Defence Cuts

HC Deb 05 July 1977 vol 934 cc1095-8

5. Mr. Goodhart

asked the Secretary of State for Defence whether he will make a further statement about the implementation of defence cuts.

Mr. Mulley

The cuts in 1977–78 are now being implemented. For 1978–79 a wide-ranging study has been carried out, and we have now put our preliminary conclusions to NATO as a basis for consultation. We shall not take final decisions until we have heard the views of our allies.

Mr. Goodhart

Does not the Secretary of State feel some embarrassment in submitting to NATO these plans for further massive cuts in our defence budget next year when he has just signed a ministerial communiqué calling for a 3 per cent. real increase in European NATO defence spending and when the Prime Minister has told us that we are on the threshold of unprecedented national prosperity?

Mr. Mulley

The hon. Gentleman is less accurate with his facts than usual. There is no question of having signed a communiqué or that the communiqué was a commitment. It was an aim for a 3 per cent. increase starting in 1979. We are now talking about the year 1978–79. I have, of course, no shame whatever in NATO councils when, as is well known, we devote a bigger proportion of our resources to defence than does any other member of NATO, apart from the United States and Greece.

Mr. Ioan Evans

Will my right hon. Friend continue to resist the demand from the Conservative Party to increase defence expenditure when it is calling on the Government to reduce public expenditure as a whole? Does he not agree that an increase in defence expenditure must mean a far greater cut-back on pensions, social services, education and other things?

Mr. Mulley

All the relevant considerations will be in the minds of Ministers when we come in the usual way to consider the public expenditure survey for future years. I take my hon. Friend's point. I find it a little nauseating to have lectures about the need for drastic cuts in public expenditure in general, not only in this area but in other areas, and opposition to any reductions in a particular area.

Rear-Admiral Morgan-Giles

Will the Secretary of State accept congratulations on the success of the naval review last week at Spithead and also on his ingenuity in scraping together everything that would float to put into the shop window on that occasion? Does he realise that that, as a contribution to NATO's premier European Navy, indicates a clear need for expansion rather than for further cuts?

Mr. Mulley

I think that the hon. and gallant Gentleman is a little unfair to his old Service. Not everything afloat was at Spithead. Quite a number of ships were on operational patrol duties. Fewer than 60 per cent. were there. While we have fewer ships than we had at the comparable review 24 years ago, I am sure the hon. and gallant Gentleman would agree that the capacity and fighting power of the ships at Spithead was greatly in excess of the Fleet in older times.

I am grateful to the hon. and gallant Gentleman for what he says about the arrangements. I shall convey them to the Admiralty Board. I have had many comments of appreciation from hon. Members about the arrangements.

Mr. Frank Allaun

Have the Government accepted a 3 per cent. a year increase, or have they merely postponed it, and kicked it out of touch? Do they realise that it will cost us £7.3 billion a year at constant prices in five years' time? If the present rate of inflation continues, it will cost £16.1 billion in five years. Will he tell his NATO colleagues that we just cannot continue any longer with this nonsense?

Mr. Mulley

As I have explained on previous occasions, I have made no commitments to my NATO colleagues on the future trends of our defence expenditure, because these decisions must be taken in the light of what is thought necessary and the resources that are available. I cannot accept my hon. Friend's arithmetic. I shall do all in my power—and I hope that he will help me—in making sure that the rate of inflation is nowhere near its present level in years ahead.

Sir Ian Gilmour

Since the right hon. Gentleman is Secretary of State for Defence, is it not rather odd that he should so much welcome cuts in public expenditure being reflected to such an extent in cuts in defence expenditure? If he believes what the Prime Minister has said about our economy—and presumably he is one of the few who does believe it—he should say to the Prime Minister that, as we are doing so well, the further damaging cuts in defence expenditure next year need not take place.

Mr. Mulley

It would be of interest to the House—but I do not propose to do it—if I could give a dress rehearsal of what I might say on these matters. As I have made clear to the House, I accept that, when public expenditure cuts have to be made, defence should bear a pro- portion of those cuts—and our proportion is not massive, as has been suggested—along with other programmes. I would be very interested if the Opposition would give even an approximation of the figure that they think we should be spending.