Mr. Speaker, with the leave of the House, let me begin by saying that I know that the whole House will join me in sending our thoughts to the 15 members of HMS Cornwall currently detained by Iran. Our thoughts go out to their friends in theatre and to their families back here in the UK. I do not intend to comment further on the issue, other than to say that we are doing everything possible to secure their release. At an appropriate time in the near future, the Foreign and Commonwealth Office will inform the House of the diplomatic efforts that are being pursued.
We welcome the 2007 independent report by the Armed Forces Pay Review Body and acknowledge the issue that it raises about manning levels. On 1 March, I announced that the Government had accepted the report’s recommendations and would implement them in full without delay. As a result, all service personnel will receive at least a 3.3 per cent. pay increase, with the 13,000 lowest paid receiving 9.2 per cent. In total, about £350 million more a year will go into pay and allowances. I also announced that we are committing £17 million to financial retention initiatives in areas where we face particular manning challenges, including the infantry and the marines—an approach endorsed by the AFPRB and the National Audit Office. We are doing all that we can to sustain manning levels for our operational commitments, and I and the chiefs of staff continue to judge that current commitments are manageable.
I thank the Secretary of State for that answer. I am sure that the thoughts and prayers of every Member will be with those illegally detained by the Iranian Government, and with their friends and families.
The Secretary of State will know that the AFPRB’s report described manning levels in the armed forces as critical and fragile. Recruitment and retention in the armed forces rely on trust, but how can people trust what the Government say about forces’ funding? Last week in the Budget, the Chancellor sought to give the impression that there is an extra £400 million for forces’ funding, but it turns out to be nothing of the sort: it is operational costs, which will be paid out of the Treasury reserve next year in the usual way. So how can men and women in the armed forces trust what the Government say, when even on something as fundamental as forces’ funding the Chancellor of the Exchequer is playing smoke and mirrors?
There can be no criticism of the Treasury’s support for the armed forces in the form of resources not just for pay and operational allowances—we have been able to announce the operational bonus in recent months—but for other areas. It would be much easier to conduct this debate about funding, including what comes from the reserve and what comes from the core Ministry of Defence budget, if other hon. Members—I excuse the hon. Gentleman from this—did not seek to give the impression that operational costs come from the MOD’s core budget. It is well known that in every Budget and pre-Budget report, the Chancellor refers to the access to the reserve for supporting operations.
I join the Secretary of State in his comments; our thoughts go out to the families of the 15 members of HMS Cornwall, which is of course a Plymouth-based ship.
The 9.2 per cent. pay increase for the lowest paid personnel is welcome, and is not the real message from the pay review board that one can do a great deal about retention and recruitment by targeting money? I also thank my right hon. Friend for the money that was spent on rewarding medical service personnel.
I am very grateful to the AFPRB and to the National Audit Office for pointing out in their respective reports the way in which targeted incentives or financial help can assist in meeting the challenge of recruitment and retention. This year, we intended that the armed forces’ settlement would help particularly the least well off—the worst paid among our troops. That was exactly what the AFPRB recommended, and I was very pleased to be able to accept that recommendation.
I accept with alacrity the right hon. Gentleman’s congratulations on the armed forces pay review settlement. The Budget’s impact is different for different people; for example, single-earner couples with children on a private’s salary will gain from the package by more than £300 a year, and I could give more examples. He asked specifically about the lowest paid. He will know that their salary will go up to £15,677, ignoring the operational bonus. The strict effect of the Budget is that those who are single and in receipt of that amount of money will be worse off by the equivalent of about £1 per week, but one has to take into account the fact that almost all of them are likely to attract the operational bonus, so that must be factored in, too.
Harmony guidelines have been consistently broken, planning assumptions breached, readiness targets not met and essential training requirements not fulfilled. Even the Chief of the Defence Staff says that the armed forces are very stretched, so just what does it take for the Defence Secretary to admit that we are asking too much of our armed forces?
The hon. Gentleman sought to get the Chief of the Defence Staff to agree at the Defence Committee evidence session that we were asking too much of the armed forces, but he would not agree. It takes exactly the same for me, as for the Chief of the Defence Staff, to admit to that, which is not correct. We are not asking too much of our armed forces; we are operating at levels that are higher than the assumptions that informed our operational planning. If that is not addressed, we know what the long-term consequences will be; but the hon. Gentleman was told by the Chief of the Defence Staff during the evidence session that we are already taking steps to address those issues. As the Chief of the Defence Staff said, the screw is being somewhat loosened by the decisions that have already been made in relation to the tightened circumstances of the armed forces..
The thoughts and prayers of the whole House will be with the families of those taken illegally by the Iranians in the past few days. Because we are aware of the diplomatic sensitivity, we shall not press the Government on the issue today, but we obviously want Parliament to have a chance to discuss it as soon as possible. I am sure that the House would also like to send condolences to the families of the submariners of HMS Tireless who were killed on active service—another example that shows how much they risk in our name.
On the question of overstretch in the armed forces, the basic problem is that the Government produced the strategic defence review, defence planning assumptions came from that and a budget was designed to suit it. The Government then exceeded those defence planning assumptions in the past five years. At the same time, they are cutting the size of the Navy, the Army and the RAF, yet they are increasing expectations and activity levels. When will it dawn on them that with defence spending of only 2.2 per cent. of GDP, the lowest since 1930, they cannot conduct wars in Iraq and Afghanistan with peacetime resources, because the people who will ultimately suffer are those in our armed forces, with the inevitable consequences for recruitment and retention that we are now beginning to see.
I assure the hon. Gentleman that a statement will be made to the House as soon as appropriate, which will be in the near future. I join him in his condolences to the families and comrades of those who lost their lives on HMS Tireless and, indeed to the submariner who was injured in that incident.
The hon. Gentleman and I have exchanged views a number of times at the Dispatch Box about how properly to interpret the investment that we are making in our armed forces year on year. I see now that he has moved on from the criticism he used to level at us, and now says that we are cutting the amount of money that we spend on the armed forces as a percentage of GDP. The fact is that we spend £32 billion a year on the defence budget. That, of course, as we have already discussed at Question Times, is supplemented by access to the special reserve in relation to operations. The hon. Gentleman has had plenty of time to indicate whether, if his party comes into government, he will increase that amount of money, or not increase—