I am pleased to present to the House today the Government's rural strategy 2004. As in the rural White Paper 2000, our vision for rural communities is based on delivering genuinely sustainable development, with economic and social strategies consistent with our aim of protecting and enhancing our natural heritage for future generations. Rural strategy 2004 represents an ambitious set of policy priorities for rural communities and the countryside, coupled with radical reforms to the delivery of our policies.

Fresh evidence that we have commissioned confirms that there is relative prosperity in rural areas. For example, measured in terms of average household income. 55 per cent. of households in rural areas are above the median, but the evidence also confirms that the picture is by no means uniform across rural England. Rural society is changing in ways that are blurring the distinction between urban and rural. Farming remains at the heart of rural society, and an important focus of rural policy, but employees in rural businesses are now more likely to be employed in manufacturing, tourism or retailing. Within the overall picture of relative prosperity, there are pockets of economic and social disadvantage.

That evidence shapes our approach to delivering sustainable communities and so puts a premium on policies and on delivery mechanisms that focus on that deprivation. My reform agenda sees the devolution of decisions and delivery—to get help to the areas and people that need it most. To ensure that they are able to access that help, I will ruthlessly streamline the funding support we provide. The present 100 rural, agricultural and environmental funding schemes will be reduced to three major funding programmes linked to strategic priorities, allowing us both to sweep away unnecessary rules and to simplify application processes.

Our policy has three main planks. First, while supporting prosperity across the board, we will act to help the minority of rural areas that are lagging economically. I want rural businesses to have the support they need. This year, I will put an extra £2 million into the Business Link network, to improve support and assistance to businesses, especially those in lagging rural areas. I want all rural business men and women to know that they can turn to a service that understands their needs, including the needs of agricultural businesses and businesses diversifying from agriculture, and a service to help them through the existing maze of services and grants available.

I will devolve decision making and funding for economic regeneration to the regional development agencies, to allow decisions better to reflect the needs and pressures in each region. I am increasing the funding DEFRA provides to the RDAs' single pot from £45 million to £72 million next year. To ensure that it is spent in the most effective way, each region is to put in place arrangements to facilitate rural prioritisation within a strong partnership structure. I shall not impose a single structural form—I want to encourage maximum simplification and streamlining—so that regional delivery partners are set free to focus on doing, rather than talking.

Local authorities have a vital role as community leaders in joining up and delivering quality services, so I intend to look at innovative mechanisms for devolving delivery even closer to rural communities. Over the course of this year we will set up a pathfinder in each region, to explore practical ways of providing more joined-up and flexible approaches at local level in rural areas, including joining up services and funding at the point of delivery.

The second plank of our policy is to tackle rural social exclusion wherever it occurs and to achieve fair access to services. Access to transport, to affordable housing and to broadband helps to underpin economic prosperity and social justice for rural dwellers. Last week, the Government announced more money for sustainable housing. My Department will act as guardian, to ensure that that money helps to address social disadvantage in rural areas.

I will devolve money for building capacity in the voluntary and community sector to each region, to be managed through the Government offices, as that sector can truly understand local need and provide innovative solutions. However, I want to be sure that we get an independent assessment of results. The need for a rural advocate is as strong as ever, so I will create a small and well-focused new countryside agency by next April, initially within the legal framework of the existing body, to act as expert watchdog and advocate on behalf of rural communities. Its priority will be rural disadvantage, and it will act as a think-tank and futures body, drawing on its monitoring of progress and best practice to suggest innovative solutions to Government.

The third plank of our policy is to protect and enhance the natural environment in rural areas, and that of our seas, coasts and rivers, and our green spaces in towns and cities. A healthy and attractive countryside brings social benefits such as tranquillity, but also economic benefits; more than 300,000 jobs depend directly on it, and rural tourism brings about £13.8 billion to the rural economy each year.

Rural England is also a treasure trove of diverse and wonderful landscapes and wildlife. Its natural beauty is an asset to be cherished and enhanced. The countryside provides us with the essentials of life; improving its health is the most valuable inheritance we can leave. Our woodlands, for example, help to mitigate the effects of climate change—one of the most serious environmental problems the world faces. Visiting the countryside does much to improve our quality of life, providing recreation, better health and a source of education and learning.

Much of the quality of our landscape and its biodiversity depends on how it is managed by farmers and others. The changes that we are introducing as a result of CAP reform will enhance the positive and reduce the negative impact of farming methods and land management on the environment. As recommended by Lord Haskins, we will establish an integrated agency to deliver our policy objective of a healthy countryside valued and used in a sustainable way. The new agency will be a powerful, independent statutory non-departmental public body, building on the world-class strengths of English Nature, the Countryside Agency and the Rural Development Service. Its remit will be the integrated management of our natural heritage that the challenges and environmental threats of the 21st century demand. That will include biodiversity, landscape, and the sustainable use of the countryside, including recreation and access. It will have a remit to carry out its functions within a sustainable development context. It will work closely with the RDAs—and elected regional assemblies, if established—to ensure that the natural environment is taken into account in regional policy making and activity.

The formal establishment of the integrated agency will require primary legislation. I hope to introduce legislation next year and to publish a draft Bill, as an early step. In the meantime, while each of the three bodies will remain responsible for their own statutory duties, they will come together into a confederation of partners by April next year. To help that partnership working, I will move the Rural Development Service from the policy core of DEFRA and give it the autonomy that befits a major delivery body.

This package of policy and delivery reform is aimed at delivering services in a more streamlined and customer-friendly way, through radical devolution to regional and sub-regional partners, as well as to our own delivery agents. The significant streamlining of our funding should make things easier and simpler for our customers. These arrangements are aimed at improving effectiveness in the delivery of our three policy priorities, within an enduring framework of sustainable development. They will also deliver efficiencies, exploiting operational synergies and removing duplication. They have been developed in an inclusive and transparent way. They will build on the excellent work being done across the country by those working for DEFRA and its family, and beyond DEFRA. They will provide greater freedom to staff to get on with delivering what our customers need from the Government, and I am confident our people will rise to that challenge.

I want these reforms to be workable, but sufficiently flexible to meet future challenges and changes. I commend the approach and its implementation to the House.

I am grateful to the Secretary of State for the letter that she sent me first thing this morning, although the website referred to in it did not contain any detail of the rural strategy, and for a copy of her statement, which for various reasons, including a mishap—I am not sure whose—I have only seen in the past 15 minutes or so. I welcome the recognition that some rural areas do not share the prosperity enjoyed by other areas, but I am afraid that I do not share her view of how their needs should be addressed.

First, on agriculture, I appreciate that the Government may have more to say about farming-related issues tomorrow, but the Secretary of State's two-and-a-half- page letter—headed, "Rural Strategy 2004"—does not mention either agriculture or farming, and the statement that she just made scarcely did so. That will alarm many people who depend on that vital industry for their livelihood. It suggests that, even now, Labour Ministers do not recognise the central role that farmers play in protecting, maintaining and enhancing the rural environment, and the extent to which prosperity in many parts of the countryside is still very directly related to the fortunes of agriculture.

The statement is made against the background of severe problems in many rural communities. Under Labour, rural councils receive less cash support from the Government than their urban counterparts; under Labour, rural communities have fewer police per head of population than their urban counterparts; under Labour, rural bus services receive less support than their urban counterparts; under Labour, homelessness in rural areas is rising; under Labour, police stations in rural areas are closing; and under Labour, post offices in rural areas are disappearing and the proportion of households in rural areas with access to affordable broadband connections is only a tiny fraction of what it is in towns.

Against that background, the proposals summarised in the Secretary of State's letter this morning and in much of the statement that she has just given to the House are vague, often riddled with jargon and sometimes of limited relevance to the needs of rural communities. A dairy farmer worried about the spread of TB, a rural community whose environment is about to be destroyed, against its wishes, by the development of nearby greenfield sites at the insistence of the Deputy Prime Minister or a neighbourhood blighted by illegal fly-tipping will draw no comfort from the waffle that we have just heard from the Secretary of State, such as

"setting up regional pathfinders";

"bringing together partners at regional and sub-regional level";

"consultation about the Department's list of indicator districts in relation to PSA targets".

So much for the DEFRA family.

Why will the Government not stand up for rural communities in a practical way and give local councils, which are democratically accountable, the power to decide how much development takes place on greenfield sites in their districts, what kind of building is allowed and where it should go? Why will the Secretary of State not address the rapidly growing menace of fly-tipping, a problem partly caused by her Department's incompetence in not preparing for the implementation of new laws? Why not, for example, make fly-tipping an arrestable offence now? Without such practical steps her claim— [Interruption.]

Order. The hon. Gentleman must be allowed to speak.

I am afraid that Labour Members do not like the truth about what they have done to our rural communities. Without such practical steps, the Secretary of State's claim that her policy will protect the rural environment will ring very hollow indeed in many parts of the countryside.

In turning to that part of the statement that deals with the response to Lord Haskins' review, I make clear our support for the broad thrust of many of his conclusions and, in particular, that too many organisations have become involved in the delivery of rural policy, leading to confusion, inefficiency and a lack of co-ordination and accountability. Proposals to reduce the number of organisations to a more manageable number are therefore desirable. However, as the Secretary of State has said, since legislation will be needed to set up the new integrated agency, there seems a danger that, until parliamentary time is available, uncertainty may now blight some of the work of the existing bodies. Since the Countryside Agency is apparently to continue as a rump, there still seems to be a lack of clarity in the Government's mind about how the new arrangements will work.

Let me also make it clear that we do not agree that the regional development agencies are the right bodies to perform an expanded role in delivering any aspect of rural policy. The idea that using regional development agencies—and, possibly, and even worse, elected regional assemblies—will bring the delivery of services even closer to rural communities is so absurd that it can be proposed only by a Minister who neither knows nor cares what life is like in the remoter parts of East Anglia and the south-west.

Regional development agencies are unaccountable, bureaucratic quangos that are wasteful in their use of public resources. They exercise powers that have mostly been seized from elected local authorities, particularly county councils. The fact that their main champion is the Deputy Prime Minister should alone make anyone in rural communities suspicious of them. We all know that the Deputy Prime Minister has only one view of the countryside and that is as a vast potential building site.

It is a pity that the Secretary of State has done nothing in her period in office to protect our landscape from the unwanted and intrusive developments imposed by the Deputy Prime Minister or to defend the rights of elected county and district councils to exercise local control over the scale of new development. We will fight the transfer of any more responsibilities to regional development agencies in the context of rural policy.

I am also concerned that the important independent advisory role at present entrusted by law to English Nature will still be performed properly under the proposed new arrangements. From time to time—for example, over the issue of GM crops and their environmental impact—the independent advice that English Nature has provided has been uncomfortable for the Government, but the need for that advice and the need for an independent voice able to speak up with the authority of a statutory body remain. I am therefore concerned that the new arrangements will not fully recognise this need.

I am concerned also that, although the aim of the proposals is to streamline the machinery through which rural policy is delivered, the situation will, in certain respects, get more complicated. For example, the role envisaged for regional rural affairs forums is a move in the opposite direction. They will be talking shops for so-called stakeholders and nothing more.

People in my constituency of South Suffolk and in other rural areas are used to plain speaking. There has not been much of that from the Secretary of State today. For too long, rural communities have been at the bottom of the Government's agenda. They have been discriminated against in terms of financial support and neglected through the provision of new services, with their age-old traditions held in contempt by urban new Labour Ministers, their industries endangered by imports, often produced to lower standards than those required here, and their environment destroyed in too many areas by a stroke of the Deputy Prime Minister's pen. Judging by what the Secretary of State said today, only the election of a Conservative Government will start the process of addressing their real and urgent needs.

I got the distinct impression that the hon. Gentleman had understood neither the statement, nor, despite his experience, the reality of what is happening in rural areas. Let me pick up on a couple of the many points that he made. He talked about ignoring the central role of farmers, but I specifically identified and recognised that, as we do through the £17 billion that goes to farmers under pillar 1 of the common agricultural policy. He is right that there are other occasions to make more detailed announcements about farming—today's statement was about rural areas as a whole. Some 25 per cent. of those employed in rural areas are employed in manufacturing, which is more than in urban areas. Some 9 per cent. are employed in tourism, with 7 per cent. in retailing and 6 per cent. in agriculture. I share his view that agriculture is enormously important, but it is a pity that he seems to think that unless we are talking about farming, we are not talking about rural areas.

The hon. Gentleman listed ways in which he thought that rural areas were discriminated against under Labour, but ignored the fact that under this Government, all councils have received more money and every area has more police services. Under this Government, —450 million has been put into supporting rural post offices. He was foolish enough to talk about post offices disappearing, but it was because many commercial rural enterprises disappeared under the Government of whom he was a member that we were forced to introduce a special rate relief for villages with only one such enterprise left. They did not all disappear under us, but under them.

The hon. Gentleman made a totally unwise and inaccurate remark about English Nature and GM crops. English Nature advised us to run the trials, which we did, and after we received the results of the trials, a scientist from English Nature told us that he could not understand why anyone would oppose something that was better for the environment. Of course, however, that is quite consistent, because the only Government who brought GM products on to the market in this country were the Government of whom he was a member.

The hon. Gentleman said that people like plain speaking and that rural areas have been at the bottom of the agenda under this Government. The plain-speaking truth is that if the Conservatives' stewardship of rural areas had been as he said, and if they had not taken many rural areas and their support completely for granted, we would not now have some 180 Labour MPs representing rural and semi-rural constituencies.

I thank the Secretary of State for providing me with an advance copy of her statement, although that happened after the Prime Minister rose to his feet for Prime Minister's questions—within half an hour of the statement itself. I did not receive a letter from her, although I have received a communication to tell me that the right hon. Member for Walsall, South (Mr. George), who shares my surname, received the letter rather than me. Perhaps the Department for Environment, Food and Rural Affairs needs to examine its bureaucratic procedures.

I understand why the Department has been drawn into the vortex of incredibly fluffy thinking that often arises when talking about rural development. Indeed, paragraph 40 of the candid report that the Secretary of State penned in autumn 2003 to review the progress of the rural White Paper said that

"defining effectively what is meant by the concept of 'rural areas' versus urban"

areas has been a challenge. In the same report, she said:

"The White Paper's inevitably aspirational nature means that it has not always been easy to pin down what it has actually meant in practice, and different groups and individuals have tended to interpret it differently. This in turn has made it harder to be specific about the outcomes that the Government wants to see in rural areas and to target resources to those areas and people with greatest need."

At least she acknowledged that, three years after the publication of the rural White Paper, the Government were not clear about what they were intending to do in the first place.

The problem is that on top of the labyrinth of strategies, initiatives, pilots and projects, the rural strategy will fail if it merely adds to the strong sense of fatigue among the agencies, local authorities and Government Departments that are expected to implement it. The streamlining of initiatives and the funds announced today by the Secretary of State will help, but at least she was honest in her review of the rural White Paper when she said that among its "successes" it was "increasingly understood". It should now recognise the problems conventionally found in strategies created to give the impression of purposefulness, compared to the determined action required in rural areas today.

I agreed with the principles that the Secretary of State set out, the general thrust of the reforms that she mentioned to clarify and devolve matters and the work to avoid rural areas becoming the exclusive preserve of the better-off. What has she done since the autumn to define what rural areas are, and do all Departments agree with the definition, especially the Office of the Deputy Prime Minister in its delivery of housing policy? Does the strategy supersede the rural White Paper? Will she explain in plain English the core objective of the strategy and is she confident that it will this time be understood across Government Departments?

Has the Secretary of State discussed the strategy on rural-proofing with her colleagues in the Treasury, who I understand are working tirelessly to ensure that Britain is removed from objective 1 and other European regional development aid? If that is the case, the money that the Government are proposing to add to rural regeneration might not even begin to match that withdrawn from the most needy rural areas that will lose aid.

The Secretary of State said that money will be given to regional development agencies, but will it be apportioned according to need or simply on the basis of rural populations? What will be the role of the fully independent sector in rural delivery? Over decades, we have had the tried and tested process of rural community councils throughout rural England providing an excellent means of delivery, so bypassing them or giving funds to regional development agencies so that RCCs must try to draw money from them would not be a good mode of delivery. She should use the existing method of delivery to ensure that the money gets to the ground, and I would like some reassurance on that matter.

On the environment, farmers are pivotal to delivering what the Government want throughout the countryside, but they are going out of business at the rate of 12 a day. Lord Haskins says that he thinks that the fact that farms are becoming larger is a good thing, although I do not know whether that is Government policy. What are Government doing to ensure that there are sufficient farmers so that their targets for the countryside may be met?

The biggest challenge facing rural areas today is housing, so what is the Department going to do about that? If rural areas are not to become the exclusive preserve of the better-off, sustainable action is needed to ensure that rural areas are there for rural people.

I share the hon. Gentleman's view that if the changes that we are announcing today merely add to the sense of fatigue, we will certainly have failed. However, I understand from the extensive discussions that my officials, ministerial colleagues and I have held with all those engaged that there is recognition of the need for change and a great willingness to embrace that change and take it forward.

The hon. Gentleman asked about definitions and data. It is a symbol of the failure of the Conservative party that when we came to power and endeavoured, through the implementation of the rural White Paper, to find out how to address some of the problems that unquestionably exist in rural areas, there was a dearth of evidence, information and reliable data. We had to start from scratch in building an evidence base. We now have an agreed definition. I shall not share it with the House, but I will write to the hon. Gentleman and ensure that the letter gets to him this time. Perhaps someone had not been to Walsall and misunderstood the nature of the countryside there.

Someone in the Department.

Someone in the postal service.

The hon. Gentleman also asked whether we discussed the issues with the Treasury. We certainly did and it is very much on board. It has taken on board the issues of rural proofing in its approach to expenditure and assessment of need. He referred to objective 1 status. He will know that no one fought harder than the Government to secure objective 1 status, not least for the area that he represents. Money has been pouring into his area under this Government in a way that has never been seen before. I am conscious of the difference between the concerns and the hopelessness that people saw six or seven years ago and the hope, optimism and fresh opportunities that exist in such areas today.

The hon. Gentleman misunderstood the position of rural community councils. We recognise the dangers he identifies. It is not intended that their funding should come through RDAs; the existing role will be retained. The general distribution of moneys between different RDAs will follow the overall picture because we will be contributing to the single pot.

I agree that farmers are critical to the environment and land management. The hon. Gentleman asked what we had done to assist their enduring participation in farming. There have been many initiatives, gestures and support of various kinds, but the most important thing we have done is to reform the common agricultural policy, which sets them free to farm to the best advantage of their business, not because that is how they get the subsidy. On housing, I said that the resources will also apply to housing in rural areas.

I warmly welcome the statement, in particular the reduction of the 100 rural agricultural and environmental funding schemes to three major ones. Will my right hon. Friend provide more detailed guidance on that, and if so when? Which funding schemes are going into which programme? Many organisations are delivering in rural areas and will want to know which section they have been put into.

Will my right hon. Friend say a little about funding for areas of outstanding natural beauty? It was clear in the Haskins review that national parks will get 100 per cent. of their money directly from the Department for Environment, Food and Rural Affairs, but the future of the money for areas of outstanding natural beauty was not clear. At the moment, some of it comes from local authorities and some from DEFRA.

Order. I must insist that supplementary questions are brief. Perhaps I can also put down a marker for Front-Bench spokesmen. Back-Bench Members also have to be called and that should be taken into consideration.

Thank you, Mr. Speaker.

I take the point made by my hon. Friend the Member for Forest of Dean (Diana Organ). We will obviously publish more detail. A rather attractive diagram shows what schemes will go where. Broadly speaking, the three major funds will focus on natural resource protection, sustainable food and farming, and sustainable rural communities. Although initially there will be an indication of how existing funds fit into that framework, one of my key goals has been that we do not simply introduce three headlines under which remain the existing complexity of schemes, rules, application forms and so on. I am determined that there will be three funding streams and that their delivery will be devolved as much as possible. We will also honour existing commitments, so it will take a little time to introduce the scheme.

If my hon. Friend will forgive me, I shall write to her about areas of outstanding natural beauty. Those are covered by a range of issues and different sources of funding.

If support for rural business is important, which it is, why are the enterprise agencies in Tiverton and Crediton in my constituency closing? The enterprise agency in Honiton will no longer be run locally, but from Plymouth—hardly rural—on the other side of the county, which is also the case for my hon. Friend the Member for East Devon (Mr. Swire), whose constituency covers Exmouth.

On social exclusion, why are the learning and skills councils cancelling from 1 August all courses that do not lead to a qualification for work, thus depriving all the adult population with learning disabilities of the opportunity to prepare for voluntary work? The Secretary of State painted a rather twee picture of the beautiful countryside, but when animals leave Devon in the next decade, which they will, it will not look like a chocolate-box picture; it will look like a wilderness.

Order. Those were supplementary questions. Perhaps the Secretary of State will answer just one of them.

A number of the questions raised on specific policy developments are for other Departments, although I recognise the potential knock-on effect. As I said, we are not only putting more resources into support for businesses in rural areas, but intend to introduce a much more simplified and more effective way in which that support and information can be accessed.

As for Devon being a wilderness and everyone leaving, the Government of whom the hon. Lady was a member would have been proud to deliver CAP reform in the way in which this Government have.

I thank my right hon. Friend for an insightful analysis of rural life and the view of the future. Will she consider the renaissance market town development of Yorkshire Forward? It has been extended to Marsden and Slaithwaite in my constituency and allows the local community to develop its own plan for sustainable development. Will the new money be accessed more easily so that those plans are not just talked about but properly implemented?

I am grateful to my hon. Friend. She is entirely right—the local project and initiative that she describes is exactly the sort of thing that we want to see spread more widely. The greater resources that we are putting in and the greater freedoms that we are devolving to a local level mean that others can learn from best practice, which can be widely replicated.

May I draw the Secretary of State's attention to your ruling on a point of order yesterday, Mr. Speaker? Her Department could comply with that by close of business tonight if she gave the necessary instruction, and I beg her to do so.

On the more substantive issue, she mentioned the RDAs in paragraph 6 of the statement. Will she look at how her proposals will affect the Peak park, which falls into four Government areas—the east midlands, the west midlands, Yorkshire and the north-west? Certain parts of the park qualify for grants given by RDAs, but other parts do not. Will she consider that particular problem?

I shall certainly check what the hon. Gentleman says about your ruling, Mr. Speaker. My understanding is that the matter is for Departments to determine, but I shall look into it.

Secondly, we are conscious of the problems faced by areas such as the Peak park. My right hon. Friend the Minister for Rural Affairs and Local Environmental Quality discussed that with the relevant chairs of RDAs only yesterday. Although I recognise that hon. Members get upset about the use of what they regard as jargon, it is sometimes hard to explain organisational change in any other way. We are anxious to encourage partnership working among and with the RDAs.

I, too, warmly welcome my right hon. Friend's statement, in particular her proposals to prioritise access to transport and affordable housing. Is she aware that £2 million has been invested in rural transport in my constituency in the past 18 months? The improvement in the quality of life of my constituents has been immeasurable. Is she also aware of the housing problems that arise for people born and bred in semi-rural areas, like Hebden Bridge in my constituency, that have become tourist honeypots? Will the new agency prioritise and address those issues of affordable housing in such areas?

I am grateful to my hon. Friend for her words, which are in stark contrast to those of Conservative Front-Bench Members. I do indeed recognise the huge difference made by the resources that have been put, for example, into rural transport, which has certainly undergone a transformation. I share her concern about access to affordable housing, about which the Conservative party seems to have nothing to say, except to try to pretend that it would all be in greenbelt areas so nobody wants any of it, which is not a very constructive approach. I also understand and share my hon. Friend's concern that we should carry on making such improvements, and we will certainly continue to do what we can.

The right hon. Lady constantly used the word "delivery". Is she aware that delivery depends on reliable IT systems that do not fail? The Rural Payments Agency is under strain and the cattle tracing service has been criticised. The besetting sin of this Government is introducing schemes before they can deliver them, as with the whole tax credit system. Will she make sure that nothing is introduced until she is absolutely certain that it can be delivered?

Some of the criticisms made of the cattle tracing service had validity but are well out of date. I entirely share the right hon. Gentleman's view that successful delivery depends on reliable IT, not least because, as he will probably recognise, when our Department was set up not only did neither of its constituent parts have reliable IT, but they could not talk to each other, so we are very mindful of the need for IT to underpin successful delivery of services.

The final sentence of my right hon. Friend's statement stressed implementation. These are major changes for the Department and the various agencies involved, and they require primary legislation according to a timetable yet to be ascertained. What mechanisms and management structures will be put in place to handle those major changes and make them successful?

I am grateful to my hon. Friend for his recognition of what the Government are trying to achieve. We will be making much more information available to Members in, I hope, the near future. We believe and hope that a number of changes on the ground can begin next April, but as he says, changing the legal structures will require primary legislation, and obviously that depends on the Government's overall approach. I believe that we will begin to see differences next spring.

I welcome the additional £2 million for Business Link announced by the Secretary of State, which is probably just as well as there will be few farmers left in Devon and we will need other businesses. Can she speak to the other agencies that may be undermining her efforts? Royal Mail is about to reduce postal collections in Teignbridge and south Devon; BT is shutting and removing telephone boxes; and the Post Office is about to close seven post offices.

Contrary to the carping that we hear across the Floor of the House, very many people in the farming community fully recognise not only that this Government have done an enormous amount to help and support British farming, but that the changes that we have negotiated and are putting in place will help to create a sounder future for the farming community over the next half-century and beyond, not least because the resources that it will receive will be given in return for public goods and are therefore much more likely to be accepted and welcomed by the public.

With regard to the hon. Gentleman's further comments, I am of course mindful that changes are taking place in rural areas, but I have already pointed out how much the Government are already doing to try to help to support rural post offices, which were one of his examples. He must be well aware of the changes that took place before we came to power, not all of which we can reverse.

I am not sure whether I heard my right hon. Friend mention rural governance in her statement, but I know that she will appreciate the importance of parish and town councils, in which I declare an interest. Does she accept that there is still a problem in rural Britain regarding the capacity of parish and town councils and the level of disagreement that sometimes takes over? Will she make sure that resources are put into the first layer of our democracy, because those bodies are, and will remain, very important?

I entirely share my hon. Friend's view that there is an enormously important and valuable role for parish councils. He will be familiar with the quality parish council initiative to which we have often referred in the House. I am also mindful of the fact that it is often at that level that the voice of the rural populace can most clearly be heard. I assure him that capacity-building, support and training is very much part of the picture that we hope to create.

I wonder whether the Secretary of State has considered getting rid of her rural policy and the galaxy of institutions and public officials that surround it, and whether the people living in the countryside might be better off as a result.

I am not entirely sure what the hon. Gentleman means. All I can say is that the Conservative party did their best to get rid of the prosperity of rural areas when they were in power.

I congratulate the Secretary of State on the statement; it reminds us why many of us voted for her 10 years ago in the leadership election. She is right to refer to the priorities of rural business, rural exclusion and rural environment, and she cites tranquillity as an important characteristic of the countryside. Where in her Department is the co-ordinated liaison with the aviation industry to try to tackle the problems of those villages that lie under flight paths or are scattered around regional airports, where environmental controls are particularly defective?

I am grateful to my hon. Friend for his welcome for the statement. I understand his point keenly, because shortly after the planes that he refers to fly over villages in his constituency, they fly over mine. I am therefore mindful of his concerns. I simply say to him that we endeavour to maintain the right balance between economic development and social and environmental concerns—it is not easy, but we will continue to try to do so.

Following the question of my hon. Friend the Member for Totnes (Mr. Steen) and the Secretary of State's inadequate reply, will she at least seriously consider shutting down the talking shop regional assembly in the south-west and the regional development agency, with all their glossy brochures and strategy documents which do absolutely nothing for the people who live and work in the south-west, and instead spend the time and effort on cutting taxes and reducing regulations on those people?

We are doing a great deal of work on whether and how we can achieve a better, more consistent and light-touch approach to regulation. The right hon. Gentleman may want all the voices for rural areas—what he calls a talking shop—silenced and the regional development agencies closed down, but many people in rural areas, as elsewhere, recognise the valuable and viable role that those bodies can play. Maybe they do not like to say so to the Conservative party because they know that it is pledged to abolish them.

The general approach of much more devolution has to be right, and I congratulate my right hon. Friend on that, but will it place new and greater demands on the rural proofing that has been so well championed by the existing Countryside Agency? If so, what does she think will happen to rural proofing in future?

Obviously, responsibility at Government level remains with my Department, but we believe that a new, smaller and more focused Countryside Agency will be able to act very effectively as an independent adviser, advocate and watchdog for the interests of the countryside. That is certainly my hope and my intention.

The Secretary of State referred to the valuable role of woodlands in tackling climate change, but not to their valuable role in the landscape, the forestry industry and local economies. How does she square her comments with the fact that private planting of woodland is at an all-time low and the losses being incurred by Forest Enterprise are at an all-time high, at the expense of the taxpayer? What is her strategy for putting that right?

We are looking at how we can best develop and make use of the economic opportunity, and indeed the social as well as the environmental opportunities, of woodland. The policy responsibilities for the Forestry Commission will in future move to my Department, but the commission will work with the other agencies to establish delivery of policies on the ground in rural areas, and it will look afresh at the approach to woodland.

With permission, Mr. Speaker, I should like to make a statement about the need to transform our armed forces to deal with the challenges of the 21st century. Before I do so, however, I know that the House would want to join me in paying tribute to the bravery, professionalism and dedication of the men and women who serve their country in the armed forces, as well as those who support them in the Ministry of Defence and British industry. Their reputation is second to none. The transformation that I am setting out today will help to ensure that our armed forces can continue to respond effectively to the global challenges they are likely to face.

The Government are absolutely committed to Britain's defence and to our armed forces. That was made abundantly clear by my right hon. Friend the Chancellor's announcement last week of the Budget settlement for defence. The 2002 spending review provided the largest sustained growth in defence spending plans for 20 years. This year it has been possible to make even more resources available to defence, providing the longest period of sustained growth for over 20 years—a defence budget rising by £3.7 billion. It is this sustained investment that makes possible the transformation to which the Government and the armed forces are committed.

In the 1998 strategic defence review we set out plans to develop defence capability to match the needs of the post-cold war world. We built on this with the SDR new chapter, published after the appalling events of 11 September 2001, and we confirmed this direction in the defence White Paper of December 2003. That White Paper makes it clear that the threats to Britain's interests in the 21st century are far more complex than was foreseen after the disintegration of the Soviet empire. That is why the defence White Paper signalled that we should continue to modernise the structure of our armed forces, embrace new technology and focus on the means by which our armed forces can work together with other Government agencies to meet the threat of international terrorism and the forces of instability in the modern world.

Our armed forces have enthusiastically embraced this process of transformation. It will see a shift away from an emphasis on numbers of platforms and of people—the inputs that characterised defence planning in the past—to a new emphasis on effects and outcomes, and on the exploitation of the opportunities presented by new technologies and network enabled capability. We measured numbers of people and platforms in the cold war because we were preparing for an essentially attritional campaign, holding back Soviet forces. That kind of campaign has fortunately passed into history as technology has moved on.

The capability of our armed forces is growing year by year as intelligence is combined with target acquisition, modern communications and precision weaponry to produce results that have changed the nature of modem warfare. These new capabilities involve the rapid communication of actionable intelligence to the commander in the field to deliver a range of combined effects, involving all three services and our allies acting efficiently and effectively together.

We are also able to respond more rapidly to crises through the improved deployability of our forces. We saw that in 2003 when forces were moved to the Gulf in less than half the time that it took 12 years before. With better target acquisition and precision weaponry, our Air Force was able to hit its targets with less ordnance—and hence fewer aircraft—than in the first Gulf war. The same tasks can now be completed in much less time, with far greater accuracy and correspondingly lower risk to our armed forces.

The defence White Paper makes it clear that this shift in investment towards greater deployability, better targeted action and swifter outcomes would involve a reduction in the numbers of tanks, aircraft and ships. Drawing on our experience of operations since the strategic defence review, the Ministry of Defence and the armed forces have been identifying which parts of the armed forces are most in demand, and which are less well utilised. As a result, we have developed new plans to ensure that our armed forces can retain maximum effectiveness. I have set out those plans in detail in the Command Paper on future capabilities, which is published today.

The majority of reductions will affect not the front line, but support operations. We will exploit greater efficiencies in the delivery of logistic support and the modernisation of infrastructure. We plan to accelerate this process over the years ahead. Efficiency savings of £2.8 billion are included in our plans. All this money will be recycled to enhance our front-line capabilities and other modernisation initiatives.

Of course, we are investing more new money in defence. This investment will, for the Army, enable us to fund its transformation into a force which is structured and equipped to meet the demands of multiple, concurrent operations across the full spectrum of tasks. This involves a shift from the current structure, which is strong at the heavy and light ends of the spectrum but thinner in medium forces, to one that is better balanced right across the capability spectrum.

The balanced land force of the future will consist of two heavy armoured brigades, three medium-weight brigades, based around the future rapid effects system family of medium-weight vehicles—FRES—and a light brigade, in addition to the air assault and commando brigades. We launched the assessment phase of the FRES project in April this year and we expect to sign a contract for technology demonstration work to start later this year.

The shift in emphasis to more agile, deployable forces means that we will establish an additional three light armoured squadrons, re-role a Challenger 2 regiment into an armoured reconnaissance regiment and re-role an AS90 regiment into a light gun regiment. Later, we will equip three artillery regiments with the new light mobile artillery weapon system. At the same time, we will seek to improve our ability to engage land targets with precision and at range. The first Apache attack helicopter will go operational later this year, which is an important first step down this path.

That will be followed by improvements in our missile inventory, through the progressive introduction of the Brimstone air-to-ground missile, a new infantry anti-tank guided weapon—Javelin—and improved artillery rounds to allow precision indirect fire over the second half of the decade. Collectively, these improvements will be balanced by a reduction of seven Challenger 2 armoured squadrons and six AS 90 heavy artillery batteries by early 2007.

Critical as these new weapons systems are, at least as important are the changes that we are making to enhance the Army's network enabled capability. Digitised communications systems provide the network links. The entry into service of Bowman at the tactical level, and the Cormorant and Falcon systems at the operational and strategic levels, will represent a step change in our capability to pass data between commanders and the front line. We are also continuing to invest in improved electronic warfare capabilities such as Soothsayer, and in developing stand-off sensors, such as the Watchkeeper unmanned air vehicle. I announced yesterday that the preferred bidder for Watchkeeper is Thales Defence Ltd. This will provide battlefield commanders with high quality, timely and accurate information. The new joint surveillance aircraft Astor recently made its first test flight successfully.

Our battlefield and maritime helicopter forces, arguably the most capable in Europe, have demonstrated their versatility by supporting the full spectrum of recent operations. Over the next 10 years, we plan to invest some £3 billion in helicopter platforms to replace and enhance our existing capability. This substantial investment within a relatively short time frame will make it possible to produce a future helicopter fleet focused on the key capability areas of lift, reconnaissance and attack, central to future expeditionary operations.

The dominance in the air by alliance and coalition air forces shown in recent conflicts, together with our judgment about the likely threat on deployed operations, and our continued investment in Typhoon and its advanced air-to-air weapons, mean that we can plan to reduce our overall investment in ground-based air defence. We will meet our requirement in future from 24 Rapier fire units and 84 high velocity missile launchers. Rapier will be deployed by the Army, with the RAF Regiment relinquishing the role. Ground-based air defence will be commanded by a new joint headquarters within the RAF command structure. We are reviewing the implications of these force structure changes for our future equipment plans. In the meantime, I can announce the procurement of additional missiles worth about £180 million for the high velocity missile system.

I come now to the infantry. We currently provide for operational and geographical variety for the infantry by moving battalions between locations and roles every few years, which is known as the infantry arms plot. This process inevitably takes battalions out of the order of battle while they are moving and training for new roles. It also adds to turbulence. We need to ensure greater capability from the infantry, improved continuity, better careers for infantrymen and more stability for their families. The infantry arms plot will therefore be phased out.

In addition, as a result of the improving security situation in Northern Ireland, we announced last month a reduction in the number of battalions committed to the Province by two. The Chief Constable of the Police Service of Northern Ireland and the General Officer Commanding have conducted a further review of security requirements. As a result, I can today announce another reduction by a further two battalions, which will take place in the autumn. That will reduce the overall requirement for infantry battalions from 40 to 36. This reduction will comprise one battalion recruited from Scotland and three recruited from England.

Those changes necessitate a new infantry structure that must preserve the best aspects of the regimental system, but produce an organisation capable of adapting for the future. The new structure will be based on regiments of two or more battalions, in largely fixed locations, allowing individuals to move easily between those battalions. Details of the new organisation will be worked out by the Army and announced by the end of the year.

The Army board wants to establish an infantry organisation that will last for the foreseeable future. The manpower released by the reduction of four battalions will be redistributed across the Army to strengthen existing infantry units, but it will also be used elsewhere among the most heavily committed specialists such as logisticians, engineers, signallers and intelligence. The overall size of the Army will be around 102,000.

Our plans for the Royal Navy involve the further development of a versatile, expeditionary force capable of operating at distance from the United Kingdom and focused on delivering effect on to land at a time and place of our choosing. Two new large aircraft carriers deploying the joint combat aircraft will provide the heart of our future ability to project military power from the sea. On Monday, I announced the extension of the assessment phase to take forward further design work on the new carriers in the run-up to our main investment decision and that the principles of an alliancing approach have been agreed with our industrial partners. We are investing heavily in our amphibious capability. HMS Albion and HMS Bulwark, which was delivered to the Royal Navy last week, will provide a step change in our ability to launch the Commando Brigade and support other forces ashore.

By ensuring that our major warships are effectively networked and supported, we can deliver more capability from fewer platforms. Developments in network enabled capability—linking sensors and weapon systems—mean that we can meet future area air defence and command and control requirements from a force of eight Type 45 destroyers. With those hugely capable ships currently under construction, we can plan to pay off our oldest Type 42 destroyers, HMS Cardiff, HMS Newcastle and HMS Glasgow, by the end of 2005. We are still in the early stages of an ambitious procurement programme and are working with industry to define a timetable that best matches our capability requirements and the need for steady work in both the shipbuilding and repair industries.

The potential submarine threat to most future UK operations is likely to be low. Where a threat exists, however, we will still need the full range of advanced anti-submarine warfare capabilities to deal with it. We have therefore decided to reduce our overall numbers of platforms optimised for anti-submarine warfare, while continuing to maintain our technological edge over potential opponents, including through the introduction of the new low-frequency active sonar 2087. We will pay off three Type 23 frigates, HMS Norfolk, HMS Marlborough and HMS Grafton, by March 2006. That shift of emphasis also allows us to meet our maritime reconnaissance needs with 16 Nimrod MR2 aircraft. That requirement could be met in future by a fleet of around 12 Nimrod MRA4 aircraft, which are more capable, subject to industry demonstrating satisfactory performance at acceptable prices.

We require a total of eight nuclear attack submarines. The introduction of the new Astute class boats will hugely enhance the contribution made by nuclear-powered attack submarines across the spectrum of operations. Solid progress has been made on the first of class following the restructuring of the project, and work continues on boats two and three, as well as on long lead items for boat four, but more remains to be done before production orders can be finalised. We are also investing in the latest generation of Tomahawk land attack missiles and improvements to submarine communications to give our current and future submarines an improved land attack capability.

Our mine countermeasure vessels have made a valuable contribution to recent operations. Against that changing threat, we must retain a balanced force of eight Hunt class and eight Sandown class vessels. We plan to pay off HMS Inverness, HMS Bridport and HMS Sandown by April 2005. The improved security situation in Northern Ireland also makes it possible to pay off the Northern Ireland patrol vessels, HMS Brecon, HMS Dulverton and HMS Cottesmore by April 2007. As a consequence of those changes, the manpower of the Royal Navy will reduce to 36,000 over the next four years.

Air power is critical to the prosecution of modem warfare. Over the next 10 to 15 years, an accelerating transformation of our air power will enable quicker, more precise and more decisive operations at range, delivered by multi-role Typhoon and joint combat aircraft equipped with highly capable weapons. The Typhoon programme is now moving forward towards initial operating capability, with indications that the aircraft is demonstrating excellent performance and good reliability. We expect to sign a contract for the second tranche of Typhoon aircraft as soon as we complete satisfactory negotiations over price and capability.

The investment in our air forces is already producing substantial improvements in existing aircraft. The Tornado GR4 is now one of the most potent offensive aircraft systems in the world, fully capable of day and night operations in all weathers. The Harrier GR9 development programme is on course to deliver a significantly more capable platform with much wider versatility, including for carrier-borne operations. The tactical information exchange capability project will examine how the effectiveness of the GR4 and GR9 can be further enhanced by improving their networked capability. The Tornado F3 aircraft is now equipped with advanced medium-range air-to-air missiles and the world-leading advanced short-range air-to-air missiles and is fully networked through the joint tactical information distribution system. The new Storm Shadow long-range air-to-surface missile proved itself as a world-beater during the recent Gulf war. New precision-guided Paveway IV bombs will further enhance our overall capability in the short term.

With those significant advances in capability, we now judge that we must reduce the types and overall numbers of the RAF fast jet force, providing a firm baseline for transition to the multi-role era. We will reduce the number of the air defence Tornado F3 squadrons by one, and bring forward the withdrawal of two Jaguar squadrons to 2006, with the final Jaguar squadron disbanded in 2007. Those changes in the force structure and the achievement of planned organisational efficiencies will lead to a reduced RAF manpower requirement of around 41,000 by 2008, which will also allow us to close RAF Coltishall airfield by December 2006. We will also be undertaking an extensive review of our future requirement for airfields. Following an extended period of consultations, we have decided to rationalise the basing requirements of a number of RAF logistic support and communication units. My right hon. Friend the Minister of State with responsibility for the armed forces is writing today to those hon. Members whose constituencies may be affected.

The RAF also plays an essential enabling role in support of expeditionary operations through its strategic and tactical airlift capability. The core of that capability remains the fleet of C-130 aircraft and, from 2011, the A400M. To accommodate larger items, we were considering the options to retain C-17s after the A400M enters service, and I am pleased to announce that we intend to buy the current fleet of four at the conclusion of the current lease arrangement and to purchase one additional aircraft, bringing our C-17 fleet up to five aircraft.

Amidst those structural and major equipment changes, we must never neglect the more immediate needs of our armed forces in the field and in particular their personal equipment. We already have a major programme under way in the light of experience from Operation Telic, and I can announce some further enhancements. This year, we will procure additional light machine guns for the infantry, together with night vision and target acquisition systems for forces in land, sea and air environments, as well as further enhancements to our special forces capabilities. We will also make major enhancements to our asset tracking capability to ensure that the right matériel is in the right place at the right time—we have learned the lessons from recent operations in Iraq.

Alongside the modernisation of our conventional forces, as set out in last year's White Paper, the Government remain committed to maintaining the effectiveness of the nuclear deterrent, including making the necessary investment at the Atomic Weapons Establishment, Aldermaston, and to keep open the options for a successor to Trident until a decision is required, probably in the next Parliament.

In addition to the reductions in the armed forces' manpower, we envisage reductions of around 10,000 in civilian jobs. Those reductions flow from efficiencies as a consequence of the Department's change programme and other initiatives. The reductions in armed forces and civilian manpower will be achieved, as far as practicable, through natural turnover. We will also retrain and redeploy personnel wherever possible. We are committed to enabling our people to develop their skills and abilities, so that those who leave are well equipped for life outside defence and those who stay are properly trained for their roles. However, redundancies will inevitably occur, and we will use the normal consultation processes to achieve them.

The White Paper makes it clear that our reserve forces have evolved to become an integral part of the UK's military capability. We learned many lessons from operations in Iraq about how we mobilise our reserves and how we must strengthen the relationship between the services, reservists, their families and their employers. The Under-Secretary of State for Defence, my hon. Friend the Member for Hove (Mr. Caplin), will make an announcement tomorrow about our plans to consult on proposals to update financial assistance to reservists when they are called into service and compensate employers who incur additional costs as a result of their staff being called up.

Some will claim that the defence budget is under such pressure that it is impossible to sustain the Department's forward equipment programme. In fact, the spend with industry will continue at the same level as in recent years. It is of the utmost importance that industry takes the maximum advantage of that substantial investment to produce what the armed forces need at a price that the country can afford. We will take forward our defence industrial policy and implement those changes in conjunction with industry to ensure a healthy and competitive defence industry, one that continues to play the leading role in our economy, a leading role that it enjoys today. I am confident that it will respond to this challenge.

For the third successive spending review, the Government have been able to announce real growth in the defence budget. That is without precedent since the mid-1980s. Even with these additional funds, it is necessary to secure maximum benefit from efficiencies and make choices to ensure that our force structure matches the requirements of today's security environment. The plans that I have announced today show the Government's determination to make the choices necessary to ensure that the real growth in defence expenditure is targeted at what the armed forces require in the 21st century, rather than what they have inherited from the 20th. That will ensure that the armed forces are equipped and trained to continue to perform with success in the future the tasks that they have undertaken so admirably and successfully in recent years.

I thank the Secretary of State, through gritted teeth, for allowing us sight of his statement every bit of 35 minutes before he rose to make it. I join him in his praise for, and commendation of, the magnificent work done by our armed forces, which does such huge credit and brings such distinction to our country.

We welcome some of the steps that are to be taken in the rebalancing of our forces for the threats and operations of today and tomorrow, and we accept the need for hard choices to deal with some of the legacy issues. We also recognise the importance of network- enabled capability as a next step in the development of the armed forces. But, however the Secretary of State tries to present it today, this announcement is essentially about cuts. The servicemen and women whose battalions are to be disbanded, planes grounded and ships scrapped are the same men and women who bailed out the Government over their dismal failures and incompetence at the time of foot and mouth disease, and bailed out the Home Office over the fire strike. These are the same people who brought peace to Sierra Leone and Bosnia, saved Sierra Leone from almost certain self-destruction, helped to secure peace and good order in East Timor, brought freedom to Kosovo, helped push the Taliban out of Afghanistan, and liberated Iraq and brought an increasing security to its people. Some of them are fighting a largely unsung battle in Basra today, in a very difficult environment.

These young men and women, at all levels of all three services, will feel themselves to have been betrayed, politically and morally. Today the nation will be dismayed that its armed forces, whom it loves and admires, who have repeatedly been deployed at the drop of the hat all over the world on the Government's instructions, and who have brought such distinction and success to Britons internationally, should be treated in such an underhand way.

Most of the current difficulties in defence are entirely of the Government's making. The promise of a strategic defence review to restructure our forces for the post-cold war world was undermined by a defence budget reduced in real terms. The SDR was never properly costed or properly funded. When the new chapter was written after 11 September, as the Labour-dominated Defence Committee has pointed out,

"ambition continued to run ahead of delivery".

Only a few weeks ago, the Select Committee lambasted the Ministry of Defence for doing away with existing equipment before replacement systems had been procured and tested, failing to tackle manpower shortages, and underestimating the importance of boots on the ground. Does the Secretary of State deny that these latest cutbacks will seriously damage our military capability and our ability to project power for several years, while we await the arrival of largely unproven technology?

Despite all the Secretary of State's extravagant claims to be increasing it, there is in reality a deep crisis in the defence budget. According to the latest report by the Institute for Fiscal Studies, the defence budget is lower in real terms today than before Labour came to power in 1997. Is it not clear that the defence budget is decreasing, not increasing? If it is not decreasing, why did the Chancellor promise £31.8 billion for defence in 2004–05 in his 2002 spending review, but only £29.8 billion in his latest—a real-terms cut of 6.44 per cent.? Under this Government, the defence budget has sunk so deeply into the red that the equipment overspend is in excess of £1 billion per annum. That is hardly a sparkling example of the efficiency of smart procurement.

Today, is the Secretary of State not taking his most reckless step so far—cutting tanks, ships, aircraft and men to make immediate savings, while making vague promises that new weapons will be delivered at some point in the dim and distant future? Is this not the worst form of post-dated cheque?

The Government parrot the mantra that numbers of platforms do not count, because modern warships are so much more powerful. Yet the same warship cannot be in two places at once, and the fewer the platforms the greater the proportionate loss when one is damaged or disabled. Does the Secretary of State accept that with the cuts in the frigates and destroyers, the fleet will not be able to fulfil the broad range of tasks assigned to it, which it performs so brilliantly with so few ships? How will the minehunters be able to continue the many tasks that they have been assigned? Can the Secretary of State confirm that only one carrier at a time will ever be in commission in future, and that without proper air cover? At the very least, the Government should give the Navy what it wants, serious land-attack capability for the reduced number of Type 45 destroyers, by fitting them with the tactical Tomahawk cruise missile.

We welcome the work that is being done to modernise the way in which the Army organises itself in this expeditionary age in which it has been so regularly and invaluably used. However, we consider the reduction in the size of the Army in general, and the infantry in particular, from a manpower target of 108,500 to the present size of 103,500 and a proposed established strength of 102,000—a cut of 6,500 men—to be extremely unwise. All the evidence and all the experience shows that declining infantry numbers will leave less time for vital training to keep up essential skills and less time for people to spend with their families, and will inevitably lead to an increase in the depressing cycle of overstretch as the infantry struggles with the many tasks that the Government give it.

Superficially, the proposals for large regiments have some logic and may appear attractive. Indeed, there is every reason for the Army to increase its usability, and to modernise the way in which it organises itself in this expeditionary age. My party believes, however, that at the same time we must at all costs retain that which makes the British soldier the extraordinary animal he is. The Secretary of State must remember that in these regiments are some of the qualities that set the British Army apart from all others, and that therefore the significance of the regimental system must be retained in any restructuring that takes place. All that these regiments stand for, and all that they have given over the years in the fighting efficiency of the Army, is not to be lightly tossed away as it has been this afternoon.

Does not the Government's astonishingly keen desire to present themselves as a wholly owned subsidiary of the American armed forces, and their attempt to keep pace with our most regular coalition partner, threaten some of the British military's more excellent traditional strengths? And what about homeland defence? How many civil contingency units are organised, manned, equipped and trained to deal now with a major terrorist incident in the UK?

Does the removal of responsibility for ground-based air defence from the Royal Air Force regiment to the Army not sound the death knell for a regiment dedicated to the defence of valuable air assets? Will not the accelerated scrapping of the Jaguar fleet deprive the Royal Air Force of an invaluable, cost-effective, recently upgraded ground attack aircraft? Over what time scale will the substantial cuts in manpower take place in the RAF and when does he expect to follow up the closure of RAF Coltishall with the announcement of further RAF airfield closures?

However powerful new ships may be, they cannot be in two places at once. However smart new systems may be, they cannot replace troops on the ground. As the implications of what the Secretary of State has begun to announce today sink in, will it not seem extraordinary to the British people that there should be such deep cuts across the board when our armed forces have never been so busy or in such demand, and at a time of such an accelerated threat?

The incoming Conservative Government—[Interruption.] The incoming Conservative Government will fully fund and equip our armed forces to carry out their agreed tasks and commitments. We will see to it that order and competence are restored to the management of defence and particularly to the business of procurement and logistics. If we are required to increase our defence spending, increase it we will.

I am delighted to see from his closing observation that the hon. Gentleman has not lost his sense of humour. What he has lost in the course of his remarks today is any credibility. If he is going to challenge the Government's spending plans and how those plans will meet defence needs in future, he has to say how he will fill the hole in spending created by his shadow Chancellor, who has made it clear that the Conservative party's spending plans involve a freeze in defence spending. Under its plans, by the time the substantial increase that the Government will commit to defence expenditure reached its conclusion, there would already be a gap of £2.6 billion.

From the hon. Gentleman's comments today, and earlier today on the radio, it seems that he is committed to reversing all the adjustments that we propose to make in defence capabilities. How much will that cost? What kind of calculations have the Opposition done on those arrangements? If he is to talk to the men and women of the armed forces about their future, he has to explain where the money is coming from. He has to explain to his shadow Chancellor what it means exactly to freeze expenditure—not the substantial increase in spending that the Government propose.

That is a serious problem for the hon. Gentleman. His own leader, when asked how much he would spend on defence, said:

"I can't tell you how much we will be spending on defence".

He did not know. The shadow Chancellor says that there will be a freeze in defence spending. What has been the reaction of the hon. Gentleman? He says that the plans are outrageous. What is the policy of the Conservative party? What exactly is it saying to the men and women of Britain's armed forces?

It is no good Conservative Members coming here and ritually saying how much they support the men and women of the armed forces. They have to explain how they are going to achieve that. The men and women of the armed forces live and operate in the real world. They have a real job to do with real equipment. It is no good coming along with fantasy figures, pretending that all these things can be restored, when there is a huge hole in Conservative spending plans.

I would have hoped that, after three years as Minister for the Armed Forces, the hon. Gentleman realised the difference between out-turn spending in defence—the money that has been spent on operations—and planned expenditure. I would have thought that, during those three years, the excellent civil servants in the Ministry of Defence would have explained that to him but unfortunately he did not appear to have learned the lesson.

One of the difficulties for Conservative Members is that, if they attack the proposals for restructuring our armed forces, they are attacking the Army board's proposals. I accept responsibility for these changes. I think that they are good for the men and women who are serving in our armed forces, but those who are tempted to attack the proposals need to explain to those men and women why the Army board has recommended those proposals, in the interests of the men and women of the armed forces and their families. That is vital to future capability—not dwelling in the past, not existing in some idyll of the past, which Conservative Members seem to believe is appropriate in respect of defence, but working out what is important for the future of the men and women in our armed forces.

The same arguments apply to each of the points that the hon. Gentleman made in relation to the Royal Navy. The proposals are strongly supported by the First Sea Lord, who recognises the importance of modernising our armed forces. There are similar changes in relation to the Royal Air Force.

The hon. Gentleman has come to the House over and over again and talked about overstretch of the infantry, but the pressure points in relation to our Army personnel are precisely in the areas that we intend to strengthen. We have a reduced requirement in Northern Ireland for four infantry battalions. We will use those posts to reinforce existing infantry units and to ensure that the logisticians, the engineers, the signallers and the intelligence people, all of whom have been under huge pressure in recent years, have more resources at their disposal. That is an entirely sensible arrangement. For him to talk about cutting infantry battalions as if that will add to overstretch is nonsense. If he thought about it for half a second, he would realise that.

What we see here is a feeble Opposition. If they ran our armed forces, they would end up sailing wooden ships. We would have squadrons of Sopwith Camels. Frankly, we would still have the cavalry. Those are the kinds of armed forces that the hon. Gentleman and his colleagues would visit upon his country.

I, too, thank the Secretary of State for early sight of the statement and pay tribute to the members of our armed forces.

Under Labour, our armed forces have seen an unprecedented tempo of action not only in combat in Kosovo, Sierra Leone, East Timor, Afghanistan and Iraq, but in filling vital gaps in the public services at home during the fuel crisis, foot and mouth disease and the firemen's strike. However, today, members of the armed forces will feel little reward for their unparalleled commitment. There is more money but the Government are desperately trying to do more with less. I agree with the MOD that there is a need to look at the defence budget, but Labour seems to be looking in the wrong places.

The most unbalanced part of the defence budget is the procurement programme—it is not infantry regiments, warships or RAF units. When it comes to cutting costs—or cutting corners—it is easier to cut current capabilities than future ones. Future capabilities take a long time to come on stream. Cuts are made instantly.

We welcome the decision on carriers that was announced today. It is right to take time to look at that, but why cut the number of surface ships and why order Type 45s without land attack capability? We welcome the decision on the C-17 announced by the Government today. We should have bought the four in the first place but which RAF bases are the Government considering cutting and why proceed with so many Typhoons that may never have an enemy to fight against?

On the Army, why invest so much in network-centric capabilities and effects-based operations, when the lesson of Iraq and Afghanistan is that winning the peace is more difficult than winning wars? That depends on low-tech soldiering, not high-tech weapons. We agree with getting rid of the arms plot but why cut the troop numbers? Which battalions are now under review?

The UK has a deserved reputation in conflict prevention and in peacekeeping. Spending on prevention should increase, so that we do not need to spend so much on cleaning up when it is too late.

The Secretary of State talks about redundancies. Can he give a cast-iron commitment today that no individual currently or recently serving in Iraq or Afghanistan will receive compulsory redundancy as a result of the announcements today? Does that mean that manning control is back? If 10,000 civil service jobs are to go, does that mean more work for uniformed members of the armed forces? Our armed forces are ridiculously overstretched, so why not use spare capacity to reduce overstretch? We do not know what the future holds. A little spare capacity would be a good thing. We do not need to issue redundancy notices.

The Secretary of State, however long he is in his current job, will be judged on whether he has the balance right—high tech on one side, troops on the other. The Liberal Democrats believe that today he has got that balance wrong.

I also look forward to a detailed assessment by the Liberal Democrats of their spending proposals on defence. So far, they have promised a lot but they have not delivered a great deal of detail. I know that the hon. Gentleman's heart is in the right place but, if he will forgive me, I sometimes wonder where his head is. I was somewhat puzzled that he started by criticising our expenditure on new equipment and then immediately—almost without a breath—suggested the purchase of an extremely expensive piece of equipment that he thought we had failed to announce. When he looks at his remarks in Hansard tomorrow, he might note a certain inconsistency about that.

As the hon. Gentleman travels the country, telling the workers of BAE Systems and other companies such as Rolls-Royce that the Liberal Democrats intend to cut remaining versions of Typhoon—which, incidentally, will be a multi-role version that is capable of ground attack, a rather vital military requirement at present, and is in no way outdated or redundant—he will be able to explain to the tens of thousands who work in the high-tech defence industry that the Liberal Democrats also want us to go back to wooden aircraft, presumably for flying across the fields of France. The idea that Typhoon—the latest and best fast jet available anywhere in the world—can be cancelled is nonsense and if he thought about it for a second, he would realise that.

As for redundancies and so on, there will have to be a reduction in numbers consistent with my announcement but I am confident that that can be done largely through natural wastage and confident that we can do it in consultation with the people affected.

I congratulate my right hon. Friend on achieving real growth in the defence budget for the third year running, which will be welcomed by the defence community. I agree about the importance of achieving value for money in support services to make way for expenditure on new equipment. Will he confirm his commitment to awarding contracts for support services, particularly for surface ship refits, on the basis of competition, rather than allocation? Does he understand the concerns of people in Plymouth that that was not borne out in the recent award of the contract for HMS Edinburgh.

I am extremely grateful to my hon. Friend for her thoughtful and measured approach to these difficult and complex issues. I agree that it is important that we look at the way in which defence funds are used effectively and competitively to provide the best equipment and the best repair. I have indicated that I will be willing to discuss with her the basis of the decision in relation to HMS Edinburgh. I understand why she makes such effective representations on behalf of her constituents.

I welcome the Secretary of State's commitment to the Eurofighter Typhoon. Will he put on record the numbers of aircraft that he is negotiating to purchase in tranche 2? Given the length of time it is taking him to negotiate best value in this context, will he also tell the House what are the barriers to further progress? When does he expect those matters to be resolved and when will the four partner nations be able to announce the purchase of tranche 2?

I am consistently grateful for the right hon. Gentleman's interest in Typhoon. I share his view that it is a vital asset for Britain's future military capabilities. Seven aircraft have now been received by the RAF and are performing better than anticipated, but these are commercial issues. The contract for tranche 2 will be signed when I judge that we have an offer on the table that is affordable and delivers the kind of capability that I judge to be necessary for the future of this country. I am grateful for the right hon. Gentleman's help in persuading the parties to the contract to produce a sensible proposal.

Does the Secretary of State accept that this is déjà vu all over again? I have listened on at least 10 occasions when announcements of cuts have been followed by promises of great improvements; I need to be reassured. Will he keep his diary free for the first week in September, as we will be inviting him before the Defence Committee to explain his statement, where he will face not rhetoric but real and serious questions? I accept that some of what my right hon. Friend said is good; I hope he accepts that. But who was the idiot who thought that we could cut the infantry at a time when the pressure on it was enormous? Has he consulted Gerry Adams or maybe the Fire Brigades Union about whether they will behave themselves over the next few years?

Finally, he may not know that the Staffordshire Regiment is to celebrate its 300th anniversary next year. Will it do so? Or, having seen off the French, Germans, Americans, Bolsheviks, Burmese, Zulus and assorted African and Indian armies, will it see off or be seen off by my right hon. Friend's Government?

I always enjoy my right hon. Friend's rhetoric and I accept that, during the deliberations of the Defence Committee, we will avoid rhetoric. I look forward, on a date of his choosing in September, to explaining to the Defence Committee in greater detail than I have done today why it is necessary to restructure the armed forces in the way the Government are proposing.

Will the Secretary of State now answer the question on the Staffordshire Regiment? Will he accept an invitation from me to come to Staffordshire in March next year to celebrate the 300th anniversary? Will he give a speech, assuring the people of Staffordshire that the regiment in which they have such wonderful pride will have a fourth centenary?

The hon. Gentleman has been an absolutely consistent supporter of the armed forces and has set out on many occasions in my hearing the importance of the Government supporting those men and women in their difficult and dangerous job. This restructuring is in order to allow those men and women to continue to do their job in the 21st century. The world has changed beyond recognition in terms of the kind of external threats faced by the men and women in our armed forces and by their families. Frankly, the idea that we can move those men and their families around every two years for essentially traditional reasons is long past its sell-by date. It is absolutely vital that we provide greater consistency in terms of our future requirements. As I said in my statement, identity is vital, as is maintaining the regimental tradition and history by which the hon. Gentleman rightly sets such store. There is no reason why, under our proposals, those traditions and that history cannot be maintained in the course of the restructuring.

Once again, I very much welcome the award of the work on HMS Edinburgh and HMS Walney to Rosyth dockyard—purely on the basis of much deserved merit—earlier this week. But I should greatly welcome a full and independent investigation into whether a competitive level playing field has existed between the two yards. Does my right hon. Friend agree that in terms of the tremendous asset, standard and merit of our armed forces—particularly in peacekeeping operations—the key has been having skilled men and women on the ground, relating to the local population wherever they are in the world? What assurance can he give—

Order. I am sorry to stop the hon. Lady but we have precious little time left for questions and an awful lot of people are seeking to catch my eye. Many will be disappointed if we do not have much shorter questions and, perhaps, short questions from the Secretary of State.

I will also try a few answers, Mr. Deputy Speaker. My hon. Friend has consistently supported the armed forces and I know that she gives a great deal of her time travelling around the world, seeing our forces deployed in a number of different theatres. On warship maintenance, perhaps I should invite her to the same meeting that will be attended by my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy), where we can discuss those matters in the round. Inevitably in a competitive environment, there will be winners and losers. But I certainly agree that we should regard this restructuring as part of the need to ensure that Britain's armed forces are equipped and trained to deal with the challenges that they face in this new and very difficult century.

This statement has confirmed that the sword of Damocles hangs over every single one of Scotland's historic regiments. One will be scrapped entirely and all the rest will be amalgamated into synthetic regional units; that signals the end of Scotland's six distinct infantry regiments. The Ministry of Defence also confirmed in a letter to me the devastating news for my constituency of a cut in the number of Nimrod aircraft at RAF Kinloss, the further privatisation of services at Lossiemouth and an uncertain future for the RAF Regiment. Both Kinloss and Lossiemouth will be reviewed with a view to making substantial reductions. Any closure or run-down of those bases has been—

Order. I ask the hon. Gentleman to put a question, please.

The local head of the enterprise company has said that any run-down or closure will have the biggest impact on the highland economy in living memory. Does the Secretary of State agree that it would indeed be a terrible blow to the local economy?

I have always had some difficulty in accepting the hon. Gentleman's arguments about defence, given that his party is committed to pulling out of NATO. If we did pull out, we would immediately no longer need the reconnaissance aircraft that he is championing. He should consider carefully what I said about regimental identity in Scotland. I am confident that, through these new and larger organisations, we can find a way to look after the interests of the men and women currently serving in the armed forces, and to provide them with a proper and sustained future. If the hon. Gentleman had any concern whatsoever for the people serving in those regiments, he would recognise the importance of these changes.

I, too, congratulate my right hon. Friend on winning a substantial increase in defence funding, but will reducing by four the number of battalions also mean that all un-amalgamated battalions will be re-organised into larger regiments? Will that proposed reduction change the received wisdom in the Ministry of Defence that an infantry battalion should always have a clear 24 months between operational tours? I ask that question because my own local regiment, the Duke of Wellington, which has a history of more than 300 years, is returning to Iraq in October after a stand-down time of only 14 months. If the answer to my questions is yes, will my right hon. Friend ensure that relevant Army officers are allowed to participate in discussions about the future of their battalions?

I am grateful to my hon. Friend for her observations. I should emphasise that in essence, the posts of the four infantry battalions no longer required for duty in Northern Ireland will be redistributed to strengthen existing battalions and to provide extra resources for those elements of our armed forces that have been under the most pressure in recent times. This entirely sensible and pragmatic change is necessary to ensure that the pressures about which Members have expressed concern are alleviated.

On the re-organisation of single-battalion regiments, there is a hybrid structure throughout the United Kingdom, in that some regiments consist of a number of battalions and others of a single battalion. It is certainly the Army Board's ambition to create a new structure in which single-battalion regiments are subsumed into larger organisations. But as I have emphasised, there is no reason why traditional regimental histories and distinctive uniforms cannot be maintained within that new structure and those larger organisations.

We support the concept of transformation—led by NATO's Allied Command Transformation, in Norfolk, Virginia—with which our troops are very well attuned. Such transformation will bring higher technology, greater flexibility and an asymmetrical capacity, but is the Secretary of State aware that if we prepare for it by cutting equipment and manpower, there will be an immediate defence weakness and—perhaps more seriously—a continuing weakness that will take many years to rectify?

The hon. Gentleman is right to emphasise the importance of NATO transformation, and the United Kingdom has led the way in ensuring that NATO's doctrine and military capabilities are transformed to face the challenge of the 21st century. But as he knows better than almost any other Member, NATO's capabilities are made up of contributions from nation states. If we fail to transform our own capabilities, we will be unable to offer the modern forces that we need to contribute, in order to allow NATO itself to develop and modernise. Such decisions have to be taken here and now in the United Kingdom; otherwise, we will be unable to make the effective contribution to NATO that the hon. Gentleman rightly says is necessary.

I commend my right hon. Friend on ending the arms plot and on stressing the importance of quality of life for serving personnel. Will he confirm that he will continue to invest in accommodation—the fundamental marker of troops' quality of life—which was disgracefully run down by the Tories when they were in government?

I entirely accept my hon. Friend's observation, which is based on considerable experience. We need to continue to invest in armed forces' accommodation; indeed, that bequeathed to us in 1997 by the then Conservative Government was appalling. We have put in place a significant number of programmes to improve such accommodation, and it is highly necessary that we continue to improve it.

The Secretary of State said that the details concerning the new organisation of infantry regiments will be worked out by the Army, and that an announcement will be made by the end of the year. He knows that a tremendous fight was previously put up to ensure that the Staffords were not reduced to a sludgy amalgam. Will he ensure that proper consultation takes place, and will he be taking personal responsibility for such matters or passing the buck?

Of course I take personal responsibility, but there is another, equally important issue. If the hon. Gentleman's concerns about serving members of the armed forces are genuine, he will recognise that it is vital that we make these changes in the interests of those men and women and, crucially, of their families. The arms plot cannot be sustained in the 21st century. Servicemen and women's partners have jobs and their children are in school, so a degree of domestic stability is vital to allow them to serve their country so successfully. If the hon. Gentleman were genuinely concerned about those people, he would support these changes.

As a former national service Royal Marine, I should point out that no Army regiment has a greater reputation than the Queen's Lancashire Regiment, and that it is able to recruit all its personnel from within the Lancashire area. May I assure my right hon. Friend that, despite what he said a few moments ago about maintaining uniforms and so on, his statement today will be regarded with grave concern in Lancashire?

I had the privilege recently of meeting senior figures in the Queen's Lancashire Regiment, and I certainly accept my hon. Friend's point about how successful it has been. But I am confident that within the reformed structure that the Army Board and I are advocating, the distinctive tradition of such regiments can be maintained and preserved.

I remind the Secretary of State of the fact that three naval bases are capable—[Interruption.] I am grateful for that invitation. If 11 fewer platforms will be available to the Navy by 2007, there must be serious concern about its ability to provide the capabilities that the Government require of it. What is the value of the cuts that he is making to the existing defence budget? Many of the people whom I represent regard those cuts as the price that they will have to pay for the failure of smart procurement to deliver the dividends that the Ministry of Defence promised.

There are no cuts to the defence budget, and the figures given are clear. This Government are committed to increasing consistently the amount spent on defence, over a prolonged period of more than 20 years. On platforms, it is vital that the hon. Gentleman recognises—I know that he spends a lot of time thinking about these issues—that there has been an enormous change in terms of what modern equipment can do. If we continue to preserve the equipment that the hon. Member for Mid-Sussex seems to think we should maintain for as long as we possibly can but that is increasingly inflexible and was designed for another era and another conflict, we will not be able to invest in the modern equipment that delivers the greater effects that can be achieved.

An obvious example, which I mentioned in the statement, is the accuracy of modern ordnance. We no longer need to fly huge formations of bomber aircraft across targets in the hope that perhaps 10 per cent. of the bombs will hit. A single aircraft with a single weapon is usually enough to deal with that target in modern warfare. The effects created by a single aircraft or a single Royal Navy platform are now so remarkable that we necessarily can adjust our platforms to go on investing in modern technology that will deliver those modern effects.

So following that, at the risk of incurring the wrath of the right hon. Member for Fylde (Mr. Jack), may I ask what is the use of Eurofighter, which is hugely expensive? Are we simply enmeshed in contracts that we cannot get out of?

On the contrary, Eurofighter will be an aircraft for the 21st century. It will provide air capabilities and have a swing role, with a ground attack facility. It is already attracting considerable interest. I was in Farnborough yesterday, and many of the overseas visitors at the exhibition were enormously impressed by Typhoon's capability. It is already winning competitions around the world, and I am confident that it will provide not only significant employment in the United Kingdom but a potent capability for the Royal Air Force.

Can the Secretary of State clear up some serious concerns and omissions in his statement, regarding the future of security in Northern Ireland? Will he confirm what will be the future battalion strength of the Royal Irish Regiment, and does it include the three home battalions necessary for backing up the police for internal security in Northern Ireland? Secondly, what is the future for RAF Aldergrove, and does it include the various forces involved in aerial surveillance for internal security in the Province. Thirdly, why are we losing the three Royal Navy coastal patrol vessels, when in the past 12 months an illegal load of imported arms came into the port of Belfast for a so-called loyalist terrorist organisation? To lose all three seems dangerous.

I accept that the defence role in Northern Ireland must be kept under constant review. We have to work closely with the Chief Constable to ensure that our view of the security situation is up to date, but as that situation is maintained at a much improved level from years gone by, it is right to consider carefully the level of resources required. Obviously, I take account of the hon. Gentleman's observations, and we must not take risks with security in Northern Ireland, but the four battalions that I have mentioned repeatedly today have not been based in Northern Ireland for some time, so I judge it appropriate to say that they are now no longer required for duty there. If there is, as I hope there will not be, a serious deterioration in the security situation there, we will have the flexibility and the capability to take appropriate action.

I welcome the recognition in the statement that warship building and maintenance require an accompanying industrial strategy from the Ministry of Defence. There was some recognition of that in the two refits commissioned for Rosyth. There is a need to do something similar for Swan Hunter on the Tyne. If my right hon. Friend cannot say now what that something similar will be, will he at least agree to meet me and the other Members representing the area so that we can discuss what can be done?

My right hon. Friend has been a strong and determined champion of Swan Hunter and his constituents employed there, and obviously I will be delighted to meet him. He is right to say that we need a co-ordinated industrial strategy for our shipbuilding, alongside the requirements of the Ministry of Defence and the Royal Navy. I will be delighted to discuss that with him on some suitable future occasion.

There is no doubt that the Royal Armoured Corps, the Royal Artillery and the infantry have handled everything that has been thrown at them over the past few years, and they have done so admirably. The fact remains that three quarters of battalions are now heavily undermanned. Those based in Nottinghamshire—the Secretary of State's area and mine—now have a ridiculously short time to rest, retrain and see their families between operational deployments. One regiment is so undermanned in Basra that soldiers are getting less than four hours—

Order. Clearly, some hon. Members have not been listening to what I have been saying. Will the hon. Gentleman now put his question briefly to the Secretary of State?

Of course, Mr. Deputy Speaker. I am most grateful.

Will the Secretary of State admit that reducing the number of fighting soldiers in the Army is an act of madness created by financial strictures rather than any tactical analysis?

I do not accept that for a moment. The hon. Gentleman and I have had some very thoughtful discussions about the problems of the modern Army as it faces the challenges of the 21st century, but he will recognise that the key challenge is how to maintain a number of concurrent operations. The real pressure has been not on infantry or on armoured units but on the logisticians, the support elements, the engineers and others who maintain the front-line forces. We propose to augment such staff in the restructuring, to allow them to have the full intervals that we have set out, so that we can maintain simultaneously a number of smaller but necessarily concurrent operations in a modern, more difficult world.

My right hon. Friend will be aware that there is some disquiet on the Labour Benches about a reduction in the size of the Army. In my constituency, and the rest of Cumbria and north Lancashire, we have no military bases at all, so we keep our contact with the armed forces through the King's Own Royal Border Regiment, and it would be a great pity if that tradition were to go, and we would have great difficulty in recruiting from these areas if the regiment were no more.

I agree with my hon. Friend to this extent, that it is important to maintain a footprint and identity right across the country. One of the problems, though, with the arms plot as it currently operates, and in particular for single-battalion regiments, is that they may not even be based in the traditional recruiting area from which they come, so it could well be that the regiment to which he refers is not even located in the area from which it is recruiting. I certainly anticipate a much greater identity between the recruiting area and the location in which people serve following the restructuring. That will be good for the footprint of the Army across the United Kingdom, as well as for the families of those who serve.

This shameful statement would be recognised by Kipling's Tommy Atkins. This Government neither understand nor value the work that soldiers do on all our behalf. The Secretary of State mentioned reservists, on whom such reliance has been placed in Iraq. Where does he intend that they train? Is it the case that Cultybraggan training area has cancelled all bookings for next year? Does he intend to sell that training area, and if so, does he intend to sell any more training areas in some sort of fireside sale?

I listened to the hon. Gentleman's tirade, but his real difficulty is that the proposals have been advocated and strongly supported by the Army Board and indeed by the chiefs of staff. For him to suggest that the Government are somehow forcing these reforms on the armed forces is frankly nonsense. Unless he can show how the chiefs of staff are somehow uncomfortable with what is proposed, he is merely substituting his own prejudices for the reality of what our modern armed forces have to do.

I warmly welcome the statement on Eurofighter, but may I reinforce the concerns in Lancashire about regimental restructuring and ask my right hon. Friend whether he is aware that we have had four regimental restructurings in Lancashire in the past 45 years and that the message from the QLR, and the King's Own Royal Border Regiment, which also recruits in north Lancashire and in Fleetwood, is that enough is enough? They want security and stability for the future.

I am mindful of my hon. Friend's point about the number of changes that have occurred over the years. It is certainly part of our determination to ensure that we provide a structure that is capable of lasting: it will be based on a regional organisation that will allow the distinctive identity of traditional regiments to be maintained and will mean that we do not need to change the structure every so often.

I would be glad if my hon. Friend would do two things for me. First, if she looked at existing arrangements across the country, she would see what a patchwork it is with multi-battalion regiments in certain parts of the country and single-battalion regiments elsewhere. In the interest of consistency for our armed forces, our proposals will deliver a second factor, which I hope that she will take back to Lancashire. What we are proposing is in the interests of the men and women serving. That may not be liked by the armchair generals of the Opposition who believe that their prejudices are more important than the reality of modern life for serving men and women. That is what it is all about—improving the way of life of people in service, not of the retired generals on the other side of the House.

The Secretary of State has talked today about an improved security situation in Northern Ireland, but he must be aware of the continued, very real and serious security threat along the border and in other parts of Northern Ireland. Can he give the House an assurance that whatever resources are required by the General Officer Commanding and the Chief Constable in Northern Ireland to meet security needs will be available?

I can give the hon. Gentleman that assurance, although I hoped that I had already given it. We certainly remain in close consultation with the GOC and the Chief Constable and if there is a significant deterioration in the security situation, we will take appropriate action.

Is my right hon. Friend aware that the Royal Scots, which recruits from the Edinburgh area, returned from Iraq earlier this year and is on call to go back there later this year? Does he realise that in that regiment there are men with wives and young families who have not been at home for Christmas for four years in a row? Given their potential contribution, including to UN peacekeeping in the future, surely we should not be considering disbanding any of the Scottish regiments.

If my right hon. Friend thinks through the premise of his initial observation, he will see that the proposals are designed to ensure much greater stability and consistency in the lives of those who serve and, indeed, for their families. That is well recognised by the Army Board—[Interruption.]I hear critical cries from Opposition Members, but, frankly, they need to talk to those who serve rather than to those who are retired.

Just like me, the Secretary of State has never served in the armed services or worn the Queen's uniform. Why has he not learned three basic, simple facts? First, technology can never replace manpower. Secondly, when we have serious problem of overstretch, it cannot be solved by cutting the number of troops. Thirdly, there are benefits from our regimental system, which is about loyalty and identity. I say to the Secretary of State: hands off the Cheshire regiment, because it has the support of the whole county and will fight to head off attempts to get rid of it, as we did before. The Army Board was wrong last time, and it is wrong this time.

I will check in Hansard, but I do not recall the hon. Lady speaking with such passion when her Government were cutting defence by 30 per cent.

She did.

I said that I did not recall it, but if she did, I am delighted to allow her the opportunity of making representations to her Front Benchers who are proposing to cut defence, should they be elected. If the hon. Lady is really concerned about the safety and security of the men and women in the armed forces, she will recognise that technology provides enormous protection for them. The programme that I announced yesterday—the Watchkeeper programme, which is the latest and best technology available—will provide us with intelligence and reconnaissance information well over the horizon, allowing those men who serve to be properly protected. That is what technology is about. It is not an either/or: we need both effective, well-trained people and effective modern technology.

The further increase in departmental spending is to be welcomed and it has to be better than what the Conservatives would do with a standstill budget. However, my right hon. Friend is fully aware of the strong support for the King's Own Scottish Borderers. History and cap badges are but two aspects of regiments, but recruitment and retention of personnel are vital and the KOSB has an excellent record. Over the coming weeks and months, will the Secretary of State make time available in his diary, because I will be coming to lobby him—and I suspect it will be on more than one occasion?

I would be delighted to meet my hon. Friend and I am grateful for his thoughtful approach to the subject. At least he is prepared to consider the arguments. Unfortunately, too many right hon. and hon. Members among the Opposition have already formed their own prejudices.

Is the Secretary of State aware that, if he goes ahead with the proposal to move RAF Boulmer to Lincolnshire, he will have to find at least £15 million—probably a lot more—to replace the facilities just being completed at Boulmer, and that the revenue savings, already greatly exaggerated, will quickly be eaten away by having to meet those capital costs?

That decision has not yet been taken, but it will have to be discussed in future.

My right hon. Friend rightly rejected the option of buying two second-hand aircraft carriers from the Americans and is pledged to plough ahead with building the two new aircraft carriers. In view of that, is it not about time that BAE Systems stopped moaning about perceived injustices and got on with working together with Thales and the UK Government to deliver on time and on budget? It is very important for Clydeside constituencies that BAE Systems clarifies its intentions with respect to the marine division.

I want to emphasise how co-operatively we work with BAE Systems and how pleased I am that it has agreed to the alliancing proposal that will ensure that it works closely with the Ministry of Defence and Thales in delivering those two magnificent aircraft carriers for Britain's armed forces.

As one of the armchair majors, may I draw the House's attention to my entry in the Register of Members' Interests? Does the Secretary of State agree that network enabled capability, like any other system, relies ultimately on the quality and calibre of the servicemen and women who operate it? The maintenance of morale will therefore retain its fundamental importance. What estimate has the right hon. Gentleman made of the impact on morale of his statement today?

I indicated to the House that we intend to update the remuneration and rewards available to those who serve so well as reservists. Once again, I congratulate the hon. Gentleman on his efforts. I ask him—he has spent some time working with the men and women of our armed forces—to consider the question of morale. The truth is that one of the most damaging aspects of lower morale, particularly in the Army, is the disruption caused to family life by the constant rotation that the arms plot involved. That is extremely damaging to personal morale. In my judgment, it is one of the reasons why many highly trained, expert men whom we would have liked to retain in our infantry battalions leave before they originally planned to leave—simply because of the effect on their families of moving around the country so frequently.

I welcome the Secretary of State's statement that the Ministry of Defence has learned the lessons about equipment from Operation Telic in Iraq. Does he believe that, as a result of the statement, there will be greater or lesser urgent operational requirements in the future?

The whole purpose of urgent operational requirements is to ensure that we have the right equipment for the particular operation being conducted. In our longer-term planning, we are trying to ensure flexibility—and flexibility is at the heart of the proposed changes—for the capabilities that we have available. Nevertheless, there will always be a requirement for some urgent operational requirements, since they are specific to the particular operation in hand.

Many constituents have approached me with their concerns about what might appear in the statement today. They recognise that high technology and what happened in the initial phase of the Gulf war demonstrated some of the Secretary of State's points in the statement, but believe that the real lesson that has still not been learned relates to what happened after the initial phase and the crucial role played by troops on the ground and the infantry. Does he recognise that it is vital for the restructuring that he does not squander what we will get by reducing numbers in Northern Ireland, but maximises the impact and availability of those forces for future peacekeeping roles?

Implicit in that entirely proper observation is the idea that technology is relevant only to the war-fighting phase, and somehow irrelevant to peacekeeping. The truth is that it is absolutely vital when one puts soldiers into a potentially hostile environment. For example, technology ensures that they can receive information and intelligence from commanding officers and that they can be evacuated by search and rescue from places of danger. The technology that we are providing—at the organisational level and to individual soldiers—will transform how they are able to conduct both the war-fighting and peacekeeping roles.

In last week's spending review, the Ministry of Defence was committed to making a contribution to the dispersal of civil servants' jobs, enthusiastically or otherwise. My right hon. Friend said today that he aims to make savings of £2.8 billion. I strongly support that and believe that it can be achieved. Will he clarify whether that figure includes an element of saving to be achieved by the dispersal of MOD activity to the regions? If not, when will he be able to make a statement on the matter?

The figure does include the dispersal element. Indeed, I am very proud of the MOD's record in providing opportunities for people to be employed outside central London and the south-east area. It has led the way among Government Departments in that, but there will be a further dispersal of jobs across the country. We anticipate that some 3,800 jobs will be dispersed in the near future, but that will be in addition to what has already been achieved.

Does the Secretary of State accept that his statement heralds the most substantial changes to the armed forces since the end of the cold war, that that has been driven largely by technological change and that a lower share of the nation's wealth, in terms of gross domestic product, is now devoted to defence? When I was in uniform, I was told that the inevitable logic of technological change was that, in 100 years, our armed forces would consist of one aircraft, one ship and one tank. Representations have been made by hon. Members of all parties about the importance of boots on the ground. Does the Secretary of State accept that war fighting has been the easy bit in the conflicts that the Government have undertaken and that the difficult bits are the subsequent peace enforcement and nation building? Is he prepared to accept that he and his Department may have got the balance wrong? Will he be prepared to listen over the coming months?

Obviously, I am prepared to listen. I recognise that the hon. Gentleman speaks with some knowledge and experience of these matters, as a serving soldier and as someone who in the past was involved in defence policy. He is right that it is necessary to ensure that we get the right balance between existing equipment, new equipment and numbers of people, but I do not accept the logic that he describes. A comparison between the numbers of aircraft needed to attack a target in the second world war—often with poor results but at huge risk to the airmen involved—and modern precision strike operations that may involve only one aircraft makes it possible to see the changes that have taken place.

I always recognise that this is a question of balance and judgment. I believe that the MOD and our armed forces have the balance right and that we must continue to invest in the new technology. In that way, we can continue to deliver the war-fighting successes that have been achieved in recent times. In addition, as I said in response to the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith), we can ensure that our armed forces are properly protected in an increasingly difficult peacekeeping role.

May I point out to my right hon. Friend that the Queen's Lancashire Regiment recruits its full complement from its own region? It will be much more likely to do so if it continues to exist under a Lancashire cap badge.

I accept the vital importance of the identity that is associated with traditional and historic regiments. I have answered similar questions several times already, and my hon. Friend makes his point very precisely. However, Lancashire covers a large area, and any organisation that replaces the existing single-battalion regiments in such areas will have a close regional identity.