Procurement

HC Deb 09 March 1993 vol 220 cc769-71

1. Ms. Eagle

To ask the Secretary of State for Defence with how many United Kingdom companies his Department was involved in procurement contracts in 1992.

The Minister of State for Defence Procurement (Mr. Jonathan Aitken)

My Department was involved in procurement contracts with some 7,000 United Kingdom companies in 1992. That figure excludes minor contracts placed by local establishments, details of which are not held centrally.

Ms. Eagle

Is it not the case that the decline in procurement volume due to "Options for Change" has led directly to the loss of 78,900 jobs since 1990, 900 of which were at Cammell Laird in Birkenhead which is currently facing closure? Will the Minister now pledge Government support for the creation of a defence diversification strategy in order to help convert those jobs to civil use, keep Cammell Laird open and ensure that we do not lose skills which are important to the British economy?

Mr. Aitken

I regret the loss of any defence jobs. The number of lost jobs since 1990 is approximately 40,000, considerably lower than the figure given by the hon. Lady. Like the hon. Lady, I lament the closure of Cammell Laird in her constituency because it has played a proud role in the history of British shipbuilding. However, it is not right for the Government to invent a diversification strategy. The owner of Cammell Laird, Vickers Shipbuilding and Engineering Limited, is already diversifying into areas such as oil rig technology. Defence diversification is best left to companies, not Government quangos.

Mr. Trotter

I thank my hon. Friend for visiting Swan Hunter last week. His sympathetic and understanding remarks were well received by the representatives of the work force whom he met there. They were encouraged by his statement that the helicopter carrier had not been cancelled and that the tendering process was continuing in good faith. Will my hon. Friend confirm that he was impressed by what he saw of the management-work force team and the quality of their work on the four Royal Navy ships being built in the yard?

Mr. Aitken

I am grateful to my hon. Friend. I appreciated the chance to visit Swan Hunter in his good company. I can confirm that I was extremely impressed by the quality of the workmanship and the dedication of the work force. The landing platform helicopter project is still in our long-term costing. It is being reviewed in the light of defence resources, but I can assure my hon. Friend that the messages that he and the Swan Hunter work force gave me have been faithfully passed on throughout Whitehall.

Mr. Hutton

Is the Minister aware of the importance to many defence contractors of the batch 2 Trafalgar order? Can he confirm that that order remains part of the Government's programme and that it is his intention to replace all the Swiftsure class with the new batch 2 Trafalgars?

Mr. Aitken

I can confirm that the batch 2 Trafalgar project is in the long-term costing. All such projects depend on the availability of future defence resources, but I can confirm that it is in the programme. I fully understand its importance to the hon. Gentleman and to his constituents at Vickers Shipbuilding and Engineering Limited. VSEL has recently executed a design study contract which we are now studying in considering the way forward.

Mr. Conway

Will my hon. Friend take the time to consider the effectiveness of the demountable rack off-loading and pick-up system—DROPS—the battlefield ammunition resupply carrier, during the Gulf conflict, which is a useful and essential piece of kit? Will he bear in mind the need for flexibility in his Department as the chill winds of recession are banging around the country and consider the long-term future of that particular carrier which is built in Shrewsbury and whose future may be in jeopardy?

Mr. Aitken

A question about DROPS appears later on the Order Paper. The DROPS medium ability vehicle that entered service with the British Army in 1990 has put up an impressive performance, especially in the Gulf campaign. Overseas customers have been particularly impressed and are interested in its progress.

Mr. Foulkes

Will the Minister clear up a mystery worthy of Agatha Christie? What is he up to in respect of the Upholder class submarines? Will they be sold to Canada? Do we not need diesel submarines any more? Will they be sold at their full cost of £800 million? Will the receipts be used for the helicopter carrier? Is that not another illustration of the muddle and confusion at the Ministry of Defence, which has no defence strategy because there has been no defence review?

Mr. Aitken

I think that my reply should be, elementary my dear Hercule Poirot. That project, like many others in the long-term costing, is currently under consideration by Ministers, and no decisions have been taken.

Mr. Viggers

Is it not a fact that the moderates on the Labour Benches are a minority in their party—a party which consistently votes at its annual conference to cut defence expenditure? Should not those who really believe in defence and procurement jobs place their trust in the party that puts defence at the top of its priorities?

Hon. Members

Say no.

Mr. Aitken

I am choosing my words with care, because I wholeheartedly agree with my hon. Friend, who highlights the continuing ambivalence and absurdity of the Labour party, which calls for more jobs and orders and for a stronger defence policy in Westminster, but then, at its annual conference, votes for cuts of £6 billion in the defence budget. That is the theatre of the absurd, and it fools nobody ultimately.