§ 1. Mr. Leighasked the Secretary of State for Defence what has been the effect of the dollar-sterling parity change on the estimated cost of Trident in the last 12 months.
§ 18. Mr. Heathcoat-Amoryasked the Secretary of State for Defence what is the latest estimate of the cost of the Trident programme.
§ The Secretary of State for Defence (Mr. Michael Heseltine)The Trident estimate is currently being reviewed as part of the annual recosting of the defence programme. On completion, I will announce a revised estimate to Parliament and the exchange rate applicable to it.
§ Mr. LeighIs my right hon. Friend aware that some Conservative Members, although fully committed to the maintenance of Britain's independent nuclear deterrent, are worried about the fact that because, according to some reports, £700 million has been added since last March to the cost of Trident due to the fall in the value of the pound, there is a need for a candid reassessment soon as to whether we can afford the Trident D5 system without damaging our conventional forces?
§ Mr. HeseltineI know of my hon. Friend's interest in this matter. I had noticed his name on the Order Paper in connection with this issue. The open government document which was published at the time of the initial decision shows that the alternatives and the arguments were fully set out. In the Government's view, nothing has changed to alter the basis of our judgment.
§ Mr. Heathcoat-AmoryI thank my right hon. Friend for his reply. Does he agree that changing technology as well as changing costs make it important to review the Trident system constantly with a view to getting value for money? Will my right hon. Friend assure the House that other nuclear weapons systems are kept under examination to ascertain whether they would offer an adequate deterrent at a lower cost?
§ Mr. HeseltineI am grateful to my hon. Friend for asking that question. If we felt that there was an alternative because of changing technology, we would have to consider it, as would any Government. It is a sign of the Government's willingness to consider their position that we moved from the Trident C4 to the Trident D5 system. It would be misleading to pretend that we have knowledge of some of the new technological development that calls for a review of the sort that has been suggested.
§ Mr. DouglasWill the Secretary of State admit that since the open government document was published we have found that a higher proportion of expenditure will be incurred in the United States and that, therefore, the analysis of the dollar-sterling rate is of the utmost importance? When will the right hon. Gentleman come clean with the House and admit that an increase of 1 cent costs the country £25 million more and that the difference in the cost of this project is now about £700 million?
§ Mr. HeseltineThe hon. Gentleman knows that, in common with others who have held this job, I have responsibility to update the defence programme on a regular annual basis. That updating is carried out along the lines of conventions which were established under the previous Government, and we have stuck to them. If anything, I have tended, if possible, to bring forward the updating announcements of the Trident system. In view of the interest of the Public Accounts Committee and the Select Committee on Defence, I am trying to ascertain whether I can bring forward the updating of the latest review, which we are in the last stage of completing.
§ Mr. D. E. ThomasDoes the Secretary of State's total figure of public expenditure on Trident include the extra low frequency communications that are required? What is the specific cost of that part of the budget?
§ Mr. HeseltineI think that the hon. Gentleman will accept that the cost includes the whole capital cost of introducing the Trident system, but I shall look specifically at the individual component part to which he has drawn my attention.
§ Mr. BoyesIs the Secretary of State aware that the Opposition are committed to the defence of Britain, too, but find that Trident does not help in the slightest in that process? Is the right hon. Gentleman further aware that we find it impossible to explain to our constituents that, while the dollar-sterling parity rate has pushed up the price of the Trident submarine, council tenants will have to suffer because cuts are being made in repairs grants so that we can pay for that ludicrous weapon?
§ Mr. HeseltineI am sure that it is more for the hon. Gentleman than for me to explain to his constituents why he thought Polaris was necessary. It has to be modernised with the Chevaline process. However, he thinks that Britain can now abandon the policies that have kept the peace for so long.
§ Sir Peter BlakerSurely any alternative system would have to depend equally on American technology. Does my right hon. Friend know of an alternative system which is capable of penetrating the likely enemy defences by the mid-1990s and which comes anywhere near being less expensive than Trident?
§ Mr. HeseltineMy right hon. Friend is correct. We looked carefully at the alternative systems, and we could 520 not find a system that gives Britain the absolute insurance which we believe to be necessary to maintain our independent nuclear deterrent. That is why we chose the Trident system and why we are determined to introduce it into service. However, I remind the House that at the time of the open government document a considerable analysis of alternatives to the Trident system was carried out, and in some cases the analysis showed that alternatives would be less effective and more expensive.
§ Mr. Denzil DaviesWhy is the Secretary of State so afraid to answer the question? Why does he not tell the House that, since we debated the Defence Estimates in the summer, the cost of Trident has gone up by £750 million? That is about five new frigates sunk on the foreign exchanges. Why does the right hon. Gentleman go through the charade of pretending that he can estimate the cost of Trident? Why does he not admit that he has no idea what the final cost will be?
§ Mr. HeseltineIt is intriguing that the right hon. Gentleman suggests that we do not know what the cost is and then presses me to reveal it earlier than we normally would. However, he will be fully aware that any estimates that we make will be trying to anticipate the exchange rates for the rest of the decade. The change may have taken place on the scale that he mentioned, which I shall not yet confirm or deny because we have not finally concluded the review, but the mere fact that he could say that there has been such an incredible change as a result of exchange rates must cause him some moments of doubt as to whether the exchange rates will not move the other way.