HC Deb 04 April 1962 vol 657 cc597-608

Motion made, and Question proposed, That this House do now adjourn.—[Mr. M. Hamilton.]

10.31 p.m.

Mr. Victor Goodhew (St. Albans)

I am grateful for this opportunity to bring to the attention of the House and my hon. Friend the implications of the Government's recent decision to order the Avro 748 aircraft in place of the Handley Page Dart Herald. This is a matter of some concern and consideration in my constituency where we have a factory, at Radlett, at which are employed a large number of my constituents. As the end of the orders for the famous Victor bomber draws to a close, those constituents of mine naturally have their eyes on the future and have put a great deal of faith in this Dart Herald aircraft to help to ensure their future.

It is not normally necessary to declare that one has no financial interest in any matter one raises, but since it has come to my ears, in recent weeks during which I have been asking Questions about this subject, that certain people have suggested that I have a financial interest in Handley Page I think it would be a good thing to take this opportunity to make it quite clear that I have never had and have not at this time. I have a purely constituency interest, which I was prepared to explore, and indeed I was prepared to sacrifice it, if I felt that the national interest, which must come first, made this necessary, but in fact I have found that this is not so.

Perhaps we could just have a look at the history of this whole question of the Dart Herald, which was originally developed as a possible replacement of the DC 111 aircraft and was first built in 1955 with Leonides piston engines. It was in 1958 that the first flight was made with the present Rolls-Royce Dart propeller turbo engines. I would emphasise that no Government assistance or support was involved in the development of this aircraft. Therefore, this is an example of private enterprise, and one which, I should have thought, this Government in particular would have been glad to support.

I appreciate fully that the Government decided upon the policy some two years or more ago of rationalisation in the aircraft industry, and it was said at that time that, once the aircraft companies had merged into the large consortia, Government orders would be concentrated upon those five major groups.

It just so happens that Messrs. Handley Page have not amalgamated with any other large concern. I do not think it a matter for this House whether their reasons, even if they were available to us, were right or wrong. It would satisfy me if I merely knew that the chairman of the company felt that he had not had an offer satisfactory to his shareholders. I should think that he was carrying out his duty in such circumstances to refuse to amalgamate.

However, in spite of this policy of rationalisation and of emphasis upon the placing of orders with those large concerns newly formed, the Government did in fact in May, 1961, invite Messrs. Handley Page to submit a fixed-price tender for a military version of the Herald aircraft. This was a rear-loading transport aircraft for military purposes. Then the question which I ask myself at this stage is why this invitation to tender was made if it was felt that this policy of placing orders with the large consortia was to be strictly adhered to.

Messrs. Handley Page had great confidence in the Herald aircraft, and at that time the only competitor available was the Caribou, an old piston-engined aircraft made by a Canadian associate company of de Havilland. The Herald was an aircraft which could be produced at low cost, because the development was complete. Early delivery could have been offered—and, indeed, was offered—in 1961. Its performance was greatly superior to that of the Caribou, and its load and range capacity were also much superior. Indeed, Handley Page assumed at the time that the invitation to tender indicated the possibility of some orders being received, and I understand that a further £50,000 was expended on developing a military version of the Herald on this assumption.

In July, 1961, the aircraft was demonstrated at the expense of the company and at the invitation of the Air Ministry—a demonstration on unprepared surfaces at Martlesham Heath Aerodrome. The Army, the Royal Air Force and the Ministry of Aviation were there, and I understand that they were all completely satisfied with the performance put up by the aircraft. It seems to me that this was the stage at which orders could have been placed, because we then merely had a contrast between the Handley Page Dart Herald and the older piston-engined Caribou.

I understand that the Army tended to look upon the Caribou as something they might like, but they are ardent traditionalists at heart, and because it was an old-fashioned, piston-engined aircraft the Army's heart may have been warmed to it. But the Royal Air Force had no doubt. It was at this moment that I became anxious lest the Royal Air Force should be robbed of the best aircraft for the job because of the policy of the Government in giving orders only to the big, major groups. I therefore wrote to the Minister expressing the hope that the only consideration would be that the Royal Air Force should have the aircraft which it wanted. This was the point at which it seemed to me that national interest came well in front of my constituency interest, although the two really coincided. I have the old-fashioned view that the Minister of Aviation's job is to provide the Royal Air Force with the aircraft it needs. Therefore, I expressed that view.

Last month, after a further delay of about eight months, we found that an order had been placed for the Avro 748, in spite of the fact the Royal Air Force was more in favour of the Dart Herald. On 5th March I asked the Minister of Aviation a Question on the matter, and he replied that in practice there was no decisive difference between the two aircraft. I asked, in an intervention in a recent debate, who made this evaluation as to there being no decisive difference—whether it was made by the men in the Royal Air Force who have to fly these machines or by the officials in the Ministry of Aviation. It is no discredit to those officials to say that, in my view, the Royal Air Force are the people who should take such a decision, where there is a narrow balance.

I was disturbed to learn, when it was disclosed in a recent debate on the aircraft industry, that no high-ranking Royal Air Force Officer in the Ministry of Aviation is responsible for this sort of decision. We therefore have a situation in which the Herald is cheaper than the Avro 748—by all accounts; perhaps my hon. Friend will be able to let us have the actual figures—it is a high-wing aircraft, and therefore to be regarded as preferable to a low-wing aircraft for use on rough surfaces such as on desert land, when rocks and stones might fly up and damage the flaps; it takes a larger payload than the Avro; its cabin is higher and wider, and therefore able to contain much bulkier loads—indeed, it is wide enough to take two sticks of paratroops disembarking at the same time—and its performance during trials has been without exception, whereas I understand that the Avro 748 was bogged down twice when it subsequently came to trials.

The Herald is available much more readily than the Avro, because it is already in service on certain airlines, and twenty-one of these aircraft have been sold for civilian purposes already, including three to B.E.A. I need not mention that His Royal Highness the Duke of Edinburgh has been flying such an aircraft on his mission to South America, and we all hope that this will help greatly to encourage the sales of the civilian version.

We find that the Dart Herald takes the R.D.A.10 engine which is now in production. I understand that the Avro 748 needs a more powerful engine because of the weight of the aircraft and requires the R.D.A.12, which is not at present in use and will have to be specially developed. I do not know the cost Of development but an estimate has been made of £1 million. That would vitally affect the whole cost of the order. I should like to know how long it will take to develop this engine. The period I have been given is eighteen months to two years which, on top of the present delay of eight months, seems to me to be an unreasonable period.

A newly-developed engine would naturally have to be overhauled and inspected at much more frequent intervals than a tried and trusted engine. Presumably the R.D.A.12 would have to be inspected after 250 or 400 flying hours, whereas the R.D.A.10 would probably run for 1,500 or 2,000 hours before an inspection was necessary. Does not this mean that there would have to be an extra supply of engines to replace those which were being inspected, and that the capital cost and the cost of maintenance will be much greater if this special engine is to be used?

Added to this we have the restricted propeller clearance of a low-winged aeroplane and I understand that it was found necessary to increase the height of the undercarriage for clearance. When that was done it was found that the cabin was too high for loading and the undercarriage had to be made adjustable so that it would go up and down. This seems to me an unnecessary complication which can only be expensive in maintenance and manufacture.

There are a good many advantages which one could point to which the Herald has over the Avro 748. It is preferred by the R.A.F. It has a larger pay load. It is cheaper to buy and to run. It would be available two years sooner than the Avro 748. It seems to me that the Ministry of Aviation should have made an exception to its policy in this case. It would have been a logical exception. After all, the policy was designed to produce cheaper aircraft and in fact this is a cheaper aircraft, even though it does not result from the policy. It is reasonable because it would give the R.A.F. what it wants, which is what the Minister of Aviation ought to supply, and it would be equitable because Avro, one of the biggest of the consortia, had a chance to produce the aircraft and has not matched up to the aircraft which was produced by private enterprise.

I think that this shows that a certain shabbiness of treatment has been measured out to Handley Page Aircraft Company, the first in this country to be incorporated for the manufacture of aircraft. The company was a pioneer in commercial passenger flying and in the production of large bombers. I can look back during my lifetime and remember when the Hannibal aircraft was flying, and the Halifax bomber in the last war, and now the Victor bombers today fly over my home and my constituency.

I feel that this decision is purely political. It is a doctrinaire adherance to a policy decision taken two or three years ago and as such I deplore it. It is made even worse by the fact that the Minister seems to have failed to follow up certain offers made by Handley Page. I understand that the firm was appreciative of the difficulty confronting the Government by having entered into this policy of giving orders to the major groups and, therefore, it suggested that it might be possible for one of the major groups to manufacture the Herald. I believe that this offer has not been taken up. I ask my hon. Friend to ask my right hon. Friend to look at this matter again, bearing in mind the need to obtain for the R.A.F. the aircraft it really wants and as soon as possible, rather than to incur unreasonable delay. Also, as a matter of future policy, he should consider whether we are ever to get the aircraft the Services need so long as the Ministry has the choice and there are no consultations with high-ranking Air Force or other Service officers with more knowledge of what is required.

I close by thanking the House for this opportunity to debate the matter, and I express the hope, not only in the interests of my constituents who have great faith in this aircraft, but also in the interests of the Royal Air Force, that this question will be looked into once again.

10.45 p.m.

Mr. John Cronin (Loughborough)

We on this side of the House are very concerned about the situation which has arisen in regard to the Avro 748 and the Handley Page Dart Herald, and we are grateful to the hon. Member for St. Albans (Mr. Goodhew) for bringing the question before the House.

So far as I know, both are excellent aircraft. Although the hon. Member has made a good case for the Handley Page Dart Herald, I have no doubt that there is much to be said from the opposite point of view. It may well be that there is not much difference between them, but it is important to bear in mind that it is widely said that the Handley Page Dart Herald has been stood down as far as this order is concerned purely for the political reason that it is not produced by one of the consortia, and it is also widely said that this aircraft is more satisfactory than the Avro 748. If that is the case, obviously it will cause considerable impairment of the morale of the aircraft industry, so I hope that the Parliamentary Secretary will give us a detailed explanation of the situation.

I understand that this deal has not yet been closed. If that is the case, I shall be glad if the hon. Gentleman will undertake that there will be a detailed explanation of the relative merits of these aircraft when the deal is finally closed and that in the meantime he will give us what information he can.

10.46 p.m.

Mr. W. R. van Straubenzee (Wokingham)

I wish—in one sentence only, for obvious reasons—to add to the plea so ably made by my hon. Friend the Member for St. Albans (Mr. Goodhew) and the hon. Member for Loughborough (Mr. Cronin), from the point of view of one who represents in this House a constituency containing the Woodley factory of the company. A very large number of persons there who add very greatly by their skill and knowledge to the value of the aircraft industry in that part of the country are anxiously watching this position and, like myself, they want to hear far more fully than they have heard so far by way of explanation from the Parliamentary Secretary.

10.47 p.m.

The Parliamentary Secretary to the Ministry of Aviation (Mr. C. M. Woodhouse)

I am grateful to my hon. Friend the Member for St. Albans (Mr. Goodhew) for giving me this opportunity to set out the facts on a matter which I am very well aware has caused wide public interest, which has been expressed both in this House and in the Press.

The military requirement with which we are concerned is for a new light cargo aircraft for two purposes, firstly to provide support in war for forces operating in the field and, secondly, to serve in peace as a replacement of the Valetta for general use. This requirement, as my hon. Friend said, was formally put in May, 1961, to the Ministry of Aviation by the Air Ministry and by us to a number of manufacturers. Several air-oraft both British and foreign were considered for the requirement and after a technical evaluation the choice was narrowed down to three aircraft, two British, the Avro 748 military freighter—a modified version of the Avro 748—the Handley Page Dart Herald and a Canadian aircraft, the Caribou, manufactured by a subsidiary of the Hawker-Siddeley Group. I shall not waste time over the Caribou, which is already in service in the United States and Canada and was therefore ready for earlier delivery than the others and did in fact meet the war-time requirement, but was judged to be inferior in a number of respects for the peace-time role.

It is not the custom, for good reasons I think, to canvass publicly the individual characteristics of aircraft in such circumstances, because the Government's requirements are to a very tight specification and one would not wish to prejudice any aircraft in any of its other markets by appearing to suggest that simply because it did not meet the extremely tight Government specification it therefore was not up to the mark generally.

I can give the House certain information about both the Avro and the Herald, which incidentally are both private ventures, without support from Government money in the previous stages. There is no distinction here between the Herald and the Avro 748. Both were given a thorough trial in their civil version and the flight trials of both were conducted at the same place in similar conditions. On both occasions experts were present at the trials from the Royal Air Force, the Army, and the Ministry of Aviation. The Ministry of Aviation experts include a substantial number of senior Royal Air Force officers, so in a sense the Royal Air Force was represented twice over in these exercises. It was, as has been said by my right hon. Friend, concluded that there was no decisive difference in the estimated performance or the operational characteristics of the two aircraft. The decision that there was "no decisive difference" was made, not by chairborne officials, but by the technical specialists of the Ministry of Aviation, in close consultation with the operational staff of the Air Ministry, and the conclusion was endorsed by the Minister of Defence himself who, as I am sure the House will agree, can speak for the technical experts in the Air Ministry.

I come now to particular characteristics. I will take payload first, which affects the number of aircraft to be ordered. There is no significant difference in the cabin dimensions. In the weight that can be carried, the Herald has a slight advantage which would be greater in some very exceptional circumstances than in others. But after careful study with the Air Ministry it became quite clear that, whichever of these two aircraft were ordered, the same number would be required. There may have been some confusion because in the case of the Caribou a larger number would be required, but in the case of the Herald and the Avro that is not the case.

With regard to delivery dates, it is probably true that the Herald could be released for service a few months earlier than the Avro 748, but the estimated delivery dates for the entire order would be very much the same and in both cases it would depend on the same limiting factor. The limiting factor concerns the engine, on which I should like to reply to the points raised by my hon. Friend.

My hon. Friend asked about the additional development cost for the Dart 12 engine. This is still being assessed, but, as far as we can foresee at the moment, it is likely to work out, spread over the whole order, at about £5,000 per engine. The time scale is that it would need about eighteen months for development from the date of contract, but the important point which I wish to emphasise is that the recommendation of the Ministry of Aviation experts was that, whichever of the two aircraft were chosen—the Avro 748 or the Herald—the Dart 12 engine would have to be installed if either aircraft were to meet the specification. With the Dart 10, the Air Ministry specification would not be fully met.

The subsequent cost of stocking and maintaining engines would be substantially the same, whether it was the Dart 10 or the Dart 12, because from the Royal Air Force's point of view both are new engines, but I emphasise again that for either aircraft the Dart 12 would have to be installed.

1 turn now to price. My right hon. Friend explained on 5th March in answer to a Question that the price for the Avro remains to be fixed by contract, and that is conditional upon reaching satisfactory terms. It is not the normal practice to give details of the quotations, and I shall not do so. However, I should like to answer a question put to me during the debate on aviation the week before last. I was asked whether the price quoted by Handley Page was a fixed price for the Herald. The answer is that we asked both firms to submit quotations which we intended to use as a basis for a fixed-price contract, but it was only at the contract stage that it could be called a fixed price in the ordinary sense of the words.

It is not a simple matter to arrive at that fixed price, because early quotations, even if called fixed-price quotations, are not related to detailed specifications which could have contractual force, and they must be treated with reserve until detailed technical specifications for the aircraft and the associated engines and equipment have been finally determined. Moreover, the price paid would be subject to negotiation after detailed investigation by my Ministry's technical cost experts, and that has not yet taken place. Finally, the manufacturers usually include in their quotations reservations and conditions which may affect the price, and both manufacturers did so in this case. It is, therefore, impossible to regard the quoted price as a fixed price until contract negotiations are concluded on the basis of a detailed specification.

On the basis of initial estimates, the conclusion, taking into account all the relevant factors, was that the difference in total cost to the Government between equipping the Royal Air Force with Avros rather than Heralds, and the cost of operating and maintaining them after purchase, would be unlikely to be very great, and it might weigh in favour of either aircraft—

Mr. Cronin

I apologise for trespassing on the Minister's very brief time, but he has dilated at some length on the similarities of the two aircraft. What I think both sides of the House are particularly anxious to know is largely why the Government have come down firmly in favour of the Avro.

Mr. Woodhouse

I am grateful for that intervention, because it enables me to pass over one or two points that I would otherwise have had to cover in detail.

Against that background of a lack of any substantial, any decisive, difference between the two aircraft, we had, of course, to take into account the Government's declaration of policy, made two years ago, in which the key phrase in this context is that Except where specialised requirements or public policy make it necessary to do otherwise, we intend to concentrate Government orders on the five major groups."—[OFFICIAL REPORT, 15th July, 1960; Vol. 617, c. 958.] If, in this particular case, we had decided otherwise, the onus would have been on us to prove that there were exceptional circumstances justifying a departure from that policy. There were no exceptional circumstances. My hon. Friend asks why, in that case, Handley Page was invited at all if it were a foregone conclusion. The answer is that it was not a foregone conclusion. There might have proved to be exceptional circumstances, and to refuse to let Handley Page tender in those circumstances would have prejudged that possibility and would, in fact, have been in contradiction of the policy declared in February, 1960.

In conclusion, I should like to reiterate, as the hon. Member for Loughborough (Mr. Cronin) has very rightly said, that these are both very fine aircraft, and I should like to pay a personal tribute to the technical and engineering skill that has been put into the Herald as well as the Avro 748. That is not merely a personal tribute, because some useful orders have already been placed for the Herald and, as I have said, the Government have themselves purchased three for B.E.A., and in one of them the Duke of Edinburgh is now touring Latin America.

Those aircraft were bought to encourage sales in a market for what might loosely be called a Dakota replacement that we feel to be potentially very large. We hope that both aircraft will be successful in that market, and that both will make a contribution to our exports. Although we can understand the disappointment of some hon. Members, with the best will in the world we could not choose more than one aircraft for one Service requirement, and we believe that our choice was the right one.

Question put and agreed to.

Adjourned accordingly at one minute to Eleven o'clock.