§ 12. Mr. StokesTo ask the Secretary of State for Defence what action he is taking to maximise weapon purchasing economy through collaborative ventures with North Atlantic Treaty Organisation allies.
§ Mr. SainsburyIn order to derive maximum benefit by co-operation, we play a full role in the relevant multilateral forums—essentially the Conference of International Armament Directors, CNAD, and the Independent European Programme Group, IEPG—and in our various bilateral contacts.
§ Mr. StokesI am grateful for that answer, but I am not exactly clear about what it means. Has any progress whatever been made in the last five years or so?
§ Mr. SainsburyI am happy to assure my hon. Friend that we all get perplexed by these numerous initials by which the MOD confuses things. I am glad to say that there has been substantial progress. We very much recognise that major benefits of increased collaboration accrue not only from the reduced costs to each country of developing complex weapons systems, but from lower unit production costs that result from longer production runs.
§ Mr. DouglasWill the Minister examine carefully the respective economies arising from our purchase of AWACS from Boeing? Will he give some clear information to the House about the nature of this contract and tell us why we have not obtained £80 million-worth of firm orders to offset purchases in excess of £1.5 billion? What economies will accrue to the United Kingdom in relation to that particular collaborative purchase, and when will the Ministry of Defence get off its backside and ensure that British industry gets its fair contractural share of offset purchases?
§ Mr. SainsburyThe purchase of the AWACS from Boeing is not part of a collaborative programme but is simply the purchase of equipment produced overseas. It carries a substantial offset of 130 per cent. of the cost. We have absolute confidence that on this occasion, as previously, Boeing will fulfil its obligations under that agreement.
§ Mr. BrazierI put it to my hon. Friend that deals of the Goalkeeper/Rolls-Royce type, in which effectively the swap of one type of equipment for another takes place, offer the same benefits as collaboration in terms of longer production runs, and so on, but without all the bureaucracy that so besets collaborative ventures—especially smaller ones.
§ Mr. SainsburyMy hon. Friend is right. There are other ways of obtaining the benefits of longer production runs and of enjoying co-operation among NATO allies than through collaboration. Reciprocal purchasing is clearly one of them.