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Defence Reform

Volume 547: debated on Tuesday 26 June 2012

I beg to move,

That this House recognises the need for defence reform; notes with concern the speed and depth of redundancies and the threat to historic regiments and battalions; supports the armed forces covenant but is anxious about the implications of changes to Service pensions and allowances and the effect of these and other measures on morale; further recognises the necessity of an advanced equipment programme but is worried about capability gaps, notably carrier strike; calls on the Government to end disadvantage and discrimination against the Service community in order to strengthen the covenant; and further calls on the Government to reassess the assumptions on which the Strategic Defence and Security Review was based.

Let me begin by acknowledging the courage and professionalism of our armed forces and recognising the invaluable support provided to them by their families. I know that that sentiment will be shared by all Members in the House. We ask servicemen and women to risk making the ultimate sacrifice, and to forgo many freedoms in the name of our national security. Their contribution to our safety must never be forgotten or underestimated.

Opposition Members recognise that our armed forces cannot be allowed to stand still. The combination of changing threats in an increasingly uncertain world with budgetary challenges means that we must be ahead of the curve in terms of technology and the tactics that we apply. We must be bold and practical in order to create an efficient fighting force which serves the primary requirement of our national security while also ensuring that we do the right thing on behalf of our servicemen and women and their families.

The major conflicts of recent history are drawing to a close. Meanwhile, a wave of popular uprisings throughout the middle east poses new challenges, as do new technologies and threats from cyber. Global changes will alter the balance of power, risk and how resources are allocated in the modern world. That is why Opposition Members support armed forces reform. Since May 2010, we have not opposed the Government simply for opposition’s sake. National security and support for our armed forces are worth more than cheap political point-scoring, although when we believe that the Government have made an error or strayed from their pre-election pledges, we will righty criticise and scrutinise their decisions.

We welcome the coalition’s commitment in 2010 to launch the security review. It built on the Green Paper published by the last Government, and our commitment in the last Parliament to undertake a defence review. Unfortunately, however, the one thing the coalition Government’s strategic defence and security review was not was strategic. The SDSR has unravelled quickly, displaying the same short-term, ad hoc and rushed decision making that is becoming characteristic of many areas of Government policy. The decisions that have been taken have left Britain with serious gaps in its defence capability. Events in the middle east last year—the Arab spring uprisings—were not foreseen, which meant the review was rendered out of date almost as soon as it had been printed. The Government were forced to use resources they had planned to scrap and bring back capability at very short notice.

The motion calls for a reassessment of the “assumptions” on which the SDSR was based. Which assumptions does the shadow Minister not agree with?

I know the hon. Gentleman takes a close interest in defence issues, but if he had read the Green Paper he would have seen that it takes a strategic look at the world. The SDSR was very rushed, and did not have the long public consultation and engagement with stakeholders that the 1998 review had. It was basically a Treasury-led review, which has resulted in some strange decisions that I shall describe later, which have affected the capability and capacity of our armed forces.

I am simply focusing on the word “assumptions”. In the motion, the Labour party criticises the assumptions that lay behind the SDSR. My opinion is that those assumptions are absolutely fine—although I agree with the hon. Gentleman that some of the other detail was not so good. Which of the assumptions behind the SDSR does he not like?

I would talk about the developing situation in the middle east, some of the decisions made post-SDSR in taking away maritime capability, and the whole issue of the deployability of our armed forces. All those decisions were taken within a financial straitjacket, instead of addressing questions such as where we need to deploy in the world and what our priorities are. That has overridden the security needs that are so vital and that were outlined so well in the Green Paper.

As a former Ministry of Defence Minister, I know only too well that the easiest ways to make the kind of in-year savings in the defence budget that are being demanded by the Treasury are to scrap capability or to make personnel cuts. However, the Government have scrapped important capabilities—Nimrod and the Harrier fleet—without any plans as to how they will be replaced. It appears that Ministers have been inflexible in their pursuit of short-term savings at the expense of our long-term security. Too often we are given the impression that the Government are presiding over decline, rather than planning for the future. The Government must reassess the security and spending assumptions on which the review was based.

How would a Labour Government have dealt with the £38 billion overhang that the Conservatives inherited from the previous Labour Government? Also, is the hon. Gentleman saying he would, in fact, spend more on defence than the current Government? He should be explicit about that, but his motion is not explicit.

I am glad the hon. Gentleman has asked about the £38 billion black hole, because it has become folklore, but the Government have not produced any evidence to justify that figure. Let me quote from an excellent Defence Committee report—which I am surprised he has not read as he is a former member of that Committee. It says:

“We note that the MOD now state the genuine size of the gap is substantially in excess of £38 billion. However, we also note the Secretary of State’s assertion that the ‘for the first time in a generation, the MOD will have brought its plans and budget broadly into balance, allowing it to plan with confidence for the delivery of the future equipment programme’. Without proper detailed figures neither statement can be verified.”

We should also consider the evidence given to the Committee by the then Secretary of State. He promised the Committee he would give details, but the final report states, at paragraph 205:

“We are surprised that this assessment has not yet begun and expect to receive a timetable for this exercise in response to this Report.”

The £38 billion figure has been bandied around ever since it was spun out of Conservative central office in the election campaign. The Government have been asked on numerous occasions to justify it, but they have not done so. They should.

On the subject of wasting taxpayers’ money, the Government said last week that almost £39 million had been spent on preparing the carriers for “cats and traps” and the variant carrier aircraft, but the media says a quarter of a billion pounds have been spent. How much money does my hon. Friend think the Government have wasted?

As with the £38 billion figure, the Government are very good at not explaining their mistakes. The original figure was, I think, £37 million. It then rose to £39 million, but the MOD subsequently briefed that it was £100 million. However, some informed sources say that it could be upwards of £250 million. The Government should state how much was spent in respect of that disastrous decision, which was taken at a time when the defence budget was experiencing savage cuts. They seem to have swept this matter aside, however, as if it is not important.

The hon. Gentleman is right: £38 billion is a huge amount of money. However, I should draw his attention to a note entitled:

“Note to Ed Miliband: Defence team work update”.

It states that Labour needs to be

“credible on defence spending and neutralising the ‘£38bn’ charge, which is our biggest weakness.”

So the Labour Defence team think that that charge is Labour’s biggest weakness.

The Minister is making various assumptions, which is not unusual for him. That note says precisely what I am saying today, which is that we need to shoot down this erroneous myth that has been put about by this Government. If he wants more evidence on this, he should read the National Audit Office “Major Projects Report 2009”. It says of the defence budget:

“The size of the gap is highly sensitive to the budget growth assumptions used. If the Defence budget remained constant in real terms, and using the Department’s forecast for defence inflation of 2.7 per cent, the gap would now be £6 billion over the ten years. If, as is possible given the general economic position, there was no increase in the defence budget in cash terms over the same ten year period, the gap would rise to £36 billion.”

Even the NAO did not reach the £38 billion figure, therefore. I acknowledge that the figure it gives is £2 billion out and this Government seem to think such sums are unimportant, but I have just quoted from the NAO report. That is possibly where Conservative central office first got the figure of £36 billion, but there is a big difference between £36 billion and £38 billion. The £36 billion is based on an assumption of a flat-cash budget over the next 10 years and every single item in the equipment budget being maintained, when everyone who has ever been involved in MOD matters knows that things come into the equipment budget and things fall out of the equipment budget.

The Defence Committee was advised in one of its briefings that the projected figure of £38 billion included a roll-forward of all items on wish lists—not things for which contracts had been let, but items the MOD had expressed a possible interest in purchasing for the future. This was, we were told, the equivalent of an individual becoming bankrupt because they fancied buying a Ferrari but never actually bought one.

I thank my hon. Friend for that. Let me quote from the evidence given to the Select Committee by the former Secretary of State. In response to a question from a Member, he said:

“There is a huge ability to reduce a very large proportion of that. My guess is that of that £38 billion we are talking of something like £8 billion to £9 billion, and that is a ballpark figure.”

During that evidence session, he gave a commitment to the Select Committee Chair that he would write giving details of how he arrived at that figure, but he did not. The Committee was still waiting for that information when the report was produced, but it did not appear. I heard one of the Government Front Benchers scoff when I said that certain things move in and out of budget, but they clearly do. My hon. Friend the Member for Bridgend (Mrs Moon) is right: the Government racked up everything in the programme over a 10-year period and assumed that it would all be delivered. That is similar to the argument used about pension black holes, the assumption being that all the money is paid out, today. That is not the way the defence procurement budget is structured.

The Government obviously intend to keep the myth going, and who could blame them for that? However, can my hon. Friend explain how, on two separate occasions—we should remember that this Government have only been in power for a little over two years—two separate Secretaries of State can have claimed that the £38 billion gap has already gone and that the budget is now in balance? If the imbalance was as large as they alleged, how on earth have two separate Secretaries of State been able to claim within two years that the budget is in balance already?

My right hon. Friend, like me, knows the MOD budget very well. Clearly, what the Government have done is to take out in-year capability. We should also remember the reductions in armed forces personnel—the people who are paying for some of this. My right hon. Friend is correct: the idea that such a big black hole can be filled in two years is complete nonsense. [Interruption.] The Under-Secretary, the right hon. Member for South Leicestershire (Mr Robathan), says that it is 10 years, but that is not the impression the Government have been giving. All their decisions, such as slashing personnel numbers, are predicated on this £38 billion black hole. Earlier last year, the previous Secretary of State stopped using that figure—for a while. Suddenly, under the new Secretary of State, it has come back. The Government have got to explain their use of it, because it is the entire raison d’être for some of the cuts they are making.

I remind the hon. Gentleman, the right hon. Member for Coventry North East (Mr Ainsworth) and the hon. Member for Bridgend (Mrs Moon) that the £38 billion figure was furnished to the Defence Committee under the previous Labour Government when the hon. Gentleman was a Minister in the Ministry of Defence. At the same time, Mr Bernard Gray produced a report saying that, on present plans, the MOD could order no new equipment at all for the next 10 years, so dire was the state of its finances. It is only by bringing defence spending within the Department back into balance that any new equipment has been able to be ordered at all.

I am sorry but that is complete nonsense. The hon. Gentleman should read the NAO report that I referred to earlier, which makes the assumption that many people have made in respect of flat cash. I will read the quote again, because he has obviously not picked up the argument:

“The size of the gap is highly sensitive to the budget growth assumptions used. If the Defence budget remained constant in real terms, and using the Department’s forecast for defence inflation of 2.7 per cent, the gap would now be £6 billion”.

There is a huge difference between £6 billion and the £38 billion figure that the Government are claiming. Even if, in line with the NAO report, we assume a flat cash budget for 10 years, we only get to a figure of £36 billion. Where the Government get the extra £2 billion from, I do not know. This issue was also dealt with in Bernard Gray’s report, and as my hon. Friend the Member for Bridgend said, the £38 billion figure is based on the principle that every single piece of equipment that was planned for would actually be delivered. However, anyone who knows the defence budget knows that that is not how things work. [Interruption.] I am sorry, but the £38 billion figure is a fiction, and this Government have got to justify it, because they are using it to justify some of their most draconian cuts, not only in equipment but to the service terms and conditions of members of our armed forces.

The hon. Gentleman seems to accept that there is a gap and that it could be up to £36 billion. What is the gap?

Let me read what the NAO report says—for the third time:

“The size of the gap is highly sensitive to the budget growth assumptions used. If the Defence budget remained constant in real terms, and using the Department’s forecast for defence inflation of 2.7 per cent, the gap would now be £6 billion.”

The figure of £36 billion is reached only if flat cash over 10 years is included. Ministers said that the £38 billion figure is over 10 years—that is not the impression they have been giving to the media, the armed forces and the public. Instead, they have been suggesting that we somehow have to lay our hands instantly on £38 billion. As my right hon. Friend the Member for Coventry North East said, the idea that that figure can be wiped out in two years is an accounting fantasy.

Listening to this debate, the one thing that is clear and that the hon. Gentleman accepts is that there is a gap, be it £6 billion or £38 billion. Given that there is a gap, why did the last Government not balance the budget?

We were on line in that regard. One of the jobs that my right hon. Friend the Member for Coventry North East gave me when he was Secretary of State—it was something of a poisoned chalice—was to draw up some reductions. Just before the general election, I had already identified some £1.2 billion of savings, but some of that involved investing money in order to save it. The problem at the moment is that the Treasury want instant cash out of the budget, and the only way to do that is to slash personnel and equipment straight away. The more sensible approach that we were going to implement was a planned phase of three to five years, involving some investment and some reductions. That is in stark contrast to the Government’s approach. What is driving this process is not defence strategy but the desire of this Government and the Treasury to take 8% out of the budget in years one and two. That has led to the short-termism we are seeing now.

If the gap is a mere £6 billion, as the hon. Gentleman is suggesting, does he believe that that in itself is acceptable—yes or no?

Yes, because some of the programme was not committed. The former Secretary of State was asked by the Defence Committee how much of that budget was committed, and quite a large portion of it was not. One approach could be to delay projects, as this Government and the previous Government have done, or to cancel them.

When the previous Secretary of State took office, he said that he was going to save a load of money by renegotiating contracts with various suppliers. We have yet to see a single example of his having been able to renegotiate procurement contracts and make great savings. [Interruption.] I am sorry, but I am not going to take any lessons from the Conservatives on the carriers, given that they have wasted upwards of £100 million through a decision that—[Interruption.] Government Members are shouting, but I do not remember either the Minister for the Armed Forces, or the Under-Secretary of State for Defence, the right hon. Member for South Leicestershire, saying when in opposition that the carriers should not be ordered. That is the problem: they were calling then not only for the carriers, but for a larger Army and a larger Navy, but now that they are in government they are doing completely the opposite.

Is the hon. Gentleman interested in the fact that the Royal United Services Institute, which is known for being a very independent-minded organisation, stated in September 2011:

“Whichever detailed assumptions are made, however, there was no doubt that the funding gap was large and real. It would take considerable energy, and political cost…to escape from…It was, in a very real sense, a black hole.”?

That is fine—[Interruption.] Well, it is fine; if it was true that the previous Government were doing nothing to address the situation, that would not be the case. But if the Government are going to claim that the black hole is £38 billion, there is an onus on them to explain in detail exactly how they arrived at that figure, because they are using it to justify every single reduction in defence expenditure that they are making. It is important that they do that. We had plans to balance the budget.

The hon. Gentleman seems to be accepting that there is a black hole. He denies that it is a £38 billion black hole, but he will not say whether it is a big black hole or a little black hole. What was the size of his black hole?

The last Labour Government were committed to looking for efficiencies and reviewing the procurement contracts. So some of the things that were planned would not have been procured, which would have closed that black hole to which the hon. Gentleman refers. [Interruption.] He asks me what the size of the black hole was. He and others have kept saying it is a £38 billion black hole, but if that is the Government’s sole justification for what they are doing, they should have the guts to explain it to the public.

One of the battalions that recruits from my constituency, 3rd Battalion the Mercian Regiment, is one of only two specialised mechanised infantry battalions. It is due to be disbanded under the current proposals, so is it a proper use of public money for it to be disbanded only for these specialised services to have to be recruited again?

There are so many leaks coming from the Ministry of Defence, some official and some unofficial, and it is not helping the process. We are seeing a ludicrous situation whereby in order to claim that the headcount of MOD civil servants, in particular, is being reduced, people are being made redundant only then to be rehired as consultants, at huge cost to the taxpayer.

Last month, the Secretary of State told the House that he had brought the MOD budget “back into balance”. Every announcement or decision made by the Government is based on that claim; he says that he has “balanced the defence budget”. However, unless we get hard evidence soon, it will remain impossible for us to believe those claims. Ministers must be honest with our armed forces men and women, who deserve to know the full picture of the MOD budget so that they can understand why they are having to undertake the pain that they are taking under this coalition Government.

The hon. Gentleman has said that the previous Labour Government had looked at making £1.2 billion-worth of cuts. Will he share with the House details of where those cuts would have fallen?

One example is that we would have taken some strategic decisions on basing around the world. I must say that, in the spirit of co-operation, I gave one of the papers to my good friend the hon. Member for Aldershot (Mr Howarth) to assist him in the process. Some efficiency savings could have been made, including some through restructuring the Army and other things. The other point to make is that some of these things also needed investment, and I had been given clearance by the Treasury in some areas to invest to make longer-term savings. They were not just in-year savings to try to satisfy the Treasury and the deficit reduction programme on which this Government are embarking.

Can we leave black holes to one side for the minute and concentrate on the Black Watch? On Saturday, the colours of the Black Watch were lowered for the last time, marking its passing as a regiment. It was the Labour party that amalgamated the Scottish regiments and they are fighting for their survival now as a battalion with cap badges, insignia and the heritage and culture that has been maintained. The Labour party moots a threat to the battalions and our regiments, so will it support us in ensuring that their survival continues and that the fantastic heritage and culture will be continued in the Royal Regiment?

I understand people’s emotional attachment to the regiments, and I understand the proud traditions and how they are held. However, I must say that I always find the Scottish National party talking about this issue difficult. If we had an independent Scotland, not only would many of these regiments doubtless have their cap badges removed, but they would be abolished altogether. The SNP’s so-called campaign on this issue is a little hollow, to say the least. The SNP needs to explain exactly what the new Scottish armed forces would be if Scotland were to be independent. Would the Navy be something like fishery protection vessels? Would the Army be downgraded to some type of border force to patrol the border between Scotland and Northumberland? [Interruption.] The hon. Gentleman comments from a sedentary position, but the SNP claims to be supporting these regiments and the onus is on him to say exactly what the SNP is going to do if there is to be independence in Scotland, not only on regiments, but what the shape and format of the defence forces of an independent Scotland would take. I am sure that they would be a lot smaller and a lot more ineffective than what we have now. I doubt whether they would be larger, and I am not sure what their role would be and whether they would be in or out of a NATO command structure.

Order. Before the shadow Minister takes that intervention, may I just point out that this is a time-limited debate and he has been incredibly generous in the interventions he has taken? That is not, however, to stop the intervention he is about to take.

I come back to that important point about the separation of Scotland from the rest of the United Kingdom. Is my hon. Friend aware of comments made by Alex Salmond, Scotland’s First Minister, earlier this year? He called the MOD plans exactly the sort of “configuration you’d want”.

That is right, but this point about an independent Scotland is not just about the regiments and the size of the armed forces; it is about all the procurement. I am sorry, but many English shipbuilders will be arguing strongly for contracts to be placed with English yards rather than Scottish yards if Scotland becomes a foreign country. We do not procure warships from foreign Governments.

The Secretary of State’s statement dealt primarily with the 45% of the budget that is spent on equipment and support. There will be no 1% real-terms rise for the 55% that is spent on other areas of defence, including personnel. We are very concerned that this will result in a real-terms cut to the armed forces personnel budget, particularly given that these costs tend to rise higher than the usual rate of inflation. Not only was the announcement therefore less comprehensive than it was spun to be in the newspapers, but it would appear that the limited investment in equipment budgets is coming at the expense of investment in personnel, who are already suffering under the Government’s cuts to personnel numbers, allowances and pensions. So it is becoming clear to many that the Secretary of State has balanced the budget on the backs of our brave service men and women, and Ministers will have to offer this House the information it needs to take these claims seriously. [Interruption.] The Whip says from a sedentary position that that is a silly thing to say, but I think I might have a little more knowledge of the intricacies of the defence budget than he has.

On the capital investment side, Ministers have not factored in the costs of the proposals to withdraw British military bases from Germany. They will have a significant short-term cost, which they seem to have conveniently just ignored. I considered that idea when I was a Minister and even four years ago the price tag was some £3 billion. Again, that seems to have been conveniently forgotten in this so-called new balanced budget.

On top of all that, the Minister has failed to substantiate the figure of £38 billion. I will not reiterate the points I have read out already, but I will add a third example. Mr Jon Thompson, the director of finance at the MOD, told the Public Accounts Committee that Ministers were committed to producing a report in autumn 2011 on the extent of the so-called gap in the budget. We are still waiting. That information is vital because the legitimacy of everything the Government are doing through the defence cuts is predicated on that so-called gap.

I would be grateful if the Minister could answer a few questions. As the post-2015 1% rise is an “assumption”, could it be revised between now and 2015? What rate of inflation was used to calculate the 1% real terms annual increase in the equipment budget between 2010 and 2020? When will we get the National Audit Office’s assessment of the MOD budget and, more importantly, when will the House have an opportunity to debate that report?

The Secretary of State also needs to factor defence inflation into his calculations. It would be interesting to know what figure he is using for the real-terms cuts to the 55% of the MOD budget that lies outside the equipment and support budget. Members might be aware of reports over the weekend, for example, that an ongoing study of British shipbuilding might result in the delay of one of the new aircraft carriers and the potential closure of Portsmouth dockyard, with a threat to some 3,000 jobs. That casts even greater doubt on the Ministers’ claim to have balanced the budget. It is hard to see how they can justify their triumph when such issues remain unresolved. The Minister’s comments on the Portsmouth report would be welcome.

We now hear announcements from the MOD by leak—either official or unofficial—and an interesting one is on the future of Defence Equipment and Support. The Chief of Defence Matériel is supposed to be pushing forward the Government-owned contractor-operated model. Restructuring is important in defence procurement, as we would all agree, but there are huge questions about the impact on accountability to Parliament of privatising decisions that deal with many millions of pounds of taxpayers’ money.

As for the carriers, the Government have sought to present themselves as economically competent and the Opposition will resist the temptation to take Ministers at their word. As was mentioned earlier, the costly, unnecessary and humiliating U-turn on the British aircraft carrier capability meant that we ended up with a policy that the Prime Minister had rubbished the year before and that millions of pounds of taxpayers’ money have been wasted at a time when the defence budget is being cut deeply. The Government must come clean and explain in detail how much was squandered by that reckless decision.

Britain is a proud maritime nation, but as a result of the decisions taken in the SDSR we are left with no maritime surveillance capability and with no carrier strike capability until at least 2017. Huge issues remain unaddressed. The Secretary of State has not decided how many aircraft he will purchase, just as he has deferred his decision on whether a second carrier will be operational. He stated to the House that he would be committed to “continuous carrier availability”, but that might now not be the case.

With such a backdrop, it is not surprising that morale in our armed forces is low. Morale has been described as in freefall as a result of some of the decisions on redundancies, cuts in allowances and permanent pension reductions. The Forces Pension Society has said that it has

“never seen a government erode the morale of the Armed Forces so quickly”.

I hope that right hon. and hon. Members have had the opportunity to look at today’s report on housing by the Select Committee on Defence. It shows that the cuts in expenditure on improvements in forces accommodation are leading to real pressures in Army housing.

The hon. Gentleman mentions pensions and a number of right hon. and hon. Members in the Chamber have a particular interest in service pensions. No doubt they will want to hear whether, if he were returned to office in 2015, he would reverse the changes that have been made.

We need to consider armed forces pensions as a whole, which is something else that I considered as a Minister. Many people do not realise that although the armed forces pension scheme is non-contributory, members of the armed forces pay for it through abatement in their increases. As the Government have abandoned the Armed Forces Pay Review Body’s recommendations and our proud record on such recommendations when we were in office, it is time to look at how armed forces pensions are dealt with as a whole. Interestingly, when I wanted to look more closely at such issues, the Secretary of State who resisted was Lord Hutton, who is now advising the Government on pensions in general. The issue needs to be considered as a whole—not only pensions but abatement in pay, too.

In 2010, we were committed to spending £8 billion on accommodation in the next decade, £3 billion of which was for improvements and upgrades. In contrast, this Government have slashed spending on housing by some £41 million. I remember that when I was a Minister and when my right hon. Friend the Member for Coventry North East was Secretary of State, despite our record investment in accommodation, the then Opposition were highly critical of what we were doing. Many in the armed forces will now be dismayed by their actions in government.

It is also important to listen to the armed forces federations. Dawn McCafferty of the Royal Air Force Families Federation has commented that families felt as though the covenant had already been broken within months of its announcement because of the cuts. Until the fall in morale is acknowledged and acted on, many will question Ministers’ commitment to upholding the military covenant.

A particular concern for us is the way in which reductions in the number of armed forces personnel are taking place. Two weeks ago, the Minister ordered yet another tranche of redundancies affecting 4,100 personnel, 30% of which were compulsory. It is a great worry that we are losing not only important skills but expertise and capability that we can no longer afford to lose. The public and armed forces community are quite rightly angry that individuals who are ready to deploy to Afghanistan are being given their P45s, despite all the assurances given by the previous Secretary of State and by this one. I know from experience that if we had treated the armed forces in such a way when we were in government, Conservative and Liberal Democrat Members would rightly have pilloried that decision. We feel it is only right to hold them to the same high standard that they put forward when they were in opposition, which they seem to have conveniently forgotten now they are in government.

Many will be concerned by the rumours that are circulating about the Government’s plans to cut regiments and battalions. Our regiments embody our proud history and the national prestige of our armed forces. Many have served with distinction in the fields of Flanders, on the beaches at Normandy and, more recently, in the deserts of Iraq and Afghanistan. The Secretary of State’s now-trademark lack of sensitivity when dealing with this issue is understandably creating anger among many serving in the armed forces and those who have retired.

May I remind the shadow Minister that his Government cut and disbanded regiments while they were on operations? They also wholesale disbanded historic regiments and invented names from “Alice in Wonderland” for new regiments, so there can be no lessons from the Opposition about the maintenance of historic and honourable regiments. Many of us wear the scars to bear witness to that.

I am worried. It is no use telling me not to worry because Members—I ought to warn them now—may be down to a five-minute limit or less if we are to get them all in. I wanted to let people know so they could alter their speeches.

I will take your guidance, Mr Deputy Speaker, and not take any more interventions. On the comments of the hon. Member for Newark (Patrick Mercer), he knows that the recommendations put forward at that time regarding structure and names were put forward by the Army.

Any uncertainty needs to be clarified. It is almost a month since the Secretary of State told the Royal United Services Institute that some units will inevitably be lost or merged. Given that he has gone outside Parliament to light bonfires of rumours, it is not acceptable for him to throw more petrol on them by delaying. We are told that the Ministry of Defence has signed off on this issue now but that matters are being held up by Downing street for political reasons. That uncertainty is leading to a lot more rumours, which are causing more uncertainty.

In conclusion, when they were in opposition the Conservatives called for a larger Army, a larger Navy and increased investment in the armed forces. In government, their actions have been to do exactly the opposite. It is not surprising that they are losing the trust of the armed forces community and the public so quickly. We in opposition want to support strong reform on procurement and the principles of the military covenant and we want the equipment programme to be improved. Too often the Government have put austerity before security. I hope that in his response the Minister will not just answer the questions I have put forward but will also agree with the terms of the motion and the recommendations regarding the assumptions of the defence review to give those whom we ask to serve on our behalf the confidence and certainty they deserve.

Let me start as the hon. Member for North Durham (Mr Jones) did—by paying tribute to the men and women of our armed forces. The job they do is difficult, dangerous and sometimes deadly, but they do it with a professionalism, commitment and courage that we have come to expect but should never take for granted. This weekend is armed forces day, which will give all of us the opportunity to pay tribute to the contribution of the entire defence community.

The House will note that we do not have the pleasure of the company of the shadow Defence Secretary this evening. No criticism attaches to him for going on a defence visit to Australia or for staying on for a few days afterwards. No criticism attaches to him for allowing the Secretary of State to honour a commitment to host Defence Ministers from several of our allies this evening. The only criticism of the shadow Secretary of State is that he has left the poor old hon. Member for North Durham the unenviable task of trying to move this completely nonsensical motion.

The Minister is correct that the shadow Secretary of State is in Australia—unfortunately with the hon. Member for Devizes (Claire Perry), but I understand that they did not travel on the same plane so that is one good thing for him. He has stayed on after the defence visit because a member of his family there is seriously ill. That is why he is not here today.

I am sure we all wish the family member well. I did say that no criticism attaches to the shadow Secretary for his absence and I mean that most emphatically.

The matter before us is this nonsensical motion. It seems to say that the Opposition recognise the need to make the changes we are making, but the fact is that they ducked these changes year after year. They went for 12 years without a defence review, with pressure building up in the defence programme all the time, and there was a black hole of whatever size—we will come back to that in a minute—by the time of the strategic defence and security review. They left our armed forces overstretched, under-equipped and underfunded for the tasks they were set. That is the legacy of the Government in which the hon. Member for North Durham served. The blame for the need to remove platforms, reduce manpower and make the other reductions we have had to do sits very squarely at the previous Government’s door. They wrecked the economy, they wrecked the defence budget and they failed to make the changes necessary to prepare our armed forces for the future.

The hon. Member for North Durham made heavy weather of the black hole. When we began the SDSR process in the summer of 2010 we asked the officials who were presiding over it at the MOD, “What is our baseline and what is the true financial situation as we start this process?” The explanation came that if we took the manpower commitments, all the overheads and all the committed expenditure, including the contracts that had been signed for procurement and those that had been announced by the previous Government as Ministry of Defence policy, and planned to bring them on stream when the Labour party said they would be, over the 10-year period, there was a gap between all that and a “flat real” terms assumption on funding—not a “flat cash” assumption—in relation to the 2010-11 budget. We were told that the gap over the 10-year period would amount to £38 billion. It was a 10-year period because that is the length of time over which the MOD plans its budgets.

The hon. Member for Bridgend (Mrs Moon) said that that was an unreasonable thing to view as a starting point. She compared it with the situation of someone who was about to go personally bankrupt aspiring to buy a Ferrari, but I do not think that is very kind to the right hon. Member for Coventry North East (Mr Ainsworth). When he came to the Dispatch Box a few weeks before Christmas in 2009, he announced that there would be 22 new Chinook helicopters. He did not sign a contract or find the money to pay for them but he announced there would be 22 new Chinook helicopters. I do not know whether in the fantasy budget of the Labour party it does not think that that was a commitment, but it was one of the commitments that that Defence Secretary made, and it was on that basis that the £38 billion black hole was presented to us by officials.

I do not call into question the personal commitment of the hon. Member for North Durham, but he has to recognise that his motion opposes everything that this Government are doing and is pretty scant when it comes to proposing any alternatives. He says that he recognises the need for defence reform, but the only response in his motion is to be concerned, “anxious” and “worried” about how we are clearing up the mess he made. He has not presented one properly costed plan or given us a coherent alternative. He has not given us a plan A, let alone a plan B. He needs to recognise that he has to do better if he wants to hold us to account for what we have done.

Does the Minister think the decision he has just criticised was better or worse than switching to a “cat and trap” system when first coming into office and then reversing that decision at great cost only a year later?

I think it was a perfectly sensible alternative to explore the “cat and trap” option. As we said at the time, it would have given us the ability to project a much better aircraft type off the carrier. I think that to commission the detailed work on that proposal was entirely responsible. If it ends up costing us the maximum, as the Secretary of State suggested, of £100 million, that is a small sum compared with the £1.5 billion the previous Government added to the carrier project in one afternoon, when they announced from the Dispatch Box that it was to be postponed by a year. That was a far greater drain on the defence budget than the relatively small bounded study, which unfortunately concluded that the costs of going ahead with the plan were such that it was not viable.

The shadow Defence Secretary has identified £5 billion of cuts that he says he supports, but that would barely scratch the surface of the black hole that his party’s Government left behind. Of course, his cuts are not new; they are already being made. On Labour’s current public plans, the defence budget would still be in chaos. They have pledged neither to make any extra savings, nor to restore the cuts that have been made. What is interesting is not what they are saying in public, but what they are saying in private. Earlier, reference was made to the interesting correspondence between the Leader of the Opposition and the shadow Defence Secretary. It is worth quoting the letter from the Leader of the Opposition to his colleague, dated 23 January this year:

“You have powerfully made the case in your recent interventions that there is no easy future for Defence expenditure and clearly in the context of the current fiscal position we can expect to have to make further savings after the next election.”

In public, the Opposition are against the cuts that we are making, but in secret, they are planning even deeper defence cuts. Today’s debate is not simply opposition, but opportunism as well.

We said that at the last general election. What we were not going to do is rush the process. I challenge the Minister of State to place in the Library of the House the details of how he arrived at the £38 billion figure. Today he has said something that no other Minister has ever said: that the £38 billion is over 10 years. The impression has always been given that it is there right now. Will he produce that information? Without it, some of the cuts he is making are not credible.

That is absolute nonsense. It has been clear from the outset that the £38 billion figure was over 10 years. I remember many a debate with the shadow Defence Secretary about whether we were talking about the 10 years being measured out on the spending side in flat real or in flat cash, and I have said again tonight that it was by reference to flat real. It has always been a 10-year figure, and the suggestion that we have magicked £38 billion out of spending in two years is clearly nonsensical; it has always been over 10 years. I am happy to give the hon. Gentleman further details of how we worked that out, but there is no getting away from the fact that the Labour Government left behind a massive black hole. The right hon. Member for East Renfrewshire (Mr Murphy) has identified a tiny number of cuts that he thinks need to be made and he has secret plans to make more, but he is not prepared to face up to the difficult decisions that have to be made to clear up the economic inheritance across the piece and specifically in defence.

Transforming Britain’s armed forces by implementing the 2010 SDSR is necessary to recover capabilities after a decade of enduring operations. It is necessary to prepare the armed forces for a future in which threats are diverse, evolving and unpredictable. It is necessary to help to tackle the fiscal deficit and to put the defence budget and equipment plan back into balance. We have to build for the future with strict financial discipline, making certain that the armed forces have confidence that projects in the programme are funded and will be delivered. As my right hon. Friend the Secretary of State announced last month, the black hole has now been eliminated and the 10-year defence budget is now in balance. I readily acknowledge that Future Force 2020 will be a smaller fighting force, but it will still be able to deploy a brigade-sized force on a sustained basis on operations, or a divisional-sized force on a best effort.

There was much criticism from the hon. Member for North Durham because we have had to reduce manpower numbers, but it is worth noting that in the memo the Opposition defence team sent back to the leader of their party, they said, in reference to Royal Navy and Royal Air Force personnel, that they recognised that there would be reductions in personnel numbers. On Army restructuring, too, the memo stated that they recognised the need for manpower reductions. So they recognise the need for the measures we are taking; they just do not like the grim reality of having to do it.

Despite all the changes that we are making, we will still be supported by the fourth-largest defence budget in the world, meeting our financial responsibilities to NATO. We will configure the armed forces for a world where threats to our homeland and allies are increasingly to be found outside Europe, rather than on the north German plain, and we will move from a heavily armoured force to a more mobile, adaptable and deployable force.

My hon. Friend is right to take no advice from the party that, when in government, more than doubled the national debt, but may I pursue the point about recruitment and downsizing the British Army? Reports suggest that 2nd Battalion the Royal Regiment of Fusiliers is to be axed, despite being one of the best recruited battalions in the British Army and forecast to remain so. Does the Minister accept that decisions about which battalions to axe should be based on the ability to recruit? In that case, the Ministry of Defence should be looking at the Scottish battalions, which consistently have trouble recruiting, with their numbers made up by English soldiers. I would suggest that no Englishman should ever be forced to wear a kilt.

I urge my hon. Friend and all other hon. Members not to give credence to speculation about which battalions might end up having to be disbanded or merged. I repeat what I said at Defence questions: the decisions will be taken on the most objective criteria, not on a snapshot of current recruitment. Those criteria will be ensuring that we get the right balance of forces for the future, that we maximise our operational output and that we have the right geographical spread across the country, and that our long-term ability to recruit is assured.

My grandfather, Hugh Macdonald, served gallantly in the Black Watch and is buried in the military cemetery in Gibraltar, where he died in 1941. I am sure that he was proud to wear a kilt. There were Englishmen serving in the Black Watch then and now—indeed, the Liverpool Scottish part of the Black Watch comes up to Dundee every year. Can the Minister of State give my constituents and serving members of the Black Watch some sort of assurance that, on his watch, there will always be a Black Watch?

I can give the hon. Gentleman the assurance I have just given the House: the decisions to be taken will be objective decisions against the four criteria that I have just set out. No one should give in to the temptation to believe what they read in the newspapers.

Scotland is suffering badly from what is happening in defence spending. Only four of the 148 major Regular Army units are based in our territory. That represents 2.7% of the entire British Army, yet we have 8.4% of the population. Why is Scotland doing so badly when it comes to defence cuts and defence spending?

I do not accept either the analysis or the figures offered by the hon. Gentleman. Scotland does well out of defence, and defence does well out of Scotland. We plan our defences for the defence of the United Kingdom as a whole in the most coherent way we can, and Scotland will do a great deal better out of being part of the UK’s defences than it will ever do if it goes on its own and plans its own defence force.

There is speculation that the process is being elongated, perhaps over a number of months, because of political considerations. Does my hon. Friend accept what a large number of armed service men and women are saying—that uncertainty is extremely corrosive, damaging and morale sapping, and the sooner these decisions, however difficult and unpleasant they are, can be made, the better?

I agree. Uncertainty always has a destabilising effect. I can assure my hon. Friend and the members of the armed forces that they will not have long to wait. However, it is more important that we get this right than that we do it quickly. These decisions are a once-in-a-generation rebalancing of the Army’s structure. If we get it wrong, the Army will suffer the consequences for decades to come, so it is important to take a little time and get it right. The House will not have long to wait for announcements to be made.

We hear reports that people are being targeted for redundancy and will therefore not qualify for their full pension. Is that correct? If it is, will the Government look kindly on those affected?

Let me say first to my hon. Friend that the issue of disbandment of battalions, which we were just discussing, and redundancy have nothing to do with each other, so nobody should read into the decisions that are taken about particular battalions that members of those battalions will be made redundant. In answer to the specific question that he puts, nobody has been selected on the basis of their proximity to a retirement date, but inevitably it is the case that where there are lines, some unfortunate souls will fall just the wrong side of the line. It is a matter of great regret, but the redundancy payments will in any case be bigger than the lump sums that those personnel would have received at retirement.

In making the very difficult decisions that my hon. Friend undoubtedly will have to make in the near future, what attitude does he have to the very gallant men and women from countries other than the United Kingdom who serve in our armed forces? How does he imagine they will be affected by the redundancy programme?

In no way will they be singled out. These decisions are being made in the most objective and scientific way we can make them, but inevitably some who serve from overseas will be affected and others will be more fortunate. There is no getting away from that.

Some of the reductions that are to take place will be accounted for by reduced recruiting and fewer extensions of service, but as I said, a redundancy programme is, sadly, inevitable to ensure that the right balance of skills is maintained across the rank structures. Compulsory redundancy will not apply, as we have made clear from the outset, to those in receipt of the operational allowance, those within six months of deploying, or those on post-operational tour leave following those deployments. In all cases it is for the individual service to determine how the necessary reductions can be achieved and over what timeline, making sure that the right mix of skills, experience and ranks are retained.

The main programme for the Royal Navy and the RAF have been concluded, but protecting the Army’s contribution to Afghanistan has meant that two further tranches are still to come for the Army. We will, as I said, make an announcement on Army 2020 very shortly, which will provide clarity on the future structure of the Army. We will have a land force of 120,000, composed of a Regular Army of 82,000, plus 30,000 reserves and an 8,000 training margin. An Army of this composition will have to be structured differently, and it is impossible to do that without losing and merging some units.

Although we cannot avoid difficult decisions as the Army gets smaller, we will seek to do this in the most sensitive way possible, respecting the traditions of the Army, respecting the traditions of our great regiments, but always recognising that military effectiveness must be the first requirement in designing our future structure.

I commend what my hon. Friend has just said. When we think about which TA regiments to keep, which to lose and where to put them, I urge him to bear in mind that a unit in the Territorial Army cannot be moved more than a very small distance without losing the people. It is even more critical than in the Regular Army to pick those that have an officer and soldier base that is well recruited; many units do not have such a base. It is vital that we build on the best ones.

My hon. Friend makes a good point, which is being taken into account as these difficult decisions are made.

The current financial situation makes it difficult to act as swiftly as we would wish to address some of the issues that make day-to-day life that bit more difficult for personnel and their families. Mention was made of the pause we have had to make on major housing upgrades, but thankfully the £100 million additional investment in accommodation that was announced in the Budget will deliver more than 1,000 new and refurbished single living and service family accommodation units. That will help the MOD to continue to meet its commitment, set out in the armed forces covenant, only to allocate homes that are standard 2 or above.

On the issue of the covenant, I start by recognising the important work done by the hon. Member for North Durham, along with the right hon. Member for Coventry North East, in preparing the ground for the publication of the tri-service armed forces covenant in May last year, which built on many of the suggestions in their Command Paper. We have been able to double the operational tax-free allowance and we have improved rest and recuperation. Council tax relief has been doubled twice since the Government took office, and now stands at nearly £600 per person for a six-month deployment. In health care, we are investing up to £15 million in prosthetics provision for personnel who have lost limbs during service, extended access to mental health and increased the number of veterans’ mental health nurses.

On education, we have set up scholarships for bereaved service children, provided financial help for service leavers who want higher and further education, and introduced the pupil premium for the children of those currently serving, making extra funds available for state schools with service children. More than 50 councils have signed up to the community covenant scheme with another 47 planning to do so, and there is a £30 million grant pot to support that. However, there is a long way to go.

For the first time, the armed forces covenant has been formally published and recognised in legislation, and we are working across Government to ensure that no disadvantage is faced by armed forces personnel, their families and veterans compared with other citizens.

Ever since the publication of the SDSR, the Opposition have been calling for another SDSR. They went 12 years in government without one, but they now seem to want another one every time the wind blows. We have put in place a system for regular strategic review through the National Security Council, and preparations for the SDSR of 2015 are already under way in the MOD. However, none of the strategic assumptions underpinning the 2010 SDSR have significantly changed, so we will press ahead with the implementation of the SDSR based on formidable, adaptable and high-tech armed forces, built on balanced budgets and supported by an effective and efficient MOD, taking the tough decisions that the previous Government ducked, providing our armed forces with the tools they need to do the job we ask of them, upholding the armed forces covenant, and protecting this country’s national security, which is the first and foremost duty of any Government.

Order. I will have to bring in a five-minute limit on speeches and I may have to reduce it. If Members are good to each other and do not intervene too often, I hope to get everyone in.

We got a lot of heat from the Minister, but we are not much clearer on the key issue on which I want to expand—defence procurement. My hon. Friend the Member for North Durham (Mr Jones) and my right hon. Friend the Member for Coventry North East (Mr Ainsworth) have already made excellent points on the issue. It is of course true that any incoming Government at the last election would have had to make savings and the process could have been difficult. The Labour Government put in place the process to consider how we should do that, but the important thing was to learn and see where the next Government could improve. So far, the signs are that this Government have comprehensively failed to do that.

When the right hon. Member for North Somerset (Dr Fox), who became Defence Secretary, was not making promises in opposition about increasing the size of the Army, he used to tell the House how terrible it was that Ministers increased the costs of projects by delaying them, but in government his party is doing precisely that, with significant added cost to the taxpayer.

As we have seen again today, Ministers are patting themselves on the back as if they have finally and magically squared the circle on defence procurement. I am afraid that what they have done is simply seek the appearance of order, in the manner of a child tidying his bedroom in great haste. They have done this in a number of ways. Some costs have been swept under the bed, increasing the burden on taxpayers and storing up risk for future years. In that category, of course, I include the successor deterrent.

Ministers can announce the necessary long-lead items initiated in recent weeks with as much fanfare as they like—they know that I have welcomed the commencement of each one so far—but they know that that is now being done to a tight timetable and with increased costs caused by the delay they imposed in bringing the successor into service when they first came into office. When the Defence Secretary boasts about balancing the procurement budget, he knows that that has been made possible only by shifting the project’s cost profile to the right, largely out of this spending round, which is precisely what Conservative Members used to rail against from the Opposition Benches. The extra cost of refuelling the existing Vanguard class submarines alone, which was made necessary by the delay, was estimated at between £1.2 billion and £1.4 billion by the former Secretary of State. We are yet to hear the full cost of this exercise in political management and short-term debt clearing. Perhaps the Minister will seek to enlighten us when he winds up.

In their desperation to present a false image of order, the Government have gone beyond simply sweeping things out of immediate sight. Some projects have been subjected to the procurement equivalent of being hastily hurled out of the window, with little thought for the waste that that causes or, most importantly, the implications for national security. Any claim they might have made to have got to grips with defence procurement was surely destroyed by the farce over the aircraft carriers, which my hon. Friend the Member for North Durham set out well in his speech.

The final trick for those worried about their shoddy work being exposed is simply to turn off the lights. The Government have produced no credible evidence today or in the past about where this £38 billion has come from or how it will be filled in future. We are left with a lingering lack of certainty over the cost of big-ticket items and the personnel are bearing the brunt, with the Army that the Government promised to expand possibly set to get another whack. The books are cooked on the assumption of long-term increases in MOD funding post-2015, and black holes, which were never properly described in the first place, are apparently filled. The truth is that Ministers do not have a grip on procurement or cost overruns and have failed to put considered policy and the defence interests of the nation ahead of political posturing.

For the past 40 years, RAF Leuchars in my constituency has been responsible for providing air defence for the northern half of the United Kingdom. It is ideally situated for the purpose, close to centres of population and training areas, and easily able to deal with intrusion by aircraft—formerly Soviet and now Russian—into British airspace. Even as this debate takes place, there are aircraft at Leuchars on standby to provide the quick reaction alert, which is an essential part of our air defence. Even as this debate is taking place, No. 6 Typhoon squadron has been stood up and is fully operational, and No. 1 Typhoon squadron is in the course of being stood up. Even now, preparations are taking place for one of the Royal Air Force’s few remaining air shows, which provides a valuable shop window, and it is able to do that, in particular, because of the accessibility of RAF Leuchars to Scotland’s central belt.

I have no doubt that a seamless and uninterrupted build-up of the Typhoon force is essential to the security of the United Kingdom. Is it true that Leuchars now has a dedicated Typhoon engine bay? Is it true that there is now a dedicated Typhoon ejection-seat facility at Leuchars? Is it true that there is Typhoon-specific survival equipment at Leuchars? Is it true that there are Typhoon-modified power supplies and Typhoo-specific IT systems already in place? It is suggested that the Army might be sent in some form or another to Leuchars, but it has not been possible to identify any capital investment in advance of such a decision.

We know that the proposal is to transfer to Lossiemouth, but no preparations have been made there for the arrival of Typhoon squadrons, which allows me, I hope, the colloquialism, “Leuchars ain’t broke, why is it necessary to fix it?” The truth is that Leuchars is in the right place at the right time and doing the right job.

Typhoon aircraft from Leuchars can be over London 12 minutes sooner than Typhoon aircraft flying from Lossiemouth. The Olympics, as the head of MI5 identified only yesterday, will be a severe test of our security, but that test is unlikely to end with the Olympic games, and the capacity to provide air defence throughout the United Kingdom will be an essential feature of our future security.

I have a profound belief that the original decision to move the Typhoon aircraft from Leuchars to Lossiemouth was based on financial and political considerations, which were put ahead of strategic obligations and of the clear operational advantages provided by Leuchars. The financial case has been substantially undermined by the Army reductions that we have heard about, by the rejection of the building of a super-base at Kirknewton near Edinburgh, by the inability of the Ministry of Defence to obtain the sums originally estimated for the sale of properties such as Redford barracks, also in Edinburgh, and by the additional costs of transferring Typhoons to Lossiemouth and of operating from Lossiemouth once they have been transferred there.

In my view, there is no question but that the deployment of the Typhoon force should be revisited as part of the ongoing review to which my hon. Friend the Minister referred but a moment or two ago. The original decision was flawed. It will be even more flawed if it is executed in the way that is proposed.

I, like my hon. Friend the Member for North Durham (Mr Jones), look at some of the defence reforms—I use the word “reforms” very loosely—and have to question the decisions that were made, including whether they were in the best interests of the defence and security of the United Kingdom, or in the best interests of the Treasury-driven agenda to cut spending.

Chief among my concerns is the scrapping of the Nimrod MRA4, which has denied us the ability to protect our nuclear deterrent and offshore oil and gas platforms properly; to gather intelligence of threats developing way beyond our coastline such as in the high north; to respond adequately to offshore emergencies; and to contribute to international efforts against terrorism and piracy.

The Government assumption that we can do without maritime capability until 2020, with the replacement of the MRA4 not being commissioned prior to 2015 and an average commissioning period of five years, is nonsensical. We lost not just Nimrod, but the individuals with the skills that need to be nurtured in the area; and they are not just skills that we need to retain in design, building, flying and the analysis of electronic intelligence data, but skills that we cannot afford to see fleeing the country for work abroad, as is happening now.

The loss of the Harriers—sold for spare parts, we were told—was based on the short-sighted assumption that we can do without planes to fly from our carriers. Ministers insisted that it was a good deal for the British taxpayer, but as one US rear admiral said:

“We’re taking advantage of all the money the Brits have spent on them. It’s like we are buying a car with 15,000 miles on it.”

We are losing our prestige overseas, and we should not underestimate how we have gone from being a respected player on the international stage to being, in many quarters, pitied for what we have lost and can no longer do.

We have been well accustomed to the problems of defence procurement and the conspiracy of optimism that has led to delayed and expensive procurement decisions, but the Ministry of Defence is in great danger of falling into the same trap with its plans for Future Force 2020. The plan seems simple—rebalancing the armed forces to increase the number of reservists, thereby saving money but gaining the benefits of the skills and experience that reservists can bring. I have to say that there is a shocking naivety in this plan. Members of our armed forces are tough, resilient people who welcome the challenges thrown at them, but I fear that reducing their numbers to 82,000 will mean that we face overstretch, burn-out and a loss of capacity, skills and capability.

As part of Future Force 2020, a threat is hanging over many regiments, including the Queen’s Dragoon Guards. That is deeply unsettling. I make no pretence about the difficulty of the decision to be made, but the amalgamation of any Welsh regiments will be a bitter pill to swallow, especially given the Prime Minister’s speech in the Welsh Assembly this time last year, when he said:

“While speaking about the part that Wales has played in our past and present, I want to put on record…here…my gratitude to the brave Welsh regiments. From the trenches of northern France to the mountains of South Korea, they have fought and died in defence of our nation and values. Today, in Afghanistan, they continue to serve with courage and distinction, and I pay tribute to them. For them, and for all the people of Wales, I will always be an advocate of this country and everything that it has to offer.”

My hon. Friend makes a very powerful point in reading that quote. She knows just how angry people in Wales are about the uncertainty facing the Queen’s Dragoon Guards. Does she therefore welcome the Welsh Affairs Committee’s decision to carry out an urgent inquiry into this matter, and does she think it important that we get the chance to question Defence Ministers in person?

I certainly do think it is very important that the Welsh Affairs Committee looks into the issue, but it needs particularly to consider the most important part of it—the potential future of all three major Welsh regiments. It is also right that Defence Ministers should be available to answer questions. In Wales, the sons, daughters, brothers, sisters and families of our regiments are deeply distressed at the potential loss of one of the regiments.

Defence reform risks becoming defence vandalism—destroying trust, reputations, capability, capacity and skills that are urgently needed to protect our country in these uncertain times. We in Wales take this extremely seriously, because we risk losing important regiments that make important contributions to the defence of the UK. It is the equivalent of leaving all the windows and doors in one’s house open to potential burglars and going up to bed. However, it is not a burglar who I fear coming into the house that is the UK; it is a murderer, who will murder us in our beds because we have failed to put in place the protections that we need.

I draw the House’s attention to my registered interest with the Royal Navy reserve.

I have mixed views about today’s debate. I am always glad when defence is discussed on the Floor of the House, but it is very important that we build a consensus between all parties on these important issues. When the Defence Committee requests time in this Chamber, it is always keen to have a motion that will not divide the House, and I have always tried to adopt that non-partisan attitude in events and campaigns that I have run for the Royal Navy and Royal Marines—for example, in asking the shadow Secretary of State to co-host last year’s Trafalgar day event with me.

I therefore approach an Opposition day debate on defence with a heavy heart, but today I have a doubly heavy heart because I have to correct a falsehood that has been running for the past few days, perpetuated by Labour’s spin operation. I do not believe that the shadow Secretary of State or his shadow Ministers would have been involved in this, but I hope that in winding up they will take the time to correct it.

Portsmouth dockyard is the home of the surface fleet. It has a wonderful natural harbour, which is being dredged to house the new carriers. New power facilities are being built, and moves are afoot to put the vacant historic dockyard to new use so that it ceases to be a drain on the defence budget. The operational stress that the carriers will be under will be considerable, so repair and support services must sit alongside the ships in their home port. There is much activity, much investment and more work for the dockyard’s partners and suppliers, most notably Rolls-Royce in my constituency.

In the face of all that activity and progress, Labour has spent the past few days telling those who work in the dockyard and their families that it will close. It has not been discussing the BAE review; it has been telling people that the Royal Navy base is toast. That is a new low. Government Members have come to expect Labour policy and its lines to take to be divorced from reality, especially where the economy is concerned, but I had thought, perhaps naively, that defence might warrant a more grown-up attitude. This sort of distortion is indefensible not just because of the unnecessary hurt and worry that is caused to people in my constituency, but because of the damage that it causes to British businesses.

We have to retain a shipbuilding capability in the UK—it is a sovereign capability. To afford the Royal Navy ships of the future, we need a slower drumbeat in our yards in building those ships. We therefore need to export more Royal Navy-designed ships. We also need to make better use of the gaps in work in our yards, rather than put the brakes on contracts, especially those that will deliver much-needed and much-missed capability, such as carrier strike force.

There is a gap between the carrier work finishing and the building of the new Type 26 combat ship starting. Rather than making the mistakes of the last Government and paying for the work to be delivered slower, we should use that time and money to do something more useful, using designs that we already have. We should build ocean patrol vessels and perhaps an ice ship, which would certainly be of use. That would be a better use of public funds, retain the capability and provide more options either to carry out operations or to generate funds for the Department. We must have no let-up in the Government activity to hook in any buyer who is looking to purchase a combat ship. I know that Ministers are considering all those options.

These are important issues, but on them, Labour is silent. It does not seem to be remotely interested in ensuring that the Government do the right thing, that we have the capability that we need or that we are getting value for money. Nor has it stated what its view is on the future of shipbuilding in the UK. Instead, over the past few days Labour’s press office has misled people in my constituency by saying that the Navy base will close. The Government could not have been clearer in their statement that all three Navy bases will be retained. The shadow ministerial team know that. I therefore hope that whichever shadow Minister responds to the debate will tell us what they think about shipbuilding in the UK. At the very least, they should state that they know that the Government are committed to the three Royal Navy bases.

The shadow Ministers should reflect on the actions of their party over the past few days. If Labour wants to have a debate about the BAE Systems review, that is fine. I will show up. In the meantime, I ask that it treats my constituents working in and with the armed forces with a greater degree of respect.

With all the pressure on defence spending in this country and abroad, it is hardly surprising that at the NATO summit in Chicago, smart defence was one of the key items of discussion and NATO pledged to do more with less. I believe that NATO, like the Defence Ministries in its member states, will deliver greater value for money if its expenditure is transparent, subject to independent audit and scrutinised by Parliaments in member states.

NATO’s external audit function is overseen by the International Board of Auditors for NATO, which consists of six board members who are nominated by the national delegations. The members rotate between the NATO member states, so there is no continuity of oversight. The IBAN board is accountable not to Parliaments, as is the National Audit Office in relation to UK defence expenditure, but to the North Atlantic Council, the executive branch of NATO. The audits are carried out by 22 able members of staff, who are not independent, but are employed by NATO.

As an ex-NATO officer, may I point out that the North Atlantic Council can sit in Prime Minister or President form, Foreign Minister form, Defence Minister form or permanent representative form? Governments are therefore represented on the North Atlantic Council, to which IBAN reports.

Governments are represented, but Parliaments are not. The principle in the UK is that the National Audit Office belongs and reports to Parliament. It has reported to Parliament for 150 years on UK defence expenditure, while obviously keeping secret things that must necessarily be kept secret, so there is no reason why we cannot have public reporting of defence expenditure.

NATO’s international board of auditors audited 49 separate sets of NATO accounts last year. I recently met Tim Banfield, a director of the NAO who is responsible for UK defence audits. He told me that NATO’s financial statements are frequently audited late, sometimes by as much as three years, which is not compliant with decent accounting standards—auditors who are trying to track expenditure cannot find the answers to the questions they need to ask three years after an operation has closed down. I asked a Foreign Office Minister how good the audits are, because they are not published. He told me that of the 49 sets of accounts last year, 14 were qualified by the auditors because of irregularities.

In addition to the financial audits, five performance audits—value-for-money audits—were carried out last year, but there is little evidence that NATO changes how it works to improve value for money in response to their conclusions. Only one of those 49 sets of accounts has been put into the public domain, according to NATO’s website.

The failure to publish accounts reduces the pressure on NATO managers to respond to deficiencies when they are revealed by audits, and to improve their performance. I raise this matter with the Minister now because I believe there is a narrow window of opportunity to change things, because the NATO Secretary-General has commissioned the new deputy Secretary-General to review the audit function. I shall share with the House a brief extract from a document provided by the Secretary-General to national delegations, including the UK ambassador to NATO. The Secretary-General said:

“We must adopt best practices employed by other international organisations. NATO is very unusual in having its own auditing service…Organisations that employ external public-service auditors include UNESCO, WTO, OSCE and the OECD.

To bring us into line with best practice, I propose the adoption of the same approach, phased in to ensure continuity of work.”

He goes on to make the point that the only other body that does not have an independent external audit function is the EU, from which some hon. Members would not like to take lessons in that respect.

The NATO Secretary-General clearly wants change, but the decision will not be made by him; it will be made by the North Atlantic Council. Will the UK representative at the North Atlantic Council, whether our ambassador, one of our Ministers or the Prime Minister, support the change agenda? Will the deputy Secretary-General’s report be shown to the NAO and the supreme audit institutions of other member states, such as the US Government Accountability Office, for comment before it is shown to the North Atlantic Council? Will our ambassador lobby representatives of other member states to build a coalition to change the audit function within NATO and to bring the information, apart from that which necessarily must be kept secret for security reasons, into the public domain?

That information will drive improved value for money within NATO. NATO can hardly urge its member states to deliver more value for money if it does not take a lead by doing so itself.

I declare an interest as a member of the Territorial Army.

I listened with interest to the hon. Member for North Durham (Mr Jones), who has just left his place. I thought he was a perfectly competent Defence Minister, although not quite as competent as the Under-Secretary of State for Defence, my right hon. Friend the Member for South Leicestershire (Mr Robathan). Having listened carefully to the hon. Gentleman’s remarks, I am clear about several matters being pursued by the Government that he does not support, but, given his acceptance that there is a deficit and that it needs to be addressed, I am less clear about what exactly the Labour party would do to address it. I hope that in her winding-up speech the hon. Member for West Dunbartonshire (Gemma Doyle) will explain to the House exactly what the Labour party would do to deal with the deficit. Without that explanation, I fear that many of its claims will look rather hollow.

I want to focus on the plan for an integrated Army by 2020. I congratulate General Carter on his review. Frankly, he was handed a poisoned chalice, but he has managed to deliver an optimal military solution from very clear terms of reference. I want to be equally controversial by saying that sometimes arguments in the House about which regiments should be saved leave me slightly cold. I understand the historic significance of many regiments, and it is right that hon. Members should defend those regiments, but ultimately, if I were a senior officer, I would be holding my head in my hands, because, following this review, politicians are now tinkering with it and seeking to influence the decision for reasons based on political grounds, rather than optimal military grounds. It is not beyond the wit of the British Army to save various regimental cap badges, so I think that my hon. Friends should relax—I am sure that these cap badges will be saved. Instead, we must focus on the optimal military solution.

The integrated Army 2020 proposition, the skeleton of which was unveiled earlier this month at the Royal United Services Institute land warfare conference, is a neat solution to dealing with a period of strategic uncertainty at a time of economic austerity, and inevitably it involves smaller land forces. Indeed, it proposes a reduction in the regular force from 102,000 to 82,000, countered by an increase in the trained reserve forces to about 30,000, with an additional 8,000 under training. It aims to deliver an Army designed to meet the capability, aspirations and commitments of the strategic defence and security review 2010.

Equally, however, the proposal has to deliver contingent capabilities and meet the requirements of the Government’s “Building Stability Overseas Strategy”, published last year. Although I am confident that General Carter’s proposals provide an optimal military solution for the requirements of the SDSR, some cross-Government work is clearly still required to flesh out how this upstream engagement in fragile states will be delivered in order to meet the requirements of the overseas stability strategy. It is here, I believe, that the unique specialist skills that so many members of the reserve forces possess should be utilised. As I understand it, the proposed force structure aims to hold defence capabilities at different levels of readiness based on a balanced mix of reaction and adaptable forces. It is key, however, that to deliver this desired outcome, the Army must be able predictably to integrate its regular and reserve components, with the reserves likely to be required routinely to undertake roles such as providing for the UN battalion in Cyprus, as it has done sporadically in the past.

At the heart of the plan is a progressive move from a reserve force that provides individual augmentees for current operations to one that delivers a scalable, adaptable response by individuals to formed sub-units. This aspiration would certainly be welcomed by the TA, but will be welcomed by the Regular Army only if the TA can be relied upon to deliver. For the individual reservists, this calls for sustained commitment to regular training attendance and predictable periodic mobilisation. This is undoubtedly an ambitious target, but it can be achieved. It is important to realise, however, that there must be not only the military will to achieve it but significant political will and leadership, if the structure and reliance on reserves is to work.

There is one other requirement: money for the reserves to train properly. Otherwise, they cannot attain the same level as the regular forces.

I agree. Indeed, I would argue that ambition without funding is simply hallucination, which is why I am delighted that £1.2 billion has been allocated for this upskilling of the reserves.

I have two concerns about the upskilling, however. First, I want to add to the comment from my hon. Friend the Member for Canterbury (Mr Brazier). When it comes to the reserve units, we must be careful, because a larger TA might actually result in a smaller footprint. We must be careful about which TA units we close, simply because, as I know from my experience as an officer commanding a squadron, we cannot simply move personnel and expect them to move units and travel some 20 miles to continue training.

Equally, I am convinced that there must be a compulsion to train. At the moment, we simply have a gentlemen’s agreement to turn up and train with the TA. Without that compulsion, I fear that the reserves cannot fulfil the commitment that they are being asked to make. We are fortunate that section 22 in part III of the Reserve Forces Act 1996 already allows for compulsory training, but we need to look carefully at how to implement it, so that we do not end up offending employers, who might then not wish to allow their reservists to go and train. It is a very difficult circle to square. Equally, we need to look at TA regulations to ensure that bounty, a tax-free payment for people who are fit for role, can be adjusted to ensure that such compulsion can be taken into account.

In my last 27 seconds, I would like to highlight to hon. Members that tomorrow is “wear your uniform to work” day, which is a celebration of our reserve forces, with some 1,900 of them currently being mobilised in support of the Olympics and some 700 on operations in Afghanistan. I hope that hon. Members will join me in celebrating their reservists, although they do not have to go as far as I will by wearing my uniform tomorrow.

This is the first opportunity I have found in the parliamentary calendar to make any remarks about the Government’s defence procurement White Paper, which came out in February. Unfortunately, it was issued as a written ministerial statement, so there was no opportunity for debate. I do think it is worth looking at what that defence procurement White Paper says. On a number of occasions, I have raised with Ministers my concerns, which arose out of spending the last nine months, along with many trade unionists, employees and family members, fighting for workers at BAE Systems in Brough, who are facing 800 or 900 redundancies.

We have heard a lot this evening about being in economic difficulties and about the deficit that we need to get down, and it seems to me that defence procurement provides potential not only for growth but for defence exports. I think the Government are missing a trick in this area. My understanding of the White Paper is that the Government are moving towards open procurement, buying off the shelf and getting good value for money, that there is no preferential treatment for British industry or British manufacturers and that they will protect the operational advantage and freedom of action of this country only where it is essential to national security. As I said, the economy is flatlining and we are in a double-dip recession, but we know that countries that invest in, and buy from, their own home-grown defence industries do the best at exporting around the world. That makes sense: if a Government are willing to buy from their own industry, it shows a commitment to, and a belief in, providing the very best. That is absolutely what we want for our armed forces.

Brough is the home of the Hawk, and when the Red Arrows go around the country and the world flying the Hawk, people know that it is an excellent, British-manufactured plane. The Red Arrows display amazing acrobatic aeronautical feats, showing again Britain’s excellence in manufacturing. My real concern, then, is about the Ministry of Defence’s approach to future procurement, as it seems to treat itself as if it were a private company, just looking for best value and not recognising that it is part of the Government as a whole. The Government have a commitment—the Opposition support them in this—to growth and rebalancing the economy.

An interesting piece of work has been done on “The Destinations of the Defence Pound”. It is a RUSI—Royal United Services Institute—pamphlet written by Trevor Taylor and John Louth. They point out that buying off the shelf has a negative effect on Government revenues so it does not help the country to deal with the public sector deficit. Buying British, on the other hand, will ensure that British taxes are paid during the course of the procurement process, and there is likely to be a British supply chain, too. The pamphlet shows that spending £1 million will lead to a 36% return to the Exchequer via tax, national insurance and other means. It does not go into the wider benefits, which would obviously include jobs—a key issue for the Government and the Opposition at this time. Then there are all the other multiplier effects of buying from the home defence industry. If the Government buy abroad, that money—those taxes—will go to another Government, and will be lost to us.

It would be helpful if the Minister said something about the European procurement defence directive, and about the need for us to monitor carefully what other countries are doing. Why does the United States of America, when it purchases defence items, demand that they be produced in the United States, and why, in most cases, is any company applying to that market required to have a United States partner even to get a hearing?

I should like the Government to hold a proper debate on procurement, because I think that it might give them an opportunity to get themselves out of the economic difficulties into which they have got themselves since May 2010. Given that we are now in a double-dip recession, such a debate might be of help to them.

In the light of your injunction, Mr Deputy Speaker, I shall shorten what I was going to say, and speed up what I am going to say, in order to stay well within the time limit.

It is a pleasure to speak in the debate, occurring as it does on the 150th anniversary of the first investiture of the Victoria Cross in Hyde park. My constituent Samuel Parkes—a long-dead constituent, I should add—was the first private soldier to receive the Victoria Cross, so the debate has extra significance and resonance for my constituents.

I was pleased and privileged to serve on the Committee that considered the Armed Forces Bill, which became the Armed Forces Act 2011 and enshrined the armed forces covenant in law. Although it is fair to say that the Opposition were broadly supportive of the implementation of the covenant, it is also pertinent to point out that it was implemented within a year of the coalition Government’s inheriting a parlous economic state. The hon. Member for West Dunbartonshire (Gemma Doyle) was involved in the Committee stage of the Bill. It is clear that the Opposition, although they played their part in the covenant’s implementation, had 13 years in which to introduce a covenant themselves. They had the time, the money and the majority to introduce one, yet they failed to do so. I am pleased that they appear to be supporting what we achieved.

We in Tamworth recruit heavily to the 3rd Battalion the Mercian Regiment, the former Staffordshire Regiment. Housing is one of the biggest issues raised by my constituents who are in the forces, and by their families. Given the strides that we have already made in improving housing, I hope that, as the Strachan report is implemented and as we proceed with the covenant and report on it, we will do three further things.

I hope that we will increase the accommodation allowances that are available to our servicemen and women, and will expand the pilot shared equity scheme that was introduced by the last Government. I know that the Minister for Housing and Local Government has announced that £400 million will be spent on helping 10,000 families with the Firstbuy scheme.

I also hope that we will help more armed forces families to get on to the property ladder. I hope that we will do something that will cost my right hon. Friend the Secretary of State nothing, and prevail on the Chancellor to prevail on the banks to offer more forces-friendly mortgages to help servicemen and women and their families to secure a fixed address, a stable home, and a foot on that property ladder. If we send people abroad to fight for us, it seems only right and proper that we should help them to get a decent home, at home. Such action would also help to reduce the £285 million a year that it costs to service 50,000 homes for forces personnel, some of which is sub-standard.

The motion suggests that the Opposition still want to make the armed forces covenant very prescriptive. That flies in the face of the messages that we receive from the service chiefs and from the armed forces families’ representatives, who have said that they want a much more flexible and current armed forces covenant that can respond to the current concerns of our armed forces.

I conclude by quoting Bryn Parry, founder of Help for Heroes. He said in the Armed Forces Bill Committee just 12 months or so ago:

“I have never seen something written down or the principles of something discussed or made into law work as well as somebody who gets up and says, ‘Right, this is what I want to happen. Let’s make it go.’”––[Official Report, Armed Forces Public Bill Committee, 10 February 2011; Q336.]

That sums up what the armed forces covenant should be: a flexible arrangement and a current arrangement—and I trust my right hon. Friend the Minister will make it go.

Members may know of my concerns regarding the number of military personnel who end up in trouble after leaving the services, and sometimes end up on the street. The Welsh Affairs Committee is currently taking evidence on that, as well as on the regiments question.

Wales has traditionally provided more than our share of military personnel. It makes sense that returning Welsh veterans—and, indeed, returning English and Scottish veterans—should be treated as close to their families as possible and should have their fair share of resources from charities and the UK Government, to help them recover from their injuries. Having seen how the US treats its veterans, I am sure there are lessons we can still learn. Some of the earlier comments on the covenant are most welcome, however.

Certainly one lesson we can learn is the importance of ensuring that former members of the armed forces do not feel that they are left behind when they are discharged from the services. The cuts that have happened, and those that are currently taking place, must take into account the need for support networks to be in place for them.

In Wales, there is a great deal of concern about proposals to merge or disband Welsh regiments such as the 1st the Queen’s Dragoon Guards, also known as the Welsh cavalry, and The Royal Welsh, which includes battalions from the Royal Welch Fusiliers and the Royal Welsh Regiment—it was only recently put together, and one would have thought it would have stayed in place for a while.

The reduction in the number of Welsh regiments to three has already left a bitter taste, and further cuts will lead to a feeling that Welsh regiments are not being recognised and appreciated for their effort and dedication. Successive generations have joined the Queen’s Dragoon Guards and fought with pride, honour and determination. Some argue that this is due to the method of recruitment, with cultural ties and local knowledge being part of both recruitment and loyalty. New recruits should have the opportunity to choose an armoured regiment or infantry regiment in which they will feel comfortable and safe in the company of their peers while facing potentially dangerous circumstances. However, despite the Queen’s Dragoon Guards carrying out more operational tours in the past 20 years than any other armoured regiment, it is under threat of amalgamation. That is in spite of its being the only remaining Welsh armoured regiment. If these decisions are made, on the order of precedence under the Ironside/Levy rules, both the Queen’s Dragoon Guards and the Royal Scots Dragoon Guards will be maintained.

There are six objective criteria to be met in this regard: recruitment strength, or the number and quality of those who wish to join; regional or national identity; proportionality to all parts of the UK—we are not looking for favours; the right geographical spread, as the Minister who opened the debate said; capabilities; and operational output. I believe that, on these criteria, the case has been made for maintaining these important and historically significant Welsh regiments.

On Trident, last week the Government announced £1.1 billion of investment in infrastructure that will make the next generation of Trident missiles. Although the main gate decision will not be made until after the next general election, by investing so heavily, they are, in effect, pushing us towards the decision, so that, as with the aircraft carriers, it becomes a fait accompli.

This has been done without a proper discussion or a debate on the Floor of the House. Opponents of Trident object for a variety of reasons: some because they are pacifists, others because they do not believe that it represents good value for money or a meaningful deterrent. Large numbers of young men and women are being made redundant from the conventional armed forces over the coming years, and regiments will be lost, but there is enough money for these weapons.

However, in Wales Labour First Minister Carwyn Jones apparently wants these nuclear weapons based near the major international trade port that deals with 30% of UK gas and 25% of UK oil and petrol. The oil refinery was the reason why Polaris was not sited at Milford Haven in 1963, and it is unclear why a busier location would be considered today. According to Chalmers and Walker in 2002,

“it remains the case that refineries would have to close if submarines were relocated there.”

Therefore, this man is arguing for Trident to come to Wales, for weapons of mass destruction to be sited on Welsh soil and for there to be a net loss of jobs for Wales—not, I think, a very good deal.

It is a great honour to contribute to this debate. I begin by paying tribute to all members of the armed forces for the fantastic work they do. I attended the trooping of the colour and I noted that many had recently returned from the line of fire and were still performing absolutely magnificently. That is emblematic of our armed forces, and we should always remember them and salute them for that.

I want to make a general point about returning soldiers from Germany, because clearly that is happening; in my constituency there are several who are in need of support from organisations such as Family Lives. It is important to recognise that such major transitions do take place.

On the black hole that we were discussing previously, I want to make clear what I think a black hole is: a great expenditure commitment over a long period for which there is no money. That was the situation under the last Labour Government, and there definitely was a £38 billion black hole. It has now effectively been filled in and concreted over by our Government, but a black hole is what I have just said it is.

The motion also refers to the possibility of changing the assumptions on which the strategic defence and security review are based. In fact, many of the assumptions the Government made two years ago were absolutely right and stand the test of time; but obviously, there are nuances that one must bear in mind and adjustments one must make.

The interesting move that the United States has made in refocusing its efforts towards the Pacific and Asia is a fascinating one that we as a country should be mindful of in having a flexible approach to our naval forces. I noted that, while dealing with Libya, we did not actually need an aircraft carrier. Because we had sensible relationships with allies, we were able to accomplish quite magnificent feats with our fixed-wing aircraft. We have to remember that the advantage of having good allies—an assumption that we made as part of the SDSR process—is absolutely critical.

We should also celebrate the Government’s creation of a National Security Council, which brings together foreign affairs, international development and defence. Without an appreciation of our foreign affairs objectives, we will not be very successful at putting together a defence strategy. This Government have understood the direct and obvious link between those areas, which is why we are so much better at calibrating, assessing and understanding our defence needs.

Clearly, we need hardware, and one good thing we are introducing is heavy-lift capacity, which we do need. It is great that Airbus, in the form of the A400M, is part of that package—an aircraft that is doing extraordinarily well elsewhere. The quality of our surface fleet is also an important issue—new frigates and destroyers that are up to the necessary standard for the tasks that we have.

On aircraft carriers, it was absolutely right to look at what is happening with the new Gerald R. Ford-class carrier in the United States, which has the electronic “cat and trap” system. It must have been tantalising for us to consider, certainly given our relationship with the French and their one aircraft carrier, which is also cat and trap. We did not go down that route, but it was sensible to consider it, because we have to make the right decisions in the long run.

I wish to start by talking about the young men and women who serve in our front-line services. I pay tribute to all members of the armed services, be they in the back room or on the front line, but special consideration has to be given to those on the front line, such as those in Afghanistan and Iraq. I went to Afghanistan in 2007 and met some of the young men who were fighting for us. They were 18, 19, 20, and they were being faced by and had to see all sorts of cruelties. They had to face so much hurt and they had to see so many injuries among their comrades. When they come back, we need to look after their physical and psychological needs. That means that if they have been injured in combat, all the best treatment should be made available to them. Even if they have not suffered any physical harm, they must be treated in respect of their emotional and psychological needs as well. They must be supported appropriately when they leave the Army and come into civilian life. That means that if they want to go to university, they should be given free tuition. Although we rightly always pay respect to our fallen heroes, we forget that what people are exposed to in war and in battles is an experience that nobody else is ever going to see and hear. So we should spend a lot more money on looking after our armed personnel who have served on the front line when they come back.

It is also important to equip these people properly when they are on the front line. They should be properly trained, and the armour, the helicopters and everything else that is required for them to do their job properly should be in place. That also means that the right amount of personnel should be there; 100 people should not be sent to do a job that requires 300 soldiers to do it. That means that the Government should reconsider the abandoning of certain regiments. The fighting force, the infantry and the regiments that go out to fight should not be reduced. One of my constituents who served in the Yorkshire Regiment, which was founded by the Duke of Wellington, says that it is one of the best regiments and has received many Victoria Crosses for the services it has rendered to the country, so I ask Ministers to reconsider reducing the number of soldiers on the front line.

We are told that some of these re-evaluations of our defence expenditure are to do with the money. I want the Minister, and indeed Labour Members, to consider whether we really need Trident. I know that people think that this is a debate of the left, but everyone knows that four years ago a number of generals and senior people in the Army and the Air Force said that Trident is actually irrelevant and is no longer required, as a result of the end of the cold war. They have also said that it is not ready to deal with the current levels of international terrorism. The generals set that out in a letter to The Times in January 2009. I have copies of the documents where they have asked that more money be spent on conventional forces, which we require to deal with the imminent threats we face. As I said, those people are not pacifists and they are not people who do not know what they are talking about; they are—

Thank you very much for calling me in this debate, Mr Speaker.

I agree with the comments that my hon. Friend the Minister for the Armed Forces made about how important this weekend is going to be, as it is national armed forces weekend. Not unnaturally, I am delighted to have this opportunity, because my constituency of Plymouth, Sutton and Devonport, more affectionately known as “Guz”, is going to be the national focus for the armed forces weekend. Plymouth is the home of 3 Commando Brigade, the Royal Marines and flag officer sea training, and it has an enormously big heritage, of which we are incredibly proud. I pay tribute to Commander Crichton for all his hard work in putting together the national armed forces weekend.

During this debate we have heard a great deal about how we need to make an assessment of where we are going. In my submission to the strategic defence and security review, I made it clear that Britain is a maritime nation, and we need to protect our sea routes. That means that we have to ensure that we are not sea blind. The Royal Navy’s role is to ensure not only soft diplomacy but that we can engage as and when Parliament decides where to go. It is a tool of foreign policy; indeed, some people would say that it could be a provisional tool in foreign policy, too.

I welcome the building of the aircraft carriers, but we need to ensure that when we move on to the next tranche of the SDSR we look long and hard at how to ensure that the supporting frigates are included.

Plymouth has a good story to tell about its harbour, which is the finest natural harbour in the world. It sits on the western approaches and is the one place in the United Kingdom that can deliver the refuelling and refitting of our nuclear submarines. That is our stake in the ground. I believe it is important that we retain our nuclear deterrent, because it is important not only strategically for our country but for my local economy, as 25,000 people are dependent on the defence industry.

Our dockyard was consistently under threat for the time that the Labour party was in power and I am delighted by the hard work my right hon. and hon. Friends on the Treasury Bench have been able to do in government to ensure that we can secure its future. The Government have been successful in ensuring not only that we will retain our Type 23s but that the £350 million refit of HMS Vengeance will take place in Devonport. The Government have been rebuilding confidence in Plymouth and Devonport, ensuring that we can do the very important job of engineering research, too, and making us one of the global leaders in maritime activity.

I am surprised by the Labour party’s approach and ask them to reconsider it. We need to ensure that those involved in our armed services have support in education, that they have decent housing and that they have provision to deal with mental health issues. We must work hard on that. This has been an important debate and we must ensure that we continue with the armed services covenant. I will welcome the opportunity to listen to the next debate on the subject, which will be important.

Britain has a proud military history and throughout that history, sailors, soldiers and airmen served our country with a courage and bravery that has become synonymous with the British armed forces. It is a pleasure to place on the record tonight my appreciation for our armed forces, as I will when I attend a ceremony in Liverpool town hall on Saturday. I will be remembering the eight brave men from Liverpool who made the ultimate sacrifice in Afghanistan, but of course the deaths of those brave men do not tell the full story. Countless others from the Merseyside area have been killed or injured in the line of duty during other conflicts and it should be recognised that Liverpool produces more men and women in our armed forces per capita than probably any other area of the country. As people will know, the Mersey is the lifeblood of our great city and Liverpool has a long history with the Royal Navy and the merchant navy. Its maritime history is a reminder to us all of the sacrifices and bravery of our ancestors.

In the somewhat limited time I have left, I want to talk about the lack of consideration that this Government have recently shown to our armed forces. I am primarily referring to the widespread reports that the Defence Secretary is to make soldiers who are currently serving redundant on their return from their tour of duty. What kind of Government would do that to their own brave soldiers? Decisions taken today, matters of life or death, spending commitments and diplomatic negotiations can and invariably will have ramifications for generations to come. What is more, some of the policy decisions made by the Defence Secretary today are likely to take decades to become manifest.

Yes, we need reform—that is why my right hon. Friend the shadow Defence Secretary outlined £5 billion-worth of reforms recently—but a reduction in Britain’s capability based on opinion polls is irresponsible. Controversy is not an excuse for carelessness or, dare I say, callousness.

The Defence Secretary should not underestimate the part that morale plays when it comes to our soldiers and armed forces. He would do well to remember the words of Dwight D. Eisenhower:

“The best morale exists when you never hear the word mentioned. When you hear a lot of talk about it, it’s usually lousy.”

Our armed forces deserve a Defence Secretary who understands defence and does not use it for political expedience. Our British armed forces deserve a Secretary of State who demonstrates compassion for the mission, empathy for the families and a determination to stand up for defence in Parliament.

It has been a pleasure to listen to this evening’s debate on defence reform, in which hon. Members have spoken on a number of topics. Let me say at the outset that the right hon. and learned Member for North East Fife (Sir Menzies Campbell) posed some very pertinent questions to Government Front Benchers.

I am pleased that we are having this debate in the week before armed forces day because it gives us the opportunity to pause and reflect on the bravery of our forces and the sacrifices they make, as has been mentioned by my hon. Friends the Members for Bolton South East (Yasmin Qureshi) and for Liverpool, Walton (Steve Rotheram) among others. Our forces do what is asked of them without question or hesitation and they often place their lives on the line to protect others. I am sure that the national event taking place in Plymouth this Saturday will be a great success. In West Dunbartonshire we celebrated armed forces day on Sunday past with a march-past in Dumbarton high street and a service in Riverside parish church.

There is no doubt that the armed forces will face challenges in the coming years, not least as part of the new employment model and the Future Force 2020 plan. Some 30,000 troops will have been removed by 2020. That will have an enormous impact on the UK’s capability, and clarity from Ministers on the decisions they have taken about future capability would be welcome. My hon. Friend the Member for Bridgend (Mrs Moon) made some excellent points about our maritime capability.

Recent reports have raised concerns that certain regiments are at risk of being scrapped. Belonging to a regiment is a very strong part of many soldiers’ identity. That is why the shadow Secretary of State launched our “Respect Our Regiments” campaign last month. I know that many Members are concerned about regiments and battalions being scrapped, including colleagues from Wales, Yorkshire, Scotland and Staffordshire. I apologise if I have missed anyone out. The Government intend to rely much more heavily on reservists in future, and the Minister knows I am concerned that he and the Government plan to scrap employment protections for reservists while asking for more from them.

The Minister shakes his head but I raised this with him last year and again last week. I know he is going to write to me and I await that letter because our understanding of the situation differs.

Last year, we reached agreement across the House on the armed forces covenant. I will resist the temptation raised by the contribution of the hon. Member for Tamworth (Christopher Pincher). As he knows and as the record shows, his party and the Minister had to be dragged kicking and screaming into putting the provisions we now have in law into the Armed Forces Act 2011. Anyone can read the record of the Committee proceedings to see that that is correct. The hon. Gentleman’s recollection was frankly a little wobbly. The Minister knows that I do not think the armed forces covenant is yet being taken seriously enough across all of government and the public sector in accordance with the principles set down. I do not doubt his commitment but more work needs to be done to make sure that it is a reality and that it works in practice.

I want to raise the issue of discrimination towards our forces. This concern is highlighted in the recent report by Lord Ashcroft, “The Armed Forces and Society”, which states that one in five members of the forces reports have been refused service in a bar or hotel while wearing their uniform and that around the same number reports being verbally abused while wearing their uniform. That is clearly unacceptable discrimination and if we take the covenant seriously we should be looking at how to tackle such behaviour.

I am afraid that I really do not think I have time, but if I have time later I will.

The service community can face indirect discrimination, creating difficulty with day-to-day matters that we take for granted such as getting credit, mortgages or even a mobile phone contract because they have moved around so often. We should not accept that as inevitable. The principles of the armed forces covenant should apply throughout society, and where those principles are routinely or blatantly breached, it may be necessary to consider introducing measures to deal with the matter. Routine disadvantage or discrimination should never go hand in hand with serving one’s country.

The hon. Lady claims credit for having forced the Government to bring the covenant into law. Perhaps she can remind me of any step taken by any Labour Government in 13 years to bring the armed forces covenant into law?

Great strides were made under the previous Government through the Green Paper and the service personnel Command Paper, which set up the provisions we now have.

Legal protections are in place for other groups in society and we believe that consideration should be given to whether they should be extended to our armed forces. I thought the Minister agreed to cross-party talks in our Westminster Hall debate last week, but that does not appear to be what is on the record. I hope that he is willing to take part in such talks and I would welcome confirmation of that today.

When referring to the wider service community, we must of course mention forces’ families. They put up with an awful lot and we do not do enough for them. We have to make many improvements, particularly in housing, on which the hon. Member for Tamworth made some welcome comments. The Minister has side-stepped concerns about the missing £41 million for forces’ housing, so I urge him to take cognisance of today’s report from the Select Committee on Defence, which sets out the concerns about housing very well. In last week’s Westminster Hall debate, I urged him to think carefully before making any changes to the rules on service accommodation. As he knows, leaked plans to change the entitlement to married quarters were not well received earlier this year. Perhaps he will tell us tonight whether those changes are still being considered.

Our motion makes specific reference to pensions. There are concerns that some individuals have been made redundant with only a few weeks to go before being entitled to a full pension. It has been suggested that that was done deliberately to cut cost. The Minister has the opportunity to say today that that is not the case and that getting rid of people from the forces before they qualified for a full pension was not a deliberate policy. Will he also comment on media reports last week that the Government may be considering raising by five years the age at which forces personnel can receive a full pension?

Many Members, including my hon. Friend the Member for Kingston upon Hull North (Diana Johnson), have highlighted the importance of the defence industry in the UK. That includes a range of industries—shipbuilding, manufacturing, maintenance, aerospace, technical support, clothing and optics. Let me say to the hon. Member for Portsmouth North (Penny Mordaunt), who raised some specific issues, that reports about Portsmouth dockyard have appeared in the media and the shadow Defence team has responded to those reports. I assure her that we share her concerns and we are on the side of her constituents and the people of Portsmouth. My hon. Friend the Member for Barrow and Furness (John Woodcock) made some excellent points about defence procurement and in particular about the successor deterrent programme.

The hon. Member for Milton Keynes North (Mark Lancaster) asked us to explain some of the savings that we have identified. He will be pleased to hear that details of a full £5 billion have been published on The Guardian website, if nowhere else, and I refer him to that site.

I want to say a little about defence in Scotland. This week saw the launch of the “Better Together” campaign—Scotland’s cross-party campaign making the positive case for staying part of the UK. It is a shame that the nationalist spokesperson for defence has chosen not to be present tonight. For more than 300 years, service men and women from Scotland have served alongside their countrymen and women from the rest of the UK, with a shared identity and goal—protecting the people of the UK and defending those unable to defend themselves around the world. The defence sector is extremely important across the whole of Scotland, supporting around 50,000 jobs and in the west of Scotland pumping about £270 million a year into the local economy.

On the “Better Together” website, Members can hear Craig and Tanya, both from Dumbarton, and Robert from Cumbernauld, who all work in the shipyards on the Clyde, talking about why they want to stay part of the UK. If any Members are in any doubt about the importance of MOD contracts to the people of Scotland, I suggest they listen to those whose jobs depend on them. Although breaking Scotland off from the UK is a reform too far for me and for the majority of Scots, we have had a good debate this evening on many aspects of defence reform.

May I say what a pleasure it is to agree with the hon. Member for West Dunbartonshire (Gemma Doyle) in rejecting any idea that Scotland would be better off independent, and how much stronger we are—both Scotland and the United Kingdom as a whole—as a Union?

Many of the contributions to the debate today show how wide and how deep the admiration and respect for our armed forces runs in the House, and that reflects the feelings across the country. We should not forget that the purpose of our armed forces is to succeed on operations, to protect our national security and to provide the ultimate guarantee of our country’s security and independence, as well as helping to project its values and interests abroad. In Afghanistan today, that is what our soldiers are doing, risking life and limb to keep us safe as we sit in comfort in Westminster.

Operations remain the No. 1 priority for the Ministry of Defence and we will do everything we can to achieve success not just in Afghanistan, but in standing operations around the world and in helping to deliver a safe and secure Olympics this summer. But to make sure that this success continues into the future, we have to make sure that our services are structured properly, that the equipment programme is funded and that the needs of our forces are looked after.

That is why the programme of implementing the SDSR is so necessary—putting the years of Labour mismanagement behind and sorting out the mess. Although it appears that the Opposition recognise the need for change, they still do not appear to understand why there is such a need for change. The shadow Secretary of State for Defence—I am sorry he is not here—has written:

“In beginning to develop future policy we have to be honest about the past.”

Today, not one Member on the Opposition Benches has been honest about the mistakes that the Opposition made in the past. Not one has said sorry—sorry for 12 years without a defence review, sorry for the £38 billion black hole in the budget—[Interruption.] The hon. Member for North Durham (Mr Jones) should stop digging. He has been digging quite enough today. Not one Opposition Member has said sorry for ducking the tough choice required to put our armed forces back on track.

I am afraid that in the limited time available I will not be able to address all the contributions to the debate. The right hon. and learned Member for North East Fife (Sir Menzies Campbell) yet again made an impassioned case for RAF Leuchars. It remains our intention that the Army move to Leuchars and the RAF move to Lossiemouth. He asked some very detailed questions. Will he please take those up and I will make sure that my excellent civil servants in the Box bring them to the attention of the Under-Secretary of State for Defence, my hon. Friend the Member for Mid Worcestershire (Peter Luff), who would be better at answering than I would be this evening?

In which case I do not think my hon. Friend the Minister will be writing to the right hon. and learned Gentleman.

The hon. Member for Bridgend (Mrs Moon) made a point about the Nimrod MRA4. It was a procurement disaster. The aircraft were never in service and never flew in service. I say to the hon. Lady and to the right hon. Member for Dwyfor Meirionnydd (Mr Llwyd) that the Government value the Welsh regiments that she spoke about. I have Welsh antecedents. I had a great uncle killed in Gallipoli in the Welsh Regiment and other relatives in the Welsh regiments, so I can assure her that we value the Welsh regiments. I do not know what is in the report. We must wait until General Carter’s report is published, which it will be, shortly.

My hon. Friend the Member for Portsmouth North (Penny Mordaunt) drew attention to misleading statements on the naval base that she attributed to the Labour press office. If that is the case, it is regrettable. We have no intention whatsoever of closing the Portsmouth naval base.

The hon. Member for York Central (Hugh Bayley) raised an important point about audit, accountability and the need to reform NATO. I suggest that he takes that up—I am looking again at my excellent civil servants—with the Under-Secretary of State for Defence, my hon. Friend the Member for Aldershot (Mr Howarth), who is responsible for such matters, and I am sure that he will get back to him on that.

I thank my hon. Friend the Member for Milton Keynes North (Mark Lancaster) for his sensible look at defence strategy and the future of the reserves. I am sure that we are looking forward to seeing him in uniform tomorrow as a serving officer. The hon. Member for Kingston upon Hull North (Diana Johnson) was keen to encourage the defence industry and exports. Three Defence Ministers spend their time going around areas trying to encourage defence exports. My right hon. Friend the Prime Minister was widely criticised, including by Labour Front-Bench spokesmen, when he tried to encourage exports to the middle east. I am very glad to have the hon. Lady’s support. She referred to the economic difficulties that the Government have got themselves into since 2010. I do not think so. I really do not think so.

My hon. Friend the Member for Tamworth (Christopher Pincher) made a good point about housing. We are working on banks and mortgages, as he asked, and BFPO addresses will now be accepted as proper addresses for security. I am very much looking forward to seeing my hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile) on armed forces day in Plymouth this weekend.

I must tell the hon. Member for Liverpool, Walton (Steve Rotheram) that we are not making reductions in the armed forces out of callousness, but with huge regret, and it is painful to us. We are doing it because of the appalling financial situation that the Government received when they took office in 2010.

The hon. Member for West Dunbartonshire is not correct that there is any intention to reduce protection for employment of reservists deployed. I am delighted to hear her praying in aid again my noble Friend Lord Ashcroft. I have never heard praise from the Labour Benches for Lord Ashcroft before, but I am pleased to hear it now. Perhaps she will bring forward an analysis of discrimination. I draw her attention to a letter that has been sent to the shadow Defence Secretary from my right hon. Friend the Secretary of State, which says:

“I welcome the work conducted by Lord Ashcroft…I was reassured that that public support for our Armed Forces remains ‘very high’”.

He particularly says:

“I would welcome a discussion with you on how we can ensure that everything we do in Parliament emphasises our cross-party support for the Armed Forces and the people who serve in them.”

The Opposition probably rather regret calling this debate today. They have made themselves look somewhat foolish. While I remember, may I say how sorry I am to hear about the shadow Secretary of State’s relation in Australia? I understand that he is very ill and we wish him the very best in that illness, and I mean that sincerely. However, having been nice to the hon. Member for North Durham, let me say that he admitted that Labour was planning savings in restructuring the Army and then attacked us for doing just that. The Opposition remain in denial. They seem to say that everything was great in defence at the general election. It was not. As the shadow Secretary of State has identified, the Opposition’s greatest weakness remains the black hole that they left us. Today, the team has been revealed in all its glory. The Opposition have shown that they have no real defence policy. They have no answers to the problems in defence. They have no acceptance of the difficult position that we are in and no acceptance of the mess made by the Labour Government of the Government finances and of the defence budget.

In conclusion—

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Question put accordingly (Standing Order No. 31(2)), That the original words stand part of the Question.