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Defence Procurement

I begin by associating myself with the Minister's comments about our armed forces, especially those who have fallen in the conflicts in Iraq and Afghanistan. The sacrifices that they made should focus our minds on the issues before us. It is worth reminding ourselves, at the beginning of this debate on equipment, that without the professionalism, bravery and commitment of our armed forces, the whole debate would be pointless. Indeed, there are many who make a false distinction between procurement and welfare issues. Procurement is a welfare issue. For our servicemen and women and their families, there are few issues as important as whether they have the equipment to maximise their safety and ensure the success of the tasks that they undertake in our name. Today, we want to look at what the comprehensive spending review settlement will mean in the years ahead, at the Government's record to date, at the implications for the big procurement projects and at project management. As a share of total Government spending, defence expenditure has fallen from 7.8 per cent. in 1998 to 6.1 per cent. in 2006, despite the fact that we are involved in two wars—in Iraq and Afghanistan—with the inevitable reduction in the life expectancy of much of the equipment involved. Funding from the Treasury reserve for urgent operational requirements—UORs—does nothing to diminish an ever-increasing liability that must be met, in terms of equipment, at some point. In that context, we must look at Ministers' boasts that they will achieve a 1.5 per cent. annual real-terms increase. The last settlement that was trumpeted in similar terms to this one resulted in three infantry battalions being cut and the loss of three destroyers and three frigates. What are the likely casualties this time round? If the rumours and leaks circulating in the Ministry of Defence are anything to go by, we could lose a further five frigates and destroyers and two submarines, up to 6,000 personnel from the Army and two squadrons of Tornado GR4 attack aircraft, cutting the RAF's front-line squadrons from eight to six. Perhaps the Ministers will take the opportunity of this debate to snuff out those rumours. My hon. Friend the Member for New Forest, East (Dr. Lewis) made a point about the Navy earlier. This is not a question of a change in our assumptions about the Navy's numbers. The Government presented the strategic defence review, in which they said that they required two carriers and 32 destroyers and frigates. When the Government's security Minister was the First Sea Lord, he said that we could not get by with fewer than 30 destroyers and frigates. If the Minister thinks today that we can get by with a lower number, let him justify that to the House. We want to know what has changed in the strategic assumptions that would allow that to happen. The argument that we are normally given is that we do not require platform numbers because we have increased capabilities, but that argument cannot be deployed indefinitely. We cannot keep cutting platform numbers while saying, ““Because they can do more, we require fewer of them.”” Ships cannot be in two places at once. If the Government intend to make further cuts to the Navy, they must explain to the House, to the Navy and to the country what strategic changes have taken place that will allow them to move from the plans that they brought to the House of Commons in recent years. All these elements occur against the Government's poor record of managing the defence budget. In September this year, the Public Accounts Committee outlined the Government's performance. In 2005-06, 19 of the major equipment projects, excluding the Typhoon aircraft, were forecast to cost £27 billion, some 11 per cent. over the approved budget, and had been delayed by a further 33 months. Indeed, the Department's performance against its key user requirements is worsening, with only 17 projects being expected to achieve all requirements—one fewer than in 2004-05. As usual with anything run by the current Prime Minister, we have to read the small print to understand the true picture. Some of the procurement reforms of recent years might have helped to stop procurement costs spiralling entirely out of control, but substantial capabilities have been sacrificed to achieve that. The number of Type 45 destroyers being procured has fallen from 12 to eight, and possibly as few as six. There have been reductions in the number of guided multiple rocket launch systems, Brimstone missiles and recovery vehicles being procured. The Public Accounts Committee reported that the MOD had previously said that it had carried out a departmental review that came up with 44 ways to reduce the forecast cost of these projects by £781 million, or 3 per cent. of the total. Yet, on closer examination, it was discovered that £91 million represented a rebate and exemption from Her Majesty's Revenue and Customs, and a further £448 million did not represent real savings at all, as the Department transferred the expenditure to other budgets. The real effect of this mismanagement has been on the operational efficiency and safety of our armed forces. The most appalling indictment in the life of this entire Government has been that relating to the death of Sergeant Roberts in Iraq as a direct result of a Government decision not to procure sufficient quantities of enhanced body armour, purely for political reasons. The assistant coroner said that"““to send soldiers into a combat zone without the appropriate basic equipment is, in my view, unforgivable and inexcusable, and represents a breach of trust that the soldiers have in those who govern them.””" No more damning words have been said about any Government. Then there was the utterly inexcusable and, in my view, inexplicable decision in 2004 to cut the FRC helicopter budget by some £1.4 billion. At a time when our troops are facing a shortage of lift capacity in both Iraq and Afghanistan, that decision was astonishingly complacent, if not downright incompetent. The consequence has been a chronic shortage of helicopters in both theatres and, although we welcome the procurement of the Merlins and the eventual conversion of the Chinooks, that has all happened far too late in the day, as my colleagues who have had experience in Iraq and Afghanistan will attest.