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Defence: Spending Review and Aircraft Carriers

My Lords, the noble and gallant Lord will permit me a smile relating to his final sentence. I am sure that it is clear to the whole House that decisions will need to be taken on our equipment programme in the light both of the changing circumstances that we encounter on operations and of how we need to rebalance the programme to make sure that we properly prioritise those needs on operations. By that, I am not confusing the funding for operations that comes from the reserve and our UOR programme; I mean those matters that directly relate to what we regard as the nearer-term needs. Within that, let me be absolutely clear about FRES—the future rapid effects programme. As I have said, I recognise that the FRES vehicle—the future armoured fighting vehicle—is the single most important project to the British Army. It has seen delays but is now on track and I am determined to keep it on track to meet the Army’s requirements. Today’s announcements in terms of the CSR will not allow that to delay FRES, under my management of the project. I shall not get into a list of what specific projects need to be looked at, because there need to be negotiations with industry in terms of the contractual basis. From industry, we need recognition of the flexibility required to ensure that our equipment programme stays relevant to the challenges that we face now. They are often different from the priorities that may have been set a few years ago. It is that kind of flexibility that we now see from industry and that today’s announcements reflect.