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Defence Procurement

I have been a consistent opponent of the structure of the FSTA programme, which I think is the most absurd procurement programme of all, and there are quite a few applicants for consideration for that. It is an absurd programme that is hugely costly and years and years late, meaning that the RAF is having to carry on with clapped-out kit in the form of the VC10 and the TriStar, which is grossly unfair to the RAF and its officers and men. That is all because the Government have come up with this fancy way of doing it. The contract is signed, and we will have to see where we stand when we come into government. Sadly, that is for another day. As I was saying, there is a fundamental flaw in the Government’s approach. The Prime Minister hailed his economic stimulus as a route to recovery from the shambles that he has created, but for some obscure reason defence has been excluded. Billions of pounds can apparently be magicked up to bail out irresponsible bankers while the service chiefs have to fight for every last penny to ensure that the men and women on the front line have the kit that they need. Planning round 09 is still unsettled, and further cuts are being demanded. Nowhere is that clearer than in the case of the Typhoon tranche 3. The Financial Times reported this weekend that a deal to approve half of tranche 3—44 aircraft in the case of the UK—has been placed on hold by the Treasury, as my hon. Friend the Member for North Essex (Mr. Jenkin) pointed out. The Minister is clearly not prepared to confirm that report, although I understand that we will get a credit for half the 44 aircraft allocated to the UK in respect of the Saudi order. It would be helpful if the Minister told us something about that, because it is a very serious matter. He needs to tell the House what the consequences will be if the deal fails to go through. I am told that there is every possibility that Chancellor Merkel will be on the phone to the Prime Minister asking, "How on earth can you expect us to follow your example and bend to your wishes on global economics when you have reneged on the long-standing deal on the Typhoon?" The Minister needs to tell the House what implications there will be for the maintenance of key technology skills in this country if the deal fails to go through. Will we have to cede those skills to Germany or Italy, or will we have to pay a financial penalty?