When he plans to meet the US Defence Secretary to discuss European security and defence policy. [148218]

If he will make a statement on European defence co-operation. [148219]

I met the United States Defence Secretary on 3 February at the annual security conference, in Munich. European security and defence was one of several issues that we discussed. On 14–15 December 2000, the North Atlantic Council welcomed the conclusions on European defence of the European Council, at Nice. The Council re-affirmed its determination to reinforce NATO's European pillar and stated that it shared the goal endorsed by European Union member states at Nice of a genuine strategic partnership in crisis management between NATO and the EU.

In view of the Secretary of State's very last comment and the fact that the Prime Minister said last week that it would be his policy to strengthen defence inside NATO, can the Secretary of State explain how those comments square with the St. Malo Anglo-French agreement, which asserted:

"The European Union must have the capacity for autonomous action, backed by credible military forces",

"recourse to sustainable military means … outside the NATO framework"?

It has always been quite clear that any significant operation involving the European Union would look, first of all, to NATO for its operational planning and, indeed, for NATO assets. Equally, however, it has always been recognised, as is the case today of course, that individual member states might join other EU member states for small operations distant from NATO—for example, ones involving humanitarian relief, which is central to the Petersberg tasks. In those circumstances, the St. Malo agreement is wholly consistent with the current position. Indeed, it is wholly consistent with the position that the hon. Gentleman undoubtedly supported when the previous Government were in office.

When the Foreign Secretary said last week that the European defence force would remain "securely anchored" in NATO, how did that sit with the documents signed at Nice, which said that

"the entire chain of command must remain under the political control and strategic direction of the EU",

No, they are not. It is clear that decisions taken by the European Union can be taken only by European Union member states. In a sense, therefore, the hon. Gentleman is stating the obvious. As I said to the hon. Member for Chipping Barnet (Sir S. Chapman), there will be circumstances in which—for small, humanitarian-type operations, consistent with the Petersberg tasks—the European Union may well choose to act alone, as member states could do now.

Does my right hon. Friend agree that if we are committed to a strong future for NATO, the United Kingdom Government must use their key position in Europe and their special relationship with the United States to prevent and deal with misunderstandings and to help to deliver a stronger European Union defence capability? Does he also agree that the two things that threaten NATO's future most are, first, European nations not delivering greater operational effectiveness for NATO; and, secondly, the anti-European rantings and scaremongering of Conservative Members?

I agree with my hon. Friend that it is important that we maintain a strong defence within NATO, and that we strengthen NATO's European pillar. That argument was first advanced by President Kennedy on behalf of the United States, and successive United States Administrations, including the new one, have made it quite clear that it is vital that the Europeans are more capable of being responsible for their own defence. Sadly, Conservative Members want to be completely isolated, not only in the European Union, but in the wider European area. Of the 25 states gathered together in the aftermath of the Brussels capability conference, not one did not want to participate in improving European defence; in the unlikely event of Conservative Members ever again taking power in the United Kingdom, this country would be the only one in the whole of Europe.

Is my right hon. Friend aware that, on Friday, President Chirac said that development of European security and defence

"se fait et ne peut que se faire en complete harmonie avec I'OTAN."

Order. I do not think that the Minister needs to answer that question.

Does the Secretary of State agree that the relationship between the United Kingdom and the United States on defence and security issues goes beyond NATO, is deeper than that between any other two NATO partners, and that development of a common European security policy should in no way necessarily break that special relationship? Is it not also true that the best way of ensuring the survival of the Atlantic alliance is for the United Kingdom to be the lead nation in developing the European defence and security policy? Will he pursue that matter?

I agree with the hon. Gentleman in that series of comments. It is vital that we maintain our excellent relationship with the United States and, indeed, with the new United States Administration. As the hon. Gentleman will be aware, my right hon. Friend the Foreign Secretary was in the United States in the past week. In the course of a number of conversations with various members of the new Administration, positive support was given to the efforts that European nations are making to improve their contribution to NATO. Specifically, Secretary of State Powell said:

"I can tell you that within the Bush Administration the President and I and Secretary Rumsfeld and Dr Rice and others think we have a very good understanding of what the European Security and Defence Initiative is all about: an effort on the part of our European friends to increase their capability for rapid reaction in Europe and wherever the need might arise. And we support that goal."

The Secretary of State now wants to claim anyone who has ever spoken vaguely about anything in the past. He is claiming President Kennedy; soon, no doubt, it will be Napoleon and Alexander the Great. Is not the reality that, at that very meeting, the US Defence Secretary raised serious concerns? Are not my hon. Friends right when they talk about the Government leading the process from start to finish, hand in hand with the French and the Germans? Will he comment on the fact that, today, Mr. Scharping has said:

"As the European Union develops its security and defence policy and becomes an independent actor, we must determine our security policy with Russia, our biggest neighbour"?

If the hon. Gentleman looks carefully at the words he has just used, he will see that they amount to everyone else in history, and currently, being wrong apart from the present Conservative party. If the Conservatives thought more carefully about how isolated they are on matters European, it might give them some credibility when addressing the issues. Frankly, the hon. Gentleman talks about isolation when he cannot find a single country anywhere in the European continent that supports his position on European defence. That is pretty desperate.

The Secretary of State never bothers with the facts. At Nice, the Government signed some undertakings: first, that EU forces would be both autonomous and independent of NATO; secondly, that the planning of operations would take place outside of NATO; thirdly, that the EU will make the first decision on what it will do and then may consult NATO; and, finally, that political and strategic control of the forces will stay with the EU, not within NATO Is not the reality that the Government are, as ever, saying one thing and doing another? In Washington, they are saying, "Trust us, we will stop this happening", while back in Europe, they are saying, "Don't worry boys, we love everything about it"?

If the hon. Gentleman wants to deal in the facts, he had better get them right. It has been made clear that operational planning will be a matter for NATO and there will be agreement between the EU and NATO to ensure that we do not develop duplicate facilities. Operational planning will be the firm responsibility of NATO. That has been agreed between NATO and the EU and is part of the underpinning that we have negotiated to ensure that there is no inconsistency between European defence in the EU and European defence as part of NATO.

If he will make a statement on the involvement of KFOR as a consequence of Albanian insurgency into Macedonia and southern Serbia. [148220]

We can be justly proud of the contribution British forces make to the multinational effort to bring peace and stability to Kosovo.

Why is it that marauding Albanians, rightly apprehended by British members of KFOR, are dispatched to the Americans at camp Bondsteel?

Forces operating in Multinational Brigade (East) are reinforcing the United States efforts but are, of course, under the control of MNB(E). Camp Bondsteel is the main centre for that. We do not have sufficient facilities available there to detain those numbers of people.

Have the new United States Administration given any indication about whether they intend to withdraw their forces from Kosovo? If they have, or they do so in the near future, are European forces capable of filling the gap?

The United States Administration have clearly indicated that they are evaluating their worldwide commitments. They have also indicated that they will not be taking any precipitous action, particularly in the Balkans, and that they will have discussions with allies on any changes that they might propose, following the evaluation that any new Administration would quite naturally make.

My hon. Friend may be aware that the Select Committee on Foreign Affairs was in Yugoslavia last week. We heard some very positive proposals by the Yugoslav Government to try to defuse the problems in the Presevo valley and to allow co-operation between the Yugoslav army and KFOR to deal with extremists while bringing moderate Albanians in Presevo more fully into public life in Yugoslavia. How are we responding to those proposals and making sure that KFOR responds positively as well?

I understand that the Foreign Affairs Committee was impressed with the work being undertaken in Kosovo. We certainly welcome Belgrade's willingness to address these issues constructively and have noted Serbian Deputy Prime Minister Covic's proposals. NATO has taken these concerns seriously. We are also considering further measures and the NATO Secretary-General has had an exchange of letters with President Kostunica.

Clearly, there are no quick fixes in the Balkans but there may be slow fixes. Will the Minister assure the House that the professionalism and dedication of British troops on the ground will be matched by the determination and support of the Government for as long as it takes?

Yes.

If he will make a statement on progress in the implementation of the strategic defence review. [148221]

The Ministry of Defence is continuing to make excellent progress in implementing the long-term programme set out in the strategic defence review. More than half of the key measures have already been completed. The large majority of the remainder are on track and we remain committed to ensuring that the strategic defence review is implemented in full.

Does my right hon. Friend agree that in implementing the SDR, the Government have had to take account of failings in defence equipment brought into service under the previous Government? Is he aware that since the review, and as a result of the significant new investment that this Government have made, those failings are either being repaired or have been repaired, and that the Chief of the Defence Staff himself, Sir Charles Guthrie, has confirmed that British forces are well equipped?

May I take this opportunity of publicly congratulating the Chief of the Defence Staff, Sir Charles Guthrie, on his impending retirement? I thank him on behalf of the four Secretaries of State for Defence whom he has served under two Governments. Most importantly, however, I thank him on behalf of the British people and Her Majesty's armed forces for a career of distinguished and unfailing service.

Will the Secretary of State confirm that, instead of expanding the regular Army by 3,000, as planned in the strategic defence review, the numbers have dropped slightly, and that the proportion of soldiers who are unfit for combat service has increased? Will he also confirm that we have a shortfall of one sixth—17 per cent.—in RAF fast-jet pilots, an even larger proportionate shortfall in Royal Navy fast-jet pilots and that the serviceability across all our major classes of aeroplanes has declined since the SDR was published?

The hon. Gentleman gives an accurate account of the problems that we inherited. We have sought to resolve several issues, not least improving retention. Recruitment remains buoyant for the Army, and we are on track to deliver the manning required by the Royal Navy and the Royal Air Force under the strategic defence review.

One of the aims of the strategic defence review was improvement of performance in the public service. My right hon. Friend the Secretary of State will be aware that the work force at Clyde submarine base, in my constituency, have shown commitment and loyalty over the years. Given the latest exercise in saving on expenditure, can my right hon. Friend assure me that he will take seriously the combined trade union response on the future of the work force? Can he assure me that he will not hand the work force lock, stock and barrel to Babcock Rosyth Defence Ltd. or the private sector, but have a public-private partnership to improve the stability and efficiency of the base now and in the future?

I am grateful to my hon. Friend. He and I have held a meeting to discuss proposals to make our systems of warship maintenance and support still more efficient. I have received various suggestions from him and from the trade unions. We are also working closely with the employers to ensure that whatever support we give to the Royal Navy will be the best value for the taxpayer.

May I associate Her Majesty's Loyal Opposition with the Secretary of State's thanks to the Chief of the Defence Staff? I congratulate General Sir Charles Guthrie on his retirement and his distinguished career. I am sorry that he is retiring, as he told us this weekend that the European Union rapid reaction force would not have a fighting role during his lifetime and that the military should not be undermined by barmy ideas. Why is the Secretary of State determined to ignore his chief military adviser and press ahead with deeply unpopular plans to peg military pay to politically correct targets rather than military effectiveness?

I thank the hon. Gentleman for his remarks about General Sir Charles Guthrie, but he should put Sir Charles's comments in the correct context. The Chief of the Defence Staff was, as the hon. Gentleman well knows, referring to war-fighting capability, and the Government agree with what he said. War-fighting is the kind of activity that we expect NATO to carry out as a result of our collective defence obligations. General Sir Charles Guthrie was quite right to refer to the fact that it is unlikely that the EU will have a war-fighting role. European defence is about crisis management and the Petersberg tasks, not war-fighting.

What the level of underspending in the defence budget is. [148222]

The latest forecasts are for expenditure to match the total to be sought in the spring supplementary estimates.

Given that the Government have cut £5 billion from the defence budget since 1997, will the Secretary of State guarantee that none of the underspend—amounting to several hundred million pounds—on last year's budget will be returned to the Treasury?

I sympathise with the hon. Gentleman, because I suspect that he was put up to ask that question by his Front-Bench colleagues, who appear not to understand the way in which departmental budgets work in government. In particular, they do not appear to understand that Departments are responsible to Parliament for their spending. If they understood that, the shadow Defence Secretary might not have told the News of the World that the underspend represented some sort of cut, as the hon. Gentleman's question suggests.

My goodness, the Secretary of State goes on for an awfully long time to say absolutely nothing; he will not answer the question. Let us take him back to the accounts. As he knows, he wrote to me on 6 February about the News of the World article, and claimed:

"There is no question that the total £241 million underspend on the Defence Programme is somehow going to be taken away by the Treasury."

"Actual surplus to be surrendered."

"unused money would not be given back to the Treasury."

What is breathtaking about the hon. Gentleman is the level of his ignorance of the way in which government works. If he understood anything about that—after he was elected to the House of Commons, he supported the then Conservative Government for five years—he would know full well that the underspend is available to the Department to carry over into the next year. He would also know—[Interruption.] This should be a matter of concern for Members of the House of Commons. The hon. Gentleman should know that the reason why there is so much anxiety to ensure that Departments stay within departmental totals is that those totals are approved by Parliament. That is why, year on year—[Interruption.]—and, specifically under the previous Conservative Government, there was a series of underspends to ensure that the MOD stayed within the total granted by Parliament. The matter is not simply that the hon. Gentleman fails to understand how government works—I might expect that, because he is unlikely ever to be in government; he does not understand how the House of Commons works either. [Interruption.]

Order. When Members on the Opposition Front Bench ask a question, I expect them to allow an answer to be made.

What assessment he has made of the desirability of antimissile defence. [148224]

What expenditure has been incurred at Fylingdales in preparation for national missile defence. [148227]

We continue to assess the potential role of ballistic missile defence systems in countering missile attacks. We have not received a request from the United States to site elements of national missile defence in the United Kingdom; nor have we incurred expenditure on any works at RAF Fylingdales in preparation for any such request.

Why does the Minister think that a proposal originally designed to deter attack from small rogue states is seen as such a major threat to nuclear powers such as Russia and China? If those countries retaliate, as they say they will, by expanding their nuclear capability or nuclear defence—triggering effects in countries such as India—what estimate has he made of how that escalation will affect our own security?

A number of considerations arise in relation to the hon. Gentleman's question. They have been addressed by the US and by this country, in considering the implications of missile defence systems. Clearly, before the US takes a specific decision, it is important that it should consult allies and, indeed, Russia. The new US Administration have made it clear that they would do so—thereby dealing with the type of strategic implications indicated by the hon. Gentleman.

Does the Secretary of State accept that NMD is an extremely dangerous adventure, incredibly expensive for both the United States and any other country that participates in it, and completely at variance with the views of the world court on the legality of nuclear weapons and with the stated aim of the Government that we were in favour of a non-nuclear world in the future? Furthermore, is he aware of the cost of NMD? One 20-missile battery would be 150 per cent. of the cost of the existing British Trident submarine fleet. Does he not think that that is a scandalous waste of money and that we should show more concern for a non-nuclear world than creating the nuclearisation of space and all the dangers that go with it?

No, I do not.

Will the Secretary of State give me a straight answer to a simple question? Given the Nice treaty and the references, which I have seen in the control-and-command system that is being set up, to a nuclear capacity in relation to the use of nuclear weaponry, does he have more confidence in our reliance on the French or on the Americans?

We work closely with our French allies and our United States allies inside NATO. Indeed, as recently as last Friday at the Anglo-French summit, we discussed a range of matters on which we intend to pursue closer co-operation with our French allies—for example, closer co-operation between our two navies, questions of logistics and the ways in which amphibious forces can be organised. We recognise that it is important to establish close co-operation not only with France and the United States, but with the range of allies with whom we have worked closely for a long time.

Did the Secretary of State acquaint himself with the views of Admiral Eugene Carroll—a retired American naval admiral, with a very fine record of service over the years—who made it clear at various meetings in the House of Commons that this was not a nuclear missile defence scheme, but a process under which the United States would aim to dominate the space of the world and be able to destroy any land installation by laser beams; that, inevitably, it is bound to lead to a response by Russia and China; and that it is not at all welcome in Europe, no doubt for that reason? Will he make it clear that to leave the decision until after the election, on the ground that no proposal has yet been made, would not be a very wise decision to take?

I am aware of a number of different opinions in the United States. There is a range of views, both in support of and critical of proposals for missile defence systems. As I have said, there is a range of different proposals. Some of them—perhaps, for the moment, those at the fantastic end of the spectrum—appear to involve proposals with lasers. However, a range of issues is being considered by the present Administration. The only thing that I should emphasise to my right hon. Friend is, of course, that the new United States President was elected specifically on a promise to the American people to go ahead with systems of missile defence and, in those circumstances, my right hon. Friend should not be surprised when, in due course, the United States makes such a proposal.

Instead of subjecting us to a diet of waffle, prevarication and stonewalling on this crucial issue of public policy, why does not the right hon. Gentleman simply own up to the fact that the reason why he will not state whether in principle he is in favour of national missile defence as a protection for this country against the antics of rogue states is that the Government are deeply split on the matter? Whereas he and his hon. Friends can see the credible advantages of such a system, his right hon. Friend, the former CND fanatic—the Foreign Secretary, no less—is profoundly against it because he has always been and remains a one-sided nuclear and other disarmer?

The hon. Gentleman should know, of course, that the Government are always of one mind on any given issue. However, let me make it clear to him that the United States has taken no decision on specific missile defence systems and, therefore, there has been no specific request to the United Kingdom regarding the use of any facility here. We share the United States's concerns about missile proliferation; we have worked with the United States for many years on ways to improve defensive systems. As its closest ally, we would, of course, want to respond helpfully should a request be made by the United States. That point has been made in our early discussions with the new US Administration.

Can the Secretary of State assure the House that Government policy has not changed since their response to a Select Committee on Foreign Affairs report in which they state that the Government

"values the stability which the ABM Treaty provides, and wishes to see it preserved. At no point has the Government given the US Administration reason to assume unqualified UK cooperation with NMD deployment … the Government is strongly in favour of deeper, carefully considered international dialogue on this complex and difficult issue."?

May I make it clear to my hon. Friend that the ABM treaty was concluded between the United States and Russia? The treaty has been amended in the past and is therefore capable of further amendment should the parties—the United States and Russia—choose to make further amendments. We certainly value a degree of strategic control should that be appropriate, and as part of the consultation process that the United States has suggested we will urge that the United States and Russia look to a degree of strategic control for the future. However, as I said in relation to the previous question, in our earlier discussions with the United States Administration we said that, as the United States is our closest ally, we would want to be helpful should it make a specific request on this matter.

What plans he has to introduce new equipment for the Army. [148225]

We are investing in a number of new systems that will ensure that the Army's capability is maintained at the highest level. The Apache helicopter entered service last month, and plans for future equipment include new armoured engineering vehicles and, in the longer term, improvements to the range and accuracy of our artillery weapons, a fully integrated fighting system for the infantry and a new range of armoured fighting vehicles. We have also taken decisive action to rectify two long-standing equipment problems by commencing a modification programme for the SA80 rifle and by launching a new competition for the Bowman radio requirement.

Is the Ministry still committed to purchasing the new heavy lift aircraft, the A400M? I urge him to ensure that he purchases not 25 but 45 of that aircraft, and makes sure that the wings are made in my constituency, where 4,800 skilled workers stand ready to be of service to him. May I further tell him that, in the Airbus consortium, our German colleagues are lobbying like mad to get the contract to make the wings? As we have had steel redundancies in Wales, including at Shotton in my constituency, manufacturing would receive a big boost if he would say that 45 aircraft will be purchased and that the wings will be made in my constituency.

I assure my right hon. Friend that we are absolutely committed to the purchase of the A400M. Plans for its development are progressing well. I am confident that the wings will be built in his constituency and will preserve the jobs that will be underpinned as a consequence.

Will the Minister accept that until we have robot wars, we need human beings to operate the equipment? Is not the British Army 8,000 men short? What would the Minister say to the Staffordshire Regiment, whose representatives said at a meeting in the House of Commons only a week and a half ago that, for the first time since the second world war, it is undermanned by more than 250?

I am well aware of the deficiencies in numbers that we inherited from the previous Government—deficiencies that, like them, we have done our best to remedy. The hon. Gentleman must recognise, however, that demographic changes in this country make it increasingly difficult to recruit into the armed forces. We are taking effective action to improve recruitment and retention through the package of support that we are giving to families, and through the improvements that we are making to accommodation. The picture in the next few years will be very much better than over the past few years.

When his Department will complete its evaluation of the tenders for the future offshore vehicles contract; and if he will make a statement. [148226]

Invitations to tender for the future offshore patrol vessel contract were issued on 12 December 2000. The closing date for submitting bids was 8 February 2001. If industry's responses confirm improved value for money over the current service, the intention is to be able to place a contract in April 2001.

Is the Minister aware of the importance of the contract to the employees of Vosper Thornycroft in the south of Hampshire, who currently face redundancy because of a shortage of work? In view of the important industrial implications, will he give a commitment to the House that the Defence Procurement Agency will complete its evaluation of the bids as quickly as is practicable, and will countenance no further delay? Will he also assure the House that the agency will be vigilant about the predatory bids for the contract that might be on the horizon, and rule them out of order? That will safeguard the position in which we have more than one shipbuilder building warships for the British Government.

I am well aware of the importance that shipbuilders in the hon. Gentleman's area attach to the contract. I assure him that there will be no delays in reaching a conclusion on the bids that we have received. We are also well aware of the importance of competition.

I declare an interest as a member of the Amalgamated Engineering and Electrical Union, which has a presence in the industry. Given the size of future shipbuilding operations in this country and the extra capacity that is required, does my hon. Friend agree that it is important to maintain the two asset bases, one on the Clyde and one on the south coast, because having two United Kingdom companies that are efficient in that sector increases our chances of building and exporting warships?

As I have said, we recognise the importance of diversity of location and ownership in shipbuilding for our armed forces. That includes the north-east and the north-west, as well as the south coast and the Clyde. We will do everything we can to ensure that we get best value for money and continue to support British industry.

What confidence can there be that the Ministry of Defence will handle the competition fairly? The strategic defence review identified two LSLs as a requirement, but it was decided that four were needed instead, two of which were given, without competition, to the Yarrow yard. That has probably enabled Yarrow, which is owned by BAE Systems Marine Ltd., to launch a predatory bid for those craft. Is it not time the Ministry returned to the use of competition as the guiding principle, and stopped handing out contracts to giants such as BAE Systems, in the interests of industrial rather than defence policy?

I must point out that the original requirement was for six of those ships, not four. [Interruption.]

Order.

When we are placing a large procurement order, such as the one mentioned by the hon. Gentleman, there is clearly a trade-off between where to place the shipbuilding orders and the time within which we want to bring the ships into service. Our armed forces are absolutely delighted with the speed with which we managed to place the orders.

What steps he is taking to improve pay and conditions of Royal Navy personnel. [148228]

The terms and conditions of naval service personnel are subjected to regular review to ensure their currency and fairness. The rates of pay and associated allowances of naval service personnel are reviewed annually by the independent Armed Forces Pay Review Body, which bases its recommendations on broad comparability with similarly weighted civilian jobs. As my right hon. Friend the Secretary of State announced on Friday, the review body's recommendations for the 2001 pay award have been accepted in full by the Government and will be implemented from 1 April. The settlement is good for all the armed forces and is fully deserved, given the excellent job that they do.

Does my hon. Friend agree that many people in the armed forces welcome the improvements that he describes? However, vessels such as HMS Ocean were not so much lean-manned ships as scandalously undermanned, as part of the previous Government's arrangements? Will he ensure that staffing levels on such ships are high enough to keep them clean, so that they can be a source of pride to the Royal Navy?

I assure my hon. Friend that the Navy's leadership is ensuring that our ships are properly and adequately manned. It is also undertaking effective recruiting, as my right hon. Friend the Secretary of State said, and the Royal Air Force and the Navy are moving towards achieving the required staffing balance.

Does the Minister agree that the most unfair aspect of pay and pensions is the so-called pensions trough, whereby some people who retired at a time of pay restraint are £1,000 or more a year worse off than people who may have retired only a few days later? Does he also agree that if those pensions were part of a private scheme, the trustees would have tried to address the problem? Will he face up to the representations made to him by the Officers Pensions Society and others to deal with that injustice?

The hon. Gentleman knows full well that the issue is difficult and has been faced by Governments of both parties for many years. It affects not only the armed forces pension scheme, but a considerable number of public sector schemes as well. It is a little disingenuous of the hon. Gentleman to imply that there may be a separation between the armed forces scheme and the schemes for the rest of the public sector. As I said, all Governments have faced that difficulty, and in 18 years, the previous Government did nothing about it.

Is my hon. Friend aware that armed forces personnel serving abroad receive less pay than they do when they are based in barracks here? Will he give a commitment to consider that issue?

My hon. Friend is probably referring to overseas allowances for personnel in Germany and the Balkans. That is a difficult matter, which raises taxation issues. The previous Administration also faced those problems—but I am not trying to place the responsibility on them. Individuals who serve in Germany and the Balkans may not be better off in their overall service, because they will be affected by a different tax regime. However, we recognise the problems caused by separation; that is why we introduced enhanced separation allowances.

Does the Minister realise that the shortfall of naval pilots in joint force Harrier is not just a question of money? Does he understand that although RAF Cottesmore is an agreeable location—it is a former bomber base in good hunting country—it is not exactly the same as a naval air station where there is salt in the air, and the traditions, atmosphere and ethos encourage Fleet Air Arm pilots, like other naval personnel, to stay and to feel at home?

I have been to Yeovilton and I did not notice too much salt flying across from the waves on the beach. Like many other countries, we face considerable pressures in recruiting naval air personnel and RAF pilots, because of the expansion of the civil airline industry. I wish only that the industry paid for all its own training, instead of constantly poaching personnel from the air force. We are looking to improve and increase output from the training system, but that will take time. That is why we have, as the hon. Gentleman will know, introduced measures to encourage retention, so as to sustain our operational effectiveness. The Navy and the RAF are hopeful and optimistic that those will have a significant positive effect.

My hon. Friend will be aware that for some years I have been campaigning to have removed the arcane old-fashioned regulations that affect the pay of Navy, Army and RAF personnel. Those regulations prevent the operation of deduction of earnings orders that the Child Support Agency has imposed on some personnel, and so help them to avoid their responsibilities. When will the Minister do something about that? The new CSA arrangements will do nothing to deal with the backlog of cases affected by those regulations, and that is a crying shame.

I know that my hon. Friend has met the Under-Secretary of State to discuss the matter. My recollection from my days as Under-Secretary is that the percentage that can be deducted from service pay is greater than the CSA levels that are to be introduced. I admit that problems arise because of arrears, which are often due to CSA bureaucracy. My hon. Friend the Under-Secretary is considering the matter.

I wonder whether the Government have any conception of the consternation and chaos produced throughout the armed forces by their ill-conceived and mishandled pay proposals for 2000. What possible sense or justice is there in paying a cook more than a bomb disposal expert with the same rank and seniority? I spent Thursday with an all-party group on one of the Royal Navy's largest ships. The whole complement was in a state of cold fury about the proposals. Is it surprising that with such a ham-fisted Government, morale and retention in all the services are collapsing—contrary to the complacent impression given by Ministers earlier in response to my hon. Friends the Members for Canterbury (Mr. Brazier) and for Lichfield (Mr. Fabricant)?

Everyone recognises that changed pay systems always create some difficulties, especially in their early stages. Policies are designed to be more flexible so that they can be adapted to changing circumstances. Everyone will have the opportunity to increase his earnings within his rank, in recognition of experience and qualifications. The second major change is a more targeted approach, which will allow us to address accurately particular areas of need. Allowances will be focused more efficiently on recruitment and retention. It is a strategy for retaining the best alongside the strategy for change. [Interruption.] The hon. Member for Grantham and Stamford (Mr. Davies) indicates some dissent. That is slightly surprising, as that was said at the introduction of the policy in February 1997, in the foreword signed by the then Secretary of State for Defence, the right hon. Member for Kensington and Chelsea (Mr. Portillo).

What progress he has made with enhancing front-line equipment for the Royal Navy. [148230]

We have under way the largest warship programme for many years. This includes the type 45 destroyer equipped with the principal anti-air missile system; new aircraft carriers with new carrier-borne aircraft and airborne early-warning aircraft; Astute class submarines; new amphibious support ships; and multi-role survey vessels. The Royal Navy will also be supported with new roll on/roll off vessels and new auxiliary oilers. This is just part of a huge programme of modernisation that, I am happy to say, is progressing well.

I thank my hon. Friend for that reply. Will he confirm that the Government's plans to procure two new larger aircraft carriers for the Royal Navy will not be affected by the outcome of the general election?

Given the performance of the Opposition, I do not think that that will be a problem.

Does the Minister recall saying a few moments ago that the Government believed in competition within the warship-building industry? Does he not realise that when the Secretary of State announced fair and equal shares in the type 45 programme last year, that in itself persuaded Vosper Thornycroft to share its commercial and engineering techniques with the big players? As a result, it is subject to predatory pricing and is likely to be driven out of the marketplace, which would be a loss to warship building and to the country's economy? What does the Minister have to say about honouring the pledges made in the House to protect smaller players from predatory pricing?

There has been no change to date in our policy, which is to conduct a procurement exercise involving both yards, under the direction of the prime contractor. That remains the policy.

Will my hon. Friend ensure that future large aircraft carriers will be capable of operating Eurofighter, as that will ensure that we have a seaworthy—or rather, sea-going—version of Eurofighter, which will benefit jobs in the north-west?

The decision on the further development of Eurofighter has not yet been taken. I am sure that my hon. Friend is well aware that we are committed to supporting the early stages of development of the joint strike fighter, which promises to be a most exciting and effective aircraft.

Will any royal naval fleet submarines be decommissioned earlier than planned?

No.

How much total expenditure on defence was as a percentage of gross domestic product in the last financial year. [148231]

Over the last year defence spending has represented 2.4 per cent. of gross domestic product.

Will my hon. Friend confirm that defence expenditure, though rising as a percentage of gross domestic product, is much lower than it was in the mid 1980s, thanks to the peace dividend? Will he also confirm that a higher proportion of that spending is now spent on peacekeeping than on offensive capability?

These issues are not so easily divisible. The ability to undertake high-intensity war fighting also produces the forces that have been able to react rapidly throughout the world, very professionally, to bring peace and stability to many areas—to Kosovo, to Sierra Leone and elsewhere. That is all part of the overall capability of our armed forces.

When he last met the NATO Secretary General to discuss European security. [148232]

I last discussed European security with Lord Robertson at the North Atlantic Council Defence Ministers meeting on 5 and 6 December 2000.

Does the Secretary of State agree with the head of the European Union's new military staff that, in time, EU rapid reaction forces will compete with NATO?

No, I do not. Indeed, as we have negotiated the way forward between the EU and NATO, it has been clear Government policy that there should no duplication whatever of complementary abilities. We want to make sure that the remaining details that still have to be negotiated are right, and we fully agree with the United States that it is important that there should be no duplication of the various available facilities.

If he will make a statement on the change in the total number of service personnel since 1979. [148233]

On 1 April 1979, the trained strength of the armed forces was 284,200. On 1 December 2000, the trained strength of the armed forces was 189,318. The reduction in the size of the armed forces over the last 20 years reflects changes in the requirements of the international situation and defence policy. The roles of the armed forces have changed from those envisaged in the cold war to those defined in the strategic defence review. Our aim is to achieve a balance of resources between platforms, weapons and people, to generate and maintain modern, joint battle-winning forces.

Will my hon. Friend confirm that the bulk of the cuts in the number of service personnel occurred under the previous Administration? How many foreign policy-led strategic reviews of defence policy, as opposed to reviews led by the need for Tory cuts, have been carried out since 1979?

I assure my hon. Friend that, as he rightly says, the strategic defence review was led by policy imperatives, followed by resource requirements. He is right to identify the fact that under the previous Administration, any such reviews were Treasury led and cuts oriented. Not only were there cuts in the numbers in the armed forces, but targets were overshot. We inherited that situation. It was undesirable because of the extra pressure on our forces, and because it gave a clear impression to people outside that the forces were no longer recruiting. I pay tribute to the recruitment organisations of the three services, which have made a considerable effort to get across the message that we are in the business of recruitment, and are still hiring considerable numbers of high-quality young people.

Does the Minister accept that, as the Adjutant-General said, at the present inflow rate of personnel to the Army, it will take 31 years to achieve the Government's targets? There is therefore no room for complacency. Does he also accept that putting women in the front line in the Army is not likely to enhance morale in the armed services? Furthermore, will he comment on the activities of two Army women who have invited contempt for the Army? Will he do something about that, so that such people do not treat the Army as a game? It is a fully professional service, and women should not treat it in that way.

I think that the hon. Gentleman has been reading the wrong newspapers. I am pleased to hear that he is contradicting his own leader on the issue of women in the front line.

Should it not be entirely for women in the armed forces to decide whether they are capable and fit to do the job in the front line? If they are, they should be able to do it, and there should be no discrimination against them. Should that not be the Government's policy?

Our policy is to await the outcome of the review being conducted by the Army, which will be conducted in depth, and extremely professional. We would, of course, be interested to know what the joined-up policy of the Opposition is.