed by all those who have participated in the debate is one that is shared by the Government both from the point of view of my own Department and from the somewhat different standpoint of the Ministry of Defence. I wish to clarify the role of my Department in relation to the company and to correct any misapprehensions that there might be on that score.

My Department has a general sponsorship role towards the company, as it has towards other private sector firms. I have much in mind the importance of Westland as an employer, especially in the south-west of England, and as a company upon which many equipment firms depend for their business.

Britain has historically been a leader in aerospace technology. It has a well-established capability in airframes, engines and equipment for both fixed wing and rotary wing aircraft. Westland has a distinguished place in this history. The maintenance of this position depends, as Westland recognises, on being competitive in world markets. It is worth recalling that Westland has made considerable achievements in the export market, often assisted by Government support in the difficult negotiations which such deals inevitably involve. I and my right hon. Friend the Minister of State for Defence Procurement have taken part at various times in those export negotiations in various parts of the world, in support of Westland.

Since 1960, Westland expertise in naval helicopters has secured 60 per cent. of the light helicopter market outside the United States, with sales of Lynx, and previously Wasps. It has also secured some 30 per cent. of the medium helicopter market with sales of Sea King. In total, some 250 Westland helicopters are in service in some 17 countries around the world, a record that speaks for itself.

We in the Department of Trade and Industry are investing large amounts of money by way of launch aid for Westland's civil helicopter projects. The agreement in relation to the W30 provides for launch aid of £41 million, of which nearly £35 million has already been paid. The civil version of the EH101 helicopter, which Westland is developing in collaboration with the Italian company Augusta, will receive launch aid of up to £60 million, of which £4 million has so far been paid.

That investment surely demonstrates that the Government are giving the company tangible support in its efforts to break into the civil helicopter market. I remind the House that the EH101 agreement with Italy is supported by an intergovernmental memorandum of understanding.

Without doubting the sincerity of what the hon. Member for Yeovil says or his right to raise the matter, I should like to say that he shares with all of us a responsibility not to say anything either here or outside the House that might have a damaging effect on the company, which we all value. Two points that he made rather surprised me. First, he said that the Government had stayed silent during the period when a bid was taking place for the company, as indeed we did. I ask him and the House rhetorically, in the interests of time, to surmise what else would have been proper for us to do. When a private company is the subject of a bid there is no way that the Government can take a view one way or the other.

Secondly, on the AST404, which is within the prerogative of my right hon. Friend the Minister of State for Defence Procurement, whom I am glad to have with me on the Front Bench tonight, I do not have anything formally to add to what he said in answer to questions in the House on 2 July. However, I should like to tell the hon. Gentleman that the letters AST—I am not trying to be offensive when I spell this out, because it might be helpful to the House — stand for air staff target, and target in defence procurement terms means just that. It is an original concept that is being devised by the services, with a possibility of it being met.

According to the processes in the Ministry of Defence, when further refinement of the staff target takes place, it becomes known as a staff requirement—an ASR, GSR or NSR. At that point, and at that point only, can a document be put out for a competition to be held. The hon. Gentleman might say that there has been a bid, it was 30 per cent. cheaper, or it was the best bid, but that is not so. There has not yet been any question of a competition. If there was an ASR in existence, we would be a stage closer to having a competition, but that stage has not been reached.

The hon. Gentleman must be careful in what he says, at about fanning up the anxieties of the work force of Westland's and his constituents, and suggesting that the company has made a bid when it has not, and that it has entered a competition when there has not been one. That needs to be fairly and clearly stated. As for suggesting that the goal posts have been moved, the Ministry of Defence and the Army Department are refining the staff targets, which is precisely why there is a target, as the hon. Gentleman would know from his military experience.

The matter must be cleared up. I hope that the Minister will recognise that equivalent anxieties about the way in which the company has been treated in this matter have come both from me and Conservative Members. Does he recognise that the Westland derivative of the W30 fulfilled the AST404 requirement, as it was laid down in detail?

The fact that the hon. Gentleman's anxieties may be echoed by my hon. Friends may mean that several people are under a genuine misapprehension. I am not suggesting that the hon. Gentleman is culpable in this matter, but I am pointing out that two stages must be completed before there is a competition. In suggesting that we should all ensure that we speak with considerable care and responsibility in this matter, I thought that it was correct to get the facts straight.

I am sure that the House would wish me to pay tribute to the contribution of Sir Basil Blackwell to the company in the past, and to offer best wishes for the future to the new chairman, Sir John Cuckney, and the acting chief executive, Hugh Stewart. Sir John has an outstanding reputation in the City and in industry. His arrival has brought stability, following the turmoil caused by the recent takeover bid and its last-minute withdrawal. It is a tribute to the inherent strength of the company that customers have remained loyal, and that there is no suggestion of any loss of confidence by creditors. Sir John will review the company's position in the light of the report that the board has commissioned from Price Waterhouse. At present, we can look forward to a period of stability and consolidation, during which Westland can redouble its efforts to promote its helicopters, especially in overseas markets. That is exactly as my hon. Friend the Member for Weston-super-Mare suggested. At present, we want a period of calm.

Westland is at present actively pursuing numerous sales opportunities for helicopters abroad. The company believes that there may be potential for sales of up to 140 Lynx aircraft in Europe, the middle east, Asia, Africa and south America, for up to 10 Sea Kings in Asia and the middle east, and for W30s in the United States of America, Europe, the Gulf, Asia, Africa and Australasia.

The House will know of the efforts that Westland has made to secure contracts to supply 21 W30 helicopters to the Indian Oil and Natural Gas Corporation for offshore work, and six aircraft to the Indian Government. The British Government have taken a considerable interest in this business and have, at the request of the Indian Government, agreed that the purchase might be funded out of the aid programme. That offer still stands. The ultimate decision about what aircraft they need must of course rest with the Indian authorities.

The Ministry has outstanding orders for 18 Sea King and six Lynx helicopters, worth about £70 million. There is, of course, a continuing need for spares and support services for the helicopters currently in service, and which will remain in service for many years to come. The Ministry is currently spending some £60 million a year on such spares and support. The Ministry of Defence is also funding development of the naval version of the EF101, which is a key element in the company's future strategy.

I hope that what I have said this evening will demonstrate that the Government are not a disinterested observer in the future of the helicopter industry, but we must not forget that Westland is a private sector company. There is no Government shareholding, and it is not for the Government to intervene in the management of the company or to seek to influence the form its future should take. I believe, however, that with good management and a determination to compete effectively in world markets in collaboration with others on major projects, Westland has a good future to look forward to.

Question put and agreed to.

Adjourned accordingly at eight minutes past One o' clock.