[Mr Peter Bone in the Chair]
[Relevant documents: First Report of the Defence Committee of Session 2015-16, Flexible response? An SDSR checklist of potential threats and vulnerabilities, HC 493, and the Government response, HC 794; Second Report of the Defence Committee of Session 2015-16, Shifting the goalposts? Defence expenditure and the 2% pledge, HC 494, and the Government response, HC 465; Third Report of the Defence Committee of Session 2016-17, Restoring the Fleet: Naval Procurement and the National Shipbuilding Strategy, HC 221, and the Government response, HC 973; Oral evidence taken before the Defence Committee on 28 February on the UK National Shipbuilding Strategy, HC 970; Written evidence to the Defence Committee, on the UK National Shipbuilding Strategy, reported to the House on 7 March, HC 970; Oral evidence taken before the Defence Committee on 8 and 15 November and 6 December 2016 and 31 January, on Defence Acquisition and Procurement, HC 698; Written evidence to the Defence Committee, on Defence Acquisition and Procurement, reported to the House on 25 October, 1 November and 6 December 2016 and 17 January, 7 March and 24 April, HC 698; Eighth Report of the Defence Committee of Session 2016-17, SDSR 2015 and the Army, HC 108, and the Government Response, HC 311; and Oral evidence taken before the Defence Committee on 12 September and 17 October, on F-35 Procurement, HC 326.]
I beg to move,
That this House has considered the Government’s review of defence capability.
It is a pleasure the serve under your chairmanship, Mr Bone, and an honour to engage with the Under-Secretary of State for Defence, my right hon. and gallant Friend the Member for Bournemouth East (Mr Ellwood), in this vital debate. People throughout the country will remember his empathy, bravery and application when he helped the emergency services during recent terror events not far at all from here. They will not be surprised to learn that he served in our armed forces with distinction before he came to this place. They will recognise the virtues that he displayed that day as the instincts of our armed forces personnel serving throughout the world. We are all lucky to have him representing us as a Minister.
At the battle of Thermopylae some 2,500 years ago, a vastly outnumbered 300 Spartans led resistance against the massed ranks of Persian invaders from the east on a narrow seaside salt marsh only 100 metres wide, while their Greek allies retreated behind them, better to defend their homeland. That Spartan royal guard, who were specially selected for their prowess and the fact that they had sons, and their King, Leonidas, all perished together at those hot gates. They bought their allies crucial time to fall back and regroup, to preserve what they held dear. A famous ancient memorial inscription to them at the site reads:
“Go tell the Spartans…that here, obedient to their laws”
The Greek word for laws that was used is ambiguous. It can mean orders. That ambiguity was appropriate, since at that particular festival time, the Spartans usually observed a strict religious law that was against their normal tradition of military readiness. However, they had been ordered by the Spartan political council to lead this vanguard of the Greek city states’ defence, and they put aside what must have been deeply mixed feelings to do the duty that had been assigned to them, for their countrymen and for wider civilisation. The culture of the enlightenment and the forces enlisted throughout history to help defend it have drawn inspiration from these men, who did their duty for the greater good against all odds.
We all remember Nelson’s final message, that
“England expects that every man will do his duty”,
and his own personal sacrifice for our nation and our allies. Our modern civilisation and modern forces face different challenges and threats, but what does not change is our crack forces’ heroic willingness to go all out, head on and straight at them, to defend each other and what we hold dear. When our modern-day political councils ask what our country should ask of those who are willing to put themselves in harm’s way for us, and how we should help them, we need to remind ourselves of the value of that bond in blood that binds our history and our fighting generations. It is easy for generations whose family memory is distant from the sacrifices our nation made to make the future safe to lose feeling for their importance. However, the modern western civilisation in which we live and into which most nations—even those from outside our tradition—seek to integrate, even while maintaining their own traditions, is founded on a rules-based system that we, as much as any nation, helped to make. We must be prepared to defend it.
Our politics, our freedom and our democracy are worth fighting for, now as always. It is only through preparation, innovation, training and modernisation in our time of relative peace—when the gates are not so hot, as it were—that we will ensure that, should things change, this and successive generations can fight and win.
It is right that in this fast-changing and in many ways increasingly dangerous world we constantly consider how to enhance our capability, capacity and ability to defend the things that we hold dear. The Government recognise that. They have a growing budget for defence and they are committed to the regeneration of our capabilities. They are committed to spending at least 2% of GDP and to grow the defence budget by at least 0.5% above inflation every year. We need to get the most out of that spending and to ensure that our armed forces and other security and support services have the resources, forward thinking and support from our nation that they need to succeed, if at any stage they are called upon. It is right that we, as politicians, in close consultation with our security advisers, military and otherwise, clearly assess our capability requirements in different areas. It is also right that we constantly drive for value for money in the long term, which includes ensuring that we have a highly productive, agile and innovative defence and security industrial base that is a strategic asset and deterrent in its own right. The political councils of our time must take a long-term view and provide consistent leadership on policy in this area for military and security chiefs to implement.
At this time especially, as we leave the political construct of the European Union, we must lead in showing that our European friends and allies have no more dependable, able and committed a partner in defence and security than the United Kingdom. I believe that the people of the UK instinctively understand that and have the overwhelming will and desire to ensure that it remains the case. The vast majority of people across politics get that when it is expressed in this way. Those who rail at the inefficiency of Brussels and its largesse, inscrutable accounting and questionable politics would nevertheless, without hesitation, defend the values at the heart of homes across Europe. Those of almost all shades of political opinion on how we should improve our compatriots’ lot would agree in a heartbeat that the defence of our shared basic values of liberal democracy and the rule of law should be defended in as modern and effective a way as we can muster. Most people understand that those values provide and preserve the certainty that is fertile ground for prosperity and happiness to flourish, and that protecting and nurturing them is a multigenerational and never-ending endeavour for us all to pursue.
I will leave it to others to catalogue the ways in which our ongoing and upgraded sovereign contribution could help to preserve the rules-based structures that nations of the world enjoy, but let us make no mistake: every child, every family and every individual throughout the land should understand that our willingness to stand up for the civilisation that we hold dear is part of what makes us the people we are, and temporary strictures should not be allowed to detract from that. We are proud of our forces and of the people who serve in them, and we want them to be proud, too. We want them to serve, safe in the knowledge that they and their loved ones will be looked after. If we need to spend more to ensure that they know that, then that is what we must do.
We should not underestimate the economic value to our communities of defence spending. That value comes not just in pounds, shillings and pence, or in the form of the 10,000-plus jobs that support families across my constituency, for example. No—the ethos of service, and respect for it, has its own much wider value in society. If we want public servants who are committed and dedicated to often unseen work, they need to know that, even when they are not thanked, we are thankful. If we want people to look out for each other, it helps to think about what we would do to help each other in extremis.
Everyone in our nation has been touched by stories of ordinary people doing extraordinary things in recent moments of need, in Manchester, London, Paris, Brussels and Nice. Our defence personnel, our security services, our police forces and all the other public servants and civilians who leap into action daily inspire us. They, too, are ordinary people doing extraordinary things. Let us think about how we inspire those who make that their life’s work. Let us ensure that we have the most excellent personnel to operate our state-of-the-art new equipment. Let us ensure that they have good pensions and homes. Let us ensure that they are incentivised to give their all.
Colleagues will, I hope, speak about how we used to spend more on defence. I will highlight two aspects of that as food for thought. In the early part of the cold war, we spent 6% of GDP on defence. I do not necessarily advocate spending quite as much as that, and obviously circumstances are different. However, it may be worth noting, at least for theory’s sake, that if the UK were to make up the other EU nations’ deficit of spending against their NATO target of 2% of GDP, we might do that by spending 5.5% to 6% of our GDP.
Some extraordinary new strategic assets are coming into our forces, not least the two Queen Elizabeth class aircraft carriers and their complements of aircraft, which it would absolutely be in our allies’ interests for us to be able to deploy, concurrently, in the European sphere and elsewhere. We should maximise the sovereign usefulness of those assets by making sure we can operate them in battle groups on our own if need be. Our naval programme should be geared towards that, and our defence spending and training of skilled personnel should be upgraded substantially to deliver it.
My community in south Somerset is particularly proud of the contribution that it makes and can make in future through the Fleet Air Arm at Yeovilton and the helicopter manufacturing and wider defence industry supply chain. I strongly believe that the armed forces component of our national security must have a 360-degree ability to deal with all requirements. For me, amphibious capability is an essential part of that. I strongly support the modernisation of our Army and want it to have sufficient trained personnel to be scalable and capable of sustained use, with properly equipped medium-weight strike brigades that can make an essential contribution to allies and that are a strategic deterrent in themselves.
I am conscious that the tempo of operations and lack of proper equipment, at least in the early part of operations in recent middle eastern engagements, put significant pressure on the Army and its families, and that must not happen again.
Helicopters were one thing our forces lacked, and I am proud of the way that my Yeovil community has helped to give our forces proper battle-space protection and mobility with its Wildcat and Merlin programmes. In particular, I note Wildcat’s agility and flexibility in close support operations, versatility over land and sea, and flexible and powerful inter-operation with other key systems in both the naval and army spheres. Although there may be other systems that one might want to add for specific purposes, I believe it would be immensely short-sighted not to upgrade and extend our indigenous helicopter platform capabilities, and indeed support, as the Ministry of Defence is, the development of the next generations of battle-space mobility and protection products.
I appreciate the hon. Gentleman giving way on that point. Does he agree that it would be great to see a defence industrial strategy that really set out a vision for the way in which we procure stuff from the MOD, particularly to support the British steel industry, which is close to my heart, so that we do not see a repeat of the procurement process for the Type 26 frigate, which saw just 35% of the steel in each ship coming from British steel?
I thank the hon. Lady for her intervention. She makes an excellent point. I will come on to industrial strategy in a moment.
I will be working as hard as I can with industry partners to raise the tempo of productivity and innovation to match the commitment from the Ministry of Defence. Defence should be a fundamental part of our industrial strategy for both military and economic reasons, and I stand ready to work with Ministers and their Departments to ensure that we get this right and that proper account is taken of these matters during the defence and security review.
So what are the arguments against spending more? There are those who say we do not have the money. I wish a strong signal to go to the Treasury and Cabinet Office from this debate that it is a false economy not to give defence what it needs to regenerate a full 360-degree capability at this time. We could certainly use a few billion pounds a year currently given in international development, with overwhelming popular support and much greater domestic economic impact.
I have made other multibillion pound suggestions for savings to the Chancellor for his upcoming Budget, which I look forward to discussing with him again. To those who say we have other priorities, I say that this Government more than any other have focused spending on defence and on regeneration of our capabilities, and that this success needs to be reinforced. Economic value added to our communities and inspiration to our people and our allies should be top priorities for us at this time.
To those who say we do not have the will, I have never underestimated the ingenuity, good humour and grit of the British people. We should not hide our light under a bushel. I believe most of our fellows citizens would be proud to see it shine as a beacon for all to rally around.
I will conclude now because I want to allow time for others to speak. We all have a duty to do what we can to keep ambitions for our civilisation open to the next generations. There are some things worth fighting for, and we need excellence in the fight for them in all aspects of what we do every day. We have a duty to honour those who have gone before us. Giving our defence what it needs now is part of defending what they held dear.
The House might like to know that the winding-up speeches will start at 4 o’clock. Only four Members have written to say they wish to speak. I shall take those Members first and then get in as many others as I can.
I congratulate the hon. Member for Yeovil (Mr Fysh) on securing this debate via the Backbench Business Committee, and I was pleased to be able to support it. It is incumbent on all Members to thank our armed forces for their contribution. They do a heroic job all year round keeping us safe and defending our citizens and allies. As the son of a submariner I know from experience how important the armed forces are, not only for my family who relied on the money brought in to help us when I was growing up but for Plymouth, which is the area to which I will restrict my remarks on the upcoming defence review.
Members will know that since the election in June I have mainly spoken in this Chamber about the paucity of the shipbuilding strategy, the offshoring of our Royal Fleet Auxiliary builds, which should have been done in UK shipyards, and the lack of detail on our Type 31 armaments. My concern is that we will have a lightly armed fishing patrol vessel rather than a fully capable frigate. I am concerned about the loss of HMS Ocean, particularly its helicopter-carrier capability in littoral waters close to the coast. Then there is the issue of wages and veterans and the need to invest more in our frigates and escort carrier fleet. There was a lot of support for that and I am grateful to Members of all parties who encouraged me to continue speaking on these matters.
My concern about the upcoming review is about the potential for hollowing out capabilities, particularly around the Royal Navy and Royal Marines. Devonport in my constituency is home not only to half our frigate fleet, but to the deep maintenance facility for frigates, submarines and our amphibious assault ships. We already know that HMS Ocean is due to be scrapped, creating a capability gap in helicopter-carrier capacity in littoral waters, but the rumours and speculation that HMS Bulwark and HMS Albion, two world-class capable amphibious assault ships, also face the axe is deeply concerning to those people who have an interest in not only Devonport and Plymouth, but in our national security, which is where I want to focus for a moment.
Having assured access capabilities and the ability to project force and deter our enemies via amphibious assault ships is absolutely a key component of our Royal Navy’s full spectrum capability. As we have the precedent of HMS Ocean, one of our three amphibious assault ships, being cut, I am concerned that we could further erode or scrap altogether our amphibious capabilities. Tying up either Albion or Bulwark alongside in Devonport has reduced our capability in that respect, which is deeply concerning.
Once the amphibious capabilities have been removed, there is a logical step forward threat to the Royal Marines. I note from recent speculation in the media that up to 1,000 Royal Marines also potentially face the axe. We need to be really clear that the amphibious capabilities provided by the Royal Navy and the specialist forces in the Royal Marines are absolutely essential.
I am grateful to the hon. Gentleman for giving way. He talks in great detail about what is going on in Plymouth, but I should make it clear, in case other hon. Members pick up on speculation about what may or may not be happening in the review, which I hope to elaborate on, that no decisions have been made at all. I know hon. Members will want to get things off their chest and share their concerns, but no decisions have been made about any of the ships the hon. Gentleman has mentioned so far. Any decisions to be made are quite some distance off.
I invite the Minister to take this opportunity to rule out cuts to our amphibious forces in that respect, because—
No decisions have been made.
I think it is entirely possible for Ministers to set a strategy and direction in which the country will preserve its amphibious assault capabilities. The forthcoming defence capability review should be able to match that, to be honest.
My concern about what is happening to amphibious assault ships is matched by the concern of many people in Plymouth after the experiences of the past couple of years: not only the closure of Stonehouse barracks, but the cut to 42 Commando Royal Marines, and the loss of the Royal Citadel and HMS Ocean. No decisions have yet been made about the future basing arrangements for the Royal Marines, and I invite the Minister to talk about when a decision will be made. The possibility that without an amphibious assault capability in Devonport the Royal Marines could be moved out of the city is a matter of deep concern to me and to those who have served, especially those who were based near the spiritual home of the Royal Marines at Stonehouse barracks.
HMS Albion and HMS Bulwark are incredibly capable, world-class ships. They are due to be out of service in 2033 and 2034 so there is still a lot of life left in them. It is important to consider the context of the defence review. I am concerned that, without the normal detail that comes with a strategic defence and security review, the mini-review will look simply at cuts, rather than at the upcoming threats that the country faces. I am concerned particularly about the rise of Russia and its influence in the Arctic. For quite some time our amphibious assault ships and the Royal Navy have been good at deterring Russian aggression, or Russian possession of Arctic waters. That issue needs to be looked at.
I am also concerned about the figure of 2% of GDP for defence spending. It is a line that I hear from Ministers a lot. The Minister will know that the gaming of the 2% figure by the inclusion of war pensions produces a situation in which we are not spending 2% on defence. I should welcome it if the Minister would adopt Labour’s position of removing those gamed elements and spending an actual 2% on defence. I am sure that that sentiment would be echoed by hon. Members throughout the House. Would the Minister rule out cuts to our amphibious force, explain briefly how the capability review will mean a greater number of frigates and, importantly, more capable frigates—with a decent offensive and defensive armament package on the Type 31s, in particular—and address what the review means in the context of post-Brexit Britain? A strong and robust full-spectrum UK capability is vital to enable us to project our power, so that we can have a distinctive beacon status as a nation after Brexit, and so that we can fulfil our obligation to our NATO allies, particularly with Russia flexing its muscles, both in cyberspace and in military space, in relation to its near neighbours.
I invite the hon. Gentleman to clear something up; he talked a lot about cuts in the military. He knows my position on that. I have advocated on that matter for a long time. However, the debate must be in the realms of honesty. Since April 2016 the money going into defence has been increasing and it is at 2%. It is going up by half a billion pounds a year. I do not understand how that fits in with his narrative of cuts happening all the time. Surely our defences should be dealt with according to threat and capability, rather than with a constant narrative of doing down our armed forces.
I am grateful for that intervention, which gives me an opportunity to direct the attention of the House to the comments from the hon. Gentleman about the gaming of the 2% that I believe appeared in the media recently. It is important to base the debate on capabilities, and I have clearly done that in my remarks. As we approach the latest round of defence cuts—
If it would be of use to him, the hon. Gentleman might apply to the Ministry of Defence for a useful fact sheet that it has provided to me. It clearly states that as of 2016 our defence budget was £34.3 billion, but that by 2020 and 2021 it will be £39.7 billion. How is that a cut?
I invite the hon. Gentleman to visit Plymouth, where I can show him Stonehouse barracks and the Royal Citadel, which are shortly to be closed, and HMS Ocean, which is shortly to be scrapped. The key point that I was making in my remarks, which I shall happily repeat so that it will not be missed, was about the capabilities of the Royal Navy and Royal Marines. It is in the matter of capabilities that we need to preserve our world-class excellence. I am grateful and thankful to the people who serve in our armed forces; I know many such people, and members of my family have served in that area as well, so I am cautious about how I talk about the issue.
I have asked, both in Plymouth and nationally, for cross-party working to make a robust case to the Government opposing cuts to our amphibious assault ships in the future. [Interruption.] I know there has been some laughing about this but, after the interventions that I have taken during my speech, I do not expect, in a few months’ time, the Ministry of Defence, the Government or the Royal Navy to announce any loss of our amphibious assault ships. I implore the Minister to cement and celebrate the world-class contribution that HMS Albion, HMS Bulwark and the Royal Marines make to the United Kingdom’s amphibious assault capabilities, and protect them in the capability review that is coming up. I should be grateful if the Minister would address the concerns that I have raised about the Type 31 frigate, in particular.
It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate my hon. Friend the Member for Yeovil (Mr Fysh) on securing this important and timely debate and I echo the comments that he made about my right hon. Friend the Minister, whose recent actions in trying to save the life of an injured police officer are an example and inspiration to us all.
I welcome a review of Britain’s defence capability. There is, after all, much to review. We should review whether we are really meeting our 2% of GDP NATO spending commitment. We should review the woeful situation that means that we cannot commit to enduring brigade-size multi-theatre operational deployments. We should review what the future of defence capability and procurement will look like if we do not continue to support and encourage the expertise and world-leading skills that we have in our country and our industry. We absolutely must address the shortfall in the current defence equipment budget. I understand that that is about £10 billion over 10 years or so. I agree with other hon. Members that we must significantly increase defence spending, for several reasons: first, the defence of the realm and the protection of our people is the first duty of any Government; secondly, we must do it for vital strategic reasons; and, finally, the armed forces are the jewel in the crown of the country, and the best of Britain. Defence spending increases our industrial capability and the ability to defend ourselves, but it is also a fantastic vehicle for social mobility and advancement for people of all backgrounds.
A few weeks ago, I visited the Kurdistan region of Iraq. I was immensely proud to meet elements of 2nd Battalion the Mercian Regiment, who are there training peshmerga forces. That is one of the many contributions that we are making in the fight against Daesh, and it is a clear demonstration of our armed forces’ global reach. Needless to say, ours is not a peaceful world: we can see threats from an emboldened Russia, a belligerent North Korea, and the remnants of the Daesh death cult. There is also always the possibility of unforeseen threats. History demonstrates that we rarely see where the next conflict will come from. It is therefore unwise, at the very moment when we are launching ourselves back into the world as an independent, free and sovereign nation, to penny-pinch on our national defence expenditure.
The 2% NATO obligation, which I am pleased to see the Americans are urging all our NATO allies to take extremely seriously, was a welcome commitment from the previous Prime Minister. However, it may inadvertently have given our forces false hope. It is now clear that we achieve 2% only by a recent change in how we measure, and what we include in, our defence expenditure. The inclusion of forces pensions and efficiency savings diminishes the value of the 2% in terms of real defence capability. I hope sincerely that the review will address those matters and lead to a realistic increase in defence expenditure. However, regardless of how much is spent on defence in future—and we must spend more—the result must be forces that are truly capable, with the ability to project both hard and soft power globally.
Currently our armed forces cannot deploy at brigade level to two major operational theatres simultaneously and enduringly. That means that we could not today undertake Iraq and Afghanistan-type operations simultaneously. That is a massive reduction in our global power, our status and our military capability and credibility. We must be able to deploy in more than one operational theatre simultaneously and enduringly at brigade level if we are to be—or remain—a nation of some worth. We need the ability to project the full spectrum of our capabilities on land, sea and air without having to be part of an international coalition, as we did successfully in Sierra Leone and the Falklands.
It is not just about the deployment of two brigade groups but about the follow-on forces: those that come six months later, and six months after that. We have to have sustainment. Sustainment is what guarantees us a decent result.
I thank my hon. Friend for his excellent intervention. I was careful to use the word “enduringly”. We could possibly throw 10,000 troops around the world to do a short operation simultaneously, but the important point is about doing so over a reasonable period of time and enduringly.
As long as we have a funding settlement that forces commanders to choose between equipment and recruitment, the armed forces will remain severely restricted and hampered in their capabilities. I suggest that the restraint on our current defence capability must be reviewed as a matter of great urgency. Such discussions normally lead to the question of equipment and its provision. Better, more realistic funding will help buy more equipment in the mid-term, but we must think in strategic terms. If the review does not lead to increased investment but further limits the spending power and capability of our forces, we may soon discover that it will be more difficult for our country to remain a world-renowned centre of defence and aerospace excellence and expertise, never mind having the ability to defend our people here and abroad.
I have the interest and great pride of representing a constituency that has a very large number of successful and highly skilled defence and aerospace companies, the largest among them being Rolls-Royce, Airbus and GKN. As an example, Rolls-Royce represents 2% of all UK exports by value. We must build on and increase that. Filton and Bradley Stoke is also home to Defence Equipment and Support at MOD Abbey Wood, which employs about 10,000 people and does a fantastic job in procurement and equipping our armed forces across the world.
The most obvious example of the threat to our sovereign defence industrial capacity is the recent announcements from BAE. From conversations I had with representatives of Rolls-Royce in my constituency just a couple of days ago, I know it is concerned in the wake of those announcements. The RAF Typhoon jets have a predicted service life of until about 2040. That may sound like plenty of time, but the delivery of the next-generation fighter could take two decades from start to finish. Also, without such defence contracts, as well as clarity on what the Government’s plans are and sufficient funding, companies such as Rolls-Royce are in danger of losing skilled personnel capable of delivering such contracts. In recent conversations the company was unequivocal in its fear that once the capability and skills are lost, in many cases they are lost for good.
I am pleased that recent responses from the Ministry of Defence have confirmed that it understands how important the review is to British industry and our sovereign capacity to equip our armed forces properly. I would therefore like to ask the Minister when progress will be made on committing to the next-generation fighter. That is vital to safeguard the expertise we need and the capacity and capability we require for future generations.
The review comes at a crucial time. If done properly, and acted on, it will reinforce and strengthen our sovereign defence capability at a time when we are reasserting ourselves on the world stage. Crucially, in the end, wars are not won, and nations are not defended, by equipment alone; we need people. The Army has a severe manpower shortage, the Royal Navy is fearful of being unable to man our aircraft carriers and the Royal Marines are very concerned about potential cuts to our amphibious capabilities.
I call on the Minister to show real courage and leadership. A failure to increase resources would see Britain losing both its technical expertise and international credibility. In short, it would serve to entrench a dire situation and diminish our place in the world—and, crucially, our ability to defend our people.
It is a pleasure to serve under your chairmanship, Mr Bone. I thank the hon. Member for Yeovil (Mr Fysh) for bringing forward this important issue for discussion.
I welcome the review of defence capability and hope that it will address some of the serious shortcomings of the current strategic defence and security review, which was published only a few years ago. As we know, the 2015 SDSR does not take into account issues regarding Brexit in any shape or form and it therefore requires urgent revision in the current climate.
We have often said that the SDSR is hugely ambitious. However, in recent years the Government have failed to manage the defence budget effectively and get best value for the taxpayer. There are gaping holes in the existing budgets. There is an £8.5 billion black hole in the defence estate strategy budget and a £4 billion hole in the defence equipment plan. As many in the Chamber know, the National Audit Office warned at the beginning of the year:
“The risks to the affordability of the Ministry of Defence Equipment Plan are greater than at any point since reporting began”.
The National Audit Office also noted the lack of room for unplanned cost growth in the equipment budget and the vulnerability to changes in foreign exchange rates, which are significant, with £18.6 billion for equipment that has to be paid in US dollars. The Prime Minister’s own former security chief, Mark Lyall Grant, has warned of a stark impact on UK national security and the military’s spending plans in the event of a Brexit downturn in the coming years.
As many Members will know, in Scotland, the Tories have slashed 20% off our defence estate, and Army personnel numbers are at an historic low. What is more, in Scotland we still have no conventional ocean-going vessels in our waters, and we have had no maritime patrol aircraft since the scrapping of the entire Nimrod fleet.
I am grateful to the hon. Gentleman for taking an intervention. Will he acknowledge the significant investment in my constituency at RAF Lossiemouth, with the P-8 Poseidon aircraft, which is replacing the maritime aircraft scrapped in 2015? That is a huge investment by the UK Government in a Scottish airbase that will make Lossiemouth one of only three fast jet airbases in the whole of the United Kingdom.
Again, that is part of an ongoing campaign by the previous Member for the hon. Gentleman’s constituency, who highlighted on so many occasions the loss of the maritime aircraft capability.
Will you welcome that investment?
Of course, we welcome that, just as we welcome the contribution of other countries in the northern Atlantic. I believe Norway has also taken on a number of P-8s. It is important that we have that level of cover. Other Members have mentioned capability, and the critical issue is how we spend our budget, so as not to keep ramping up a misspent budget.
We are now in the absurd situation in Scotland that we do not have a single maritime patrol aircraft, and neither do we have any ocean-going surface vessels to defend our own waters. Let us not forget the ludicrous scenario in February 2014, when The Scotsman reported that the MOD had had to use Twitter to gather information about a Russian warship moored in Scottish waters over the Christmas period of 2013. That was not only a national embarrassment; it reflects the utter inadequacy of the UK’s defence capabilities.
As a member of the all-party parliamentary group for the polar regions, I have a particular interest in the Arctic and high north. The Defence Committee published a report in 2015 called “Flexible response? An SDSR checklist of potential threats and vulnerabilities”, which identified Russian aggression in Europe and the high north as one of the potential threats facing the UK. In evidence given to the Committee in 2015, Tim Reilly, founder of the Arctic Advisory Group, highlighted the importance of a UK presence in the Arctic and high north, yet the UK has gone AWOL in the region. That is not good enough for Scotland and for the UK. It should be a bread-and-butter activity and military priority to defend our own shores and coastlines.
The cuts in defence—some Members have said that there are no cuts—have been made to fund the Tory obsession with Trident. In 2010, the national security strategy downgraded the threat of nuclear weapons conflict, yet the SDSR failed to downgrade the role of nuclear weapons and military capability in that area. It is high time the Government prioritised conventional defence capabilities instead of weapons of mass destruction, which I think we all pray will never be used. We issue the reminder again that Trident skews every single part of the defence budget, across three services, and that the project should be abandoned.
Almost all the promises made to Scotland on defence during the independence referendum have been broken. It is clear to us that the Government cannot be entrusted with the defence of the UK or Scotland. Only this week, we heard that the Type 31 ships, promised in 2014 to workers on the Clyde, may now be built on Merseyside. For those workers, their trust in the Government lies at zero. I urge the Government to commit to publish the findings of the review by the end of the year. Beyond that, we need as a matter of urgency a new live-within-our-means SDSR that takes account of the repercussions of Brexit for today and beyond.
I am grateful to my hon. Friend the Member for Yeovil (Mr Fysh) for securing this important debate. I must start by saying that my constituency will be at the heart of any discussion of defence capability. Aldershot, the home of the British Army and with a significant garrison, welcomes some of the specialised infantry battalions that will be formed in response to the SDSR 2015. In Farnborough, the birthplace of British aviation, we have a significant number of world-leading defence industry companies, which export their world-class manufactured goods around the globe.
In the brief time that I have, I will express two things. First, I hope that this review will be about more than just kit and equipment. When we consider responding to the threats this country faces around the world, our attitude should be one of energetic and ambitious global engagement. I saw a good example of that last weekend—I refer hon. Members to my entry in the Register of Members’ Financial Interests—when I travelled to Bahrain with several other hon. Members to see work being done on the new Royal Naval base, HMS Juffair. It is a remarkable facility, which will accommodate the four mine countermeasure vessels that are already out there, and will allow our aircraft carrier to be serviced via tender. It is a phenomenal capability multiplier and a tangible commitment to the security of an important ally. That is the kind of model we should apply elsewhere—not just in the Gulf, but around the world.
It is an attitudinal thing. We must ask the question: “If we do not have the resources to facilitate that commitment in the Gulf states and beyond, should we perhaps invest in them?” It will be money well spent.
My hon. Friend makes an important point about an attitude, with which I entirely agree. Under this Government, we are seeing for the first time an increase in the defence budget by 0.5% each year. We have a growing defence budget, a new naval base east of Suez again, Type 31s giving us the opportunity to increase platform numbers on the fleet, and new aircraft carriers. Under this Government we see an increasing defence budget and increasing defence capability.
Absolutely; I am very grateful for that intervention. What is impressive, when travelling to the Gulf—
Order. If the hon. Gentleman faces more toward the Chair, the Minister will hear better and the microphone will work better for the recording.
I will gladly afford the Minister the opportunity to listen. I agree with my hon. Friend the Member for Witney (Robert Courts). When travelling in the Gulf, as the Minister and others will know, it is reassuring that they recognise the tangible commitment to our collective security. There is a return on the investment that is more than the value of the vessel itself. I hope that that attitude, and our requirement to invest in that attitude, will be recognised in the review, because it could apply elsewhere, such as Libya or Iraq. If that recognition is to be meaningful, however, it must be joined up with our foreign policy. For example, there is no point in our having military engagement with Iraq while simultaneously closing our consulate in Basra. We should be energetic and ambitious, but that must be part of the whole package, alongside our foreign policy.
My second point is that I hope the review will recognise the strategic importance of our defence industries in enhancing our global position. I have talked about the naval base, but I want also to mention the export of Typhoon to our allies in the Kingdom of Saudi Arabia. That has not been without controversy, but having travelled to Riyadh to visit the targeting centre, where targets in Yemen are assessed and allocated, I was most impressed to see NATO doctrine in use and a large number of British-trained members of the Saudi royal air force and army. Because we are involved, and not another supplier such as China or Russia, they have the benefit of our doctrine of responsible use. We do not only sell them aircraft, but we export a doctrine of responsible use. I know that the Saudis are grateful for that, and it is a tremendous strategic benefit to us.
I was with my hon. Friend when he visited. I point out to the House that the Saudi pilots we spoke to would often abort their mission immediately if they felt there was any danger of so-called—I hate this phrase—collateral damage; in other words, civilians being killed. That was good to hear.
I agree entirely with my hon. Friend. We should have the confidence to double down on those relationships. BAE Systems successfully supplied the Typhoon to our allies in Saudi Arabia, and it has been very effective operationally. We heard recently that BAE Systems has signed a memorandum of understanding with the state of Qatar for 24 Typhoon aircraft. I hope that more exports can be achieved throughout the region. It is the right thing to do not only commercially, but strategically and morally.
We have now heard from all those hon. Members who notified me of their wish to speak. It may help new and less experienced hon. Members—I know that some are less experienced—to know that the same rules apply in Westminster Hall as in the Chamber: you should notify the Chair if you wish to speak.
I congratulate the hon. Member for Yeovil (Mr Fysh) on securing the debate. I will concentrate on the particular aspect of defence and industrial capacity relating to his constituency: helicopters. It has long been understood that that is an important sector—those with long memories will remember that Michael Heseltine walked out of the Cabinet over the issue. It was also important to me. I recall that early in the coalition Government we had a deputation from the six leading aerospace companies, which pointed out that the British capacity in aerospace manufacture was gradually declining because of a lack of commitment to research and development. Helicopters were very much part of that story. On the back of that, we launched the aerospace growth partnership, a £2 billion joint research programme that did a lot to revive the sector.
The current Defence Secretary was a stalwart supporter of that programme, and of the defence partnership that was a key component within it. We also provided substantial funding through the regional growth fund to enable what was then AgustaWestland to diversify into civilian aircraft while maintaining its military capacity. Although it is seen as a niche industry, it is an important one—I think current figures suggest that about 10% of British aerospace exports come from the helicopter subsector within the industry. There is a massive supply chain; about 17,000 jobs depend on it. For the part of the country that the hon. Member for Yeovil represents, south Somerset, it is fundamental to its future as a regional economy. The industry’s health is a matter of great importance.
However, there are clouds on the horizon, as the hon. Gentleman knows well. There was a decision two years ago on Apache replacement, and he will recall that, contrary to the advice from the Business Department, his predecessor for Yeovil and others, the Government went ahead with procurement from the United States rather than from Yeovil. Since then, the pound-dollar exchange rate has deteriorated by 18%, which makes it a rather less clever decision than it may have seemed at the time. There are now doubts over the Wildcat platform. The company has a potentially excellent long-term future built around unmanned helicopters, but it needs time, resources and steady orders to maintain its capability.
I agree with much of what the right hon. Gentleman says about past Governments’ actions. In the light of that, does he agree that it would be odd to decide to scrap the Wildcat, of which we have about 60 and which is an exportable helicopter with a high degree of flexibility, in order to keep the Pumas, which are not made in the UK, are not exportable and are old, about to retire and less flexible and capable?
The right hon. Gentleman is right. The Wildcat programme is of great advantage, and it is of considerable concern to the industry that its future is now in question as a result of the opening in a very open-ended way of the procurement programme by the Government.
I want to leave the Minister with one question. Can he say quite explicitly that the helicopter sector is an important part of the industrial strategy? If he can give that statement and commitment, that is rather important. This is the only part of the whole aerospace sector where there is a completely integrated system, from R and D upstream, down to manufacture in the UK. If that is lost, an industry that is crucial to defence and to the economy is lost.
As time is so pressing, and so many people wish to speak who do not get as many opportunities as I do to speak on this subject, I shall just raise a few brief points.
First, I wish to place on record the gratitude of the Defence Committee as a whole to my hon. Friends the Members for Beckenham (Bob Stewart), for Filton and Bradley Stoke (Jack Lopresti) and for North Wiltshire (James Gray) and the hon. Member for Dunfermline and West Fife (Douglas Chapman), who served on the Committee in the last Parliament, for everything they did to buttress the strength and depth of our inquiries and conclusions. We are very grateful to them all.
I would like to raise the following questions. What is this review about? Who should be able to scrutinise the process? What should we be spending on defence? What is our concept for defence? Is our decision-making process adequate to produce a strategy? Is our soft power adequately resourced? The answers necessarily will be inadequate.
The answer to the first question—what is this review about?—is: I do not know. It is about either increasing the money, sorely needed for defence, or further cutting capability in order to balance the books. I know which of them I should like it to be, and I know which I fear it will be.
Who should be able to scrutinise the process? This process is being carried out by the National Security Adviser, Mark Sedwill. The Defence Committee has applied to have Mr Sedwill appear before us, but the initial response has not been encouraging. It is being suggested that the Joint Committee on the National Security Strategy would be the appropriate body for the National Security Adviser to appear before, notwithstanding the fact that National Security Advisers have appeared before us previously. I hope wiser counsels will prevail there.
What should we be spending on defence? I thank my hon. Friend the Member for Yeovil (Mr Fysh) for not only initiating the debate, but making the point very well about what percentage of GDP we used to spend on defence. We used to spend the same on defence as we spent on education and health in the 1980s. Now we spend two and a half times on education and nearly four times on health what we spend on defence. Although we are spending more on defence, defence has indisputably fallen down our national scale of priorities.
What is our concept for defence? That was ably set out by the Labour-led strategic defence review of 1997-98, which came to the conclusion—at a time when we were not facing a threat on the continent of Europe—that we needed an amphibious taskforce and a carrier strike taskforce in order to form a sea base that could go anywhere in the world. I hope to reassure the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) by quoting to him from what the Minister for Defence Procurement wrote in a letter deposited in the House of Commons Library in January, after I raised the question of the future of HMS Albion and HMS Bulwark on the Floor of the House. She said:
“There are no current plans to decommission the ships early, and I can reassure you that their out of service dates are 2033 and 2034 respectively.”
It would be diabolical to take ships with that amount of life left in them and retire them early.
I absolutely agree with what my right hon. Friend said, not least because he is my boss on the Defence Committee. To take Albion and Bulwark out of service would be an absolute false economy, and I very much hope that the Minister will convey that back to the Department.
The idea that anyone could be my right hon. Friend’s boss on the Defence Committee is polite, but fanciful.
Is our decision-making process adequate to produce a strategy? In a word, no. We have got to a situation where the chiefs of staff are too divorced from strategy-making. They are then left to have to make cuts in capacity themselves, while they are not able to get together to thrash out a joint strategy in the way that the Chiefs of Staff Committee traditionally did.
Finally, is our soft power adequately resourced? It could be, but the signs are not promising. For example, we produced a report entitled, “Open Source Stupidity”—I think that is probably the first time the word “stupidity” has appeared in an official Select Committee report title—referring to the fact that, for £25 million a year, we need not close the BBC Monitoring centre at Caversham. It is not too late to reverse that extremely stupid decision; and I am glad that the Foreign Secretary, the Chairmen of the Foreign Affairs Committee and the International Development Committee and I will have the opportunity to visit that excellent establishment soon, in the hope that we can, even now, prevent that folly from proceeding.
Order. A number of Back Benchers are still trying to catch my eye. While I cannot extend the debate, I will shorten the time for the Front Benchers. The winding-up speeches will now start at 4.6 pm, to give more Back Benchers a chance.
It is an honour to serve under your chairmanship, Mr Bone. I thank the hon. Member for Yeovil (Mr Fysh) for securing the debate.
I will constrain my remarks to a specific element of defence policy, which is the recently published national shipbuilding strategy, in the context of previous policy with regard to the shipbuilding strategy in the United Kingdom and, in particular, the terms of business agreement signed between the Ministry of Defence and what was then known as BVT in 2009 and subsequently known as BAE Systems Surface Ships Ltd. I would appreciate it if the Minister made specific reference to how that terms of business agreement has been formulated into the current national shipbuilding strategy.
I was alarmed to read that document and learn of key omissions that have not been carried over from the TOBA to the national shipbuilding strategy—most notably, the definition of any key industrial capability with regard to the shipbuilding industry. The key industrial capability for shipbuilding is defined as being to
“design, build and integrate…a complex warship of up to 5,000 tonnes deep displacement at an interval of 1 shipbuild every 12 months and a design interval of every 6 years”
“contribute to the sustainment of sovereign capability”
through the provision and maintenance of facilities and key post workers in the shipbuilding sector.
I was alarmed to learn that the Type 31 frigates should be competitively tendered, which essentially breaks clause 39 of the TOBA between the Ministry of Defence and BAE Systems because it jeopardises that long-term drumbeat of work. It also makes no reference to the achievement of upper quartile performance in the national shipbuilding industry. That upper quartile performance was defined as a benchmarking exercise that would determine the optimal design, build, combat systems integration and through-life support infrastructure in the UK that would be in the upper quartile of all firms engaged in the industry worldwide. I would like to know why those terms and definitions have not been sustained in the current national shipbuilding strategy.
I had the privilege of working in the shipbuilding industry, following in the footsteps of my grandfather and father, and was heavily involved in the development of the benchmarking exercise during my time at BAE Systems. That included development of the design of a shipyard on the Clyde that would deliver exactly what I have referred to: the key industrial capability at an upper quartile performance level. I was rather alarmed to learn that that will no longer be invested in. That means that we will no longer be able to achieve a build interval of one shipbuild every 12 months or a design interval of every six years. That capability has now in effect been surrendered by the Ministry of Defence, as is clear in the current shipbuilding strategy. I would like to know why that has happened and why the business case demonstrating that delivery of that capability was perfectly financially viable has not been upheld. What long-term financing options have been considered beyond current in-year spend to deliver that long-term build capability? I would be grateful if the Minister elaborated on those issues.
We have six minutes and three people.
I shall be brief, Mr Bone.
This is like wandering into a group of the last of the big spenders. I do not share the view of most of my colleagues that we should be spending more on defence. Moreover, I am always very suspicious of Members of Parliament who come and represent their constituency interests in these sorts of lobbying exercises. Therefore, I was loth to contribute to a debate that is about, from my point of view, the question of helicopters, which the leader of the Liberal Democrats raised, but I have looked into it a bit and I find, to my surprise, that I can reconcile what I want to say both with my views about defence expenditure and with the national interest rather than my constituency interest, which happen, on this rare occasion, to coincide.
I understand that, as part of the review, the Government are, rightly, considering reducing the number of kinds of helicopter that are run by the armed forces as a whole by at least one. I welcome that, because I am perfectly sure that we run too many kinds of helicopter, which is a very expensive way to do things. I understand that the choice may come down to one between the Puma and the Wildcat. As my hon. Friend the Member for Yeovil (Mr Fysh) mentioned, the Wildcat is built in his constituency. Many of my constituents work in the Leonardo factories that produce it. It is a relatively modern—in fact, very modern—helicopter. It is highly flexible, small, agile, armed with the latest equipment and highly exportable. It is also highly usable on the new light frigates, which unlike most of the ships of our Navy, which I persist in believing will never be used in the whole of their lives, are likely to be used, because they are small and agile themselves and may be useful somewhere in the world. They would be a great deal more use if they had helicopters on them, and those helicopters are ideally suited to that. The Army also uses them. They are very new, as I said; they have many years of life ahead of them. We own roughly 60 of them.
The Puma, by contrast, is a much bigger thing, which the Royal Air Force loves. I bear the scars, as I think the right hon. Member for Twickenham (Sir Vince Cable) and my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) do, of a previous defence review, in which we found a sort of gang of all the top brass. They appeared, with spaghetti all over them, at the National Security Council, and persuaded us to invest in cats and traps and things on those very large aircraft carriers, and to get rid of the vertical take-off planes that we then had, the Harriers, because the Royal Air Force loves big fast jets. I fear that the Royal Air Force may also love those large helicopters, but they are not built in Britain. They are aged. They will be disappearing quite soon anyway. They do not carry the latest equipment. We cannot put them nearly so easily on ships.
I think it would be a travesty if we ended up getting rid of the 60 modern, light, effective, flexible, British-built, exportable helicopters, for the sake of keeping 22—if I have the number right—ancient, foreign-produced, non-exportable, heavy RAF helicopters. I very much hope that the Ministry of Defence will not make that mistake.
It is a pleasure to serve under your chairmanship, Mr Bone. I, too, welcome the debate secured by my hon. Friend the Member for Yeovil (Mr Fysh).
I want to put on the record some positive points about defence and defence spending in Scotland. GMB Scotland reported in July 2016 that almost 14,000 people were estimated to be employed at MOD installations in Scotland and that MOD employees support 20,687 jobs and £473 million-worth of wage payments in Scotland alone. That contrasts with some of the more negative points that we heard from the hon. Member for Dunfermline and West Fife (Douglas Chapman). He went on to talk about the Clyde. The Clyde is getting 20 years of work building the eight Type 26 anti-submarine frigates. That is what this Government are investing in Scotland. The hon. Gentleman also mentioned the Type 31 contracts. Scottish yards will be able to apply to build those frigates like any other yards across the United Kingdom, so it is important to put that on the record.
I again welcome the investment in my constituency; I also did so in my intervention. RAF Lossiemouth will be a key focal point for the UK’s defences with the arrival of the P-8 Poseidon aircraft. That will bring 400 new jobs and will involve £3 billion of investment over the next 10 years. That is crucially important to my constituency and very welcome.
The UK has one of the biggest defence budgets anywhere in the world. Scotland benefits from that, and I am sure that under this review it will continue to benefit.
I shall be brief, Mr Bone. There is a realism that we need to bring to this debate. A capability review starts with what sort of country we want to be, what sort of role we want to play in the world, and the strategic situation that we face; and the only thing that is changing is the strategic situation that we face, which is getting worse. The Development, Concepts and Doctrine Centre puts state-on-state warfare as a major threat; it is slight now, but growing and will be becoming severe in the next 20 or 30 years. That is the context in which this debate should be seen. We keep hearing, peppered throughout the debate, the noises from colleagues who are complaining that capability is being cut on an arbitrary basis because there is not enough money in the budget. These are not strategic decisions; they are decisions taken to match a year-on-year target, so the impression being given is that the defence budget is really being planned only one year ahead, with the consequences of these cuts.
Let us look back over the last seven years. The coalition Government inherited a black hole in the defence budget of £35 billion. Coupled with George Osborne’s 8% defence cash cut to the headline figure, that meant that we reached 2015 already having suffered a real-terms cut of 17% in the defence budget, regardless of the ongoing pressure of defence cost inflation. Recently, we have suffered the collapse in the value of the pound against the dollar, as has been said; and looking five and 10 years ahead, we are facing another black hole in the defence budget, which will have severe consequences, because the big equipment programmes that tend to dominate defence expenditure are crowding out investment in technology and people. Always it is manpower that takes the cut to protect the big equipment programmes.
We need to concentrate not just on how we are to strategically improve the defence budget to protect the existing programmes. If we are to have such a limited defence budget, we need to learn how to spend more on people, technology and industrial capacity, to be able to build the equipment that we need for the campaign that we are in, rather than finding ourselves with the equipment that we ordered 10 years ago, which is inappropriate for the campaign that we now face. We need to invest more in the people, who are, in the end, the absolute force multiplier in any crisis that we face. It is a big challenge, but if we continue on the present trajectory, the situation will just get worse.
I am not a religious man, but it is proof that God is smiling on us when you are in the Chair, Mr Bone. I congratulate the hon. Member for Yeovil (Mr Fysh) on securing the debate and giving a very thoughtful speech at the start.
Like other hon. Members, I pay tribute to members of the armed forces, the first responders to the events that happened here and across Europe earlier this year, and of course to the Minister. He knows that although we have disagreements, I have great respect for him. I am a fan of his. I think he is a thoughtful Minister and I look forward to his summing up the debate.
The review is welcome. It is of course necessary. However, as has been mentioned, we hope that it leads to a new SDSR, because the previous SDSR, which other hon. Members have mentioned, does not take account of the currency fluctuations and does not take account of Brexit. We need a proper review of our strategic assets.
The Government need to be a bit more transparent on this. I was concerned to hear what the Chairman of the Defence Committee, the right hon. Member for New Forest East (Dr Lewis), adumbrated earlier on the lack of engagement from those involved in the review. It would be good if the Minister secured that for the Defence Committee when he leaves the debate today.
The big thing that we need to look at is our own back yard. As the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) and my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman) mentioned, we are AWOL in the High North. It is an area where we are not just letting ourselves down, but letting our allies down as well. It has to be a high strategic priority, and this review and the subsequent SDSR that we think should happen must address that. The total absence of major surface vessels anywhere in Scottish waters, and the continued reliance on our allies, should alarm every single Member of this House. They are our waters and we have a duty to protect them.
I also want to address the 2% spend on GDP. It is, frankly, the most creative accountancy that I have witnessed in some time, including efficiency savings and pension contributions, as has been mentioned. Let us be clear: the 2% that the Government claim is an example of the books being well and truly cooked.
There are too many glaring and serious problems for one mini review to handle: a black hole in the equipment plan; inadequacy of the defence estate; dilution of the national shipbuilding strategy, as mentioned by my fellow Glaswegian, the hon. Member for Glasgow North East (Mr Sweeney); threats to the Royal Marines; uncertainty over amphibious assets; and the impact of Brexit—the list is alarmingly long. If the review is to be honest, and if it is to be worth the paper it is written on, it will lead to a new SDSR and it should be published before the end of the year. I look forward to hearing what the Minister says in his summing-up speech.
It is a pleasure to serve under your chairmanship, Mr Bone.
This is an important debate, and I congratulate the hon. Member for Yeovil (Mr Fysh) on securing it. It comes at a very appropriate time, as has been mentioned, because the Ministry of Defence, the Cabinet Office, the Treasury and other Government Departments are currently conducting a review of national security capabilities. My first question to the Minister, echoing what others have asked, is about whether he can indicate when that report will be published and what exactly its terms of reference will be. As I understand it, the strategic defence and security review will be, to use the Secretary of State for Defence’s phrase, “refreshed”. Will the Minister confirm that that will dovetail into the review of national security capabilities?
We know that a review is necessary because the Ministry of Defence is facing enormous problems. The SDSR 2015 is built on the premise that there will be sufficient efficiency savings, but as we all know those savings have not been identified. I know that the MOD was hoping for savings in the defence estate, but very little has come from that direction and, of course, there is the deprecation of the pound following the decision on Brexit. In fact, the Royal United Services Institute recently warned that there will be “substantial financial implications” for defence as a result of the weakening pound. In August, RUSI warned that the MOD faces extra costs of up to £700 million a year in the wake of the Brexit vote and the pound’s fall against the dollar. The National Audit Office recently pointed out that there is
“little room for unplanned cost growth”
and has expressed concern about the current defence equipment plan’s vulnerability to foreign exchange rates.
The problem is that approximately £18.6 billion is going to the United States in dollars. Rather than placing an emphasis on developing our own industrial defence capacity—our sovereign capacity—the Government are buying a whole raft of new equipment from the US for the Navy and the RAF: the F-35s, nine P-8 Poseidon maritime patrol aircrafts and 50 Apache attack helicopters, all from the United States of America.
We buy equipment and weapons from the United States because they are better than the equipment and weapons we can produce here, and those of us here all want our armed forces to have the best. That is the reason we do it: we do not have a choice if we want to help our armed forces.
That highlights the short-term thinking of the present Government. What we really need is an industrial defence strategy that invests in the skills and capabilities of our own indigenous industries, so that when choices have to be made we can choose, quite rightly, to have our own capability enacted and not bought off-the-shelf from abroad.
The Government regularly come out with their platitudes that defence expenditure increases every year, but let me be clear that the MOD faces a financial crisis. We are told by the MOD’s permanent secretary that over the next 10 years the MOD will have, in his words, to seek out and secure £20 billion of efficiency savings. He says that notwithstanding increased budgets,
“our ambitious equipment program will not be affordable without”
those efficiency savings. I do not believe it is realistic or, indeed, honest to talk about that level of efficiency savings. I note the comments by Sir George Zambellas, the admiral and former head of the Royal Navy, who recently said to the press:
“There is a suggestion that there’s lots more efficiencies to be made. There are not. I’ve been helping deliver efficiencies for my 37 years in the navy. We have reached the bottom of the efficiency barrel and we all know that, because the Navy is so hollowed out. It hasn’t got enough missiles and spares. It’s very short of the integrated support that is needed as a single service.”
Those are damning comments by someone who does not have a political axe to grind, but takes an objective view of the very real crisis that the Navy, in particular, faces.
Indeed, it is clear that the MOD is already involved in planning for a fresh round of deep and crude cuts. As we have all seen, there have been reports in the press that the Royal Marines may be cut by 1,000 from their present 6,500. Earlier this year there was confirmation that Plymouth’s 42 Commando, one of the last specialist Royal Marines fighting units, was withdrawn from frontline service. The amphibious fleet may face decommissioning, with HMS Albion and HMS Bulwark both potentially becoming part of history—I refer Members to the excellent early-day motion 391 in the name of my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard). I ask the Minister to listen not only to what I am saying, but to what all Members have said this afternoon about how important it is to maintain that amphibious capability, and I urge him to give a commitment today that those two ships will not be considered ripe for cutting.
This is all occurring, as I said, at a time of crisis. The Navy personnel stands at 2% under establishment. There is a particular problem in the Navy with skilled personnel and engineers. The RAF is 5% under strength, and we had the very bad news last week that nearly 2,000 skilled, well-paid jobs will be lost with BAE Systems. One of the reasons it has given for those redundancies and the cutback in capacity that has taken place, is the slowdown in production of the Hawk aircraft. I would reiterate what was asked for this week and ask the Government to bring forward an order for nine new Hawk aircraft for the Red Arrows. As well as the crises in the Navy and the RAF, we are seeing a crisis in the Army, which is 5% understrength. I remind hon. Members—
Order. I am sorry to interrupt the shadow Minister, but I am afraid I cannot let him speak for longer than the Minister will be able to, so I hope he is about to finish.
I am about to wind up. I remind Members that the Conservative manifesto for the 2015 election said that the Army would not fall below 82,000 people. It has: the latest figures show that the Army is down to 76,680, which speaks for itself. There is a very real crisis.
In conclusion, I ask the Minister for an honest statement about the real problems that our armed forces face today. Can we have a commitment that the short-term—
Order. I am not having this—the hon. Gentleman must sit down.
I am grateful for the opportunity to speak today, Mr Bone. It is a real pleasure to be able to draw some thoughts and conclusions together on this important, interesting and timely debate. Like others, I pay tribute to my hon. Friend the Member for Yeovil (Mr Fysh), who has shown passion and a detailed understanding not only of what is going on his constituency, but of the wider picture of the defence capability. I congratulate him on bringing this debate to the fore. Looking around the Chamber, I recognise that there is an officers’ mess worth of experience, commitment and understanding of what the armed forces has done and is doing, and of where we want to go. It is a pleasure to respond to this debate.
I give hon. Members the apologies of the Procurement Minister—the Under-Secretary of State for Defence, my hon. Friend the Member for West Worcestershire (Harriett Baldwin)—who would otherwise be here. However, I take a personal interest in these matters, so I grabbed the opportunity to share some insight about what is going on. This has been a wide-ranging discussion and as I have said, if I am not able to answer some questions, I simply will not be, but I will write to hon. Members, as I have before.
All hon. Members, including my hon. Friend the Member for Yeovil, began by paying tribute to our brave and professional armed forces. As a former Regular Army officer, and indeed, a reservist, I stand with all in paying tribute to those who, when there are so many opportunities in the world today, choose to wear a uniform, to step forward and be counted, to stand and defend our country and to do the things we see, whether that is in the Caribbean or in the floods, or by going into harm’s way. We think about what it means to be British, what Britain is and what our reputation is, and that is shown in the professionalism that our armed forces display.
As a nation, we have an aspiration and the ability to shape the world around us and to play a role on the international stage, and that comes about because of what our armed forces can do. We are recognised as the world’s leading soft power because our professional armed forces are respected and revered not just by our allies, but by our adversaries. We follow a transparent agenda and in a changing, challenging world, leadership is needed on the international stage. I think we can all agree that we want our armed forces to continue to play that role in shaping this very challenging world.
We need to face some big questions, many of which have been raised today. I join right hon. and hon. Members in recognising the important economic value of our industrial base—not just in defence and aerospace, but in a wider context—in the economics of this country. However, we face a fiscal reality and my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) made the situation clear, taking us back in time to the legacy fiscal issues that we have inherited, which are still very real today. My hon. Friend the Member for Yeovil touched on the important wider duty of care that we have to our armed forces. I include the whole family—the partners, the wives, the husbands, the children, the cadets and the reserves. It is important that we look after them not only when they are in uniform, but further afield, when they finally move back into civilian life as our respected veterans.
Before I come on to the national security capability review, which is the core of our discussion, I will respond to a couple of points. The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) spoke about the importance of the Type 31e. It is a simple design that is intended to have bespoke changes put on to it. It is designed for export. That is why it seems simplistic compared with the Type 26, the frigates, the destroyers and so on.
I am grateful to the Chair of the Defence Committee, my right hon. Friend the Member for New Forest East (Dr Lewis), who made the future of HMS Albion and HMS Bulwark clear. We should not forget the amphibious capabilities in the Bay class, as was illustrated in our response to the recent hurricanes in the Caribbean.
My hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) spoke about our commitment to 2%, which I can confirm. I am pleased that other nations are catching up with us to meet that important commitment. We want that to continue and, as many hon. Members have said, we are increasing our budget by 0.5% above inflation. That is very important to recognise.
My hon. Friend the Member for Aldershot (Leo Docherty) spoke about the importance of our footprint across the world. There is not only HMS Juffair, which I am pleased that hon. Members were able to see; we have a footprint right across the Gulf and in other places, including in a transitional or temporary mode. We are operating in and have exercises in 20 locations from Nigeria to the Balkans, to further afield in Poland with a resurgent Russia, to the Caribbean and not least, to the skies of Iraq and Afghanistan.
The right hon. Member for Twickenham (Sir Vince Cable) asked important questions about helicopters. If I may, I will ask the Procurement Minister to write to him in more detail.
My right hon. Friend the Member for West Dorset (Sir Oliver Letwin) spoke about the number of platforms, and I agree with him. We have more than a dozen different helicopter platforms, if we count them all up, which is too many given all the procurement lines, software upgrades and training packages. That needs to be simplified.
On the national security capability review, we need to step back and remind ourselves that the SDSR 2015 was the blueprint for our security—for meeting terrorism, the growth of terrorism and extremism, state-based aggression and cyber, and responding to those who undermine the rules of international order—but there have been changes. We have had five terrorist attacks in this country, a resurgent Russia, the activities of North Korea and cyber-attacks on our health service, on companies and on Parliament itself. That is why the capability review is required. As I said, there has been much speculation, but the details will come through in the new year. I am sure that Parliament will be involved in the usual manner, including through the Select Committee.
The review will be Cabinet-led and have 12 strands, of which the defence aspect is simply one part. It is important, however, to recognise that any armed forces must adapt to and evolve with the times. We need to understand what the right balance of scale, readiness and reach is, and what our enablers to provide that support are. Where do we place those assets, not only so they are ready to be used but as a deterrent?
I will leave a minute for my hon. Friend the Member for Yeovil to conclude, but I am sure that we can all join in saying that we are very proud of our—
Before the Minister sits down—
I will not give way to the hon. Gentleman. He took far too much time—
Answer some questions then.
I will not give way to the hon. Gentleman. I have made that clear—
Answer some questions.
Order. The hon. Member for Caerphilly (Wayne David) is not in my good books at the moment. Yelling from a sedentary position is not acceptable.
The hon. Member for Caerphilly (Wayne David) has successfully eaten into more of my time, so I think he had best remain seated.
To get back to the point, we are all committed—I hope even the hon. Member for Caerphilly—to working hard for our armed forces and ensuring that they have the equipment they need and that we provide support for personnel. Yes, in politically difficult times, that is tough, but we will work hard to ensure that we meet the armed forces’ requirements.
I thank all hon. Members for turning up to this important debate. We have heard that since SDSR 2015 the challenges have increased and so has our need to project our capabilities and to make them available to our allies on a full-spectrum sovereign basis. We heard from many Members about the energy we need and about our potential deficiencies, not least in integration with industrial strategy, which in defence must be an essential consideration.
Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14)).