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Conventional Weapon Stocks: Expenditure

Volume 836: debated on Monday 19 February 2024


Asked by

To ask His Majesty’s Government when they plan to provide an update on the spending of the £2 billion allocated in the 2023 spending review for replenishing conventional weapon stocks over the next two years.

My Lords, £1.95 billion was allocated in the 2023 Spring Budget to improve resilience and readiness across a range of defence capabilities. This is not just about new investments and new equipment; it will also be used to address long-standing challenges across the defence programme, which will make us better able to respond to new threats. The Ministry of Defence remains fully engaged with industry, allies and partners to ensure the continuation of supply to Ukraine and that all equipment and munitions granted in kind from UK stocks are replaced as expeditiously as possible.

My Lords, I thank the Minister for that Answer; I am not sure that it contained any information, but it met the basic specification. In my view, the moneys are not being spent on their original requirement. That could be for one of two reasons: first, that the money is gone because it has been spent on budget shortfalls and not on the original objective, or, secondly, that the MoD is not good at purchasing things. Let us take, for instance, the 155 mm shells which are very much desired by Ukraine at the moment. The letter of intent was in November 2022, the contract took nine months to negotiate—to July 2023—and none will be delivered until 2025. Which is it: has the money gone, or is the MoD not good at purchasing things?

My Lords, we have just short of £1 billion out for contract, so it is on the way, and we have invested a further £500 million in industrial capacity. Therefore, the money has not been spent elsewhere in the Budget; it is being spent on what it was originally purposed for. This is not the easiest thing to grasp. Resilience and readiness are all about improving capability through, among other things, updating weapon stocks and munitions and investing in manufacturing to ensure that stockpiles are current and ready to meet defence needs. It is not just about replenishing like for like on capability.

My Lords, has the Minister discovered the underground ostrich room deep in the Ministry of Defence? It churns out complacent ministerial briefs and Answers to Questions telling us that all is well: no procurement black holes, enough ships to meet operational needs, and recruiting and housing improving. Last July, the Commons Defence Committee report said:

“We have discovered a UK procurement system which is highly bureaucratic, overly stratified, far too ponderous, with an inconsistent approach to safety, very poor accountability and a culture which appears institutionally averse to individual responsibility”.

Can the Minister say what improvements and changes, if any, have been made, and whether the MoD really needs to employ 60,000 civilians—which is virtually the same size as our Army?

I thank the noble Lord for that question. There are a few feathers lying around in some of the rooms in the Ministry of Defence because one thing that the disaster in Ukraine has meant is that the speed with which effective procurement needs to be undertaken has really shaken a few things up. There have been occasions where—it has not happened in the past—specification has been compromised for availability. That is a very good indication that things are starting to move.

My Lords, can I take the Minister back to munitions and how we are restocking those supplies? Given the limited lifespan for anything stored, can he say something about the surge capacity for production, in terms of both manufacturing and storage?

My Lords, a lot of orders are outstanding, as I have just said, with an enormous amount coming through in the next 12 months. We are replacing everything that we have gifted to Ukraine as expeditiously as we can. As I think I have described once before, this is a holistic view. We are not just replacing like for like; we are taking advantage of improvements in technology to ensure that we have the correct weapons to meet the threat that defence faces.

My Lords, Russian shell production—not shell orders—next year is assessed to run at 4 million per year. The Secretary-General last week asked member states to increase arms production. In response, arms manufacturers, including Norway’s Nammo, suggested that this would be possible only if Governments shared risks with manufacturers, given the scale of the capital investment needed. Therefore, what discussions are we having with our NATO partners about formal mechanisms through which this can be achieved?

The noble Lord raises an extremely important and valid point. Noble Lords will know that NATO placed an order for 155 mm artillery shells on 23 January worth $1.2 billion. We have also placed two orders with BAE Systems and invested in its production capacity to ensure that we can also take delivery of the right amount of 155 mm shells. I understand that it has increased the production rate by eight times.

My Lords, the Defence Command Paper places great emphasis on technology and innovation. A great deal of innovation comes from small and medium-sized enterprises, most of which view the MoD as one of the world’s worst organisations with which to do business. What progress is the MoD making to change that culture and eliminate what those enterprises refer to as the “valley of death” between good ideas and commercialisation of those ideas?

The noble and gallant Lord knows only too well that procurement is really difficult when it comes to military assets. We had a conversation last week about appetite for risk, but getting SMEs involved at the correct level will always be quite tricky because of the scale of operation that we need to deal with weapons and munitions. However, it is absolutely a focus in the MoD to ensure that procurement is much more light-footed that it has been in the past.

My Lords, what is my noble friend the Minister’s assessment of Russia’s current conventional weapon stocks and its reliance, so we are told, on importing shells from North Korea?

My Lords, the Russian threat is paramount, and Russia must not on any account be allowed to prevail—there is no question about that, and the Government, the Opposition and everybody else are on the same page. Russia has ramped up its production capacity and has been using North Korean equipment, although its reliability is not quite clear. It is certainly something of which everybody is increasingly aware.

My Lords, while this investment was welcomed when it was announced, if the Minister’s department does not spend the money, the Treasury will claw it back. Is it not about time that he acted to make sure that the money is spent?

My Lords, I could not agree more. We are spending the money and as quickly as we can get it. We have delivered everything to Ukraine that we said we would. We are replenishing our stockpiles as quickly as we can, and we are investing in technology.

My Lords, Putin has increased his defence spending to 40% of GDP. That is, in effect, a war footing. I think that, in many ways, he almost thinks that he is at war with us. How, in all conscience, can our Government not immediately increase our defence expenditure?

My Lords, I think that everybody knows where I stand on this. There are competing demands on a finite amount of resource. The Government and the Prime Minister have made perfectly clear the direction of travel; it is just a question of when it is appropriate to get there and how far it goes.

My Lords, can my noble friend the Minister be a bit more precise about the quantities of ammunition being supplied to Ukraine and the different types?