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Financial Waste

Volume 264: debated on Tuesday 24 October 1995

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2.

To ask the Secretary of State for Defence if he maintains a central record of financial waste in his Department. [36560]

My Department has identified significant improvements in the way in which we carry out our tasks, leading to large efficiency savings. We are determined to bear down on waste wherever it occurs.

Given the Secretary of State's tough reputation for controlling public expenditure, can he explain why his Department appears unable to control cost overruns at a time when more and more disclosures of incompetence and mismanagement are emerging virtually every week?

I am tempted to ask: where's the beef? The hon. Member for Easington (Mr. Cummings) was one of those who signed the Labour amendment last week calling for huge cuts in defence spending and the scrapping of Trident. He is living proof of the adage that was just stated by my hon. Friend the Minister: one cannot trust Labour on defence. My Department has been at the forefront in cutting out waste. The defence costs study, to which my hon. Friend the Minister referred, rightly called "Front Line First", will yield savings rising to £1,000 million over the next seven years, and that is over and above the efficiency savings that my Department has gone in for.

Is my hon. Friend aware of the financial waste that would accrue both to his Department and to the British aerospace industry if the Department were to purchase F16s rather than have the mid-life update of Tornados? Is he further aware that such a decision, if it were taken, would be seen as a major blow to British industry and to many of the constituents of his hon. Friends, and as such would be wholly unacceptable?

I congratulate my hon. Friend on managing to get into his question an important point on behalf of his constituents. It is true that we have to consider all options in considering the mid-life update of our Tornados. One of those options is the possible leasing of F16s from the Americans. That is an option that we are obliged to consider, and we would be properly criticised—possibly by my hon. Friend, but certainly by Opposition Members—if we did not consider all the options in deciding on the mid-life update of our Tornados.

On the subject of waste, will the Minister confirm that the Department spent £24 million on buying 846 Reynolds Boughton light vehicles in preference to Land Rovers; that all those 846 vehicles have been found to be defective and unroadworthy and are in store in Army depots since they are unusable? How does he justify that as a sensible spending of taxpayers' money?

I have already said that, if I or any of my fellow Ministers find waste in our Department, we are determined to come down on it like a ton of bricks. That remains the case. The hon. Gentleman is, as always, picking around tiny little things. He is determined to undermine as much as possible the savings that we are introducing. The efficiency scheme that we have introduced in the Ministry of Defence has over-achieved its target ever since 1988. It has produced savings of around £2.5 billion; that is a dramatic achievement of which we are proud.

When my hon. Friend pursues his study in bearing down on costs, will he tell the House what is happening about the disposal of surplus MOD properties, which has been a subject of complaint for many years now by the Public Accounts Committee? Some progress has been made, but will my hon. Friend tell the House?

My hon. Friend is right that some progress has been made, but it is not yet sufficient and that is why we are conducting a study to improve it and will be able dramatically to improve those sales of land during the next few years.