§ Mr. Healey
I will, with permission, now answer Questions Nos. 31, 69, 73 and 86.
The French Government have informed Her Majesty's Government that they have decided that for budgetary reasons they must withdraw from the Anglo-French variable geometry aircraft project. They have been forced to take this step solely because of the pressure on their budget for a number of years ahead; full agreement was reached on the specification, the development cost, and the production cost of the aircraft. M. Messmer has assured me that the decision will have no effect on the French attitude towards the other projects, both civil and military, on which agreements have already been reached, or indeed towards the possibility of further collaboration in the future.
Her Majesty's Government have received this decision with great regret. It raises a number of fundamental issues. We are now giving urgent consideration to all aspects of the new situation, including the industrial and military implications, possible alternative ways of replacing the V-bombers in the conventional rôle in the mid-70s and the possibility of collaboration with other countries. In the meantime, in order to preserve as wide a range of options as possible, we are authorising British firms to carry out a project study on a variable geometry combat aircraft to a modified specification. Exploratory talks with potential partners will be held as soon as possible.
I will, with permission, circulate in the OFFICIAL REPORT the joint communique reporting the outcome of my meeting last week with M. Messmer which is being issued this afternoon.
§ Mr. Wall
Would not the right hon. Gentleman agree that the Opposition have been continually saying to him that there is great uncertainty over this project? Having cancelled the TSR.2, and now the A.F.V.G., which, in the words of his White Paper, was to be the core of our long-term programme, would he not agree that the whole of our Defence Review has been shown to be completely "phoney"? What is he going to do about it?
§ Mr. Healey
I think that on reflection the hon. Gentleman—who normally takes these matters with great seriousness—will regret the words he has used and will particularly regret attempting to attract some petty party advantage—[Interruption.]—that is what it is; a party advantage—out of what is a very serious matter, not only for Britain but for Europe as a whole.
To answer the particular points he raised, I have been repeatedly and, in my view, rightly urged by hon. Gentlemen opposite to try to make a success of Anglo-French co-operation in the aircraft field. If I have failed, that is not my fault. [HON. MEMBERS: "Whose is it?"] I do not believe that anybody will be able to maintain that Her Majesty's Government share any aspect of the responsibility for the decision which the French Government, on purely financial grounds, have found it necessary to take. As for the policy of Her Majesty's Government in the Defence Review, the hon. Gentleman's statement was so ludicrously extravagant that I shall not bother to reply to it.
§ Mr. Farr
Is the right hon. Gentleman aware that after this gross miscalculation there is no one on this side of the House who can have the slighest confidence in any future plans which he may outline? Will he consider whether it is possible to have a 100 per cent. British alternative flying by the late '70s to try to retrieve the position?
§ Mr. Healey
To answer the hon. Gentleman's remark about a miscalculation, I hoped and believed, as the Front Bench opposite expressed itself as hoping and believing, when we started this project that we would be able to make a success of a major new Anglo-French venture in the sphere of advanced combat aircraft. If hon. Gentlemen opposite think that we made a mistake to try to do that, they should have said so at the time, and they should have given us some alternative way of meeting both our military and operational requirement.
To answer the hon. Gentleman's question about a purely British aircraft to meet the requirement, let me say straight away that the Government are now reexamining very closely—
§ Mr. Healey
With respect, if we had gone ahead with the TSR2 programme as the former Conservative Government had conceived it, not only would we have been bankrupt on defence by now, but we should have had no money in the kitty whatever to support any research and development project in the next six years for any aircraft for our own industry.
On the question of a British aircraft, we are, of course, re-examining the operational requirement, in terms of scale and characteristics, for supplementing the Fl11 forces in the late 70s in the light of our tasks and commitments as they are emerging from our consultations with our Allies and Commonwealth partners. If we find, as a result of this examination, that the best way of meeting this requirement is to produce a British aircraft, perhaps in collaboration with others, then we shall recommend this to the House.
§ Mr. Rankin
Is my right hon. Friend aware that all that he does to secure cooperation between Britain and France in joint aircraft projects, particularly towards peaceful evolution in Europe, will be warmly supported by those of us who believe in the Common Market? However, is he further aware that any attempt to replace the joint British-French V.G. project by a return to America for more Fills will be bitterly resented by a good many hon. Members in this House, and will be consider—
§ Mr. Speaker
Order. The hon. Gentleman must be fair. I want to give a number of hon. Gentlemen an opportunity to ask questions. Questions must be reasonably brief.
§ Mr. Rankin
Would not my right hon. Friend consider that the funds released would be better employed in going ahead with the BAC211?
§ Mr. Healey
With respect, I think that on reflection all Members of the House on both sides of the Gangway would wish that I, as Secretary of State for Defence, would put as my first objective meeting all the operational requirements of our defence forces as we foresee them in the light of our likely tasks in the later 1970s. I hope there will be no disagreement between us on this. I do not see the BAC 211, excellent aircraft though this is, fulfilling the Royal Air Force's 1828 operational requirements for strike and reconnaissance.
§ Mr. Spriggs
In view of his statement, will my right hon. Friend remember that the British aircraft industry has proved itself as a world leader in aircraft production, and will he take this into consideration when consulting the industry before making any future plans?
§ Mr. Healey
Yes, Sir, and, of course, industrial considerations are very much in the forefront of my mind. However, as I say, I also have responsibility to the House and to the taxpayer to ensure that we meet our operational requirements as effectively and as cheaply as we can. As I say, we are now looking at the operational requirements. We are having another look at these in the light of the evolution of our policies as a result of our recent consultations, and we are also looking at various possible ways of meeting the requirements.
§ Mr. Powell
There will, of course, have to be a full debate in the House about the wreckage of the Government's defence policy. But is the right hon. Gentleman aware that he cannot disavow, as he attempted to do just now, responsibility for having made aircraft which will not come into existence at all the core of this country's long-term defence and industrial aircraft programme? Is he not ashamed that he should have rested the future of the Royal Air Force on a bluff that was called and a gamble that did not come off?
§ Mr. Healey
I look forward with delight to another debate on aircraft with the right hon. Gentleman. I very much enjoyed the last one, and so did my hon. Friends, and I look forward to the next. However, on the question of the future needs of our aircraft industry and the Royal Air Force, the whole of the Opposition Front Bench supported me in trying to achieve the proposed Anglo-French aircraft, and I think it shows a very shabby and sordid side to them that they should now attempt to draw a petty party advantage. [HON. MEMBERS: "Resign."] The shouting of "Resign" by hon. and right hon. Gentlemen opposite will do them no credit in the country when the country comes to look into this. As I say, I look forward very much to another opportunity to trounce the right hon. Gentleman on the Government's aircraft programme.
§ Mr. Lubbock
Is the Minister aware that those who believe, as we do, in the retention of European capabilities in these fields of advanced technology will be dismayed at the decision made by the French Government? May I ask him whether he will give an undertaking that no further F 111s will be purchased, as demanded by his hon. Friend the Member for Glasgow, Govan (Mr. Rankin), and has he considered the design studies carried out some time ago by the English Electric Company based on the jointly-developed Rolls Royce-Man turbomotoren engine that would have been suitable for this requirement? If we cannot co-operate with the French in developing such an aircraft, can we at least make an attempt to do so with the Germans?
§ Mr. Healey
I am, of course, and have been for some time, in close contact with a number of potential collaborators who might have collaborated with us on the Anglo-French variable geometry project if the French had not decided at this late day for financial reasons to withdraw. I am anxious to explore this possibility before coming to a final decision. I am particularly anxious that we shall retain our option to develop such an aircraft. It is for this reason that we are ordering a project study by British firms of a variable geometry aircraft to a modified specification. I think that this is only sensible, as I hope the House will agree. But the decision that we finally take must be determined by the defence and industrial benefit that we get in return for a given expenditure, and until we have had a very careful look at this question I do not propose to rule out any option.
§ Mr. Robert Howarth
Can my right hon. Friend say what effect, if any, this will have on the helicopter agreement with the French? To my mind, the agreement seemed to offer the French a particular advantage, and it could be that it ought now to be looked at again.
§ Mr. Healey
The French Government have indicated their firm intention to proceed with the joint production of three helicopters as planned, but we shall be studying this matter further later in the year. I am deeply concerned, as I think the whole House will be, in the light of our experience with the variable 1830 geometry project, to make absolutely certain that the continuation of the helicopter package will involve industrial, operational and economic advantage for the United Kingdom which is totally commensurate with that derived by France.
§ Mr. Shinwell
Do I understand from what my right hon. Friend said that because of failure due to the budgetary and apparently impoverished position of the French Government he now intends to proceed with discussions with Commonwealth countries with a view to proceeding with a project of this character? Does he realise that many of us regard him as quite blameless in the matter and will be delighted to find that he is turning his mind away from a country associated with the Common Market and in the direction of the Commonwealth?
§ Mr. Healey
My right hon. Friend will not expect me to endorse all the sentiments that he expresses, although I deeply appreciate the thought which lies behind them. There are a number of countries in Europe and outside with which it may be possible to agree on the development of a common aircraft, and we are urgently considering the possibilities. I do not want at this stage to rule out any possible option of solo production, collaborative production or, if this turns out to be the only reasonably economic way of meeting our requirement, purchases from abroad, but I think that the Government, in the light of this very disappointing decision by the French Government, must have an opportunity to explore the requirement and the various ways of meeting it before taking a final decision.
§ Sir A. V. Harvey
Will the right hon. Gentleman consider publishing a White Paper giving all the facts leading to the breakdown of these negotiations? Is he aware that until a fortnight ago he was brazening out his optimism about the project when everybody else knew that it was not coming off? Is he aware that he has shown a complete dereliction of duty as Her Majesty's Secretary of State for Defence?
§ Mr. Healey
I really feel that that was a rather trashy remark. On the question of the facts, I have given the facts to the House whenever I have been able to 1831 produce them. In May last year the French Government told me that they might run into financial difficulties on the phasing of expenditure. I worked very hard for nine months to see whether we could find a way round that difficulty. In January this year I was assured by the French Government that that difficulty had been overcome, and I told the House so at the time. I was congratulated by hon. Members on both sides on this achievement. Since January the French Government have had second thoughts about the requirement, and, of course, have had a General Election. I discussed the problem of the requirement, and total agreement on it was reached by myself and M. Messmer, who—I should like the House to recognise this—has behaved throughout as a good and trustworthy colleague. In fact, I could not wish to collaborate with a more valuable partner on a project of this nature.
When the French Government decided after the election that they must make substantial cuts in their expenditure both civil and military and decided that this project was one which must be cut, they took this decision after agreeing the new requirement as M. Messmer and I had agreed it and after agreeing that the cost estimates for research, development and production as put to them by M. Messmer were themselves accurate and reasonable. I regret this decision, but if right hon. and hon. Gentlemen opposite can explain to me why Her Majesty's Government are blameworthy for the decision, I shall be interested to hear.
§ Mr. Edelman
Is my right hon. Friend aware that the unhappy decision on the part of the French to withdraw from this project will deal a very heavy blow to the British aircraft industry in the 1970s and also to Anglo-French relations, and will he not ask the Prime Minister to raise the matter at the very highest level—as the President of France did when it was thought Britain would cancel Concord? Finally, would he himself make clear what is meant by an "all British" aircraft? Is not the case that the Home Secretary when Minister of Aviation said that never again would Britain produce a highly sophisticated technological aircraft?
§ Mr. Healey
On the first question, I really do not think we should be right 1832 to draw great political conclusions from the decision which the French Government thought it necessary to take, particularly in the light of the fact that I have been assured in the most absolute terms that it is the desire of the French Government to continue collaboration on other projects. I would say to my hon. Friend—and knowing he will appreciate the importance of the point I am about to make—that the industrial problem for the French aircraft industry is quite as serious as the problem for ours, because it has been made clear to me that the French Government have no intention of proceeding with developing the experimental IIIG aircraft into an operational aircraft, or indeed of producing any variable geometry combat aircraft in the rôle we were jointly discussing with each other. This does face them with very serious problems, problems which are both operationally and industrially quite as serious as those which face the United Kingdom.
§ Mr. Onslow
Since the possibility that the French would take this decision must have been known to Ministers and might have been expected for some months now, would the right hon. Gentleman tell the House what contingent planning has taken place in advance? Why has it not been possible to bring it much further forward, and how much longer does he expect to take over it?
§ Mr. Healey
First of all, because, for the reason suggested by my hon. Friend the Member for Coventry, North (Mr. Edelman), there are very powerful reasons which were outlined in the Plowden Report against this Government undertaking on their own an advanced combat aircraft for the later 'seventies. I would wish, before considering such a decision, to explore the possibility of collaboration with other countries on such an aircraft, but I have not been able to discuss with other Governments the possibility of such co-operation until the French Government had taken their decision.
§ Mr. Ronald Atkins
Does my right hon. Friend agree that if international cooperation fails any military aircraft which are required should be British-built and British-designed, and that to rely on the supply of sophisticated foreign aircraft is 1833 a danger to an independent defence policy?
§ Mr. Healey
No, I cannot agree with that as a general principle—nor can right hon. and hon. Members opposite, who decided to buy the Phantom for the Royal Navy when they decided not to buy the P1154 in that particular rôle. What I think we must all accept—and I hope the House will treat the problem with the seriousness which it deserves—is that advanced combat aircraft are very expensive indeed to produce, and an advanced combat aircraft for a country with a very small national requirement is a matter which would require the most careful consideration. I thought both sides of the House agreed when we discussed this matter in a more dispassionate atmosphere a year ago that this type of production, if it can possibly be organised, should be organised on an international scale so that the size of the ultimate market bears a reasonable relation to the amount of research and development expenditure involved. With respect to right hon. and hon. Members—I know how strongly they feel about this matter—I think I should be betraying my duty to the taxpayers and to the electorate and to the country if I decided without examination of all the possibilities to go from one particular option to another.
§ Mr. Hugh Fraser
Has the Minister, in his cordial relations with M. Messmer, learned the phrase qui s'excuse, s'accuse? Furthermore, would he now be in a position to publish a White Paper with the alternatives put before this country quite clearly? As so many people in the Royal Air Force and the House of Commons, including myself, believed that this project would not come off, surely there must have been contingency planning going on in the Defence Department, and surely it is time that it should be published, and published quickly?
§ Mr. Healey
I recognise the depth of emotion which made it difficult for the right hon. Gentleman to get his first phrase out. Of course, before the Government finally take a decision, or when they finally take the decision, they will explain all the considerations which led them to take that decision.
§ Mr. Orme
Is my right hon. Friend aware that not everybody on this side will view this with dismay? If the French 1834 have got a problem in relation to finance, so has Great Britain. This aircraft is needed for a world military rôle. Therefore, should we not review our world military rôle rather than look at the future of British aircraft which we shall not need if we contract our present position in the world?
§ Mr. Healey
I recognise the depth of feeling of my hon. Friend and of some of those who feel like him. This is one of the matters which make me and the Government as a whole very anxious to consider the operational requirement, the various ways of meeting it, and the cost in relation to industry and military benefit before taking a decision. It may further interest my hon. Friend to know that the reason why I was unable to meet M. Messmer earlier than last Thursday was that he was visiting French troops east of Suez.
§ Several Hon. Members rose—
§ Mr. Emrys Hughes
On a point of order. In view of the unsatisfactory nature of the reply, I wish to give notice that I will raise the matter on the Adjournment.
Following is the Joint Communiqué:
Mr. Denis Healey, Secretary of State for Defence, Mr. Stonehouse, Minister of State for Technology, and M. Messmer, the French Minister of Defence, met in London on 29th June.
2. M. Messmer informed the British Ministers that the French Government had been forced to make a number of budgetary economies and in particular in the defence field to withdraw from the Anglo/French Variable Geometry aircraft project which was being negotiated.
3. This decision, which has been taken on purely financial considerations, has no effect either on the agreements already reached on the other aeronautical programmes, or on the possibility of new agreements.
4. The Ministers signed supplement number three to the Memorandum of Understanding of 17th May, 1965, authorising the second stage of the development programme for the Jaguar.
5. The Ministers decided to hold a meeting in September to discuss the progress of the collaborative helicopter programme.