HC Deb 03 August 1965 vol 717 cc1605-22

8.9 a.m.

Mr. Eric S. Heffer (Liverpool, Walton)

I shall be as brief as I possibly can about the point I want to raise in connection with arms expenditure. I want to raise this question because I feel that it goes to the very root of the economic problems with which we are faced at present. I think that it also has an effect in relation to international affairs and the Government's policy with regard to our rôle east of Suez.

I am convinced that this country cannot continue to bear the present heavy burden of arms expenditure. I think that a great deal of our modernisation is being retarded because of the high arms expenditure. Everyone accepts and knows that we are facing a serious economic situation, and this was underlined by the news that we received yesterday of the drain on our gold reserves. Everyone accepts that we are in this difficult situation. We also know—we heard this in the discussion that took place in the last few minutes—that there is a great need to meet the needs of our people in relation to housing, schools, roads and hospitals. We know, too, that these things are being retarded precisely because of our economic situation.

Mr. William Yates (The Wrekin)

Hear, hear.

Mr. Heffer

The hon. Gentleman says "Hear, hear". The policies pursued by the Tory Government for 13 years are responsible for our present situation, and if we are to get to grips with it we cannot rely purely on a long-term policy of the modernisation of industry and higher productivity. It is vital that we take some immediate steps to cut our arms expenditure much more than is being suggested by the Government.

The Government have made it clear that by 1969–70 we shall bring our arms expenditure down to £2,000 million per annum, based on 1964 prices. This is a most welcome step, and is certainly an advance on anything that we could have expected from the Tory Party. What we had from the party opposite was a continuing rise in arms expenditure, and this trend is being reversed by a Labour Government. But, having said that, I think—and the entire Parliamentary Labour Party agrees with me—that we must do much more to get to grips with this problem.

I should like to give the House one or two figures of our overseas expenditure. Germany costs us £180 million per annum. The Middle East, which includes £35 million for the base in Aden, costs £60 million. The Mediterranean, which includes £25 million for Cyprus, costs £60 million. The Far East, including £15 million for Hong Kong, costs £270 million. At the moment we have 50,000 troops in Malysia and connected with Singapore. Army expenditure in Singapore in 1962–63 amounted to more than £28 million. Air Force expenditure amounted to £21 million, and for the three Services it totalled about £72 million. If we add to that certain civilian services, and so on, we find that the operating costs in Malaysia are approximately £100 million a year.

We cannot hope to solve our economic problems, or even to begin to get to grips with them, while we have this huge expenditure on overseas bases, together with our military commitments and general arms expenditure. I appreciate that within the limit of our commitments the Government are doing everything possible to bring down our expenditure. But it is not merely a question of bringing it down within our present commitments; it is a question of reducing our commitments. This means that there must be political settlements to the situations in South-East Asia, South Arabia and the Middle East.

I do not accept the argument that we have a special rôle east of Suez. Let us suppose that the Russians and the Chinese decided that they had a special rôle west of Suez. What would we say if the Russians decided that they ought to have battleships cruising up and down the English Channel because that part of their commitment west of Suez? We are a Socialist party. We believe in a Socialist policy, and that means that we cannot continue the Tory idea of being the policemen of the world. We must therefore cut our commitments and bring about political settlements in the Far East and Middle East.

I emphasise that we appreciate everything that is being done by the Government. No one is suggesting that the Government are not trying to get to grips with the difficult situation that this country has inherited from the Tory Party. But we must do much more. We must ensure that our people get the social benefits that we promised. There must be a stepping up of the housing programme and not merely its containment within the present limits. We must be able to give our people the sort of old-age pensions they desire and the old people's homes that are needed.

We can do this only if we take immediate steps to ensure a drastic cut in arms expenditure.

8.18 a.m.

Mr. Michael Foot (Ebbw Vale)

I understand the impatience of the House to conclude a long debate on the Third Reading of the Consolidated Fund Bill. I understand that one or two of my hon. Friends wish to speak on this matter, so I will compress what I have to say in support of my hon. Friend into what I hope will be a very few sentences.

We understand that in one sense we are pushing at an open door, which is a very good thing to push at. If we needed any further incitement to do so it was given us by my right hon. Friend the Chancellor of the Exchequer in his speech in the Motion of censure debate, when he quoted the striking figures showing the increase in our overseas net Government expenditure in the past eight years. Comparing 1956 with 1964 there was an increase of £240 million, to £552 million. I know that some of this is not military expenditure, but I imagine that the bulk of it is.

There has, therefore, been a sensational increase in eight years in the military burden, in terms of overseas expenditure, which the country is required to carry. Ten years ago we had greater commitments throughout the world than we have now, so there is some mystery as to how this vast increase occurred. However, it has occured, and it is quite clear that it must be reduced. If we could cut out a great part of the military proportion of that increase the consequent contribution to the solution of our balance of payments problem would be striking. Therefore, we must press the Government to do everything they can in this direction.

The Government say that they are now carrying out a review of the defence expenditure and of the commitments generally. The reason why we are pressing so strongly in every way we can, by the statements some of us have signed and issued, supported by large numbers of hon. Members on this side of the House, and the reason why we press this matter elsewhere, and the reason why we think it was quite right to press this issue in this debate and we do not think it anything improper that the House may be concluding its discussion on the Bill with this important question, is that we want the Government, when they conduct the review during the summer—and presumably there will be some reports of their review in the next month or two *** —to understand how powerful and growing every day is the pressure on this side of the House to ensure that the review and the cuts shall be as drastic as possible and as swift as possible—swifter than the Government have already proposed to the House.

This is what we wish to achieve. I believe that the Government, in spite of all difficulties, have, as my hon Friend has said, a great prospect ahead of them. Throughout the night we have had some indication of the great things that can be achieved if the Government can win the time to achieve them. I believe that by cutting military expenditure more drastically than they have yet attempted to do they can gain the time and the means to achieve the things which they want to achieve.

Some of us in the Labour Party have been through these arguments before, and when we look back on them they tell on our side. Those who look at what happened in the 1945–51 Government will see how that Government had to face the enormous difficulties of how they were to deal with overseas expenditure. In Hugh Dalton's book on what happened inside that Government it is revealed how pressure from the Chancellor and the economic side of the Government lost the battle, and it was partly because they lost the battle on the burden of military expenditure that that Government later got into difficulties. I urge upon the Government to recognise how strong, passionate and determined is the desire of the overwhelming majority of hon. Members on this side of the House that the cuts shall be sufficiently drastic and swift to enable the Government to carry out their full economic programme.

8.22 a.m.

Mr. Robert Woof (Blaydon)

My hon. Friends the Member for Liverpool, Walton (Mr. Heffer) and for Ebbw Vale (Mr. Michael Foot) have thrown a good deal of light upon the need to reduce military expenditure, and because we are faced with economic and financial difficulties the demands which are made upon us with so many preoccupations dominating our minds, I readily endorse the main thesis that has been advanced.

While this is held on grounds for which there is an immense deal to be said, I think flat both sides of the House will agree that there is an earnest need to put our intelligence to the present situation. It bears directly and pertinently upon the reasons which have led us into the existing state of the economy, and the means by which we might hope to emerge so as to regain the offensive. Having in mind those periods in the history of the world in which the discovery of new weapons and the means of waging war fundamentally changed the art of war, the changes made necessary in the military organisation, and new techniques, are now contributing very considerably to the greatest arms race ever known.

There is no valid parallel in history. It is going at full blast—the military expenditures of practically every Government of any consequence are straining their resources to the uttermost. It affects the existence of all of us. In terms of money, translated into military power—and manpower is sufficiently alarming—it has grown constantly more intense. Tremendous amounts of money are being spent, a tremendous amount of material used, with an army of talent and genius mobilised for the job. But the stark reality is that Governments throughout the world are spending no less than £50,000 million today and, because of its spectacular nature, it must attract a great deal of attention. It would, I think, be a mistake to judge events by themselves, without remembering that they arise out of developments which have been piling up over many years.

As a consequence, people of profound thought and people of profound learning, realising that we are facing major tasks, warn us to set the country on its feet again, to give it a sound economic and financial basis, which implies the modernisation of our whole economic, financial and social life. It is understandable, one must admit, that our economic position would be eased only if this country is able to get out of its balance of payments difficulties, but the outstanding fact is that our annual overseas military expenditure is being soaked to the tune of £350 million in foreign currency, which is almost half last year's depressing deficit of £750 million and accounts for a great deal of the balance of payments problem.

The unfavourable state of affairs in which a very high proportion of our national wealth is devoted to the £2,120 million defence budget should help us to interpret more accurately the reason it is more difficult to reorientate ourselves with the objective of harnessing wealth for the nation's well-being. This financial over-strain brings a sharp reminder of the primary and elemental place in the catalogue of our needs.

It has been explained often enough that the previous Administration committed the Government to such an expenditure programme that was to be based on the revenue and savings which would accrue from a growth rate of 4 per cent. per year in the gross national product, but the latest survey on the state of our economy by the Organisation for Economic Co-operation and Development came to the conclusion that a 4 per cent. growth rate is beyond Britain's capacity at present.

It also made the important point that the recovery process of the sterling crisis would be a long one and that it would be several years before Britain's debts were repaid. I appreciate that priority must be given to defence of the £. It is a very vital matter, but, as the arms bill is very much at the root of all our economic difficulties, I believe that we must have a programme designed to bring our military demand into line with our financial resources, as, above everything else, we want to avoid the bill continuing on the same upward trend.

While my right hon. Friend the Chancellor of the Exchequer last week introduced further measures to avoid the £ coming under insuperable pressure, I feel that his announcement to reduce next year's defence programme by £100 million is inadequate. Surely it must be admitted that too much has been spent on armaments and that this gravely weakens Britain's economic strength and independence. I feel that this is not good for Britain, being saddled with such heavy bills. The only way to relieve the burden and help to solve the balance of payments problem would be to abandon much of the cold war policies which send British troops thousands of miles away, with the terrific costs of upkeep.

This is very expensive indeed, and I believe that we must have a cost-conscious approach to the amount of military expenditure which the economy can safely bear. I think we should feel much happier by refusing to plunge into the bog of foreign military spending and huge armaments. Nevertheless, I wholeheartedly agree with my right hon. Friends the Prime Minister, the Secretary of State for Defence and the Chancellor of the Exchequer who are seeking with varying degree of adroitness to reduce military expenditure. One of the first facts which I think should strike them—and I no doubt that it does—is the great volume of British private investments overseas. Since 1952 more than £3,000 million has been invested abroad. While this brings in some return in the form of interest payments and profits, military expenditure which amounts to about £2,500 million over the same period has brought in nothing. A point which deserves particular notice in this respect is that while much economic history has been largely a record of enterprise, the export of capital and the activities of such financial interests has meant that some of the consequences of growing financial appetites reflects a painful and greater demand on military expenditure.

In a way this is nothing new. As far back as 1897, in June and July of that year, Joseph Chamberlain stated in a confidential report of a conference at the Colonial Office that These Fleets and this military armament are not maintained exclusively or even mainly for the benefit of the United Kingdom, or even of the defence of Home interests. They are still maintained by a necessity of Empire. The only difference between Joseph Chamberlain's time and ours is that export of capital and military expenditure has rocketed out of all proportions, while the Empire has largely disappeared.

One of the consequences of this difference was noted by the Select Committee on Estimates dealing with military expenditure overseas. It stated, In days before Air Trooping, it was clearly necessary to maintain forces on the spot at a base overseas capable of dealing with practically any emergency. Nowadays a military presence on this scale is no longer necessary. As a member of the Sub-Committee which carried out the actual investigation into military expenditure overseas, I welcomed this conclusion. There should be no cries of anguish about this. It should enable an initiative to be taken with the review of defence expenditure which has been promised.

Might I say that "review" is a word often used as being a necessary preliminary before deciding to do nothing, but in this case I do think that it should mean to think of reasons why things should not go on as they are now. Old ideas, like old habits, die hard. It used to be argued that we must retain bases to safeguard our possessions and economic interests, but the idea that we can maintain trade by maintaining a military presence in some areas is now out of date.

I think that the Persian Gulf should serve as an object lesson. I readily accept that the assurance of adequate supplies of oil is one of the first essentials even in peace time to developing and maintaining great industrial establishments and systems of transportation. I do not see why many millions of £s of the British taxpayers' money should be spent in that area, particularly when wealthy American oil companies in the area are extracting far more oil than we are and do not contribute anything by way of military defence.

American companies have been quite successful in their petroleum enterprises, through obtaining concessions, and have developed extensive distributing and marketing facilities in both Europe and throughout the East. I believe that oil supplies should be sought and guaranteed through commercial arrangements. There is no need to spend about £125 million a year of much needed taxpayers' money.

No one will dispute the desirability of keeping the peace in the Middle East, but there are other countries with a direct interest in the stability of the area—and their defence budgets show that they contribute far less than we do. I hope, therefore, that in reviewing defence expenditure it will be viewed in the light of changing reasons which cannot justify the spending of such colossal sums of money on military bases, wherever they happen to be.

The Times, not usually regarded as revolutionary in matters of defence, compared the situation to the cherry tree which Catherine the Great planted in the Royal Gardens of St. Petersburg. To prevent damage, she gave orders for a platoon of soldiers to guard the tree. Years later the tree had died—but the soldiers were still standing guard over a patch of grass and weeds.

It is not necessary for me to enumerate the stupendous tasks which we face. However, I submit that there are com- pelling economic reasons why we need to redeploy the forces of production and rearrange the nation's budget with a great deal less being spent on military matters. We must do this on a scale which requires a drastic cut in our defence commitments. If we are convinced that the stand we are taking is in accordance with the interests of the country as a whole and if we are to release more public money for economic and social services, then we must neglect nothing to make that aim triumph.

8.38 a.m.

Mr. Philip Goodhart (Beckenham)

I intervene briefly in this rather one-sided civil war among hon. Gentlemen opposite. I appreciate that the Government are in an anxious dilemma which they have tried to get out of by speaking in different voices at home and abroad.

On the wide economic front they have in the last few months sounded a note abroad saying that the deflationary cuts which they have been making will be effective, while at home they have been telling their supporters that the cuts will not produce deflation at all. In the rôle of defence, the picture is reversed. Abroad the Government have been telling their allies that their defence programme means that the forces of this country will continue to be strong and will continue to play a full part in all their alliances, while they tell their supporters that drastic cuts are on the way.

It is possible to sound different notes at home and abroad, but it is not possible to do that and retain the confidence of people at home and abroad. It is that difference in emphasis that is one of the reasons why the Government's prestige continues to sink.

8.40 a.m.

Mr. Stanley Orme (Salford, West)

I rise to support what has been said by my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) and other hon. Members on this side of the House. We welcome the intervention of the hon. Gentleman the Member for Beckenham (Mr. Goodhart), as we welcomed the intervention of his right hon. Friend the Leader of the Opposition yesterday. We welcome the fact that he quoted the widely reported resolution which had been passed by the Parliamentary Labour Party. If he and his hon. Friends would like to make it a political issue, take it to the country and test us on whether firms expenditure should be reduced, we should welcome that, too.

The electorate would support us. They would support us against the party that has wasted hundreds of millions of pounds over the last 13 years, and they would support us against a party which will have left us with a current expenditure of between £2,500 and £2,600 million at the present time, the party that supported Blue Streak and the TSR2 at a total expenditure of £750 million. That is the sort of attitude that the Conservatives had. If they are going to try to end the bipartisan policy that they have pursued in the past on defence, my hon. Friends and I welcome it and will willingly take the matter to the electorate. I should be happy to take it to my own constituency, and the hon. Gentleman would be welcome to come to Salford and see the problems that are faced there of housing, hospitals, schools and planning, and justify the waste of money on arms at the present time.

Mr. Frank Allaun (Salford, East)

I agree with everything that my hon. Friend the Member for Salford, West (Mr. Orme) is saying, as I have agreed with everything he has said since he came to the House. The point that he is making is that here is the modern equivalent of guns or butter, but now it is pensions or Polaris, bases or bathrooms. In my part of the world, the people need bathrooms in their houses, and that is what the money should be spent on. Labour would have an overwhelming victory if it went along those lines, and I hope that it will.

Mr. Orme

I thank my hon. Friend the Member for Salford, East (Mr. Frank Allaun) for intervening and underlining the point that I was making. We appreciate that the Government are in the process of a detailed cost analysis of arms expenditure, and cuts have been made already. But we do not want to see some of the cuts replaced by other expenditures, particularly if the Government decide to buy the American F111 in place of the TSR2, because that would prejudice our balance of payments position and our dollar exchanges with the United States.

However, I do not think that cost analysis in itself will solve the problem. It is more a question of our overseas commitments, our rôle east of Suez and the chain of bases which we have throughout the world. I do not believe that in the present economic situation the country can afford to try to maintain a world rôle and, at the same time, put itself back on its feet economically. Therefore, the Far East is absolutely vital for us, and I want to say a few words about the Indonesia-Malaysia position.

The Government should take some very strong action to bring the situation there to a rapid conclusion. Fifty thousand troops are tied up in Malaysia at the present time, in an area of the world which is highly dangerous. It is not in the British interest, and I feel that some urgent steps should be taken. An immediate reduction in arms expenditure could be made in that region.

It is said in the Middle East that one cannot drink oil. The people there want a higher standard of living, and they want the goods that we can provide. It is absolutely idiotic for us to maintain bases throughout the Middle East that became out of date many years ago and, in any case, are not now viable. That is why my hon. Friends and myself feel as we do about the need for arms cuts.

When I was in my constituency at the weekend I was made well aware of the feeling of the party there and the people about the Government's economic measures. They are prepared to support those measures, but they want to see other forms of drastic action to convince them that there is reality in the situation. As my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) has said, we have had these crises before. We had a crisis in 1931, and again in 1950–51. Now we are faced with another economic crisis at home and a heavy arms expenditure.

I therefore hope that the Government will move much more quickly, and will not only proceed on a cost-analysis basis but will have a general review of the whole of our arms expenditure, which obviously overlaps into foreign policy. We have to do that this year. We have to turn our attention to making Britain into a viable industrial nation, and one in which we can put our skills to productive uses for the benefit of the nation and to help other people in the world. The day of sending arms to help people has passed—they want goods and food now.

That being the situation, I hope that the Government will take heed of the pressure that we are putting on them even at this late hour because of the urgency of the case. I tell the hon. Gentleman opposite that we on this side are united in wanting something to be done. It will be at your peril if you do not recognise that it is what the people want.

Mr. Speaker

Order. The hon. Gentleman must address his observations to the Chair.

8.47 a.m.

The Under-Secretary of State for Defence for the Royal Air Force (Mr. Bruce Millan)

As my hon. Friends have kept their speeches short, I hope to be able to give a brief reply while, at the same time, of course, dealing with a number of the points they have made. Perhaps I can start by saying that the Government are as serious as any of them are about the need to cut defence expenditure. There is no difference of opinion between us on that. If there is any disagreement, it is only about the speed and the extent of the cuts that are now possible. On the main question of the necessity to cut arms expenditure, particularly in view of our very difficult economic situation and our difficult balance of payments position, there is no disagreement between my hon. Friends and the Government at present.

I would start by saying what has already been achieved. First, as my hon. Friends will recollect, the 1965 Defence Estimates were £55 million less than the cost of the programme that he had inherited from the previous Government. That was done within a period of a very few months after our coming to office in October of last year. My hon. Friends will also recollect what my right hon. Friend the Chancellor of the Exchequer said last week about a further cut of about £100 million in defence expenditure in 1966–67.

Looking a little further ahead, to 1969–70, our present aim—and if we can improve on it we shall be delighted—is a cut of £400 million, at 1964 constant prices, in the programme for that year that we inherited from the previous Administration—

Mr. Frank Allaun

I hate to interrupt my hon. Friend, but I must, because this is being said so often and we must get it home that this is an "Irishman's" cut. The cost will not really come down from £2,117 million, but will go up. This is a notional cut, and it is slightly misleading to repeat it.

Mr. Millan

It is not a notional cut. If my hon. Friend had been patient a little longer I was about to explain exactly what the cut means. It is a cut of £400 million at constant prices. The programme we inherited provided for an expenditure of £2,400 million at 1964 prices in 1969–70 and we intend to cut that to £2,000 million at 1964 prices. Of course it is true—and I would not want there to be any misunderstanding about this—that the defence budget, like any other, cannot be isolated from price increases.

For example, there is the pay review for the Services which will operate from 1st April, 1966. I am sure that my hon. Friends would not suggest that we should cut the defence budget by giving up the pay review for the Services. Obviously the pay review, whatever the result may be, will add to our expenditure as from 1966.

The fact is, nevertheless, that to get the defence budget down to £2,000 million at 1964 prices will represent a cut of £400 million and, since the gross national product will be continuing to increase in the years between now and 1969–70, it will mean that the percentage of the gross national product attributable to defence will go down in 1969–70 from about the present percentage of seven per cent. to rather less than 6 per cent. That in itself will be a considerable achievement.

Mr. Norman Atkinson (Tottenham)

The figures my hon. Friend is now giving assumes that we are going to achieve a 4 per cent. per annum growth rate.

Mr. Millan

I hope that my hon. Friend does not disagree with the Government's aim of achieving a 4 per cent. growth rate. I am sure there is nothing between us on that. I repeat that, between now and 1969–70, the percentage of the gross national product attributable to defence will go down quite considerably.

I want to say something about the difficulties of getting very speedy reductions in the defence budget because, again, there is a certain amount of misunderstanding. First, about 50 per cent. of our total defence expenditure now is directly or indirectly on personnel and it is not, of course, possible simply to cut personnel overnight. Before we can get a substantial reduction of the defence budget it means personnel cuts and there is considerable difficulty in doing that very rapidly.

Secondly, even when the decisions we are taking are exclusively within our own control many of them take a number of years to come fully into effect. One of the best examples of this is the cut in the Territorial Army announced last week by my right hon. Friend. This will save about £20 million a year but it will take two or three years, for perfectly good reasons, before the full saving can be achieved. In addition, legislation is required to reform the Territorial Army.

A number of other cuts have already been made and we have tried to make quickly those cuts on which decisions could be taken within a few months of our coming to office. There have, for example, been the cancellations of the P 1154, the HS 681 and the TSR2 aircraft projects.

Mr. Goodhart


Mr. Millan

I am sorry. I have already given way twice. If I am to finish in reasonable time I must continue.

These cancellations between them represent savings—even taking account of any possible replacement for the TSR2, which must await the outcome of the defence review—of more than £600 million over a period of 10 years. Substantial cuts have already been made even before the outcome of the general defence review.

There are particular difficulties, even if we were to take decisions now to cut overseas commitments—and this again is something which must await the outcome of the defence review—about cutting overseas commitments quickly, but even in that case the House will recall the new agreement on offset costs which my right hon. Friend the Chief Secretary to the Treasury reached with the German Government and announced to the House on 1st July. This agreement also represents very considerable savings to the balance of payments.

A number of my hon. Friends have mentioned particular commitments in various parts of the world. Perhaps just as an example of the difficulty of cutting quickly I can mention the commitment to defend Malaysia, which is by far the most expensive commitment which we have in the world at present. It is worth reminding the House that we are committed by a binding agreement to help to defend Malaysia. This is not something which we have taken on gratuitously. This is something which we are bound legally to do in an agreement between the British and Malaysian Governments.

One of my hon. Friends said that we must do something urgently to get a political settlement of the Indonesian-Malaysian confrontation. Certainly the Government would be delighted if we could get a political settlement, but I must remind the House that we are dealing with an example of unprovoked aggression by a large power, Indonesia, against a small power, Malaysia. We must be clear exactly what it is that we are negotiating about. Indonesia is a large power with a population of 100 million and has attacked a small power, Malaysia, which has a population of not much more than 10 million. The large power has attacked the small power for completely invalid reasons—no reasons at all.

The great difficulty in the situation, of course, is the complete intransigence of the Indonesian attitude, its determination to crush Malaysia which has led it, for example, to leave the United Nations and its complete unwillingness to negotiate on the situation. It is not an easy problem and this is not an expenditure which we can cut quickly, and certainly there can be no question of our getting out of our legal obligations willingly entered into with the Malaysian Government.

I hope that in these very few minutes I have persuaded my hon. Friends that although our aim is the same, namely, to cut defence costs considerably, there are considerable difficulties in doing so as rapidly as some would like. Nevertheless, all the matters which I have mentioned and many others are being looked at in the context of the defence review. I assure my hon. Friends that that review is both comprehensive and thorough. It is to decide not what British defence policy is for the 1970s, but what contribution our defence forces can make to the foreign policy of the United Kingdom for the 1970s. All that is being done in the context of the country's difficult economic

Whereupon Mr. SPEAKER declared that the Question was not decided in the affirmative, because it was not supported by the majority prescribed by Standing Order No. 32 (Majority for Closure).

Question again proposed, That the Bill be now read the Third time.

Mr. Goodhart

On a point of order. In view of yet another procedural defeat for the Government, will the Leader of the House make a statement on the Government's intentions?

Mr. Speaker

That is not a point of Order. It may be a question addressed

situation with the aim to cut our defence budget to meet our economic situation and the need to solve our balance of payments problem.

The Parliamentary Secretary to the Treasury (Mr. Edward Short)

rose in his place, and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 98, Noes 4.

Division No. 269.] AYES [9.2 a.m.
Allaun, Frank (Salford, E.) Grey, Charles O'Malley, Brian
Alldritt, Walter Griffiths, David (Rother Valley) Orme, Stanley
Allen, Scholefield (Crewe) Hamilton, William (West Fife) Oswald, Thomas
Atkinson, Norman Hamling, William (Woolwich, W.) Page, Derek (King's Lynn)
Bacon, Miss Alice Hannan, William Park, Trevor (Derbyshire, S. E.)
Bagier, Gordon A. T. Harper, Joseph Prentice, R. E.
Barnett, Joel Harrison, Walter (Wakefield) Price, J. T. (Westhoughton)
Baxter, William Hart, Mrs. Judith Robertson, John (Paisley)
Bennett, J. (Glasgow, Bridgeton) Hazell, Bert Rodgers, William (Stockton)
Blackburn, F. Heffer, Eric S. Ross, Rt. Hn. William
Blenkinsop, Arthur Howarth, Harry (Wellingborough) Rowland, Christopher
Boardman, H. Howie, W. Short, Rt. Hn. E. (N'c'tle-on-Tyne, C.)
Bowden, Rt. Hn. H. W. (Leics S. W.) Hoy, James Silverman, Julius (Aston)
Braddock, Mrs. E. M. Hunter, Adam (Dunfermline) Slater, Mrs. Harriet (Stoke, N.)
Bradley, Tom Jackson, Colin Small, William
Brown, Rt. Hn. George (Belper) Jeger, George (Goole) Stonehouse, John
Brown, R. W. (Shoreditch & Fbury) Johnson, James (K'ston-on-Hull, W.) Swain, Thomas
Buchan, Norman (Renfrewshire, W.) Jones, Dan (Burnley) Taverne, Dick
Buchanan, Richard Kenyon, Clifford Thornton, Ernest
Callaghan, Rt. Hn. James Lewis, Arthur (West Ham, N.) Tinn, James
Carter-Jones, Lewis Lomas, Kenneth Urwin, T. W.
Coleman, Donald Loughlin, Charles Varley, Eric G.
Crawshaw, Richard McBride, Neil Wainwright, Edwin
Dalyell, Tam McCann, J. Walker, Harold (Doncaster)
Diamond, Rt. Hn. John Mclnnes, James Williams, Alan (Swansea, W.)
Doig, Peter Mahon, Peter (Preston, S.) Williams, Clifford (Abertillery)
Duffy, Dr. A. E. P. Mapp, Charles Williams, Mrs. Shirley (Hitchin)
English, Michael Millan, Bruce Wilson, William (Coventry, S.)
Fernyhough, E. Morris, Alfred (Wythenshawe) Woof, Robert
Fitch, Alan (Wigan) Morris, Charles (Openshaw) Yates, Victor (Ladywood)
Fletcher, Ted (Darlington) Murray, Albert
Foot, Michael (Ebbw Vale) Neal, Harold TELLERS FOR THE AYES:
Freeson, Reginald Newens, Stan Mr. George Lawson and
Gregory, Arnold Norwood, Christopher Mr. Ifor Davies.
Farr, John Kitson, Timothy TELLERS FOR THE NOES:
Goodhart, Philip Scott-Hopkins, James Mr. William Yates and
Mr. Anthony Fell.

to the Leader of the House, but he does not appear to be particularly eager to answer it. Mr. Farr.