Procurement (Hansard, 14 April 1981)

§ 7. Mr. Foulkes
asked the Secretary of State for Defence what percentage in terms of value of defence procurement in 1980 was made in the United Kingdom.

§ Mr. Nott
My Department's expenditure with British industry amounted, at forecast outturn prices for 1980–81, to some £4.1 billion in 1979–80 and some £4.5 billion in 1980–81. In cash terms, it is nearly £1 billion more than the previous year. As regards equipment expenditure alone, over three-quarters went to national contracts placed with British industry in 1979–80, and I would expect it to be of the same order this year.

§ Mr. Foulkes
Will the right hon. Gentleman's Department give preference to goods manufactured in the United Kingdom, even if it means a little extra cost? In particular, will he consider bringing forward the orders for boots and plimsolls from Bata and including Jetstream in an earlier part of the defence programme?

§ Mr. Nott
I am slightly at a loss about the boots and plimsolls. If we put aside collaborative projects, which represented about 15 per cent. of equipment expenditure, we have placed only about 2 per cent. of total equipment expenditure overseas in the past few years, which is relatively slight. I will need notice of the hon. Gentleman's question about boots and plimsolls. I do not know whch ones he is referring to.

§ Mr. Wilkinson
Does my right hon. Friend agree that for a country such as ours, which relies upon all-volunteer Services, it is essential to make up for the small numbers in our Armed Forces by the very highest quality of our weapons systems? Will he, in this time of recession, do his very best in the year ahead to ensure that essential weapons programmes are not diminished?

§ Mr. Nott
Year by year, since the Conservative Government came to office, we have been spending more with British industry, as my answer indicated. I cannot undertake that every programme now in research and development will go forward into production, because if that happened we should be bankrupt, but I can tell my hon. Friend that we shall do our utmost to protect and encourage the defence industrial base of this country. I can give an absolute assurance on that, because it is in the interests of all of us.

§ Mr. Ford
I note the Secretary of State's answer. Will he now give an assurance that he intends to maintain the development and manufacture of Sea Eagle, in which we have an absolute world lead in guidance techniques and in which some 10,000 jobs are at stake?

§ Mr. Nott
As I said in my statement on the current year's expenditure, we decided at that time to keep the present development programme for Sea Eagle going. That is the present position. I am well aware of its very great importance to British Aerospace dynamics. It will be considered, together with many other programmes, when we review all these equipment programmes over the next two or three months. I cannot say more than that at present.

§ Mr. Colin Shepherd
Is my right hon. Friend aware that some 650,000 people in this country are employed directly or indirectly in defence-related industries? Does he agree that it would be a major disaster if my right hon. Friend were to accede to the siren calls from the Opposition for a reduction in defence expenditure?

§ Mr. Nott
The answer to that is "Yes".

§ Dr. David Clark
With regard to Government procurement from the Royal ordnance factories and bearing in mind the fact that there have been 1,200 redundancies already this year in areas of high depression such as Birtley, Blackburn and Crewe, when may we expect the report from the study group set up to look at the work of the Royal ordnance factories, which we were led to expect would appear in February? Is the Minister aware that there is great disquiet in the ordnance factories due to uncertainty caused by delay in the appearance of the report?

§ Mr. Nott
The report to which the hon. Gentleman refers was an internal Whitehall study of the position of the Royal ordnance factories. It is effectively prepared and ready, but I have not yet seen the final version. Until I have received and considered it, I cannot say anything about this matter. Nevertheless, I am well aware of the need to say something about the Royal ordnance factories, and indeed something about the dockyard report, as soon as we possibly can, to end uncertainty. That I undertake to do, but it cannot be for a few weeks yet.