To ask the Secretary of State for Defence what are the implications for United Kingdom defence policy of President Gorbachev's proposed military reductions.

To ask the Secretary of State for Defence what are the implications for United Kingdom defence policy of President Gorbachev's proposed military reductions.

To ask the Secretary of State for Defence what are the implications for the North Atlantic Treaty Organisation's defence strategy of President Gorbachev's proposed reductions in Soviet forces stationed in Hungary, Czechoslovakia and East Germany.

To ask the Secretary of State for Defence what are the implications for United Kingdom defence policy of President Gorbachev's proposals to reduce the numbers of tanks, combat aircraft and artillery systems.

The British Government and their NATO allies have welcomed the reductions in Soviet forces announced by Mr. Gorbachev on 7 December. If implemented, these will be a significant step towards the elimination of the Warsaw pact's large numerical superiorities in conventional forces in Europe. Even after such reductions, however, Warsaw pact conventional forces would outnumber NATO in Europe by approximately 2·5:1 in tanks and artillery. It will still be necessary, therefore, for NATO to pursue its existing policy of maintaining adequate forces to deter aggression while seeking improved international relations through arms control and other measures.

Is that not a complacent and disappointing answer to the question? Does the Minister accept that the proposals are very significant, that they will save the Soviet Union a considerable amount of money, that they will enable it to get rid of obsolete equipment and that they will also be a significant step towards reducing armaments? Can the Government match that with some similar gesture? Is it not time that we got rid of Trident, which is extremely expensive and clearly will not work, as we do not have an independent communications system? Would that not be a significant gesture in the same direction?

The difficulty that we face is the appalling imbalances between the Warsaw pact countries and our own, so there is nothing to be said for balancing this. We want to see continued asymmetrical cuts bearing heavily on the Warsaw pact side. However, we very much welcome this as a good first step.

Is the Minister telling us that, until the reduction in the Soviet Union and Warsaw pact forces passes the level of the NATO forces on the way down, NATO, and the British Government in particular, will not change their defence policy or try to participate in the process of build-down that the Soviet Union now appears to want to initiate? Does he agree that, by the time President Gorbachev arrives on the re-arranged visit to this country, the Government will have prepared no new United Kingdom defence policy in answer to what appears to be a completely altered threat from an offensive strategy by the Soviet Union to a defensive strategy? Surely the Government must have some response to that.

It is much too early to say that the whole Soviet threat has altered. We are seeing a reduction, or proposed reduction, in the numbers of troops, but the military capability of the Warsaw pact, in terms of its equipment, is improving.

Does the Minister accept that the Soviet Union's package of proposals means that NATO should consider revising its strategy? Should not decisions such as those to base more nuclear-capable United States aircraft in this country be delayed until the full impact of the proposals has been taken into account?

No. What we next want to see is progress being made on the conventional stability talks, which will reduce numbers on both sides. There are proposals to reach lower levels, and we are proposing that the number of tanks held by both sides should be 40,000.

Does my hon. Friend agree that, even after the proposed reductions, the Soviet Union's massive superiority in numbers should give us cause for concern? Does he also agree that the demonstration given by the Mig at Farnborough last year shows clearly how the Soviet Union has caught up with the West in technology and ability and that this should also give us cause for concern, because, at one time, we thought that we had superiority in quality?

My hon. Friend is right. Both Flanker and Fulcrum are sophisticated aircraft that have given the Soviet Union a great technological leap forward; we certainly cannot be complacent about the technical capability of the Soviet forces.

Is my hon. Friend aware that there is strong support for the views of the Government and their attitude and reactions to the Soviet initiative, but that there is still a great deal of work to be done on verification, and that the best way of dealing with these matters is through the conventional stability talks rather than through unilateral NATO reductions?

Yes, that absolutely must be true. It is important that the Soviet Union takes up a defensive posture over this rather than an aggressive one.

Does my hon. Friend agree that, while the reductions are welcome, they do not in any way affect the modernisation programme of sea and air-launched cruise missiles that the Soviet Union is carrying out, and that for many years the Soviet Union had a policy of keeping its older tanks as new ones come in and that the equivalent British tanks which correspond to those being scrapped on the other side left service many years ago?

Yes, that is absolutely right. Modern Soviet tanks virtually outnumber all tanks held by NATO forces.

Is it not a fact that Mr. Gorbachev has made it clear that there is real expectation in the Soviet Union that the unilateral cuts will take account of that notion and that there will be new tanks among those that are to be reduced?

I should be surprised if we saw substantial cuts in the number of new tanks held by the Soviet Union. I remind the hon. Lady that it was Mr. Krushchev who said that he would reduce troops by 1·25 million, and that those reductions never took place.

Does my hon. Friend agree that many eastern European countries go some way towards welcoming Mr. Gorbachev's announcement of these withdrawals, but would welcome even further withdrawals from their territory? Can he keep pressure on the Soviet Union to continue talks about the future of the balance between the Warsaw pact and NATO at the conventional stability talks in Vienna?

Yes, we shall maintain all pressure. Several eastern European countries are grateful to see Soviet divisions withdraw, but there are no proposals to withdraw the large numbers of divisions from East Germany.

The Minister said that the number of Soviet tanks which will be withdrawn are predominantly aged. Will he concede that the bulk of the tanks which are at present located in the German Democratic Republic have of necessity to be among the most modern? Given that a large proportion of the tanks which President Gorbachev has said are being withdrawn will be withdrawn from East Germany, surely it would be inappropriate for us further to enhance the instability of the position by going ahead and modernising our tactical weapons at a time when the threat that those weapons are supposed to be meeting will be considerably reduced?

No. As the hon. Gentleman well knows, in practice the Soviet Union is modernising all its weapons systems, so it is important that we maintain the quality of our weapon systems even if we have fewer of them.

To ask the Secretary of State for Defence what is his policy as to the correct balance of tanks and helicopters for the operational effectiveness of the British Army of the Rhine.

rose—

Hear, hear.

Recent operational analysis has confirmed that both the tank and the helicopter have an essential role on the modern and future battlefield. We shall continue to invest substantially in both, but it is not the policy of this or previous Administrations to provide details of future levels of investment.

I welcome my hon. Friend to the Dispatch Box and am delighted to hear him for the first time in the House after his rather long period of enforced silence. May I tell him that the statement made by my right hon. Friend the Secretary of State before Christmas about the Challenger 2 tank has been widely welcomed throughout Yorkshire? Can he tell the House what role the Royal Air Force plays in support helicopters for the British Army of the Rhine? In achieving the right balance of tanks and helicopters, does he accept that, so far as possible, we must ensure that whatever equipment is purchased is the best available and is manufactured in Britain? Does he further accept that there should be no reason why those two points are incompatible?

I am indebted to my hon. Friend for the kindness of his opening remarks. It will be refreshing to give voice in this Chamber more frequently in future. He is right about our decision to commission at the demonstration phase the Challenger 2 tank which has met with a wide welcome in the House and in the world outside, but not in the Kremlin. My hon. Friend asked about command and control of support helicopters. Following a separate study of that question, changes have been implemented that we believe will constitute the best arrangements for guaranteeing support helicopters for land battle, and for providing the necessary confidence to Army commanders that support helicopter assets will be made available and deployed in accordance with their priorities.

While we are on the subject of helicopters, are the Government egging on, or pulling at the shirt tails, of Sir John Cuckney in his bid for GEC?

That matter may arise later, if right hon. and hon. Members are lucky enough to catch your eye, Mr. Speaker.

My hon. Friend may like notice of this question; if so, he will let me know. Do the Federal Republic of Germany's defence forces, and those of the United States, have a much higher ratio of helicopters to tanks than we do? If so, is there a lesson for us to learn from that?

It is not our practice, nor has it been the practice of previous Administrations, to indicate the precise balances of weapons and, in particular, to disclose the numbers of operational aircraft. It is clear that tanks and helicopters are both necessary. Certainly the Soviet Union thinks that tanks are needed, as do the Dutch and the Germans.

To ask the Secretary of State for Defence if he will take steps to ensure that after 1992 there will not be a monopoly supply situation in any branches of the defence supply industry.

The Ministry is committed to procurement by competitive tender, wherever practicable. We will continue monitoring changes to the supplier base and assess their implications for defence on a case-by-case basis.

When my hon. Friend's advice is sought over any bid for defence contractors in this country, and for the Plessey company in particular, please will he bear in mind the partners who may be involved in such a bid— especially in view of the fact that they may have nothing to contribute from a defence point of view—

Order. The hon. Gentleman's own question is about what will happen after 1992.

Following 1992, will we be careful to ensure that we do not make deals with people within the Community that will not be to the benefit of our defence interests, particularly when those concerned have little or no defence expertise of their own? That would mean sharing our secrets now, which might adversely affect our ability to obtain future contracts.

I know that my hon. Friend takes, understandably, a close interest in the defence activities of many of his constituents. I assure him that we shall look carefully at each bid that might arise after 1992, or before, to take account of all the relevant factors, including the ownership of any companies that may be involved in any such bid.

Can the Minister give the House an indication of his Ministry's strategy for ensuring that its procurement programme is not in any sense disrupted or adversely affected by the takeover of companies either now or after 1992?

I assure the hon. and learned Gentleman that we attach the greatest importance to maintaining competition among our suppliers, because we believe that that is the best possible way of promoting efficiency and therefore giving us value for money. We consider any circumstances that may arise, including bids of the kind to which the hon. and learned Gentleman refers, in the light of that strategy.

Important though events after 1992 are, will my hon. Friend bear in mind events prior to 1992? Does he agree that, important though it is to have a non-monopoly, it is equally vital that Britain's largest defence contractor, GEC-Marconi, is not allowed to become partly owned by a foreign state-owned company? Does he accept that many people in my constituency and elsewhere believe that, if that situation were to arise, it would be the height of folly?

I am sure that my hon. Friend will appreciate that it would not be proper or helpful for me to speculate on possible bids which have not yet been made and the nature of which we do not know.

Given that the Minister is looking ahead to 1992, will he enlighten the House with his definition of "monopoly"? I accept the confidentiality of this, but what advice has he been given by the Civil Service about the blocking of bids which might result in large defence contractors which are now under threat being taken over or substantially controlled by foreign creditors?

I hope the hon. Gentleman will agree that only one definition of "monopoly" stands up: when there is only one supplier. That is the one that we intend to stick to.

Does my hon. Friend agree that, both before and after 1992, there is a great deal to be said for big, Great British companies remaining British?

I am sure that my hon. Friend will agree that we can take considerable pride in the competence of British defence contractors. I am sure that we can also agree that we can look forward to continuing to have a flourishing and successful British defence industry.

In 1986, the Government told the Monopolies and Mergers Commission that they were against a GEC-Plessey merger on the grounds, first, that that would reduce competition in defence procurement, and secondly, that it would mean a financial loss to the MOD of between £600 million and £900 million. May we assume that the Government, who pride themselves on being consistent, still hold the views that they propounded in 1986?

As I think is already known, the Office of Fair Trading has asked all interested parties, including the MOD, for advice on the bid for Plessey, and we have provided that advice in confidence in the normal way—

Have the circumstances changed since 1986?

As I have just said, we have provided that advice in confidence in the normal way. Sir Gordon Borrie will make a recommendation to my right hon. and noble Friend the Secretary of State for Trade and Industry on whether the bid should be referred to the Monopolies and Mergers Commission. If there were a referral, we would expect to be asked for our views by the commission, and in due course it would publish a report which would. contain our views.

Does my hon. Friend agree that conditions have changed significantly since the original bid was made? Moreover, when considering, as the question does, the situation after 1992, does he agree that the defence procurement needs of this country will be far better served by companies on a European basis that have the collaborative research strength and base to compete with some of the biggest defence contractors internationally? I very much hope that, for those reasons, my right hon. and hon. Friends will not make representations to the DTI which will prevent the shareholders of GEC and of Plessey from being able to decide for themselves how best to dispose of their assets.

I assure my hon. Friend that the important and relevant factors to which he refers will be fully taken into account in any observations that we make about bids that are made, as opposed to bids that might possibly be made.

To ask the Secretary of State for Defence if he will make a statement on the AOR programme.

There are currently two auxiliary oiler replenishment vessels on order. These vessels, with their ability to replenish both solid stores and fuel, represent a new capability for the Navy. We expect to order further vessels, but no decisions have yet been made on the size and timing of such orders.

When does the Minister expect AOR 1 to be in service with the Royal Navy? In the meantime, will he confirm that Swan Hunter will be asked to bid for the work on HMS Southampton?

On the first part of the question, as the hon. Gentleman will be aware we do not give precise in-service dates for new ships. As he will appreciate, AOR1 is at a relatively early stage of construction, as is AOR2, and it will be two or more years before we expect it to be in service.

Will the Minister confirm that AOR I is proceeding at Harland and Wolff with the ability that it has displayed in the past and that any delays that may occur are not necessarily the responsibility of the main contractor, because some of the larger subcontractors may not be delivering according to the time specifications?

I can confirm that the construction of AOR1 is proceeding. I have been to Harland and Wolff myself to see the work in progress. It would not be helpful for me to speculate about any arguments or disputes that might take place between principal contractors and sub-contractors on any delays or difficulties that have arisen.

To ask the Secretary of State for Defence if he will make a statement on the future programme of orders for tank recovery vehicles.

Subject to detailed contract negotiations, we intend to place an order with Vickers Defence Systems Ltd. for the supply of a further 47 Challenger armoured repair and recovery vehicles in the near future.

Will the Minister accept that, on the Scotswood road in Newcastle, where the six prototype tanks of a heavier type to support the Challenger 2 tank fleet are being built as a result of competitive tender, his statement will be widely welcomed?

I am grateful for the hon. Gentleman's comments and I appreciate that the order for a further 47 important armoured recovery and repair vehicles clearly will represent a considerable amount of useful work for Vickers Defence Systems Ltd.

Could I ask my hon. Friend yet again to look five to 15 years into the future and to look at the potential survivability of the tank and the recovery vehicle? When he comes to the conclusion that many other people have come to—that there is no survivability at all—will he save the money and spend it instead on helicopters?

I congratulate my hon. Friend on his ingenuity in bringing in his argument about the relative values of tanks and helicopters on the battlefield. I assure him that the Ministry of Defence always looks five and 15 years ahead in determining its requirements. It seems that others, such as the Warsaw pact countries, still attach great value to tanks and believe they have a considerable survivability, even on the modern battlefield, because they commit large resources to continuing to produce highly capable tanks.

What is wrong with our tanks, then, that they require so many recovery vehicles?

The hon. Gentleman may be familiar with the fact that, if there were a conflict on the central front—we all hope and pray that there will not—there is a likelihood that some tanks would be hit and would need to be recovered.

Send the AA.

Despite the criticism of my hon. Friend by the Opposition, may I assure him that the order for 47 vehicles is very much welcomed in Shrewsbury, where the engines are made? Can he tell the House whether this generous order—which will bring much-needed work to my constituency—could have been placed if the Government had taken the Opposition's advice and cut conventional defence expenditure?

I am grateful to my hon. Friend for his comments. He is right in identifying the point that such an order not only provides work in the location of the principal and main contractors but for a large number of sub-contractors. He is also right to say that we continually hear Opposition criticism of new orders being placed and suggestions that the equipment is not necessary. If their policies were put into effect, the implications for those employed in the British defence industry would be serious.

To ask the Secretary of State for Defence what discussions he has had with the United States Secretary of State for Defence on the development and deployment of the tactical air-to-surface missile.

We are continuing to study a number of options for the replacement of the United Kingdom's free-fall nuclear bomb. A collaborative approach to the development of a successor system remains highly attractive. In this context, we are keeping in very close touch with the United States Government.

The Government announced earlier that they were interested in the tactical air-to-surface missile. Will the Minister confirm that they are also interested in the nuclear tactical air-to-surface missile which is being developed by the United States Government? Can he also confirm that if the missile is developed, it falls within the same category as the cruise missiles, which appear to be being abolished under the INF agreement?

The answer to the second part of the question is no. The system will be shorter range than anything that comes under the INF agreement. We are interested in this development, but the warhead would be developed by this country.

Does my hon. Friend agree that it is very important to provide a stand-off capability for the Tornado aircraft as soon as possible, because its ability to bomb with conventional or, indeed, nuclear free-fall bombs is being degraded progressively by the increased effectiveness of Russian defences?

My hon. Friend is absolutely right. We do not think that the free-fall bomb will be effective after the end of the century, and we must look for a successor if we are to maintain our policy of flexible response.

Has the Minister seen recent press reports suggesting that Britain is likely to replace the WE177—a free-fall nuclear bomb—with the United States SRAM T system? Can he say whether there is any truth in those statements, and whether discussions are still continuing about the possibility of an Anglo-French tactical air-to-surface missile?

We are very interested in the successor to the ASMP French missile rather than the existing one, which will, I think, be getting very old by the time we are talking about bringing the new missile into service. As for our discussions with the Americans, we are looking at two United States systems, one of which is the SRAM-T—the short-range attack missile. I do not know what the "T" stands for. We are also looking at the SLAT— supersonic low-altitude target—drone. No decision has yet been made, however.

When my hon. Friend meets the United States Secretary of State for Defence will he remind him how necessary it is for American forces to be stationed in Europe, despite the remarks of the West German Admiral Schmäling at the weekend?

Yes, indeed. We are constantly reminding our friends in the United States how essential it is that they remain in Europe, and hoping that there will be no withdrawals by United States frontline troops until agreement has been reached under the conventional stability talks.

Although the nuclear-capable TASM—the tactical air-to-surface missile—is classified as a shorter-range bomb, when the bombs are flown from aircraft can they not be lobbed into the range where the INF agreement applies? In that case, would not the forces be cheating on the agreement?

It is not our intention to breach the INF agreement with the replacement of the free-fall bomb.

To ask the Secretary of State for Defence at what point in the arms control process the Government will be willing to discuss a reduction in the United Kingdom strategic independent nuclear deterrent.

Our policy remains as set out in paragraph 222 of the "Statement on the Defence Estimates 1988", to the effect that if Soviet and United States strategic arsenals were to be very substantially reduced, and if no significant improvements had occurred in Soviet defence capabilities, we would want to consider how we could best contribute to arms control in the light of the reduced threat.

Will my hon. Friend bear in mind that Mr. Gorbachev has been in power for only about four years, and the Communist system remains in its entirety? Will the Government bear that fact in mind when considering future changes in nuclear weapons, so that the future defence of this country may be upheld?

It is true that the offensive capability of the Soviet Union remains, and we must have a deterrent to stop any Soviet attack in the future.

Is the United Kingdom not obliged, under clause 6 of the United Nations nuclear non-proliferation treaty—which we honour and to which we conform—to get rid of our nuclear weapons? Is it not a breach of that treaty and a discouragement of the 135 non-nuclear nations that signed the treaty to deploy nuclear weapons as we do?

The United Kingdom is not covered by the non-proliferation treaty.

Is it not a fact that Mr. Gorbachev has recognised that the United Kingdom nuclear deterrent is not to be included in the nuclear arms control talks at present?

That is true, but what we are supporting is the strategic arms reduction talks, which propose a 50 per cent. reduction on both sides. There is no question of our deterrent being included in those talks.

Does the Minister recognise that we are signatories to the non-proliferation treaty, but cannot be signatories to the first Start treaty, although we could well be signatories to the second Start treaty? Have the Government given any consideration to making British nuclear weapons available in the second round of arms reduction talks, following the early completion of the present round between the Soviet Union and the United States?

As the hon. Gentleman knows well, we put much greater importance on the conventional reductions and the global chemical ban, which we think should come first.

On a point of order, Mr. Speaker. I asked a supplementary question to question No. 10 on the United Nations non-proliferation treaty. The Minister denied that Britain was a signatory to the treaty. Is it possible to allow a correction to Hansard to be made by the Minister because he was incorrect? I know that he is new to the job, but he should be accurate. We are signatories to the treaty. The Minister was corrected by my hon. Friend the Member for Clackmannan (Mr. O'Neill), but the record in Hansard will be misleading. It will show the Minister to be incompetent and will suggest that Britain is not prepared to honour clause 6 of the treaty which obliges us to get rid of nuclear weapons.

Further to that point of order, Mr. Speaker. I said that Britain was not covered by the treaty; I did not say that we are not a signatory to it.

To ask the Secretary of State for Defence when he last had consultations with his United States counterpart on the deployment of chemical weapons.

My right hon. Friend has regular discussions with his United States counterpart on a wide range of defence issues. However, the United Kingdom has not been approached about the possible deployment of United States chemical weapons in the United Kingdom.

Will the Government urge the United States to make a speedy response to the recent Soviet announcement on the elimination of chemical weapons stocks? Will they also urge the United States to come up with a timetable for disposing of its own stocks rather than building them up, as seems to be happening at present?

The hon. Lady should not forget that the Soviet Union has the largest and most sophisticated chemical weapons capability in the world. For 18 years, between 1969 and 1987, the United States observed a moratorium on the production of chemical weapons with no response from the Soviet Union. In fact, it was only 18 months ago that the Soviet Union acknowledged that it had any. The Russians have a long way to go, but I am sure that the United States, like Britain, will be glad of their response.

Does my hon. Friend agree that the rapid progress being made in talks on chemical weapons has a great deal to do with the Government's initiative in the exchange between scientists at the chemical defence establishment at Porton Down and its Russian equivalent last year?

My hon. Friend is right to point to that sequence of events, but it was disappointing that on our bilateral visit to Shikhany we were refused the opportunity to inspect a building that was clearly part of a chemical weapons complex.

Is it not the height of hypocrisy for America to point the finger at Libya when the Americans are continuing to manufacture and to build up stocks of chemical weapons?

The United States is right, as we are, to be concerned about the possibility of Libya acquiring a chemical weapons capability. That regime is a self-proclaimed sponsor of international terrorism and the prospect of it having chemical weapons must be of concern to all of us, including, I hope, the hon. Gentleman.

Is not the only honourable policy to be followed that which Britain followed many years ago—to destroy all stocks of these abominable weapons as soon as possible? Should not any country thinking of building chemical plants abandon the idea immediately?

My hon. Friend is right to point to Britain's record. We abolished our stocks in the late 1950s. However, the American moratorium met with no response and there is always doubt about the effectiveness of such unilateral measures.

Why do the Government always have a negative response to anything that comes out of the Soviet Union? Is it not clear that Mr. Gorbachev has the generals and others breathing down his neck while he is trying to get rid of weapons of all kinds in order to help Russia's economy? Is it not about time that the Government gave a positive response to what Mr. Gorbachev is doing?

We and the Americans have given a positive welcome to what the Soviets have proposed, but, as I have made clear, they have a long way to go and we shall want some assurance, particularly about verification, before we can be satisfied that their proposal will meet the objectives that we all seek.

Are not consultations urgently needed with the American Defence Secretary on the possibility of chemical weapons falling into the hands of terrorist organisations, particularly as one state seems happy to hand over all types of weapons to terrorists? Should not we be intervening to stop that as soon as possible?

My hon. Friend is right. We have close consultations with the Americans on that issue because the proliferation of such weapons in Third world countries which take a different view is a matter of concern to both our nations. The United Kingdom and the Americans are seeking a comprehensive global and verifiable ban, and that will be the best thing.

I welcome the Minister to his new post, particularly after his six years of silence while I have been a Member of the House. I hope to hear some words of wisdom from him, including an undertaking to ask the United States for a commitment to destroy all the 155 mm shells that they have armed to deliver chemical agents on to the battlefield.

I am grateful to the hon. Gentleman for his opening remarks. It must be for the Americans to dictate the pace and choice of their weapons policy. They are keen to achieve a comprehensive ban. It was President Reagan's initiative that brought about the Paris conference last weekend. Their good faith is not in doubt.

To ask the Secretary of State for Defence what are the implications for a North Atlantic Treaty Organisation short-range modernisation programme of President Gorbachev's proposals for military reductions.

To ask the Secretary of State for Defence what are the implications for a North Atlantic Treaty Organisation short-range modernisation programme of President Gorbachev's proposals for military reductions.

President Gorbachev's proposals for a reduction in Soviet conventional forces, if implemented in full, will be a welcome step towards removing the Warsaw pact's significant conventional superiority. However, NATO's requirement to retain the full range of capabilities, nuclear and conventional, in support of its strategy of flexible response, will not change. In order to maintain deterrence at the minimum level of forces, Alliance capabilities must be kept effective and up to date.

Does the Minister agree that the Montebello decision, rather than short-range weapons, is outdated now that we have the Gorbachev proposals? When will the Prime Minister be big enough to match the proposals? If it is possible to remove troops and tanks from central Europe, is it not time to withdraw nuclear weapons too?

As the hon. Gentleman knows, at Montebello it was agreed to reduce nuclear stockpiles and remove 1,400 shells. However, at the same time, it was agreed that it was necessary to put forward proposals to update our short-range nuclear systems and that is what we are examining now.

During the afternoon we have constantly heard welcomes for President Gorbachev's disarmament initiatives together with the response that we intend to do nothing in return. Could we think again and be more imaginative and generous? The Minister knows that the plan for short-range modernisation is dividing NATO and is deeply unpopular in Germany. Here is a chance for us to reciprocate, to say that we shall not modernise, but will attempt to achieve further disarmament. Or are the Government not really in favour of multilateral disarmament?

I must put the hon. Lady right about the deep unpopularity. An agreement was reached to update short-range nuclear systems in October last year. Therefore, there is unanimity on that. If we made other gestures of reductions, we would, merely widen the imbalance between the number of Warsaw pact forces and our own. This is a first step and is welcome, but we want to see subsequent steps which will continue to reduce the imbalance between the forces of both sides.

It would be churlish not to welcome the latest Soviet proposals. However does my hon. Friend agree that so long as the Soviet Union maintains its present enormous numerical advantage over NATO, and while the Gorbachev era is still at an early stage, it would be the height of folly for the West to be lulled into a false sense of security and to beat its swords into ploughshares?

My hon. Friend is correct. The Soviet Union still maintains an aggressive first strike capability in Europe. We must see a change to a defensive posture. That has not yet happened. We must judge the Soviet Union not by what it says but by what it does and by the factual situation in Europe.

Will my hon. Friend remind the House of the lessons of the INF treaty? Is it not the case that without our resolve to modernise our weapons there would be no treaty? Is that not the prime reason why we must press ahead with modernisation, while welcoming any steps that the Russians may genuinely take to lower tensions?

My hon. Friend is right. We must continue to negotiate from a position of strength. Any unilateral gestures would undermine our negotiating position rather than enhance it.

Does the Minister envisage a role for tactical nuclear weapons when a conventional balance is reached?

Yes, I think that as part of the flexible response we shall continue to need tactical nuclear weapons, although, of course, we do not exclude any weapons system whatever in the future.

Will my hon. Friend agree that we have short-range nuclear weapons because of the very large disparity in conventional forces in the field? Will he further agree that while Mr. Gorbachev's proposals are welcome, we would wish to see actual and real reductions before we could ever think of reducing our modernisation programme?

My hon. Friend is absolutely right. We are at present talking in terms of proposals and we have not seen any changes on the ground. We must wait until we see those come through and see subsequent reductions as a result of the conventional stability talks which should be going ahead this year.

To ask the Prime Minister if she will list her official engagements for Tuesday 10 January.

This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Many families in this country are this month facing increases in their mortgage repayments of between £50 and £100 a month. For how long will millions of home owners have to suffer as a result of the Chancellor's blind determination to use one weapon arid one weapon only—interest rates—to control the explosion of credit which the Government have themselves helped to generate?

The Chancellor puts as top priority the reduction of inflation — [Interruption.] I notice that this question is asked by a member of a party which during its term in office never got inflation below 7·4 per cent. The top priority must be the reduction of inflation, and the interest rate weapon is the main one. I should also point out that the Chancellor has a more than balanced budget—unlike the position under Labour Chancellors—and that, too, is a significant feature in his fiscal stance.

To ask the Prime Minister if she will list her official engagements for Tuesday 10 January.

I refer my hon. Friend to the reply that I gave some moments ago.

Those affected by the tragic air disasters that have occurred in the last few weeks, in Scotland and in the east midlands, will be grateful for the interest and compassion shown by the Prime Minister in visiting the sites so promptly. Will she do all she can to guarantee to keep the skies as safe as possible for those who travel by air and for those who live under the flight paths?

I thank my hon. Friend for his remarks. Of course I went to the scene in all cases of recent tragedies and of course we all thank most earnestly the wonderful emergency services—the ambulances, doctors, nurses, police and armed forces who have been helping. They are different teams on each occasion. They are all excellent.

Returning to the question of interest rates, will the Prime Minister reflect on the fact that interest rates in West Germany, which has no oil reserves, are at 3·5 per cent. as against our 13 per cent. plus? Surely part of the reason for this must be related first to an imprudent budget and secondly to our continued failure to join the European monetary system.

No. It is due to years and years of discipline in the German financial system, with the German people accepting that they must, above all, have policies which keep inflation down and that they must watch their unit labour costs accordingly.

Will my right hon. Friend accept that the people of Lockerbie and bereaved families from many countries deeply appreciate her two visits to the town and her support and comfort to all concerned? Will she accept that the visits of her Ministers to the town were also welcome, and that the fact that right hon. and hon. Members in all parts of the House attended the memorial service was also much appreciated? Meanwhile, the thoughts of Lockerbie are with Kegworth and the British Midland casualties.

I am grateful to my hon. Friend. Those of us who went had the greatest possible respect and admiration for the way in which the people of Lockerbie and the local services met the appalling tragedy which befell them one evening, and similarly, for the excellent way in which the people of the east midlands tackled their great tragedy. It is almost impossible to think that we should have two such tragedies in such a short time. If anything was obtained from the disasters it was the marvellous spirit that arose in tackling the problems.

To ask the Prime Minister if she will list her official engagements for Tuesday 10 January.

I refer the hon. Gentleman to the reply that I gave some moments ago.

Will the Prime Minister explain her honour to Mr. Evelyn de Rothschild whose main contribution was to set up in Switzerland to pay less United Kingdom tax?

Order. We do not ask questions about the honours list in the House.

Will the Prime Minister comment on her new proposals for the poll tax? We all know that folk are about to be hammered and hounded for the poll tax. Why should they not resist when the message from the Government's supporters, honoured by the Prime Minister, is "Can pay, won't pay"?

I quite understand that the Opposition oppose the community charge because they do not want readily available criteria by which Labour local authorities can be judged on their extravagant expenditure.

As John McCarthy spends his 1000th day in captivity, will my right hon. Friend reassure the families of British hostages held in the middle east that the Government will use all honourable means, eschewing contact with terrorists, to guarantee their release?

Yes. Our thoughts are very much with the British hostages and their families, particularly at this season. As my hon. Friend knows, we follow up every possible lead on their whereabouts. Our ambassador in Beirut is particularly active in that, but he knows that it is not easy to find answers to those most difficult subjects. My right hon. and learned Friend the Foreign Secretary, during his visit to the Gulf has made it quite clear that we think that the hostages should be freed and that now is the time to do it. The Minister of State, Foreign and Commonwealth Office, my hon. Friend the Member for Bristol, West (Mr. Waldegrave) did the same at his recent meeting with the Iranian Foreign Minister. As my hon. Friend said, we shall not pay ransoms or do deals for hostages. Any civilised nation should do the utmost to see that hostages are released.

First, I strongly commend the efforts so far made on behalf of Mr. McCarthy and others and urge upon the Prime Minister further similar efforts to achieve the result which every civilised person must want.

The right hon. Gentleman will know precisely what is the law passed by this House on any proposed merger. [HON. MEMBERS: "Answer the question."] I must act in accordance with the law passed by the House. Under the provisions of the Fair Trading Act 1973, the Director General of Fair Trading has a legal responsibility to advise the Secretary of State for Trade and Industry on whether a merger should be referred to the Monopolies and Mergers Commission. The Secretary of State for Trade and Industry is required to take into account the advice of the director general in reaching a decision on whether to refer a bid to the Monopolies and Mergers Commission. The right hon. Gentleman should be very much aware that we have to follow the law passed by the House.

I am well aware of the law and the interpretation which the Government have successively put upon the law. I am also aware of the activity of Sir Gordon Borrie. Surely the Government have a view about an issue of such strategic industrial and technological importance. Will the Prime Minister give us the Government's view? Does she consider that it would be in the national interest for GEC to fall into foreign ownership?

The right hon. Gentleman is inviting me to prejudge the result of a legal process which, by law, we must undertake. Is it his policy that we should be able to override the law passed by this House just because he asks us to do so?

As it is impossible to wipe out the knowledge of how to make nuclear weapons, may I ask my right hon. Friend whether, if every country with nuclear weapons were persuaded to remove that capability and if a conventional war broke out and we were winning, she could give a guarantee that the opposition would not use that knowledge of how to make a nuclear weapon to redress the balance—[Interruption.]—

Order.

If my right hon. Friend cannot give that guarantee, is not the best solution for the security of this nation a small, powerful nuclear deterrent?

History has shown that conventional weapons are not sufficient to ensure the defence of freedom in this country. If ever they were totally abolished and a conventional war were to break out again, the race would be on to see who could gain nuclear weapons first and we should be back in the same kind of position that we were in at the end of the last war. Nuclear weapons have kept the peace for 40 years. We should not abandon them until we are sure that we have something even safer to protect us and to deter any aggressor.

To ask the Prime Minister if she will list her official engagements for Tuesday 10 January.

I refer the hon. Gentleman to the reply that I gave some moments ago.

Does the Prime Minister share the concern of Opposition Members that the Government's target take-up of 60 per cent. for family credit has not been reached and that the take-up is currently below 40 per cent.? What do the Government intend to do about that? Will the Prime Minister look especially at form FC1, which has 16 pages, 13 sections and almost 200 questions? That form is unacceptable, unnecessarily complex and should be simplified as a matter of urgency.

The hon. Gentleman is aware—we have debated this subject before—that it is our intention to do everything possible to increase the numbers of those who can claim family credit to obtain it. We have looked carefully and recently at the numbers of people who do not claim family credit. Generally we found that those families that could expect a substantial amount from family credit claim it and that those who do not claim are those who are only on the margin. That is the broad, general conclusion. We do our level best to see that all who are entitled can claim.

During the course of her busy day, will my right hon. Friend take time to speak to the chairman of the anti-British Broadcasting Corporation about the "Panorama" programme that was screened last night, which showed a Sinn Fein spokesman, with an actor's voice dubbed over, attempting—pathetically—to justify the murders of Light Infantry soldiers last year? Will my right hon. Friend ask the chairman of the BBC when the widows and children of those murdered are likely to get a right of reply?

My hon. Friend has made his own point effectively and I have no doubt that it will be noticed in the appropriate quarters. I well remember the letter that I received from the mother of a soldier who has been murdered. Referring to the electronic media she stated:

"They talk about the freedom of the press and the media. Where is freedom of my son?"

To ask the Prime Minister if she will list her official engagements for Tuesday 10 January.

I refer the hon. Gentleman to the reply that I gave some moments ago.

Does the Prime Minister recognise that in the first seven months of this financial year, the Burnley office has used only 17·1 per cent. of the money available in community care grants under the new social fund and that that figure is higher than the figures for some other offices? Does she further recognise that many people in this country are suffering extreme poverty and deprivation as a result of the new system? Will she also acknowledge the words of her right hon. Friend the Secretary of State for Social Services to the Select Committee on Social Services just before Christmas and undertake to hold an urgent review of the procedures and the rules to ensure that such people get the help to which they are entitled as speedily as possible?

We are anxious that people should get the help to which they are entitled. That is the way in which the local offices discharge their duties and the appropriate appeal procedures. The hon. Gentleman will be aware of the enormously increased resources that have been made available for all the social security services, going up from about £17 billion 10 years ago to £50 billion this year—an increase of 38 per cent. in real terms. That is what the Government have been able to do to increase the amount of money available for the poorest section of our community.

As my right hon. Friend comes towards the end of her first 10 years as Prime Minister, will she confirm that during that time we have had exactly 10 Budgets—not one more—and that the reason we enjoy so much greater prosperity today is precisely that the Government have consistently stuck to clear, long-term aims, rather than bending to the latest fashion in economics?

Yes, I warmly endorse that. We shall keep the reduction of inflation as the top priority. I am the first to accept that it is the steady and right economic policies which have greatly increased the prosperity of the people of this country and the amount going to the social services, and which have kept us with a staunch and sure defence.

On a point of order, Mr. Speaker, in relation to Question Time.

Order. I shall take it after the statements.