Royal Navy

HC Deb 16 February 1995 vol 254 cc1145-230

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Willetts.]

4.13 pm

The Minister of State for Defence Procurement (Mr. Roger Freeman)

It is my privilege today to open our annual debate on the Royal Navy. Since I was last a Defence Minister, the cold war has ended and our armed forces—including the Navy—have necessarily been restructured. By 1995–96, the defence budget will be some 25 per cent. smaller than it was in 1985, and that is a position broadly similar to that of other major western nations.

After the inevitable turbulence that followed "Options For Change" and "Front Line First", our armed forces can now look forward to a period of broad stability in funding. The Royal Navy will remain a formidable fighting force with global responsibilities, manned by professional and dedicated personnel to whom I am happy—I am sure the whole House is also happy—to pay tribute today.

In the uncertain and unpredictable world of today, the ultimate guarantee of our nation's security remains our strategic nuclear deterrent. My right hon. and learned Friend the Secretary of State for Defence announced on 19 December last year that HMS Vanguard was on its first operational patrol. Vanguard's deployment marks a key point in the progressive replacement of Polaris by the Trident system, the capabilities of which will ensure that the UK's strategic deterrent will remain effective well into the next century.

I note that the view of the Labour party is divided on Trident, while the view of all Government Members is entirely in one accord in support of Trident. Early-day motion 29 carries the signatures of 40 Opposition Members, of whom two are in their places this afternoon. Those 40 Members are entirely opposed to the introduction of Trident, and would cancel our nuclear submarine programme.

Dr. David Clark (South Shields)

I am sorry to interrupt the Minister so early, but I must make it plain that, as the Minister knows, the Labour party's policy is that we will deploy the Trident system, but we will limit the number of nuclear warheads to the same number as there are on Polaris. I hope that that is clear to everyone concerned.

Mr. Freeman

It is entirely clear that that is the policy of the hon. Gentleman and the Opposition Front Bench. I put it on record that 40 Opposition Members do not agree with that policy, and I must point out that the Labour party is entirely divided on this crucial aspect of defence policy. [Interruption.] The hon. Member for Motherwell, North (Dr. Reid) groans, but it is the truth. That is one reason why, at a general election, the electorate will not trust Labour on defence.

Mr. Andrew F. Bennett (Denton and Reddish)

Surely the Minister accepts that even the Government would like to get rid of Trident, on the basis that they would like to have a world where it is not necessary, and therefore the difference is not all that great. It is not a question of whether we should get rid of it, but of how we can get rid of it, particularly as it will cost about £30 billion over its lifetime. Surely everyone would like to remove the need for Trident.

Mr. Freeman

The point is that 40 Opposition Members want to get rid of Trident now. It is difficult for anyone who takes this subject seriously—including those on the Opposition Front Bench—to envisage a scenario in the near future where the withdrawal of our nuclear submarine fleet would be possible. That is not a credible defence policy at present.

Dr. John Reid (Motherwell, North)

Every Conservative Member voted for the statement on the defence estimates, which says that the ultimate aim of the Government is to work towards a nuclear-free world. Can we take it that every Conservative Member wants to see a nuclear-free world? Is that not exactly what Labour Members want to see?

Mr. Freeman

The hon. Gentleman knows full well that that is not the case. The difference between the 40 Labour Members and the majority faction of the Labour party is that those hon. Members who signed the early-day motion are calling for the scrapping of Trident now. We all want to work for the reduction and the eventual abolition of nuclear weapons. In the mean time, we believe firmly as a Government—I speak for all my hon. Friends—that we must pursue a sensible and coherent policy to retain the Trident submarine force.

Mr. Michael Colvin (Romsey and Waterside)

Flow many fingers are there are now on nuclear triggers—despite the non-proliferation treaty—as opposed to during the cold war, when there were not very many?

Mr. Freeman

My hon. Friend is right. A capacity is being developed by a number of countries, of which we should be very wary. One of the main tenets of our policy is that we should retain our nuclear deterrent while any other country in a position to threaten our security possesses a nuclear weapon or the ability to construct a nuclear weapon. That is a clear policy, but there is total division of approach on the Opposition Benches.

Dr. Norman A. Godman (Greenock and Port Glasgow)

rose—

Mr. Freeman

I will seek to make progress.

Dr. Godman

Will the Minister give way on Trident?

Mr. Freeman

I shall return to the subject of Trident, and I shall then give way to the hon. Gentleman.

The Royal Navy has adapted quickly to the post cold war environment, with its new roles and challenges. Its most visible commitment in the past 12 months has been in the Adriatic. The UK task group, led since August by HMS Invincible, the carrier, has the primary task of supporting the North Atlantic Treaty Organisation's Operation Deny Flight, and its Sea Harrier jets help enforce the no-fly zone over Bosnia.

HMS Campbeltown and HMS Cumberland currently contribute to United Nations embargo operations in the Adriatic on Operation Sharp Guard. Sea King helicopters from 845 Naval Air Squadron, based in Split, also continue to provide casualty evacuation and general helicopter support to Commander British Forces.

In September 1994, the Royal Navy acted in support of UN resolutions by participating in the United States-led Operation Restore Democracy in Haiti. HMS Lancaster, and subsequently HMS Broadsword, were involved in embargo operations, while RFA Oakleaf replenished ships of the international task force. HMS Exeter is currently contributing to the US-led task group in the operation to withdraw peacekeeping forces from Somalia.

In October 1994, as Saddam Hussein's forces once again threatened peace and stability in the Gulf, HMS Cornwall, with her Lynx helicopter, was diverted from the Armilla patrol, and was quickly in position as the first visible allied presence off the Kuwaiti coast; 45 Commando Group Royal Marines also deployed to Kuwait, as the spearhead battalion, and returned home in early December, leaving behind well-prepared defensive positions for use by Kuwaiti forces and having earned universal respect.

In Northern Ireland, 42 Commando Royal Marines are currently the South Armagh roulement battalion, and they continue to demonstrate great professionalism in tackling the new and delicate challenges presented by the peace process.

Back in the Caribbean, HMS Broadsword is currently undertaking West Indies guardship duties. Part of our operational duties involve working with the United States in the fight to combat drug trafficking in the area, a dangerous trade, which increasingly involves drugs destined for the UK market.

The Royal Navy has also played a full part in the process of developing contacts with Russia and central and eastern Europe. In October, HMS Newcastle and RFA Olna took part in Exercise Co-operative Venture in the North sea and Baltic approaches. That was the first joint maritime exercise under NATO's Partnership for Peace initiative. It is a measure of the Royal Navy's global role that, last Christmas, 26 out of a total of more than 100 Royal Navy and Royal Fleet Auxiliary ships were away from their base ports.

I turn now to the equipment programme, and also Trident. To meet those global defence responsibilities, we must ensure that the Royal Navy is properly equipped. We have a major procurement programme for new vessels—one of the largest programmes for many years. We continue to plan for a broad range of capabilities, based around the three core elements of nuclear-powered submarines, aircraft carrier task forces and amphibious forces. We continue to introduce modern, more capable vessels and now have the youngest fleet since the first world war.

I have already mentioned—

Mr. Richard Ottaway (Croydon, South)

rose—

Mr. Freeman

Will my hon. Friend forgive me for a second? I want to mention Trident, and then give way to the hon. Member for Greenock and Port Glasgow (Dr. Godman) first.

I have mentioned the Trident programme. The deployment of HMS Vanguard on her first operational patrol last December met the original in-service date set more than 12 years before. The achievement of such a major and complex project on time is in no small part due to the skills and commitment of VSEL, the builders, and many other companies involved, and the contributions of Ministry of Defence staff at all levels.

Dr. Godman

As the Minister well knows, a goodly number of my constituents work at the Trident base on the other side of the firth of Clyde from my constituency, at Coulport and Faslane. I was pleased to receive a letter from his ministerial colleague, saying that 23 more posts were to be created there, but many people are deeply worried about what they perceive as the threat to their terms and conditions of employment in Coulport and Faslane.

Will the Minister give the House an assurance that he is completely confident of the efficacy of the ship lift on the other side of the Clyde from my constituency? Is he confident that it is able to carry out the programme of lifting those vessels out of the water with no threat of safety hazards to the people who work there?

Mr. Freeman

I am confident about that. If the hon. Gentleman has not witnessed a ship lift lifting one of the boats out of the water, I shall arrange for him to do so. One of the reasons for the increased costs of Trident's works was the extra expense of making sure that that facility was as safe as human beings can possibly make such a complicated mechanism—strong enough to withstand a geological fault shock.

As for the contracts of employment of those who work at Coulport and Faslane, those workers have nothing to fear. I have announced that, over the next two years, we will accept the proposals from the civilian work force—to whom I pay particular tribute for what they have achieved—for improvements in efficiency at Faslane. Coulport is not affected. In due course, but not before 1997, we will introduce some market testing for some of the support functions at Faslane. There is no reason, however, for anyone there to feel either threatened or adversely done by.

Mr. Ottaway

I welcome what my right hon. Friend says about providing the nation with a modern fleet. This autumn, I had the good fortune to spend some time on board HMS Illustrious as she was embarking on sea trials before she was deployed to the Adriatic. Although it is an efficient ship, during my time on board I began to sense that probably, together with HMS Invincible and HMS Ark Royal, it is beginning to age.

Those ships were designed in the 1970s, and they are now about 15 years old. Is it not appropriate now to be thinking about the next generation of aircraft carriers, because the lead time for the introduction of an aircraft carrier is about 10 years, which is when the present generation of ships is likely to be becoming worn out and unserviceable?

Mr. Freeman

My hon. Friend anticipates me. We plan to retain three aircraft carriers and modernise their aircraft, including upgrading the Sea Harrier and introducing the new Merlin EH101 anti-submarine warfare helicopter. If we are to retain three aircraft carriers, we must plan for their replacement now. Planning is at an early stage, and I anticipate that we shall have another 10 to 15 years minimum service out of those aircraft carriers. One is in extended refit at the moment—

Dr. Reid

Extended service.

Mr. Freeman

I am grateful to the hon. Gentleman for correcting me. I assure my hon. Friend the Member for Croydon, South (Mr. Ottaway) that planning has begun at an early stage.

Mr. Toby Jessel (Twickenham)

Will my right hon. Friend give way?

Mr. Freeman

If my hon. Friend will forgive me, I shall make a little progress. I anticipate what my hon. Friend might be interested in, and I shall give way in a minute.

Development work on Merlin is now largely complete, and it remains on schedule to enter service with the Royal Navy in 1998. I understand that Mr. Alan Jones, the chief executive of Westland, is shortly to move on to BICC. May I say to those who take a close interest in Westland and the current procurement competition for support helicopters, that the move of Mr. Jones and his replacement by Mr. David Wright, for whom I have a high regard, is in no way connected with the continuing negotiations on the support helicopters. I gather that there has been some speculation that there was a connection—there is none.

Mr. Jessel

Apart from the purchase of new ships and the upholding of the best of our existing ships, will the Government give some attention to the preservation of old warships, so that, in 100 years' time, people can see what a ship from the first or second world war looked like? Will my right hon. Friend continue to encourage the work of the Warship Preservation Trust, which was founded and is chaired by our former colleague, Sir Philip Goodhart? Can my right hon. Friend say whether HMS Caroline could be made available for preservation at some suitable location?

Mr. Freeman

I am a supporter of the Warship Preservation Trust, and played some small part almost eight years ago in saving HMS Plymouth. She is now berthed at Birkenhead docks and is a credit to the Royal Navy and its long traditions. HMS Caroline, a light cruiser, is currently berthed in Belfast lough, and I shall certainly consider its future sympathetically. We must preserve and protect the resources of the Ministry of Defence and the Royal Navy, and, sensibly, we will do anything we can to ensure that.

Mr. Andrew Mackinlay (Thurrock)

I am grateful to the Minister, because I hope to mention HMS Caroline later on. HMS Caroline is a wonderful time capsule, which all of us interested in naval history wish to see preserved. Belfast city council and others, including myself, believe that, after all the years it has been in Belfast lough, there it should stay, to the advantage of the people of Northern Ireland, who could benefit from it becoming a conference and tourist centre. It could be part and parcel of the new enterprises that will develop in Northern Ireland.

Certainly, as a lad from Essex, I suggest that it should not come to England, but should remain in Belfast for the benefit of the people of Northern Ireland. I hope that the Minister will bear that in mind, rather than give way to some of the bids being put in by people who have no commitment to Northern Ireland.

Mr. Freeman

We continue to plan for a force level of 35 destroyers and frigates from this year, with type 23s having replaced older vessels such as Leanders and type 21s, which we have been able to release for sale overseas. There are currently 10 type 23s with the Royal Navy, with a further three under construction. At the end of last year, we issued an invitation to tender for a further batch of up to three frigates.

We demonstrated our commitment to maintaining a highly capable mine counter-measure flotilla for the Royal Navy last July, by placing an order for a further batch of seven Sandown class single-role minehunters.

Mr. Christopher Gill (Ludlow)

Will the Minister tell the House over what time scale those minehunters will be delivered to the Royal Navy—and, more to the point, could he confirm that the last one of the seven now ordered will not actually be commissioned until well into the next century?

Mr. Freeman

The work is placed with Vosper Thorneycroft in Southampton, and occupies a good deal of its capacity. I cannot recall the exact delivery schedule, but I shall write to the hon. Gentleman. I am satisfied with the efficiency of the work and the rate of production, and Vosper Thorneycroft is delighted with the order.

The delivery of the last of the batch early in the next century—although I cannot give a precise date—will bring the mine counter-measure force to the 25 vessels announced in the 1993 Defence White Paper. We are also planning a programme of upgrading the 13 dual-role HUNT class minehunters/minesweepers to improve their capability to deal with future threats.

The Royal Navy now operates a 12-boat-strong attack submarine fleet, now entirely nuclear-powered, of the Swiftsure and Trafalgar classes. We issued an invitation to tender last July for the design and build of second batch of the highly successful Trafalgar class SSNs. The batch 2 submarines with which we plan to replace the Swiftsure class will be based closely on the Trafalgar class, and will incorporate the new tactical weapon system which is also being refitted to existing Swiftsure and Trafalgar class boats.

Mr. John Hutton (Barrow and Furness)

The Minister was talking about batch 2 Trafalgar class submarine programme. He will know that order is extremely important for the future of VSEL and many thousands of my constituents' jobs. He has confirmed that invitations to tender have been sent out.

Will he also confirm that his right hon. Friend the former Minister for Defence Procurement, now the Chief Secretary to the Treasury, confirmed on 12 May 1992 that the orders for those submarines will be placed in January 1994, and at the earliest that order will not be until the summer of 1996? What is the reason for that two-and-a-half-year delay in ordering the submarines, and what consequences will the delay have for ray constituents?

Mr. Freeman

I am conscious of the need to ensure that, in the interests of the nation, warship building yards such as VSEL have a sensible flow of orders, whether placed by the MOD or abroad. That must make economic sense.

One of the reasons for the delay was our desire to create a competition in the design for the new Trafalgar class submarines. I am glad to say that the competition between VSEL and the consortium, including GEC, will proceed, and will be brought to a conclusion.

A decision about how to build a nuclear-class patrol submarine is independent from where the bulk of the integration work might take place. I am sure that the hon. Gentleman is right to point out that VSEL has the only submarine construction facilities in Britain—and they are excellent facilities. Therefore, it would not be inconsistent to select a different method of procurement of design development and yet still build the boats at VSEL's yard at Barrow. I hope that we can bring the competition to a conclusion quickly, and get on with placing the orders.

Dr. Godman

I am grateful to the Minister for displaying his characteristic courtesy. With regard to the construction of type 23 frigates, is he in a position to give to the House the names of the yards which have expressed an interest in seeking that work?

Mr. Freeman

I see no reason why I should not do so, as it is obvious to anyone who is interested in the industry that they would include Yarrow, VSEL and Vosper Thornycroft. I have visited its yard, and I assure the House that Vosper Thornycroft has the capability of building a type 23, although it has not built a frigate or a destroyer for many years.

The capability of our SSNs will be further enhanced by the Spearfish torpedo, the most advanced anti-ship and anti-submarine torpedo in the world, whose speed and endurance enables it to outmanoeuvre the fastest and deepest diving targets. As was announced in last year's Defence White Paper, an initial batch of Spearfish torpedoes entered service with the Royal Navy in March 1994.

Following improvements to the weapon's reliability, a main production order for the remainder to be supplied, and for the in-service support of that weapon system, was placed with GEC-Marconi Naval Systems in December. A large measure of the work on Spearfish will take place at the Royal Naval Armament Depot, Beith. The Spearfish torpedo will replace the Tigerfish in all Royal Navy submarines.

We plan to retain a substantial amphibious capability. The "Front Line First" announcement confirmed that we intended to replace the assault ships, HMS Intrepid and HMS Fearless, and an invitation to tender for their replacement was issued last August. I expect orders to be placed around the end of this year, and I am sure that that news will be welcomed by all hon. Members on both sides of the House. Good progress continues to be made on the design and construction of the new helicopter carrier, which was ordered in 1993, and which will form the cornerstone of our future amphibious capability.

We recognise the importance of specialist hydrographic vessels and personnel. We continue to plan for the upgrading of the capability of the hydrographic service by procuring four new vessels—including a new-build ocean survey vessel, an order for which was placed last month.

Mr. David Nicholson (Taunton)

My right hon. Friend knows of my interest in the hydrographic service whose offices have been located at Taunton for more than 50 years. In its bicentenary year, will he send his congratulations and best wishes to all those who work in that service on their excellent quality work, which I believe is still unparalleled throughout the world—not only in the area of military and naval surveying and research, but in a growing amount of civil research which will be extremely valuable to this country in the future. Will my right hon. Friend do all that he can to ensure that that work is continued and bettered in the future?

Mr. Freeman

I am grateful to my hon. Friend for reminding me about the bicentenary, and I send my best wishes to all of those who are involved in that vital work. I will be grateful if my hon. Friend will convey that message to his constituents, and, indeed, to all of those who work at the centre. We have decided to name the new ocean survey vessel after the great Antarctic explorer, Scott, and that vessel will do valuable work for the hydrographic service, as will the other vessels that we intend to order in due course.

We also recognise the importance of modern, capable support ships. Since last year's Royal Navy debate, two auxiliary oilers, Fort George and Fort Victoria, have entered service with the Royal Fleet Auxiliary. As part of the defence costs study, we announced in July last year that we are exploring the possibility of fitting our submarines with conventionally armed Tomahawk land attack missiles procured from the United States. Feasibility studies were launched in the autumn.

Mr. Mackinlay

How long was HMS Fort Victoria under construction? How much overspend was involved in that construction, and how late was the vessel delivered?

Mr. Freeman

I try to carry as much information as I can in my head, but I do not know the answers to the hon. Gentleman's questions. I will write to him, and put a copy of my reply in the Library of the House.

To enable us to maintain and enhance the fighting capabilities of the front line, we have sought major efficiency savings in the support area—not least in the recent defence costs study "Front Line First". Naval support has been largely a civilian operation since Samuel Pepys was secretary of the admiralty. "Front Line First" has successfully identified ways in which administrative and support functions could be carried out more cost-effectively, and I acknowledge the significant impact that those plans will have for a very loyal civilian work force.

A number of decisions have been taken in recent weeks that affect naval infrastructure. I announced last December our intention to redeploy minor war vessels from Rosyth. Work is proceeding to schedule and, when achieved, will represent a significant step towards eliminating excess capacity in our naval support facilities and will save some £20 million annually. The human cost of closure is, of course, a matter of regret, and I pay tribute to the work force at Rosyth for their admirable record in serving the Royal Navy for most of this century.

I am personally committed to ensuring that the future redevelopment of the parts of the base that are no longer required by the Royal Navy takes place as quickly as possible, and in a manner in which enhances the economic and particularly the employment prospects of the region. I look forward to receiving proposals next month from the Rosyth 2000 consortium for the whole Rosyth complex. We will carefully consider those and any other approaches to take over surplus facilities, so long as they assume responsibility for the whole rather than only part of the facility.

Proposals to streamline Royal Navy armament depots have also been announced, and my hon. Friend the Minister of State for the Armed Forces has also announced in recent days the Government's intention to rationalise the naval stores depots, leading to the closure by April 1997 of three main depots—at Exeter, Eaglescliffe and Wrangaton—and reductions elsewhere, particularly at Devonport. Those measures are intended to maximise the utilisation of the modern facilities we have, eliminate the overheads associated with excess capacity in the system and, most importantly, meet the operational requirements of the Royal Navy.

Mr. Gary Streeter (Plymouth, Sutton)

Will my right hon. Friend assure me that every effort will be made to try to find alternative employment within the Ministry of Defence for the people, particularly in Plymouth, who will be made redundant by the recent announcement, and that outplacement consultants will be engaged to give them every ounce of active advice possible?

Mr. Freeman

Of course my hon. Friend is concerned about his constituency, but the point is of general interest, wherever changes are made.

My hon. Friend the Minister of State and I are jointly responsible for a number of decisions affecting service men, service women and civilians. First, we take very seriously the need to co-ordinate within the public sector to ensure that other Departments deploy their skills and experience in helping those people to find alternative employment; secondly—I cited Rosyth as an example—central Government have a role to ensure that we take the initiative now, before the depot or naval base closes, and without unnecessary delay to find an alternative use.

I am quite determined not to fall into the trap of piecemeal closure and piecemeal sale. The people who work at Rosyth, for example, and many other locations, deserve our help now, not simply, when the depot or garrison closes, our thanks at the end. I therefore hope that my hon. Friend is suitably impressed.

Mr. David Jamieson (Plymouth, Devonport)

Will the Minister tell the House how, by closing the supply stores at Exeter and Wrangaton, and by the partial closure of Devonport, the Royal Navy is best served by having those supplies sent from Portsmouth, which is 170 miles away? Is there some hidden agenda whereby he intends to run down or close the naval base at Devonport?

Mr. Freeman

No, absolutely none at all. The hon. Gentleman, I am sure, appreciates the difference between slow-moving stores—those that are required perhaps at a week or even a month's notice when a ship comes in for a planned refit, in which case they should be held in a centralised location—and the stores that are needed when a ship comes in, for example, after sea training off Portland, which may need a new generator and needs it now. If it comes in to Devonport, the Navy will have the available stores at the dockside. Therefore, the items that are fast moving, in urgent need, will be available at the ports.

Mr. Jamieson

indicated dissent.

Mr. Freeman

The hon. Gentleman shakes his head, but I can assure him that the Navy take an even greater interest than I do in ensuring that the spares and stores are available for the ships when they are needed.

Plans to move the Flag Officer Scotland, Northern England and Northern Ireland and his non-operational staff from Pitreavie to Faslane by April 1996 were announced last year, and I have announced today, in the form of a written answer, that the Government also intend to relocate FOSNNI's operational headquarters to Faslane in the same time frame. Consultation on those proposals have been under way for several months, but having weighed all the representations most carefully, it has been decided to proceed with the relocation, which will save some £22 million over the next 10 years.

I am pleased to be able to say that we have already reached agreement with Fife Enterprise to release a small area of the Pitreavie site for inward investment purposes, and the rest of the site will be similarly disposed of after April next year. In that way, the economic impact of the decision will be substantially offset, to the benefit of the local community and the Ministry of Defence employees affected.

I now outline the key principles that affect our procurement policy. It is time that we put on the record the elements of a modern procurement policy, which faces very different circumstances from the ones which Sir Peter Levene, as Chief of Defence Procurement, found almost 10 years ago when he revolutionised the way in which we acquire equipment. To maintain our Navy in the years ahead, we need a fully appropriate procurement policy, to which I now turn.

The first policy objective is for the United Kingdom to retain a capability to build warship hulls and to retain as far as possible a choice of yard for each class of vessel. But there is, understandably, more warship building capacity in the United Kingdom than can be sustained by Ministry of Defence requirements alone. That means that yards must now turn to new markets if they are to survive in their present form, and it remains our aim to secure the opening of the European market for warship building on a fair and equitable basis.

Winning export orders will not get easier. In general, a reduction in the perceived threat and universal pressure on defence spending has resulted in declining opportunities to supply new build warship hulls, and a greater number of naval hulls may ultimately be built in the yards of previous customers.

The over-capacity among warship builders has, of course, had its casualties, as in the case of Swan Hunter. Swans had a strong tradition of supplying the Royal Navy with quality ships, and, in keeping with its excellent track record, completed the type 23 frigates Westminster, Northumberland and Richmond to a very high standard in what were difficult circumstances. That excellent record is testimony to the work force's commitment, and will no doubt assist the receivers in their future drive to find a buyer for the yard's main shipbuilding facility at Wallsend.

I am confident that sufficient capacity still remains for the Ministry of Defence in warship building. Our competition policy has been successful and our latest ships represent excellent value for money. As in the rest of the equipment programme, if competition proves impracticable, we would continue to seek value for money, through pursuing what we call "no acceptable price, no contract" arrangements, pricing non-competitive contracts at the outset and in such a way as to promote efficiency.

Mr. Hutton

The Minister said that it would be the Government's policy to retain a capability to build hulls. What about fitting out? Is it the Government's policy that the fitting out of vessels will also be retained in the United Kingdom?

Mr. Freeman

If the hon. Gentleman will bear with me, when I conclude I will deal with project Horizon and answer that question specifically, because I draw a distinction between hulls and equipment. The hull accounts for perhaps 10 to 15 per cent. of the total cost of a warship. The equipment that goes in is the expensive part. Even for a Royal Air Force modern fighter, 50 per cent. of the cost is in the avionics alone.

The second policy objective is to ensure that warship building and refitting are in the private rather than the public sector. The royal dockyards at Devonport and Rosyth continue to benefit from the refitting arrangements announced in June 1993 by my right hon. and learned Friend the Secretary of State for Defence.

Both dockyards continue to receive a regular allocation of work from the naval refitting programme, and additionally, both have been successful in securing work from the unallocated programme, in competition with other ship repair companies. In that way, Devonport Management Ltd. has secured contracts for the refits of HMS Cornwall and HMS Birmingham, and Babcock Rosyth Defence Ltd. has recently won the competition to extend the life of the Royal Fleet Auxiliary vessel Sir Bedivere.

Following the announcement in October 1993 of the Government's intention to seek tenders from the private sector for the sale of the royal dockyards as separate and independent commercial entities, invitations to submit initial tenders were issued in July last year. As I announced on 23 November last year, we have received initial tenders from Devonport Management Ltd. for Devonport dockyard, and from Babcock International Group for Rosyth dockyard.

Those initial proposals have been evaluated, and invitations to single tender to those companies have now been issued, with final tenders due before Easter. I cannot rule out at this stage other options for future dockyard management, but we continue to believe that privatisation on the right terms will give value for money, and for the taxpayer within the future framework of fleet support. These are complex undertakings, which will involve detailed contractual negotiations, but we expect to be in a position to make final decisions by the summer.

Our third policy objective is to meet the operational requirements of the armed forces in a way that achieves the best value for money for the taxpayer. As a result of the Government's competition and open procurement policies, the UK defence industry is strong and highly competitive at home and overseas. It would soon lose its place in world markets that have generated an average of £5,000 million-worth of export orders a year over the past five years—that is the average rate of orders—if we resorted to protectionism, or abandoned the principle of value for money for the customer.

When assessing the available options, however, Ministers must take account of the wider implications that procurement decisions will have. Some decisions may have consequences for the future availability of competition, and could in extreme cases even bring into question the continued existence of a viable industrial sector, with consequential effects on employment in the United Kingdom. Defence Ministers therefore give due consideration to the possible consequences of any procurement decision for the defence industrial base.

Fourthly, we need to consider security of supply; but that need not imply production in the United Kingdom. It is difficult to envisage future circumstances in which Britain would act militarily without the support of allies, or when all overseas supplies were unavailable. British and French companies are currently discussing a possible link in ammunition production. We shall need to take a view in due course on whatever proposals may emerge, but in principle we would not consider production-sharing in an Anglo-French industrial collaboration a fundamental threat to our security of supply.

Fifthly, we are alert to the possibility that a militarily important technology might be put at risk as a result of a procurement decision, but we have not found that to be a problem so far. There has undoubtedly been a significant reduction in the capacity of the UK defence industry, but that has not led to any significant loss of capability. It is not essential to retain a domestic capability in every area of defence technology, but in a number of instances—for military reasons—we would not be prepared to buy from overseas, provided that an indigenous capability could be sustained at an acceptable cost.

Before a Front-Bench spokesman asks me to name those key technologies, let me say that, if I did so, we should be at a disadvantage in terms of retaining procurement value for money for the taxpayer.

Sixthly and finally—I apologise for going into the subject at such length, but I consider it important—we need to accept and pursue collaboration in defence research and procurement with our allies in Europe and the United States, for sound economic reasons. Some restructuring of industry is inevitable, given declining defence budgets, the increasing costs of high-technology development programmes and the competition from a rationalised United States defence industry.

If UK companies are thinking about alliances and mergers—as, of course, many are—they would do well not to confine their attention to other UK companies alone. I am pleased to note that many are entering into joint ventures and co-operative arrangements with companies in both Europe and the United States.

There is no doubt that such cross-border alliances will be a vital component in meeting our future defence needs. Collaboration is an economic necessity, and as a result of our efforts to promote wider armaments co-operation with other nations, we are currently collaborating on some 45 projects at various stages of the procurement cycle—the largest being the European fighter and Project Horizon. The keys to successful collaboration in the future must lie in the agreement of a standard requirement, a sensible industrial structure and maximum use of competition within the collaborating countries, at the very least.

I want to make special reference to Project Horizon, on which the United Kingdom is currently collaborating with France and Italy. The programme will provide the Royal Navy with a new anti-air warfare warship in the early years of the next century to replace our 12 type 42 destroyers. The programme memorandum of understanding for the ship was signed on 11 July 1994. The principal anti-air missile system will be subject to a separate memorandum of understanding when the three partners have reached an agreement with industry on a compliant, cost-effective solution; I expect that to happen soon.

The Horizon trinational project office is based in London, and staff there from the three nations have already embarked on important preliminary steps that include the issuing of invitations to tender for the design definition of the ship and its combat management system. An international joint venture company comprising companies from all three nations will act as prime contractor for design and build of the three firsts of class—one for each nation. That involves the hull of the ship.

The Horizon project combines the essential ingredients for effective collaborative procurement. The three nations have agreed a common requirement, with only minor national exceptions; the industrial structure is sound; and—here I refer to the point made by the hon. Member for Barrow in Furness (Mr. Hutton)—the components of the warship will be ordered following international competition. I do not limit that competition to the three participating nations. All that benefits both the Royal Navy and the taxpayer.

It has been a busy and challenging 12 months for our senior service, but I know that I carry the House with me when I say that, once again, the men and women of the Royal Navy, and the civilians who support them, have acquitted themselves superbly. They have been a credit to themselves and, indeed, to the nation as a whole.

4.55 pm

Mr. Derek Fatchett (Leeds, Central)

Unlike the Minister of State, I have not returned to this annual debate as almost a recidivist; I am here in my present capacity for the first time.

I welcomed some of the Minister's comments, and the way in which he set out the roles performed by the Royal Navy. It is always interesting to hear them set out, and their extensive nature described. The Minister did that in his opening remarks, and he was right to suggest that the Navy's important functions in the Adriatic and Somalia, for instance—and its other United Nations functions—are making an important contribution to both peacemaking and peacekeeping throughout the world.

I am sure that every Opposition Member wishes to be associated with the Minister's closing thanks to all in the services who have made those tasks possible, and fulfilled them so effectively.

I particularly welcomed what the Minister said about procurement. I shall deal with some of it later in my speech.

Reading reports of Royal Navy debates held in previous years, I was struck by the fact that—regardless of the political position that hon. Members may adopt on a number of other issues—there seems to be a genuine consensus on the specific theme of defence debates, whether it is the Royal Navy, the Royal Air Force or the Army. That is largely understandable, because defence debates are part of the national and international debate about what is happening to our forces—and those of other countries—in the post-cold war period.

The hon. Member for Upminster (Sir N. Bonsor), who chairs the Defence Select Committee so effectively, will be very familiar with the remarks that I am about to quote. In his contribution to last year's debate and in his Select Committee's 1993 report, he summed up the anxiety felt by hon. Members on both sides of the House about the future shape, activities and functions of the Royal Navy. He seems to have the ability to write in language that I suspect will attract one or two newspaper headlines. I do not object to that; I think that it does not do a bad job in warming up what may sometimes be seen as rather a tedious issue. The hon. Gentleman has brought to the Select Committee the same sort of approach that Judge Tumim has brought to the Prison Service: I mean that as a compliment.

In the Select Committee report, the hon. Gentleman concluded: It appears self-evident to us that matching resources to tasks is becoming increasingly fraught, stretching both crews and vessels to unwise levels even during peacetime. It is evident that, in the event of full-scale war, the Royal Navy would be incapable of defending our sea-routes on which we depend for both trade and the movement of our Armed Forces. It is our view that this shortcoming poses a serious, and potentially fatal, threat to the long term security of this country. That view, expressed by an all-party Committee, has been reflected in debates both before and after the report's publication.

The hon. Gentleman used different language to make exactly the same point in the closing words of his contribution to last year's Royal Navy debate. He said: We must look to the long-term future with a possibility that we shall need a strong united Nato and a British contributory force in the Army, the Navy and the Air Force capable of carrying out a role in an all-out war against us. It is the finding of the Defence Select Committee that our Navy is not strong enough properly to fulfil such a role."—[Official Report, 17 February 1994; Vol. 237, c. 1105.] That has been the backcloth, and I shall return to those key arguments later in my speech. There has been broad agreement across the House that resources must match commitments and that we must engage in a broad debate on how we bring those two sides of the equation together.

At the end of his speech, the Minister mentioned the need for teamwork and co-operation. He pointed out that, like good industry, all our forces depend on developing teamwork. It is an essential part of the esprit de corps of the services' efficiency. The Navy is no exception in that respect. We are concerned about the extent to which the management of the Ministry of Defence can undermine the armed forces' confidence and sense of purpose. The Ministry is about leadership and a sense of direction and, if those are lacking, morale can fall, if not collapse, in certain circumstances.

The National Audit Office, the Public Accounts Committee and my hon. Friend the Member for South Shields (Dr. Clark) have all drawn attention to the important issue of waste and inefficiency in the Ministry of Defence. [Interruption.] I know that parliamentary private secretaries take a Trappist vow, but the word that the hon. Member for Norfolk, North-West has just uttered is absolutely correct: that waste is "disgraceful".

The catalogue is substantial, and includes the fact that £1 billion was spent on Upholder submarines. No function was defined for those submarines, which are now for sale. A further £7.2 million was spent on the Government's favourite friends—consultants—who were brought in at Rosyth and Devonport. That money was wasted because the consultants could find only one horse to run in the race.

Dr. Reid

That is not bad for £7.2 million.

Mr. Fatchett

As my hon. Friend says, that is not bad for £7.2 million.

Other problems have emerged. My hon. Friend the Member for Plymouth, Devonport (Mr. Jamieson) has come up with a lovely Spanish practice that seems to exist in the Ministry of Defence. At one time, trade union practices were criticised, but we have found such a practice in the Ministry of Defence.

It concerns the housing trust which the Ministry was to establish. I suspect that many of my constituents would love such a job—all the freedom and a salary to go with it. In response to my hon. Friend's questions, replies from the Minister of State for the Armed Services show that the chief executive of that housing trust, which does nothing because it has no role, is on a three-year contract worth £240,000. In addition, he has an efficiency bonus totalling £600,000. I presume that, if one starts with no houses, one cannot mismanage the housing stock, so he will qualify for that bonus.

The Royal Naval engineering college at Manadon in Plymouth is now up for sale, and I have before me the glossy brochure produced by the estate agent. If anyone is looking for a cheap property, this may be the answer. It has a number of bedrooms and a range of facilities. We know that it is up to date because, in recent years, the Ministry of Defence spent nearly £3 million on modernising it. In line with the new traditions in the Ministry, I understand that, in the ward room, £20,000 was spent on carpets. We have no figure yet for the amount spent on curtains, but I am sure that they are up to traditional Ministry of Defence standards. There are many other examples of that process of waste in the Ministry of Defence.

Significantly, a statement made last week about the air vice-marshal was not made in this Chamber by the Secretary of State, and no ministerial or civil service responsibility was taken for the waste and inefficiency in that Department. Is it not time that a sense of values returned to our public life, and people responsible for decisions carried the can when those went wrong?

Mr. Mackinlay

If it had happened in a Labour-controlled council, we would have heard about it.

Mr. Fatchett

My hon. Friend is absolutely right, but he knows that no Labour-controlled council could waste money on that scale, even if it tried.

Morale is damaged as a result of that wastefulness.

Mr. Andrew Robathan (Blaby)

I apologise to the hon. Gentleman for not having heard his whole speech but, on the latter point, may I point out that, for two years, I was a councillor on Hammersmith and Fulham council, which is Labour-controlled. The hon. Gentleman is absolutely wrong, because it was wasting money like it was going out of fashion.

Mr. Fatchett

I am delighted with that intervention, as I note that the hon. Gentleman does not try to support the Ministry of Defence. Clearly, that was beyond even his substantial talents.

I noticed that, in opening the debate, the Minister did not refer to the pay, conditions and job losses of those who work in the Navy. It is worth while putting on record what has happened over recent years.

Numbers have dropped substantially, but that drop appears to have taken place differentially. In 1979, the last year of the last Labour Government, 72,500 people were employed in the Navy. The figure is now 54,000—a loss of 18,000. During that period, the number of officers has dropped by 8.4 per cent., and the number of ratings by 25 per cent. So when the burden of redundancy has been divided in the Royal Navy, as in other services, those at the bottom have, yet again, taken the brunt. We now have an officer:ratings ratio that is substantially less efficient than it was 15 years ago.

What has happened on pay? One might think that the Royal Navy is based on esprit de corps, the principle of equality which even the Prime Minister in last week's Question Time said he accepts. That principle of equality may be shown in terms of pay. The figures, which the Minister did not defend, show that, in the period 1978–94, the top two ranks in the Navy have enjoyed pay increases of 15 to 18 per cent., while the bottom two ranks have suffered pay cuts in real terms of 13 to 14 per cent. The gap has widened not just in society as a whole but within our armed forces, and it is simply not acceptable.

The Minister discussed the importance of civilian forces, and how the Ministry of Defence civil service backs up the role performed by our armed forces. He was right to make those comments, and, at one stage, he related them to this week's decision to close the naval stores at Eaglescliffe, Exeter and Wrangaton, with 1,000 job losses.

When the Minister said that everything would be done to provide jobs for those people, I thought that, if that were said to the 1,000 people whose jobs are now at stake, their response would be cynical, given the Government's record. They have heard it before, it never happens, and there is no reason to believe that it will happen on this occasion.

A recent report produced by the hon. Member for Upminster on the Ministry of Defence naval stores was a damning indictment on the process of management within the Ministry of Defence. The first page sets out a catalogue of failed consultations and the inability of the Ministry of Defence to talk to its trade unions and civil servants, or listen to others.

The Select Committee yet again damned the Government's proposals in strong language. The conclusion of that all-party, Conservative-dominated Select Committee was critical of the way in which the MOD handled these matters. It stated: The procedure by which the conclusion was reached was fundamentally flawed". Does not that describe the Government, not just in defence policy but in a whole range of issues? They do not understand the word "consultation". If ever it passes their lips, its application is fundamentally flawed. When the hon. Member for Plymouth, Sutton (Mr. Streeter) feels that he has a promise that he can take to the bank in relation to the 1,000 people who have lost their jobs, he should think again of the fundamental flaw in that consultation process.

Mr. Streeter

Is it still the Labour party's policy to reduce so-called waste in the armed forces by decreasing the defence budget by 30 per cent.?

Mr. Fatchett

I thought that that intervention would come up. I am delighted that it has, because I have with me yet further evidence of the great inefficiency of Conservative central office—a brief that it prepared on 5 October 1994. The hon. Gentleman probably does not read everything that comes out of central office. I can understand that; it is perfectly acceptable. I confess to the hon. Gentleman that I do not read everything that comes out of Walworth road. If that damages my future promotion chances, I shall put it on the record and just put my hand up.

The document, which no doubt the hon. Gentleman used with enthusiasm—I can imagine the press releases going off to radio stations in Devon and newspapers in Plymouth—sets out a series of Labour's new expenditure commitments, so I read it with interest. Central office always accuses Labour of taking money out of the defence budget, so I assumed that there would be a minus figure for defence, and that the hon. Gentleman would be right.

I know that central office likes to do its research on an accurate, honest and fair basis. Its document does not show a minus figure; it states that Labour will increase its defence expenditure. It has got Labour adding to its defence commitment. I am an innocent man in this respect. I believe what comes out of central office. It says that expenditure is going up.

Mr. Streeter

The hon. Gentleman made a bit of a hash of answering my question. Will he please tell us what Labour's policy is? Will it cut defence expenditure by 30 per cent.—yes or no?

Mr. Fatchett

The hon. Gentleman should read the central office record. Labour's position is simply the position at the 1992 election.

Mr. Andrew Hargreaves (Birmingham, Hall Green)

What about the 30 per cent. reduction, and the Labour party conference vote?

Mr. Fatchett

Our manifesto is very clear. During the excitement of the next election, I shall ensure that the hon. Gentleman receives a copy of the manifesto, which will clearly show him and the country that Labour will commit the resources that are necessary to maintain this country's defence.

The hon. Member for Sutton was so myopic in his intervention. He failed to recall the comments of the Minister at the beginning of his speech, when he said that, since 1989, this Conservative Government had cut 25 per cent. out of the defence budget. The hon. Gentleman should get the facts and listen to his own Minister.

Mr. Colvin

Will the hon. Gentleman take this opportunity to acknowledge that the 25 per cent. reduction is entirely consistent with the expenditure of our North Atlantic Treaty Organisation allies?

Mr. Fatchett

I have no reason to say otherwise. The only exception—I am not advocating this as a policy, or the hon. Member for Sutton would get too excited and read it in another way—is France, which has gone in the other direction and made some increases in defence expenditure. The hon. Member for Romsey and Waterside (Mr. Colvin) was correct about the general trend among our NATO allies.

I have spent some time considering MOD mismanagement. It is right to do so. That wasted money should he available for our troops and for our front-line functions. It is not available, simply because of the Government's mismanagement.

I should like to discuss an important issue that the Minister raised. He is right to say that, without an efficient industrial base, we cannot support our defence requirements. The two go hand in glove. I was delighted to hear him say that Britain's industrial future will be taken into account when procurement decisions are taken. I congratulate him on that. He has shifted the Government's ground. We welcome that. They are going much more in the direction that we have been advocating for some time. It would be churlish of us not to congratulate the Minister now that he is moving towards our ground.

I welcome the decision taken in the past 12 months—not by the MOD, but by the Department of Trade and Industry—to refer the British Aerospace and GEC bids for VSEL to the Monopolies and Mergers Commission. That is the right decision. Again, we asked for it. It is crucial that national and defence interests should be taken into account by the MMC. The Government should recognise, as they did on that occasion, that leaving everything to the market is not the best way of securing Britain's defence interests and its industry.

In the past few years under this Conservative Government, a significant shift and decline has taken place in our manufacturing base. Highly skilled jobs that are important for our industrial future have been lost in our defence-related industries. There has been a significant decline. We need to recognise that, and to lit that into procurement policy.

When the Minister talked about the three requirements of procurement policy, he raised questions as well as provided answers. He talked about a need for a standard requirement in terms of procurement and of the item under question. He talked about the need for an industrial base and for competition. He also referred to an industrial dimension. He will recognise—perhaps the Minister of State for the Armed Forces will comment on this in winding up—that a substantial restructuring of defence industries is taking place in Europe and in the United States of America. We must decide to what extent that restructuring will be assisted in any way by Government, or whether it will be left to the market.

We must also decide whether that restructuring will be undertaken on a UK-Atlantic basis, on a UK-only basis, or as part of broader European integration. If so, are we moving into common European procurement? What does that mean in terms of the Government's wish for competition? Does it mean substantial restructuring of the defence industries, with only one capability in each European Union country—Germany undertaking one function, the UK another, and France another? Is that the Government's objective? A common procurement policy poses real and substantial dangers to Britain's industry. We need to discuss them.

In winding up, the Minister should make abundantly clear the Government's intentions in relation to Britain's industry and, in particular, to the relationship with Europe. I know that it is difficult for Conservative Members to raise the issue of Europe without getting into great difficulties, but key issues exist here and they must be dealt with for the sake of British jobs, British industry and British companies. We need to hear what Ministers are thinking. They should not be frightened of their own Back Benchers: they need to face up to those issues.

Mr. Freeman

I hope that I did not confuse the hon. Gentleman. I tried to set out clearly our present procurement policies. Collaboration within Europe is a separate issue from Government funding of restructuring or diversification—call it what you will—within the United Kingdom industrial base.

Our policy is clear: that is a matter for industry, and not for the taxpayer. We have no intention of funding a diversification agency, as is being tried in the United States, because we do not believe that that is the most efficient way forward. It is for industry to make its own decisions about either looking for more exports or rationalising production, and it has been successful in doing that.

Will the hon. Gentleman set out clearly whether any future Labour Government would commit additional funds, separate from Konver—the European Union funding programme, with which the hon. Gentleman will be familiar—for conversion of the defence manufacturing base? If so, how much?

Mr. Fatchett

The right hon. Gentleman has raised an interesting point about diversification, and I will answer it. However, I should like to tease out of the Minister the view that he expressed in the early part of that intervention.

I believe that the Minister said that it is not the Government's responsibility to use taxpayers' money to help restructure industry—I would not want to misquote him. I understand that: the Government may have a role, but not in terms of making available taxpayers' money. The Government have accepted that, because of their decision to refer the VSEL case to the Monopolies and Mergers Commission.

I want to tease from the Minister the extent to which the Government see themselves as having a responsibility to restructure Britain's defence industries, either in line with some European process or in another way which sees Britain standing alone, or perhaps in some alliances across the Atlantic with United States companies. That is the important issue. In that way, the Government would be using not taxpayers' money but their own good offices. I want to know what the Government's direction is.

Mr. Freeman

Perhaps I can help the hon. Gentleman. Clearly the Government are involved in the restructuring of British industry, not in terms of directing what GEC, British Aerospace or Rolls-Royce should do—that must be for industry—but as the procurer and the spender of upwards of £10 billion of research, development and procurement moneys. Clearly, the Government's procurement policies must have an effect on the industrial base.

The hon. Gentleman will wish to read my comments at his leisure, but I did say that, if Governments—the procurers—collaborate on a European basis, they can require competition at the industrial level. That competition on a European scale will lead inevitably to the restructuring of the European defence manufacturing base.

Mr. Fatchett

We have opened up an interesting area of debate, and I suspect that the Minister and I could spend some time discussing it. I am delighted that the Minister has pushed the Government's policy along substantially towards a recognition that there might be a need for something called an industrial policy. I wish that we could transfer this Minister to the Department of Trade and Industry, where his comments are much needed and could be important for the future.

I am sure that the Minister would not wish me to avoid reference to diversification. I recognise that there is an important responsibility to assist the process of change. It can be played out in different ways. The Government have had a minimal role in that process, and have left most of it to the market. They could play a more active role in terms of dual-use technology and looking for ways in which the process of change could be helped.

That is why we have talked about the need for a defence diversification agency. We have always recognised that it would be a slim body, and that its funding would not be substantial, but it would change the climate and culture, and try to ensure that companies that have had a long-standing relationship with the Ministry of Defence could look for new markets and operate in new ways. It would be a culture-changing agency, and it is crucial.

The Merchant Navy is crucial to the success of the Royal Navy. It is often overlooked in these debates. In 1982, talking about the Falklands, Admiral Sir John Fieldhouse said: I cannot state often enough or too clearly how important has been the Merchant Navy's contribution to our efforts. Without the ships taken up from trade the operation could not have been undertaken and I hope that this message is clearly understood by the British nation. It might have been understood by the British nation, but I wonder whether it has been understood by the Government. Since 1980, the level of tonnage on merchant shipping for the United Kingdom has fallen to a third of the level 15 years ago. That is a substantial decline. There are those on both sides of the House who raise serious questions about whether the Merchant Navy could fulfil again the functions that it has fulfilled in the Gulf—at substantial cost—and in the Falklands.

In last year's debate, the then Minister, now the Chief Secretary to the Treasury, said, with all the dynamic nature of his market approach to politics, that the Government would keep an eye on the Merchant Navy. If he did that, he would see that it has declined both in size and in the contribution that it could make.

The Minister who opened the debate today is more active, more of an interventionist. I look to him to make sure not just that he keeps an eye on the Merchant Navy but that he recognises the contribution that it has made, and could make in the future. [Interruption.] My hon. Friend the Member for Motherwell, North (Dr. Reid) said that, with that reference, the Minister could be the new Chief Secretary.

When looking at last year's debate, I noticed that the winding-up speech was made by the present Chief Secretary, and the debate was opened by the current chairman of the Conservative party. I do not know whether that is seen as promotion within the Conservative party nowadays. However, I must tell both the current Ministers that one great possibility is open to them if they join the Cabinet—they no longer seem to be bound by collective responsibility. They will be able to speak freely on all the issues that are important to them.

Some of the broader arguments have run through all these debates over the years. They include the questions of commitment and resources. As politicians—the Government in particular, because they have a greater responsibility—we have missed an opportunity to engage in an important debate for Britain in terms of a cold war world. We have seen a clear threat disappear, but we have not clearly defined our new roles. I must tell the Defence Ministers that "Options for Change" and "Front Line First" have not engaged in that exercise.

There is a strong criticism that the conclusions of those studies were Treasury-led rather than foreign policy-led, and we need to ensure that we work out our foreign policy options and requirements. Defence is the support of those requirements and options. That is why the Opposition have been arguing consistently for a full defence review.

That argument has a great deal of intellectual weight and merit. Our view is supported by people in the services, those who used to be in the services and academics who understand the issues. All those individuals understand that we need to put together three crucial aspects—our future foreign policy role, the defence requirements to fulfil that role, and the industrial base to ensure that we can do it. A future Labour Government will engage in that full defence review, because that is the way for the future.

There is an element of cheek in the Secretary of State and his Ministers—the salami Ministers from the Ministry of Defence—saying that Labour would mean uncertainty for our armed forces. I think that everyone in the armed forces agrees that if, in the desperate months in the run-up to the next election, the Government are faced with the choice of cutting public expenditure on defence and offering tax cuts, they will go for tax cuts. That is the greatest uncertainty for our defence forces. Only Labour offers a clear policy.

Our defence forces—the Royal Navy and others—would benefit from a stable Government with a clear majority and a sense of purpose. Only Labour can offer that on defence. The Chief Secretary, whom I quoted earlier, said that, if defence was not safe in the hands of a Tory Government, that Government were nothing. I think that he was right on both counts: defence is not safe in the hands of this Government, and the Government are nothing. The electorate know that, and the Government will be out of office soon.

5.30 pm

Sir Nicholas Bonsor (Upminster)

I welcome the hon. Member for Leeds, Central (Mr. Fatchett) to his new post on the Opposition Front Bench. We shall enjoy his contributions enormously over what I hope will be a prolonged period: I trust that he will stay on the Opposition Front Bench for many years to come. I thank him for his kind remarks about the Select Committee on Defence and my contribution to its work. What they did for my popularity with my colleagues I am not sure, but, none the less, it was very kind of him to draw attention to the Committee's work.

The hon. Member for Leeds, Central quoted the Select Committee's report. I think that it was wrong to cut 25 per cent. from our defence expenditure. Since 1985, the world has become a significantly more dangerous place. I say that for two reasons, and I think that it is worth outlining them briefly.

The first is that Russia is not a lesser threat to security than the Soviet Union was. In the 50 years or so since the last world war, we have had what in retrospect we can clearly see to have been a prolonged period of peace because of the nuclear stand-off between the Soviet Union and the west. The Soviet Union was not really going to attack western Europe and we certainly were not going to attack the Soviet Union, but there is now a grey area in central Europe. However, we shall stand by it and not allow it to be taken back into a communist regime. Poland, Hungary, the Czech Republic and Slovakia can rely, and should be able to rely, on western intervention if Russia were to reinvade them. Under Mr. Yeltsin that will, one hopes, not occur, but Mr. Yeltsin's regime is not secure.

Members of the Select Committee went to Russia last year. The most depressing part of our trip was to discover that not even senior members of the current regime in Russia were prepared to tell us that they thought that they were secure. Usually when one goes to a foreign country, even if it is on the brink of revolution, the people in power will not admit to a foreigner that they are not secure. However, every Russian to whom I spoke in the current Administration said that they did not think that their positions were secure. They were extremely fearful of being overthrown by a Zhirinovsky-type regime, not necessarily by Mr. Zhirinovsky himself but by someone who shares his ideals—perhaps "ideals" is not the right word to describe his wish to recreate a Russian empire and reoccupy the areas which Russia once ruled.

I do not think that we can safely allow our defences to stay at a level that might not allow us to face the possibility—I hope to God that is only a faint possibility—that the west and Russia will confront one another in the foreseeable future over democratic government in the central European countries that have now turned their faces to the west. We cannot safely ignore that danger.

Nor can we safely ignore the possibility of something happening in the middle east, where fundamentalist Islamic regimes are expanding their power base and moving into Egypt and Algeria and along the north African coast in what looks like an inexorable advance of that philosophy.

That philosophy is hostile to the west and must pose the danger of a major war or a possible one-off attack by a lunatic such as, for example, Colonel Gaddafi unleashing a missile or two on Europe.

They are the two main dangers facing our country and our allies in the next 10 years or so, and our defences must be sufficient to deal with them. I regret the cuts introduced under "Options for Change" but I shall not dwell on that because the case has already been well made. We must and will now begin to re-establish the strength of our military forces.

I deal now with specific matters in which the Select Committee has been interested and on which it reported to the House. We raised several issues arising from the report in a debate on the defence estimates last October. I am delighted that in many instances the Government responded to our anxieties and dealt with the shortcomings that we outlined. For example, I am very pleased with the order for the Sandown class mine counter measure vessels. We have 18; the Ministry has identified a minimum of 25 as necessary and we are now tackling the shortfall. I am a little disappointed about the time scale but hope that Ministers will be able to speed up progress and ensure that we reach the required number earlier rather than later in the first decade of the next century.

I welcome the fact that the Trafalgar class will get Spearfish torpedoes and welcome the continuing programme for building and equipping our submarine fleet. Last year, the Russians built and commissioned as many submarines as we have in our entire fleet. They also commissioned the most powerful cruiser in the world, so we must not take our eyes off the potential threat with which the Royal Navy might have to deal.

We welcomed the amphibious replacement programme, especially the HMS Ocean helicopter landing platform. We also welcome what my right hon. Friend the Minister said today about the two assault ships. I am pleased that we now have a firm programme for the replacement of HMS Fearless and Intrepid. I am a little concerned about the Royal Fleet Auxiliary. I know that the "O" class tankers are to be replaced but I am not absolutely clear about when. They are old, and I hope that we can formulate a programme quickly.

We have three Rovers and three Leaf class support ships, which are also getting old. As far as I know, there are no plans to replace them, but I hope that they can be added to the programme of new shipping.

The Merchant Navy is, of course, a vital part of our defence strategy. It is extremely important that it is always able to carry our troops wherever they are needed and that it could, if necessary, once again launch a Falkland-type operation. The Select Committee took evidence on the Merchant Navy yesterday and was assured that the Ministry of Defence is confident that it could do so. We examined in detail the facts put to us and will report fully to the House in due course.

At this stage, I am still concerned about the number of people in the Merchant Navy reserve and the number of ships available. A paper exercise is being carried out in the next week or two to ascertain whether we could launch a Falkland-type operation. The Chamber of Shipping has been asking for such an exercise for a long time, and I welcome the fact that it is at last being undertaken.

Mr. Jamieson

The hon. Gentleman refers to the fact that we now have insufficient merchant ships to launch a Falklands-type campaign. Does he agree that we now have insufficient dockyard capacity to launch a Falklands-type campaign?

Sir Nicholas Bonsor

The short answer to the hon. Gentleman is no, I would not accept that. We probably could launch such a campaign. Our dockyard capacity certainly has shrunk, but it has not been suggested to me that we could not launch a Falklands-type campaign for that reason. I shall ensure that we address the hon. Gentleman's point, but at the moment I do not think that his fears are justified.

The hon. Member for Leeds, Central said that the Select Committee has been highly critical—as, indeed, it has—about the way in which the decision to close Eaglescliff and the other naval stores and to centralise them in Portsmouth was undertaken. Committee members were not, however, critical about the conclusion. We were critical about the way in which it was undertaken, and justifiably so. The Ministry has accepted most of our criticisms and in its reply to us, which is in the Library, it has accepted that the way in which that decision was taken was flawed. I hope that it will not happen again.

The Minister of State for the Armed Forces (Mr. Nicholas Soames)

The Select Committee made some important criticisms and, as my hon. Friend said, we took them on board. I should like my hon. Friend to know that we remain determined to handle such matters better in future and I like to think that, as a result of that report and the actions that we have taken, we shall do so.

Sir Nicholas Bonsor

I am grateful to my hon. Friend. I welcome his statement and I am sure that what happened will not be repeated. To be fair to him, most of the front-line study reports submitted to the Defence Select Committee were very full and had clearly been very well thought through. Naval stores were the exception not the rule. [Laughter.] The way in which that particular decision on naval stores was taken was the exception not the rule. Most of the reports are extremely full and I do not think that the Ministry should be criticised on the generality. As my hon. Friend said, there certainly was a flaw in the way in which the Ministry went about the decision on naval stores.

I very much welcome the fact that training will become the responsibility of a defence agency. I hope that there will be a vigorous programme of market testing, as the Ministry has promised, that it will begin soon and that we shall he able to see its results.

The Committee regretted the closure of Manadon. I understand the reasons for it and that it was—possibly—inevitable. None the less, it is a great loss to the Royal Navy and the way in which we train our engineering officers. It is a great pity that the opportunity was missed to join with Shrivenham and put the engineering forces into that university. The Select Committee visited Shrivenham last year and saw that there was no doubt that it had the capacity to undertake such an additional course. It would have enhanced Shrivenham and would have fitted very much better into royal naval training than sending the potential royal engineer officers to Southampton, which is what will happen.

We hope that the Southampton university course will be a success and will turn out engineering officers who will stay in the Royal Navy. The Committee will watch closely how that situation develops, but I would be less than honest with my hon. Friend and the House if I did not express fears that it is not an adequate or satisfactory long-term solution to the way in which we train our engineering officers.

The Committee was concerned that, despite the assurances that we were given, there were excessive funding constraints on ships' exercises. We concluded that the failure to give adequate exercise to our royal naval vessels could lead, in time, to measurable deterioration in our operational standards. The Ministry's reply to the Committee observes that exercise cancellations are often the results of programming pressures and changing priorities in operational commitments. I accept that. In fact, it is another way of saying precisely what we are saying—that there are not enough ships and that they have too much to do. At the moment, we cannot put our Royal Navy ships into the areas where they are needed and give them adequate exercise time in major warfare preparation, and that should be addressed.

I am very sad that we do not have a type 23 combined tactical trainer stage five simulator at HMS Dryad, or, indeed, anywhere else. That means that people who are training either for the new type 23 ships, or for the upgraded older ships that have been fitted with the same equipment, undergo training at sea during live operations, which is a great pity. It is a waste of resources and it must he very difficult for those conducting the training. Indeed, to have to run as a training base as well must be very difficult for ships' ordinary operations. It is unsatisfactory and I very much hope that my hon. Friend will address that in his winding-up speech and will be able to assure the House that when we order the Horizon frigate we shall ensure that we also order a training simulator. We are due to get a type 23 simulator, but not for at least another three years. That is three wasted years, which could have been avoided with a little foresight.

I congratulate my right hon. Friend the Minister of State for Defence Procurement, who, unfortunately, is not in his place, on the way in which he has handled the difficult issue of our industrial base. There will always be a stand-off between our defence needs—in other words, the need to give to our troops and our armed services the best available current equipment—and our need to ensure that we have a defence industrial base capable of meeting our needs in the longer term. An obvious example of that is the European fighter aircraft. It would have been very much cheaper and easier for us to have ordered the American aircraft, which are probably very nearly as good, but the view was taken, correctly, that Europe, and especially Great Britain, could not afford to lose the technical capability that we shall need in the longer term to ensure that we can equip ourselves with such aircraft.

There is a trade-off between what we need for our defence purposes and the industrial base that we need to preserve. My right hon. Friend set out clearly and very well the Government's approach to that. I welcome it and look forward to seeing what comes out of it in due course.

5.46 pm

Ms Rachel Squire (Dunfermline, West)

I am pleased to follow the hon. Member for Upminster (Sir N. Bonsor). I entirely agree with his comments on the European fighter aircraft and I share some of his concerns about the developments in the former Soviet Union and the middle east over our security and foreign policy.

While another year has passed since the previous debate on the Royal Navy, the Navy has certainly dominated my agenda as a Member of Parliament. For instance, I am just about to complete the armed forces parliamentary scheme with the Navy, along with the hon. Member for Birmingham, Hall Green (Mr. Hargreaves). I am sure that the hon. Gentleman would agree that it has been an interesting, informative and invaluable programme. I am sure that we would both welcome the earlier announcement of the four new vessels for the hydrographic service, with which we spent an interesting day, during which we were greatly impressed by that excellent, world-class service. I am pleased to mention that service because we often tend to forget the invaluable role that it plays.

The armed forces parliamentary scheme has certainly introduced me to people and taken me to places I would never have thought possible. I have had meetings with admirals, I have been winched into helicopters and I have been saluted by men in uniform. I have had many memorable experiences, but probably the most memorable of all was my visit to HMS Nottingham with the hon. Member for Hall Green, when the ship was out in the Adriatic enforcing the arms embargo against the former Yugoslavia. There I found myself undertaking a jackstay transfer between HMS Nottingham and another vessel. It was quite an experience to find oneself dangling on a rope, buffeted by the wind, and with no secure, firm deck underneath one's feet.

More seriously, when I thought back on that jackstay transfer, which lasted for no more than five minutes, I realised that it has been the experience of Rosyth for the past five years. The base has felt itself to be dangling on a Treasury rope which is becoming ever slacker, with no firm deck of security underneath. The stress and strain of that insecurity has had many effects, not least on people's health. It is not entirely surprising that earlier this week, Walter Strachan, the industrial convenor at Rosyth naval base, was taken into hospital with chest pains. I am sure that the whole House wishes Walter a full and speedy recovery. While I was inquiring about his progress at Queen Margaret hospital in Dunfermline, I also inquired about another strong supporter of Rosyth, Lord Ewing. Again, I am sure that Members on both sides of the House wish him a full and speedy recovery.

During last year's Navy debate, I talked about the strategic and operational importance of Rosyth naval base. It is clear that my words fell on deaf ears, as did the words of many others. When we were assured last February that Rosyth's future was safe and that no decision had been taken, we did not believe that assurance and we certainly do not believe it now. Rosyth's experience of uncertainty and insecurity has lasted for five years. Two days before Christmas 1989, the first rumour came out that the closure of Rosyth naval base was firmly on the agenda for certain people within the Ministry of Defence. The campaign at that time was effective in preventing the closure. However, with the benefit of hindsight, it is easy to see that the intention to close Rosyth did not disappear. The campaign did, however, force the Government to adopt a salami-slicing approach rather than wielding a big axe. The decision to reduce the base to a minor war vessel operating base clearly weakened its position in the defence establishment and resulted in the loss of 800 civilian jobs and the transfer of 1,100 service personnel.

I protest about the manner in which the effective closure of the naval base and the decision on the naval stores were announced. To make the announcements in written answers was a way out for the Government. I accept that this week, at least, we have the opportunity, two days after the written answer, to have a proper debate about the decision on the naval stores. However, to confirm the decision on the effective closure of Rosyth naval base in a written answer not long before Christmas was unacceptable. It would have been far more honest for the Government at least to have made a statement on the Floor of the House which would have allowed questions to be asked immediately.

I return to the history of Rosyth's campaign. When the defence costs study was announced in November 1993, it was once again clear that Rosyth was a target for closure.

Sure enough, despite the denials given, that was the recommendation made in July 1994. The decision was then confirmed. The Minister may be thinking, "What is new? We have heard all about Rosyth before." I can only repeat that there has been blow after blow for the loyal, dedicated and committed work force of Rosyth naval base who feel that their loyalty has been repaid with betrayal and broken promises. Moreover, they feel strongly that public money has been wasted. Some £63 million has been spent on improving facilities at the base. Substantial savings were made by the work force which have apparently been ignored.

Some 10,000 defence-related jobs are going in Fife between 1991 and 1996. That estimate was produced not by some Labour research team, but by the Fraser of Allander institute and McKay Consultants. Their report says clearly that Fife is an area where 30 per cent. of gross domestic product is defence-dependent. The unemployment rate is already 24 per cent. more than it is in the rest of Scotland. I would welcome the Minister telling us where those people can go to find alternative work and whether all of them will be offered jobs on the quangos referred to earlier.

I am well aware that defence-related job losses have not been confined to Rosyth and that the latest announcement on the naval support infrastructure affects areas all over the country. I especially mention Exeter, Devonport, Wrangaton and Eaglescliffe. I condemn the way in which the decisions were reached and announced. My hon. Friend the Member for Leeds, Central (Mr. Fatchett) referred to the report by the Select Committee on Defence and to its criticism of the conduct of the defence costs study. I take this opportunity to quote paragraphs 9 and 12 of the report because they have widespread relevance and are not only relevant to naval stores.

The report says: The absence of any appraisal of alternative options from the naval support stores consultation documents means that they failed to provide for the proper degree of public accountability: and that the impression was given that the proposals were ill thought out and unlikely to withstand intensive scrutiny … Without the results of that investment appraisal it was unsafe for MoD to have reached a conclusion. MoD's view is that the confirmation in broad measure of its favoured option provided by the investment appraisals means that the work was 'nugatory'. We utterly reject that view. In matters of such significance, public and parliamentary accountability demands the production and publication of proper financial and operational appraisals, so that justice can be seen to have been done". That point applies not only to the defence costs study on the naval support infrastructure, but to Rosyth naval base and, indeed, to Pitreavie. I hope that the Minister will listen to the concerns being expressed about the decisions on the naval support infrastructure, not just by Opposition Members, but by senior naval personnel who are concerned about the centralisation of the stores.

As I mentioned, the criticisms made by the Select Committee also referred to what has happened over Pitreavie. Yet again, this afternoon I had the dubious pleasure of finding on the notice board a letter with the Ministry of Defence insignia on it. I have learnt to dread such letters, as they always mean bad news and jobs lost, as my hon. Friend the Member for Plymouth, Devonport (Mr. Jamieson) knows only too well.

Pitreavie thought that it had a secure future. Again, in the past two years, money has been spent on improving the facilities there. Less than two years ago, the Secretary of State for Defence announced that the rescue co-ordination centre for the United Kingdom would be at Pitreavie. In July, it was announced that the flag officer for Scotland, northern England and Northern Ireland would be moving to Faslane, as part of the effective closure of Rosyth naval base. That meant that the Government decided that Pitreavie was too costly for the RAF to stay there. Last year, the Secretary of State announced that the rescue co-ordination centre and the air officer would be transferred to Leuchars.

That was welcome news to Fife Members at that time, in particular to the hon. and learned Member for Fife, North-East (Mr. Campbell). It was regarded as recognition that the people of Fife should be assured that their contribution to the defence of the realm and, in particular, their contribution to rescue co-ordination work were valued and would be retained. Rumours then started—of course, they were denied by the Ministry of Defence—that the rescue co-ordination centre was to go elsewhere, probably Kinloss. I hope that the Minister will confirm today that the RCC is to stay at Leuchars rather than at Kinloss. I would welcome an end to insecurity about Pitreavie and Leuchars.

Mr. Menzies Campbell (Fife, North-East)

I am most grateful to the hon. Lady for giving way and, in particular, for the objective way in which she has put the case for the rescue co-ordination centre to be relocated from Pitreavie to RAF Leuchars in my constituency. Is she aware that, last week, the Royal Air Force in Scotland confirmed that the centre was to move to Kinloss, whereas the Ministry of Defence in London declined to give any confirmation whatever, and said that no decision had yet been reached?

Ms Squire

I thank the hon. and learned Gentleman for his intervention. What he has recounted does not surprise me in the slightest. It is all too characteristic of the conduct of the Ministry of Defence. It also relates to crucial lessons that I urge the Ministry of Defence and the Government to learn in respect of the defence of this country and their treatment of those on whom we depend for the defence of the realm.

The Pitreavie saga and the future of the rescue co-ordination centre cause one to wonder who will lose most. Will it be the people whom the service is committed to rescuing or will it be the Government? Once again, we have a Government shambles masquerading as a defence review that involves more broken promises and more money leaving the Fife economy.

The removal of the operational facilities from Pitreavie undermines the future of a naval presence at Rosyth and fuels the widespread view that, however the Ministry of Defence might like to dress it up and talk about a Royal Navy support establishment, in effect it is severing the Navy's links with Rosyth, which will lead to complete closure. It is also characteristic of the Government's defence policy that we in Fife are to be left with holes in the ground. We already have the infamous RD57, and it now looks as though we will have the reinforced concrete bunker at Pitreavie.

Reference to RD57 leads me to Rosyth dockyard. It is not only naval base personnel who have been involved in that permanent jackstay transfer of uncertainty and insecurity; so, too, have the dockyards. In the mid 1980s, Rosyth and Devonport had to deal with partial privatisation. The dockyards then had the fierce argument about where submarine and surface ship refitting work would be allocated. Both dockyards now face full privatisation. When the major customer will always be the Ministry of Defence, when the Ministry of Defence will always have a major interest in those workplaces, and when there is only one bidder for each yard, it is a waste of time and money to proceed with privatisation.

I will give the Minister credit for visiting the dockyard recently. His interest and his personal attention were much appreciated by the work force and the management at the dockyard. I hope that there will be a continuing improvement in direct communication between the upper echelons of the Ministry of Defence and those on the ground who are working for the defence of the country day in, day out. Privatisation, if it proceeds, will make it even more important that the dockyards are treated equally and receive contractual guarantees of the work that is allocated to them in future. I ask the Minister to give me such a guarantee tonight.

I seek further assurances from the Minister. First, I seek an assurance that all decommissioned submarines will be removed from Rosyth, following the welcome assurance that RD57 would not he turned into a graveyard for decommissioned hulks. Secondly, I ask the Minister to repeat that the allocated programme of surface ship work for Rosyth will include aircraft carriers. Thirdly, I seek an assurance that the work force at both dockyards will have their pension arrangements honoured and their redundancy entitlements met.

I should like clarification of the Minister's statement concerning other options. Perhaps I am paranoid and suspicious about such phrases.

I now refer to other immediate action that the Government should take in respect of Rosyth and Pitreavie and to some of the overall lessons that are to he learnt. If the Government are serious about offering the Rosyth complex a future and security, we need a positive, co-ordinated approach that will assist employment creation and economic regeneration in an area that is heavily dependent on defence. Nearly 80 per cent. of the naval bases' work force are resident in the Dunfermline district, and approximately 85 per cent. of commercial defence-related output emanates from the Dunfermline district. Economic activity must be stepped up a gear if the Fife economy is to have a chance of staying afloat.

I welcome previous statements about the need for a central Government initiative, but I should like the Minister to answer some questions. First, what resources will the Government allocate to Fife to deal with such high unemployment? In particular, what hard cash will be made available? Secondly, will the Minister update us on what the Scottish Office task force is doing? Thirdly, what is happening about the disposal of land and assets at the Rosyth complex? Will the Ministry of Defence undertake all necessary work to ensure that contaminated land, premises and facilities are properly treated? What was meant by an earlier statement about the responsibility for the whole site and not just a part, and a rejection of the piecemeal approach? Is the MOD now trying to walk away completely from the whole Rosyth site, or will it be realistic and accept that it will always have interests and responsibility?

Fourthly, what arrangements arc being made to provide the men and women who are facing redundancy with an integrated package which offers proper training and the realistic hope of a job at the end of it? Will the Minister establish an integrated training initiative? What will the Minister do to encourage companies to come to the area and provide real and decently paid permanent jobs, and not casual, short-term and low-paid work?

I draw attention to some general lessons which the Government need to learn from the way in which they have dealt with the Rosyth and Pitreavie work forces. They should reward the loyalty, commitment and dedication of the naval personnel and civilian work forces by providing them at least with some relatively secure decks on which to stand.

I shall quote from the Royal Navy's "Broadsheet" article on the defence costs study, which states: It was recognised that, following the changes that have occurred in recent years culminating with "Front Line First", there is a need for stability … Change is likely to be a continuing theme but everything will be done to minimize its many effects on those who serve in the Navy and especially upon their morale … We have to recognise that change is endemic and strategic uncertainty probably as great as ever before in our history. Nevertheless the Navy Board will be aiming for stability in the fundamental structure of the Service. If the Government and the Navy are serious about those statements, I suggest they do a number of things.

First, I should like to pick up on a comment made by my hon. Friend the Member for Leeds, Central (Mr. Fatchett) that the Government should conduct a full defence review, rather than one led by Treasury demands. That view is not just confined to myself or to Opposition Members. I have had contact with naval personnel and civilian work forces all over the country as a result of the armed forces parliamentary scheme. One of the constant themes—whatever the ship, base or facility that I visited—has been the strong feeling of insecurity and uncertainty at a Treasury-led defence policy, where decisions are determined by the Chancellor rather than by the Secretary of State for Defence.

Mr. Colvin

The hon. Lady's call for a full defence review seems to be a shroud behind which she can hide a non-existent defence policy. Through "Options For Change" and the defence costs study we have had what amounts to a full-scale defence review. What more can the Labour party offer?

Ms Squire

There is a widespread view, not only among naval personnel but among all sections of the armed forces—including retired members—and among academics that the questions posed by the end of the cold war which require difficult issues to be debated have not been adequately dealt with by the Government. There is a feeling that defence reductions have been initiated by Treasury demands for savings. An overall review would outline the strategic and operational requirements for the next five years, and would take us into the 21st century. We will decide on the basis of those decisions what level of defence expenditure will be necessary.

Mr. Colvin

It seems to be inconsistent of the hon. Lady to, on the one hand, report to the House that the armed forces are calling for stability while, on the other, reporting that they are calling for a further defence review with all the instability and uncertainty that that engenders?

Ms Squire

Naval personnel are looking for some stability and certainty, but they are criticising what has happened to them in the past few years. They feel that the Government's defence policy has lurched from one Treasury-determined objective to another. My impression, from my contact with members of the Royal Navy and the civilian work force, is that the person who they would nominate to put out on a permanent jackstay transfer—or, even better, to walk the plank—is none other than the Chancellor of the Exchequer. Some Conservative Members may feel that it might be an attraction if, at the next election, the Chancellor of the Exchequer offered to walk the plank.

Mr. Gareth Wardell (Gower)

Like my hon. Friend, I was one of the first Members to have the benefit of taking part in the armed forces parliamentary scheme, and I spent some considerable time with the Royal Navy. In addition to the well-made points which she has put to the House, does she feel that one of the fundamental difficulties which the major leaders in the armed forces—the First Sea Lord, the Air Marshal and the head of the Army—find is that they are put in an unstable position because they plainly do not know what the Government want them to do?

Ms Squire

I entirely agree with the excellent points made by my hon. Friend.

There are other lessons which the Government must learn. There was widespread agreement among naval personnel that the Navy can take no further cuts. The feeling is that it has been cut to the bone, and there is no spare flesh. There is also a widespread view that the defence procurement policy of the Government is still unsatisfactory, and that there is a waste of money because of the overpricing of both basic items, such as telephones, and complex equipment. There is a strong feeling that the time that people are being asked to spend away from their families is being unfairly increased.

I return to the argument that was made earlier about people saying that they need some stability and feel uncertain and insecure. I hope that the Government will find ways of listening more closely to what is being said by those who daily serve in the defence of the country.

The third specific lesson that I would ask the Government to take on board is the one that was reflected earlier in the comments of the Second Report of the Defence Select Committee concerning the naval infrastructure—the need for openness, for full consultation and for a complete review of the process of managing and proposing change.

I think that we all agree that the country's defence depends on people. However high-tech and expensive the equipment that is available to us, loyal, dedicated and skilled people are needed to make it, maintain it and use it. The Government must start to demonstrate far more clearly their appreciation of the loyalty, commitment and dedication of defence personnel, the civilian work forces and their families. An invaluable way of doing so would be to provide more accurate information and proper consultation and to give those people, as my hon. Friend the Member for Leeds, Central said, a sense of values.

The fourth lesson that I urge the Government to learn from the process of the defence costs study is one that has already been mentioned: the whole business of taking into account industrial procurement. I welcome the hints that have been given about that. I have a special interest in respect of the future of our warship building capacity, and I feel compelled to express again my dismay at the tragic loss and closure of Swan Hunter and the waste of such valuable skills.

It appears that the future of what is left of our warship building capacity is insecure, and I look to the Minister to give an assurance that the long-term procurement plans of the Navy are sufficient to maintain the remaining warship building capacity in this country.

I quote the Defence Select Committee again, which said in its Fifth Report of Session 1993–94, at paragraph 96: The United Kingdom industrial base is a strategic asset and must be safeguarded accordingly. We believe that it would be unwise to rely entirely on even our closest Allies to provide surge capacity as they have their own priorities and their industry may wish to supply their own national forces first. In conclusion, I am determined, as are my hon. Friend the Member for Dunfermline, East (Mr. Brown) and other Opposition Members, that the lessons to be learnt from Rosyth's experience should be neither forgotten nor repeated. I would not wish any other group of naval personnel or civilian work forces to be treated in the way that I think that the Rosyth work force have been treated by the Government.

I trust that, in his reply, the Minister will demonstrate that lessons have indeed been learnt, that the Government are committed to the best traditions of the Royal Navy and the defence of the realm, and that they intend to provide some security for all those who serve our country so well.

6.23 pm

Mr. Andrew Hargreaves (Birmingham, Hall Green)

I am especially grateful for the opportunity to contribute to the debate, and especially pleased to follow the hon. Member for Dunfermline, West (Ms Squire), because we are just completing our attachment to the Royal Navy under the armed forces parliamentary scheme, and I should like to say what a pleasure it was to accompany her on the various visits; some of those visits were slightly more hairy than others, notably the jackstay transfer.

We were both enormously impressed by the way in which the scheme was organised. We should like to thank my hon. Friend the Minister of State for the Armed Forces and ask him to pass on our thanks for the way in which it was organised and for the value that was attached to the scheme.

I also wish to put on record our appreciation of the immense professionalism and cheerfulness of all ranks—officers and other ranks—and the positive attitude, despite some difficult circumstances and change, of all those in the Royal Navy whom we met. It impressed us and we are very pleased to note it for the House.

In a previous debate, I and other hon. Members questioned the concept that the world had become a safer place than it was during the cold war, and therefore the logic that lay behind the massive reductions that have taken place in our defence budgets since "Options for Change". In that, I wish to identify my remarks specifically with those of my hon. Friend the Member for Upminster (Sir N. Bonsor).

Indeed, if anything, the contrary is now true, in that the world is a less stable place and we are more likely rather than less likely to need our armed forces to protect British or western or European interests. For that, we perhaps need a different balance of forces. The recent exercise of defence costs studies made some progress in trying to solve that problem, and I pay tribute to the Ministers and their predecessors on the Front Bench for the way in which they approached that exercise.

However, if one is to consider, as perhaps we should, the role that we might foresee for our armed forces in the next five or six years, one thing is absolutely for sure—the Royal Navy is crucial and pivotal to the type of force projection that one might imagine to be necessary, especially where there are likely to be extremely sensitive political considerations.

The hon. Member for Dunfermline, West referred to our participation on board one of Her Majesty's ships in the Adriatic as part of Operation Sharp Guard. That is only one type of activity that exemplifies the way in which the Royal Navy is pivotal to the ability to project a force in an extremely difficult area.

The Royal Navy and any navy like it, but especially the Royal Navy, possesses certain advantages for this purpose. They are: the ability to maintain a self-sustained presence for long periods; a self-sufficiency even where there are no friendly bases in the vicinity; controlled increase or decrease in the scale of force projection required and the possibility of temporary or complete commitment, or indeed withdrawal, as for example might be the case from Bosnia; the choice of highly visible or covert operations; and the advantage of using the same tools, perhaps with the possible exception of SSBNs, as would be used in total war. The Royal Navy therefore affords an extraordinarily potent stand-off capability, or stand-to capability, while using exactly the same investment that the taxpayer has already made for full-scale engagement as might be envisaged during a war.

However, if one believes that that type of force projection is necessary—as it may well be—to defend British interests, or to act for humanitarian purposes, in the next five or six years, one needs to consider the assets that the Royal Navy might need. I wish to single out the role of the aircraft carrier. My right hon. Friend the Minister of State for Defence Procurement mentioned HMS Invincible, which is shortly to be replaced in deployment in the Adriatic by HMS Illustrious.

I joined the hon. Member for Dunfermline, West on board an aircraft carrier. We were impressed because, in many ways, such a vessel is the only unit that can provide for a task group a platform capable of two essential ingredients of any military effectiveness. It has the broad spectrum of capabilities in one ship, ranging from organic self-defence or external defence and land attack, through surface warfare, to a highly potent anti-submarine warfare capability, which allows it to carry out composite war commander's duties, whatever those might be in that area. It can also move on along the high seas almost anywhere in the world, where it can poise in international waters without commitment or the need for any host nation to support it.

The naval aircraft launched from that vessel might be the first on the scene in any particular situation, which would therefore grant politicians or military commanders alike a number of variable options not otherwise available, at immediate notice.

With that in mind, I agree with my hon. Friend the Member for Croydon, South (Mr. Ottaway), who raised with my right hon. Friend the Minister of State for Defence Procurement the need to start thinking now about replacing one or two of our aircraft carriers, which, in 10 years, will almost certainly be beyond refit capability. HMS Ark Royal is the oldest and would probably be the first to fit the bill. I hope that Ministers will consider seriously now what to do about those extremely important and capable assets in the future, because the cost of replacing or refitting a number of extremely expensive items of defence expenditure could be lumped together rather dangerously in 10 years' time.

The need for any task group force must be considered in conjunction with the need for submarine capability and frigate or destroyer escort. My right hon. Friend the Minister has already mentioned the extremely welcome news about the order for more type 23 frigates. I hope that my hon. Friend the Minister of State for the Armed Forces will be able to confirm that the communications systems on those frigates have been improved. I understand from Royal Navy personnel that the existing system posed some problems, so I look forward to my hon. Friend's confirmation that they have been resolved satisfactorily. It would be a great pity to have ship which could not he used in the type of operations we are currently running, for example Operation Sharp Guard. I hope that my hon. Friend will be able to offer me good news.

On submarine warfare, I was pleased to hear about the likely orders for batch 22 Trafalgar class submarines. I was also extremely pleased to hear at the time of the defence costs study about the possibility of fitting Tomahawk cruise missiles on those submarines in due course. That would give the Royal Navy an even greater stand-off capability to poise and to deliver a potent threat where necessary. That would enormously improve the way in which we could subtly escalate or de-escalate, if necessary, a military commitment or threat. Those weapons offer a huge advantage because they can be fired from a position unknown to any possible enemy. Those submarines are therefore able to operate from a cloaked position, perhaps well away from any other task group that might be deployed in the area.

One of the most important subjects about which Ministers have spoken and which has been referred to recently in Navy journals, is amphibiosity. In any discussions about the role of the Royal Navy in the next six years, amphibiosity must be the key to our ability to deliver or extricate forces in any given situation. The order for the landing platform docks is therefore good news.

I am also pleased that my right hon. Friend the Minister has been able to put a time, finally, on the order for the replacement of Fearless and Intrepid. I hope that it will not be subject to any delay, because it has been flagged up on a number of occasions. I hope that that promise is crystallised into reality.

At the time of the defence costs study the excellent idea of a joint rapid defence force was mentioned, but things have gone rather quiet since then. From the discussions that the hon. Member for Dunfermline, West and I had with members of the armed services during our attachment, we know that they are keen on that idea. They were rather disappointed that they had not heard more about it.

Mr. Soames

My hon. Friend has raised the most important matter of a JRDF. I am glad that he is excited by that prospect. He will understand that that concept requires a great deal of work to get the operations and strategy deployment correct. I can assure him that a great deal of work is going on and we hope to be able to make a detailed announcement, certainly not in the near future, but in the medium future. We are anxious to complete that work as soon as we can.

Dr. Reid

It has been crystallised.

Mr. Hargreaves

Yes, it has.

I am extremely grateful to my hon. Friend the Minister for that announcement, which will be widely welcomed in the Royal Navy and by the other forces.

I also welcome my right hon. Friend's announcement about the new hydrographic vessel. The hon. Member for Dunfermline, West and I were extraordinarily impressed by the professionalism of the service operated under the command of Captain H at the hydrographic squadron. I am sure that the hon. Lady shares my pleasure that the new vessel is considerably larger than the existing one. It will be a great extension to the squadron's capability, because it has long argued for a longer hull to improve its sea-keeping capabilities so that it can put to sea, irrespective of the weather, in whichever section it is asked to operate. The members of the squadron will be able to keep going on-station, without having to dive because of storms and so forth. The squadron will be delighted by the announcement.

There is a slight question mark over that vessel, however, because I read somewhere that it might have a maximum speed capability of not more than 17 knots. I hope that my hon. Friend the Minister will prick up his ears at that, because, given our aim to have ships that are flexible in terms of investment, whether they are used in a Falklands operation or anywhere else, we should consider whether there is a cheap way to improve that speed should the need arise. That would be in the interests of joint force operability at a later stage.

A number of concerns became apparent to the hon. Member for Dunfermline, West and I during our various visits to ships and ships' companies. I had intended to allude to them, but they have already been mentioned by the hon. Lady. My hon. Friend the Minister knows, however, about my concern about the pressure on family life when ships' crews are at sea, whether on Operation Sharp Guard or elsewhere, and away from the home port for seven months or more. Everything that we can do to reduce that time spent at sea would be greatly appreciated.

I cannot resist mentioning morale. Despite the tribulations which have been experienced by the Royal Navy and the other services as the result of several changes, the hon. Member for Dunfermline, West and I found that morale in the Royal Navy is remarkably good, all things considered. I do not feel that it will be enormously improved by the comments by the Opposition spokesman, the hon. Member for Leeds, Central (Mr. Fatchett), who could not resist his classist, socialist revanchism by pointing out the differentials between the pay of officers and other ranks. It would have been interesting to hear whether the Labour party intended to change that. The First Sea Lord happened to be in the Gallery at that time and I am sure that he was interested in those comments as well. Such remarks will not help him as he tries to attract quality graduates to become officers in the Royal Navy. It will not help those graduates, nor those chief petty officers and others who aspire to be officers if the politics of envy are introduced even on matters of pay into debates here.

Dr. Reid

Far be it for any of us to introduce the politics of envy, but we cannot accept the hon. Member's proposition that it is not a fall of 15 per cent. in real terms in the wages of ratings and squaddies that is wrong, but the fact that the Labour party should remark upon it. Is it not essential, especially at a time of instability and rapid change, that the esprit de corps, comradeship and unity in the armed forces should be strengthened and increased by equality of treatment and fairness rather than that the differential that existed in 1979 should be increased by a huge percentage?

Mr. Hargreaves

The House is better informed for the hon. Gentleman's intervention, but I can assure him that one thing that we did not encounter on our visit to the Royal Navy was serious unhappiness about pay. The unhappiness that we mentioned came from instability rather than pay.

The other unhappiness that is worth mentioning, if I can call it that—and I am sure the hon. Member for Dunfermline, West will agree—had more to do with the internal differentiation of jobs within the Royal Navy than with almost anything else. That was a key factor in the ward rooms. It did not involve the relative earnings of officers and junior ranks. I shall pass over that as it was not a helpful contribution from the hon. Member for Leeds, Central.

Finally, the hon. Member for Dunfermline, West and I were enormously impressed by the job that the Royal Navy does. I hope that one message we send back from these debates is that we appreciate those who serve in the Royal Navy and we support them, no matter what strictures are imposed by budgets from the Treasury or the requirements of Foreign Office inspired commitments that we cannot always control, although we would like to do so—and that does not always make their lives easier. We appreciate that they do an extraordinarily good job, in sometimes extremely difficult circumstances.

6.41 pm

Mr. Menzies Campbell (Fife, North-East)

These single service debates allow the opportunity for concentration on the particular service with which they are concerned, but they also give us a chance to debate some of the wider strategic issues and to apply our minds to the strategic context in which the Royal Navy has to operate.

Looking round the House, since approximately six and a half years ago when I first spoke in a defence debate in the House, I do not remember an occasion when the House was quite so thinly populated. That is a pity because the importance of all three services—and today's debate emphasises the importance of the Royal Navy—certainly cannot be underestimated.

Had he still been present, I would have liked to welcome the hon. Member for Leeds, Central (Mr. Fatchett), who opened the debate on behalf of the Opposition, to the first defence debate he has addressed from the Opposition Front Bench. He made an extremely competent and quite combative speech. Not surprisingly, like others who have spoken from the Labour Front Bench in recent times, he laid some stress on the policy of what is sometimes called, "a fundamental defence review", "a full-scale defence review" and "a far-ranging defence review", and I shall return to that in a moment.

The message which is transmitted to any of us who have spoken to commanders at all levels of the armed forces is that the one thing that they desperately require is a period of stability and calm. We tend to forget that the political decisions about "Options for Change" and "Front Line First" have been taken and announced, but that those decisions have not yet been fully implemented and there is a period of disruption yet to come. Only yesterday, there was an announcement in the newspapers about further redundancies at senior levels in the Army.

I am one who in the past has argued vehemently for a full-scale defence review. There was a time, particularly in the period immediately after the announcement of "Options for Change" when the strategic context was changing so rapidly and fundamentally, when a full-scale defence review would have been entirely appropriate, but I am now of the view that that time may have passed.

Those of us who argue for a full-scale defence review, or have done so in the past, should now be arguing that the conduct of defence policy should depend on a number of principles. First, foreign policy should dictate defence policy. Secondly, resources should match commitment and, thirdly, we should accept the overwhelming presumption that the stability that senior commanders require is best met for the time being and for the foreseeable future by no further reductions in the defence budget.

I understand the intellectual case of those who argue vehemently for a full-scale defence review, but we cannot instigate such a review with an entirely open mind unless we are willing to consider increasing defence expenditure. I do not know of any defence review, fundamental or otherwise, ever carried out in the United Kingdom containing a resolution that defence expenditure should be increased, with the possible exception of the rather fraught circumstances of the 1930s, when after a period of total lack of resolution, investment in defence became necessary as a matter of survival.

Dr. Reid

I have listened carefully to the hon. and learned Gentleman, who speaks with great authority in these matters and I understand the point he makes and the requirement and desire for a period of stability in the armed forces. However, the three principles that he Gentleman set out contain an inherent contradiction.

The hon. and learned Gentleman's first point was that foreign and defence policies should match, his second requirement was that resources and commitments should be matched, and his third and vital one was the presumption that the status quo fulfils the first and second requirements. The status quo patently does not fulfil a match of resource and commitments of foreign policy and defence which is precisely why we need to bring them into alignment and one can not do that in a rational fashion without a defence review.

Mr. Campbell

If the hon. Gentleman had listened he would have heard me say that there should be a presumption for the foreseeable future that there will be no more raids on the defence budget. I am one of those who argues strongly that if a political settlement is achieved in Northern Ireland, that should not be seen as an excuse for a further raid on the defence budget by the Treasury. There is a full range of tasks which the United Kingdom land Army could perform in furtherance of the United Nations and for which it has special skills; we should be making our forces available for that purpose.

If on 14 October 1997, or perhaps rather earlier, the hon. Gentleman and his hon. Friends march up the steps of the Ministry of Defence, call the chiefs of staff together and say, "The first thing we want is a full-scale defence review", if "Options for Change" and the defence costs study have not yet been implemented, those who contend that morale is fragile may be entirely justified by the response that they will get. We have to get way from what is essentially an absolutist position, and say that we will conduct our policy in accordance with certain principles.

It is a reasonable principle to say that the starting point should be that there is a presumption for the foreseeable future of no further cuts in the defence budget and that. in accordance with that presumption, we shall apply the principle that foreign policies should dictate defence policy and that resources should match commitments. I see nothing illogical in that, and it carries with it the benefits of that stability and period of calm for which I understand senior commanders are almost desperate because of the difficulties of morale which they identify in the conduct of their responsibilities as the head of their respective services.

We could not conduct a debate on defence without some reference to the debate on Europe which is taking place in the House and, perhaps more robustly, within the Cabinet Room in No.10 Downing street. In Luxembourg on Tuesday, 10 May 1994, when nine eastern European countries became associate members of the Western European Union, the Secretary of State was quoted as saying—I do not think that he has denied the accuracy of the quotation—that the evolution of a European Community defence policy was an "inevitable consequence" of the Maastricht treaty.

If that remark were widely publicised among some of the Secretary of State's hon. Friends, I think that it would cause considerable anxiety even now. I think that the Secretary of State is right, but I do not think that we will wake up one morning to find that a common European foreign and security policy has been declared. I think that such a policy will develop organically.

Elements of that development are already in place. There is extensive nuclear co-operation between France and the United Kingdom. It is not publicised very well, but it has been going on for 18 months to two years. The co-ordination of air resources between the two countries was announced some four or five months ago. The evolution of Eurocorps was first thought to pose some sort of threat to the North Atlantic Treaty Organisation and the allied rapid reaction corps. However, it is now viewed as being rather more friendly to existing defence structures. The United Kingdom-Dutch amphibious force has existed for a considerable time.

The NATO summit of January 1994 recognised the opportunity for what were described as "combined joint task forces", whereby NATO's entire resources may be made available to European members of NATO for operations in which the United States would not expect to take part. Those existing components, which are of varying strength, will lead inevitably to the evolution of a far greater degree of integration in defence matters in Europe.

Another equally, if not more, compelling factor for integration is economics. Because defence inflation always runs ahead of what may be described as "ordinary" inflation, there will be continued economic pressure for force specialisation, for interoperability and for common procurement. I do not underestimate for a moment the difficulties of achieving those aims, but I believe that they will be driven by economic necessity.

The Navy is currently contributing to the force in the Adriatic which is enforcing the arms embargo in the former Yugoslavia. Hon. Members have already paid tribute to the professionalism of those who are engaged in that task, and I had the good fortune to see it at first hand when I visited HMS Ark Royal.

The force's presence in the Adriatic depends on the continuance of the embargo. I am implacably opposed to any lifting of the arms embargo, either unilaterally or multilaterally. I think that there will be general agreement about that matter in the House. How could we continue the remarkable humanitarian effort if the arms embargo were lifted? How could our forces and those of other countries remain in the former Yugoslavia in safety if the arms embargo were lifted? How could we withdraw without undue risk from the difficult circumstances—including terrain and other factors—in the former Yugoslavia as we would inevitably have to do if the arms embargo were lifted?

Would the no fly zone be maintained? What air assets would be available for that operation and from whom would they come? For example, once we have withdrawn and the arms embargo has been lifted, would we continue to provide air resources in order to police the no fly zone?

I suspect that what is described in the Untied States as the "lift and strike" policy—lifting the arms embargo and then using air strikes—would soon become a reality. Once that had happened, what some have long suspected to be the principal objective of the Bosnian Muslims—to draw the United States and perhaps others into the war on their behalf—might be achieved.

What consequences would that action have for NATO? Some say that NATO would be finished for ever. I do not think that the consequences would be apocalyptic; however, I think that they would be severely damaging for NATO.

In practical terms, an announcement that the arms embargo will be lifted is hardly likely to be met by a totally unresponsive Bosnian-Serb Government. They would be bound to take maximum advantage of the inevitable gap between the announcement of the end of the embargo and the arrival of weapons, or the gap between the announcement, the arrival of weapons and the training of people in their use, and act upon their present military superiority. I hope that, even now, we will be able to persuade our friends in the United States—it is clear that we have persuaded the United States Administration, but I hope that we will be able to persuade others also—that that policy would be extremely damaging and dangerous.

Like other armed services, the Navy has faced the difficult transition from a capability which was based on a clear threat—which had existed for 40 years—to a capability that is now based on anticipated tasks. As many hon. Members have already pointed out in the debate, it is extremely difficult to anticipate what those tasks might be. Therefore, we must return to principles.

The first principle must be a balanced fleet, within which there may he a change of emphasis. For a long time the United Kingdom's anti-submarine warfare capability was deep water in nature because our task was to ensure that the reinforcement of NATO forces across the Atlantic would not be prejudiced by Soviet submarines breaking out from the north Norwegian sea. I am sure that hon. Members will recall our policy of forward maritime defence. That is no longer relevant in the changed strategic situation.

However, we still need anti-submarine warfare capability in order to counter the proliferation of diesel-powered submarines. Russia's readiness to sell Kilo class submarines to anyone who is willing to buy them gives rise to the possibility that our forces may be required to exercise their anti-submarine warfare capability against such submarines.

The hon. Member for Dunfermline, West (Ms Squire) asked the Minister many questions, but I would like to ask him only one. If he cannot answer it tonight, I will happily accept a written answer in due course. The Merlin programme is a very important part of the all-round capability of the type 23. Can the Minister tell me, either tonight or at a later stage, when the Ministry of Defence expects that the Merlin helicopter will he fully deployed?

Mr. Alan Jones of Westland announced today that he intends to relinquish the post of chief executive of that company. Mr. Jones has made a remarkable contribution to the fortunes of Westland and, in so doing, he has assisted in maintaining a very important industrial and military capability for the United Kingdom.

Mr. Colvin

Does the hon. and learned Gentleman think that an announcement from the Front Bench confirming the order for 25 Westland EH101 support helicopters would be a very nice parting gift for Mr. Alan Jones? We have been waiting for that commitment for nearly five years and it is about time that the Government gave it.

Mr. Campbell

As the hon. Gentleman knows, the first commitment was made in 1987 by the then hon. Member for Ayr, who is now Lord Younger of Prestwick in the other place. I think that Alan Jones would be well rewarded for his time at Westland if the Minister were able to make that announcement which hon. Members would welcome also. Apart from anything else, it would ensure the continuance of Westland as an important part of the United Kingdom's military and industrial base.

I suspect that some of the tasks and important roles that the Navy will be required to fulfil in future may be of a rather lower intensity than many of those for which we have prepared in the past. Under the auspices of the United Nations and in co-operation with others I suspect that the Royal Navy may be called on to take part in arms and trade embargoes authorised by United Nations Security Council resolutions. It is important to make the point that, although carrying out low-intensity operations can be a valuable contribution to security, it is equally clear that we must, in the Royal Navy, maintain a capacity for high-intensity warfare if it becomes necessary. Many people are concerned that if we become so committed to low-intensity United Nations-sponsored deployments, it might prejudice our ability to conduct high-intensity warfare. I know that the Minister is seized of that apprehension—indeed, I was able to discuss it with him when I went to see him at the Ministry of Defence a little while ago.

The nuclear deterrent remains the responsibility of the Royal Navy. We are committed to a minimum deterrent and to nuclear weapons as weapons of last resort. I do not believe that we fulfil those principles unless we take a conscious decision not to deploy any more warheads on Trident than on the Polaris system that it is to replace. In that regard, it is right to remind the Government of their obligations under article 6 of the non-proliferation treaty, which, of course, is currently under active consideration.

Important though the nuclear deterrent may be, we should remember that the most flexible asset that the Navy possesses—one that is capable of performing a wide variety of tasks—is the fleet of frigates and destroyers. I was pleased to hear the Minister of State for Defence Procurement, who opened the debate, say that we have 35, instead of that awful word "about" which, for years, bedeviled the Defence Committee's taking of evidence from Ministry of Defence officials, who would only ever say "about" 50, "about" 40 or "about" 35. The Minister was unequivocal, and for that he deserves the congratulation of the House.

I suspect that 35 is pretty well the minimum number at which the Navy could continue to perform the tasks that they are obliged to perform at the moment or may be called on to perform in the future. I remind the House that it is the frigates and destroyers from which we provide the West Indian guardship and part of our presence in the Adriatic. As has already been pointed out, it is from the fleet of frigates and destroyers that we were able to make such a swift deployment against a further threat to Kuwait only a few months ago.

There will be only 12 submarines. The four Upholder class are to be sold, leased or in some way disposed of. There will be a loss of capability, although that is substantially discounted by hon. Members who know more about submarine warfare than I do. It will mean that the remaining submarines will be very heavily worked and deployed. Therefore, refit schedules and their maintenance at a proper level of readiness will be extremely important.

I support the proposal to obtain cruise missiles. I believe that the opportunity for force projection, which that will give, will be a considerable enhancement of capability.

On mine counter-measure vessels, to which reference has been made, I believe that it is a capability in which we lead the world. It is vital that we do not sacrifice that lead. I get the impression that Ministers on the Treasury Bench recognise that it is important that that capability be preserved.

The importance of the Royal Marines cannot be understated. At a time when we are looking for flexibility, what is more flexible and valuable in an unstable and unpredictable environment than an amphibious capability?

The hon. Member for Dunfermline, West spoke at great length, with great sincerity and to great point with regard to Rosyth. I certainly do not wish to do anything other than endorse what she had to say about the way in which Rosyth was treated and the experience of the loyal workers who worked there for many years. I would just embellish—if I may put it that way—what she said by making the comment that the position of both royal dockyards is still uncertain until the whole question of privatisation is resolved. It now appears that there has been only one bid for each, from the incumbent. I have not seen the bids and am not in a position to make any judgment about their commercial acceptability or otherwise, but I believe that it is incumbent upon the Government to resolve the issue as soon as they can, and if it is necessary, to ensure that those bids are effective, that there be some kind of contractual arrangement with regard to the provision of work to the two dockyards. I would support moves towards that end.

We are, notwithstanding the channel tunnel, still a maritime nation. We have traditionally been a naval power, but that tradition has been bedded in the practical necessity of ensuring that we were able to defend our shores at all times. Geographical and physical considerations will continue. The traditions of the Navy—service, commitment and professionalism—will be maintained. It is to those traditions that we should pay proper tribute this evening.

7.6 pm

Mr. Gary Streeter (Plymouth, Sutton)

I am pleased to follow the hon. and learned Member for Fife, North-East (Mr. Campbell), who speaks with great authority on the subject. I certainly wish him well with his leadership campaign.

I am also proud to represent a region that has had a distinguished record of service to the armed forces over the years, particularly the Royal Navy and Royal Marines. In Plymouth, there has been a naval base and dockyard for many centuries, and we have been the home of the Royal Marines for many generations. I know that you, Madam Deputy Speaker, are extremely familiar with all those establishments, and are well loved by those who serve therein.

I am delighted that my hon. Friend the Minister of State for the Armed Forces will be replying to the debate, because he made a recent and highly successful visit to Plymouth and, as usual, was extremely popular wherever he went.

In recent times—as you, Madam Deputy Speaker, will know—we have experienced the dreadful trend of downsizing our defence establishments, caused, quite understandably, by the ending of the cold war and the break-up of the Warsaw pact. I associate myself with the comments of my hon. Friend the Member for Upminster (Sir N. Bonsor), who made a telling argument about why it is more vital than ever that we keep our defences up.

The so-called peace dividend that we have enjoyed these past few years has hit us particularly hard in the west country. Since 1985, the number of employees at the dockyard has reduced from 13,500 to only 4,000 some 10 years later. It is generally recognised in the west country that, had the Labour party won the previous election, with its commitment to defence cuts of 30 per cent. or so from 1992—not from 1985, which deals with the point made earlier by the hon. and learned Member for Fife, North-East, representing the Liberal Democrats, who pledged to reduce defence spending by a staggering 50 per cent.—we would have been even harder hit. I will take no lectures on defence cuts from Opposition Members.

None the less, times have been hard in Devon and Cornwall, and we have experienced considerable job losses. As you will know, Madam Deputy Speaker, anxieties about job losses have not entirely gone away. They come from a variety of sources. The maintenance of the Trident submarine, and its refits, will secure and guarantee 4,000 jobs in Devonport dockyard for the next 20 years.

That is very welcome, but people in Devon and Cornwall worry about Labour's commitment to Trident if it formed the next Government—which we know is highly unlikely. They worry about Labour's record on defence. They worry about the 60 or more Labour Members who signed an early-day motion late last year calling on the Government to scrap Trident, and they worry about the fact that the leader of the Labour party, and indeed Labour's entire defence team, used to belong to the parliamentary branch of the Campaign for Nuclear Disarmament.

Dr. Reid

Would the hon. Gentleman care to amend that last statement, as in making it he was inadvertently misleading the House?

Mr. Streeter

The hon. Gentleman has not given me the detailed information that would allow me to amend it, but if he wishes to make a statement about his own position, I shall be delighted to hear it.

Dr. Reid

I have never been a member of the parliamentary branch of CND.

Mr. Streeter

The statement that I made about the leader of the Labour party none the less stands. Many hon. Members wonder how a Member of Parliament could decide that we should not have a nuclear deterrent when the cold war was at its height and the Warsaw pact constituted such a threat, and then decide in 1990—when the cold war was winding down and the Soviet bloc was breaking up—that such a deterrent was appropriate for this country after all. Many of us feel that that conversion was extremely superficial, and would melt in the heat of battle.

Mr. Jamieson

Labour's commitment to Trident is certain. The hon. Gentleman knows that, because our Front Benchers have made it clear on many occasions. His own Front Benchers, however, may be interested to know that I have a photograph in my pocket—I will show it around the House if the hon. Gentleman wishes me to—taken in 1987, which shows the hon. Gentleman, then an SDP councillor standing with the SDP Alliance in Plymouth. In the photograph, the hon. Gentleman is sharing a platform with a leading member of the local branch of CND.

Mr. Streeter

That is a rather feeble point, for two reasons. First, the purpose of that debate was for me to put the case for a nuclear deterrent, against which the CND member was arguing. Secondly, the hon. Member for Plymouth, Devonport (Mr. Jamieson) has an old skeleton in his cupboard in the form of his past membership of CND. How ironic that he should now represent Devonport, whose dockyard is to maintain the Trident submarine.

Mr. Jamieson

On a point of order, Madam Deputy Speaker. Will you ask the hon. Gentleman to withdraw that comment? I have never been a member of CND.

Madam Deputy Speaker (Dame Janet Fookes)

That is not a point of order for the Chair. It is a point on which the hon. Member for Plymouth, Devonport (Mr. Jamieson) might wish to intervene, and that is how I shall treat what he has said.

Mr. Colvin

rose—

Mr. Menzies Campbell

He has not accused you yet.

Mr. Colvin

He probably will.

Sharing a political platform with someone does not necessarily involve sharing that person's views. I have shared a platform with the right hon. Member for Chesterfield (Mr. Benn) many times, but that does not mean that I shared his political views on those occasions.

Mr. Streeter

I am grateful to my hon. Friend. Indeed, as I said, the purpose of my being on that platform was to contradict the CND argument. I have always supported the independent nuclear deterrent. Will the hon. Member for Devonport reflect on this point? I think that it is better for an hon. Member to maintain his principles while changing his party than to stay in his party and abandon all his principles, as so many Opposition Members have done.

Let me continue with my thoughtful speech. People in Plymouth are also worried about talk of a further defence review. I have spent a good deal of time talking to members of the armed forces, and I know that the last thing they require is another defence review. They want a period of stability and certainty, and the ability to plan within a given framework; the possibility of a further defence review terrifies them. I agree with what my hon. Friends have said about the desirability of such a review.

People in Plymouth are also concerned about the fact that the implications of "Front Line First"—albeit a masterly exercise in support for our front line—are still trickling through. Only this week, we heard the sad announcement of 427 job losses in Devonport as a result of the rationalisation of naval stores.

I believe that my hon. Friend the Minister of State for the Armed Forces handled the matter as sensitively as it could have been handled, but he will appreciate that this constitutes a further blow to economy and morale in a region that has already been hit by many job cuts over the years. Moreover, the review of the Royal Marines and their location is still taking place. I know that my hon. Friend will understand my concern, and will note my call for a period of stability and security for Devon and Cornwall.

I welcome the clear assurance by my right hon. Friend the Prime Minister that there will be no further defence cuts under the present Government. That gives us confidence for the future; how it contrasts with what has been said by Opposition Members.

May I raise three specific local issues? I hope that my hon. Friend the Minister will deal with them, either when he winds up or later in the year. I seek assurances about the future of vital defence establishments in our region.

From time to time, we have debated the future of the naval base at Devonport. I entirely accept the assurance that the Ministry of Defence believes that we need a strong naval base there, and that the base has a strong and vibrant future; but concerns remain about the onward drift to Portsmouth and the amount of base-porting in Devonport. We in Devon and Cornwall seek a positive commitment to the naval base. We were pleased to learn of the commitment to replace HMS Fearless and HMS Intrepid with two new landing platform docks and a new amphibious craft for the landing of helicopters.

I suggest to my hon. Friend that there is a happy marriage between the base-porting of amphibious craft and the location of the Royal Marines. I understand that the base-porting of amphibious craft has not yet been settled; will my hon. Friend give a commitment to base-port those vessels in Devonport, so that they can enjoy collocation with the Royal Marines—our strike force in Devon—that will be of great strategic and economic benefit to the Navy and our region? I am prepared to wage a long campaign until Devon receives the answers to which I believe it is entitled.

It is not part of my brief today to be in any way derogatory about Portsmouth, the city in which I was born. I fear, however, that, as ferry traffic from Portsmouth increases—the channel tunnel may affect some ports in Kent in the same way—it may not be the right place in which to base-port new naval ships.

My next point concerns the location of the Royal Marines. They are currently based at the Citadel and Stonehouse, with a logistic division at Seaton and Coypool and a 42 Commando at Bickleigh. They have been part of our history for as long as anyone can remember. We know that the Ministry of Defence is currently considering the relocation of some Royal Marines at RAF Chivenor; that option is clearly attractive, given that it is a level, single site with newer facilities than Plymouth can offer in some instances.

I realise that my hon. Friend is examining the possibility of the move very carefully. He is taking his time to get it right, and I respect and support that. We are grateful that the Citadel and Stonehouse are not even under consideration. We know that the Royal Marines will remain in those locations.

I would understand it if the Logistics Division were to relocate from Seaton and Coypool, which are not ideal sites. I could understand the argument if it were in the interests of the Royal Marines to move that to RAF Chivenor in north Devon. However, if 42 Commando is moved from Bickleigh, particularly if it were for purely financial reasons, it would be seen as a major blow to our region, and the final straw that broke the camel's back. So I ask my hon. Friend the Minister to consider carefully before going further down that route. We must retain 42 Commando in Bickleigh.

If the Logistics Division relocates from Seaton and Coypool—I do not concede that point—will the Minister do everything possible to ensure an early release of those sites into the private sector, so that new jobs are generated from those valuable sites in the centre and on the edge of Plymouth?

Will he reassure me that, if those relocations take place, those sites will be actively put on to the marketplace for economic regeneration? The release of surplus Ministry of Defence sites in Plymouth has a mixed history. We welcome the excellent investment of £45 million in the site of the Plymouth Development Corporation, but are concerned about how long it is taking to deal with the redundant Manadon site.

The third issue that I wish to raise with my hon. Friend the Minister is competition in defence procurement. I welcome my hon. Friend's remarks about the Royal Navy's secure future. Many of my right hon. and hon. Friends would like even more ships to be ordered and built than those referred to in last year's "Statement on the Defence Estimates", but with replacements planned for HMS Fearless and HMS Intrepid, the batch 2 Trafalgar class submarines and up to three type 23 class frigates, significant work will be provided for our warship building yards and, importantly, the naval equipment supply industry?

I declare a further constituency interest. A company with many employees based in my constituency—British Aerospace Systems and Equipment Ltd.—is one of the equipment supply companies that will benefit from that work. I recently received a brochure from British Aerospace Systems and Equipment Ltd. which recalls the substantial naval work carried out within British Aerospace.

Most of us probably regard British Aerospace as the nation's premier supplier of aircraft, and I confess that, until I saw that brochure, I had only limited knowledge of the company's significant presence in naval prime contracting and systems. Hon. Members will be surprised to learn that, in 1993, British Aerospace's naval business turned over some £365 million.

Will my hon. Friend the Minister confirm that it will continue to be the Government's policy to encourage competition between British Aerospace, GEC and other major prime contractors, as the best means of ensuring value for money in naval, whole ship and systems procurements? It has been our consistent line to insist on competition in the refitting and maintenance of our ships by maintaining two dockyards. I hope that similar principles apply in relation to major defence procurement elsewhere.

In conclusion, I seek assurances about the future of Devonport naval base, and would like a response on the specific suggestion that I put to my hon. Friend the Minister. I also seek assurances on the retention of a substantial Royal Marine presence in south Devon and that the world of defence procurement will continue to be a competitive environment.

7.23 pm

Mr. David Jamieson (Plymouth, Devonport)

I am pleased to follow the hon. Member for Plymouth, Sutton (Mr. Streeter), having listened to his speech, which was so carefully crafted in the few minutes before he rose. Is it not refreshing that a Conservative Back Bencher should be so close to the ear of the Prime Minister? He comes to the Chamber tonight to tell us facts about the Government's policy on defence that we have not heard from the Minister. He said that there will be no further cuts in defence, but I understood that the Government's policy was to make a succession of cuts in defence during the rest of this Parliament. Clearly, the hon. Gentleman has the ear of the Prime Minister on those matters.

Mr. Freeman

I hope that there is no misunderstanding. In my opening speech, I made it clear that we sought stability in funding in real terms from 1 April this year for the next three financial years. That is the period for which the Government plan and the Chancellor made that clear in his statement. Decisions made under "Options for Change" and "Front Line First" will take a number of years to implement. I made that plain in my speech and my hon. Friend the Member for Plymouth, Sutton (Mr. Streeter) has been consistent with what I said. It is as plain as a pikestaff that that is what will happen.

Mr. Jamieson

That was a revelation. I am pleased that the Minister has confirmed that cuts will continue for the next four years. What the Prime Minister meant in the private moment that he spent with the hon. Member for Sutton was that there will be a succession of cuts in the next four years, which have already been agreed by the Government. I am glad that the Minister has reaffirmed that view.

The hon. Member for Sutton said that I was scaremongering when I mentioned the Marines leaving Plymouth. I am glad that he has now come to the view that the Government may take the Marines away from the city.

Like some of my hon. Friends I declare an interest. My hon. Friend the Member for Dunfermline, West (Ms Squire), who made an excellent speech on behalf of her constituency in Scotland and the Royal Navy, and the hon. Member for Birmingham, Hall Green (Mr. Hargreaves) are both on the armed services parliamentary scheme. I, too, have been on the armed services parliamentary scheme, with the Royal Marines. If I am allowed to mention the Royal Marines in a Royal Navy debate, may I say that I admire their work and pay special tribute to the work that they contribute to our armed services' effort. On one occasion, for the brief moment in which the hon. Member for Sutton was also on the scheme, he and I were sped around Poole harbour on a landing craft. Having heard his speech tonight, I wish that I had pushed him in.

Before I clear up the matter of the photograph, will the hon. Member for Sutton withdraw the comment that he made about my having been a member of CND? I have never been a member of CND but he has put it on the record that I have.

Mr. Streeter

I am always willing to accept the hon. Gentleman's word. I therefore withdraw the remark if he assures me that it was inaccurate.

Mr. Jamieson

Anyone listening to the hon. Gentleman will realise that his ungracious apology will not be well received.

Let me clear up the matter of the photograph. The hon. Gentleman said that he shared a platform with, but was in opposition to, a member of CND. That is not true. The photograph in my possession shows that when the hon. Gentleman was a member of the SDP and shared a political platform with the alliance, and therefore the Liberals, he was photographed for election material put out on his behalf standing next to the leading member of the CND in Plymouth. We are, however, glad of the hon. Gentleman's conversion to sense. Now that other Conservative Members have discovered that, long may he remain on the Back Benches.

Dr. Reid

Will my hon. Friend confirm that it is now clear that my hon. Friend and I were never members of CND but that the person who accused us was on a platform supporting, and publishing literature proclaiming his association with, the CND?

Mr. Jamieson

My hon. Friend is correct.

Mr. Streeter

On a point of order, Madam Deputy Speaker. How can I place it on the record that I have never, at any stage in my life, espoused the principles of CND, and that I have always supported an independent nuclear deterrent? The hon. Member for Plymouth, Devonport (Mr. Jamieson) is misleading the House and he should be careful.

Madam Deputy Speaker

Matters of fact are not something on which the occupant of the Chair can rule. Of course I expect hon. Members to be careful in what they say. I am sure that, if they are found to have made inaccurate comments, gracious withdrawals would be the order of the day, but I cannot adjudicate on such matters.

Mr. Jamieson

If we want some clarification, I shall say it again. A photograph of the hon. Member for Sutton standing next to the chairman of CND appeared on election materials. At that time, he was in the SDP and sharing the same political platform as the Liberal Democrats. I am pleased that he has come to the House to make the position clear. We welcome his change of view over that period.

Mr. Streeter

Will the hon. Gentleman give way?

Mr. Jamieson

I shall give way in a moment. We have heard enough from the hon. Gentleman. I am glad that he has clarified his position on the matter. If he wants to put out a public statement to make absolutely certain that everyone in the House understands that he never shared a platform with people who espoused CND views, I would be happy to read that statement.

Mr. Streeter

Will the hon. Gentleman give way?

Mr. Jamieson

Not at this moment.

Mr. Streeter

On a point of order, Madam Deputy Speaker.

Madam Deputy Speaker

Order. This debate on the Royal Navy is of great importance. I deprecate what appear to be personal comments being made across the Floor of the House. It would be for the good of the debate if no more references were made, and if any differences were settled privately outside the Chamber.

Mr. Jamieson

As always, I shall be guided by your words, Madam Deputy Speaker.

Mr. Streeter

Will the hon. Gentleman give way?

Mr. Jamieson

I shall not give way to the hon. Gentleman. Having been guided by your words, Madam Deputy Speaker, I shall not give way again to the hon. Member for Sutton.

Mr. Streeter

On a point of order, Madam Speaker. Is it in order for an hon. Member to make a scurrilous accusation, and then not to give way so that it can be corrected?

Madam Deputy Speaker

I regard that not as a point of order, but as a point of fact. I have given my advice on how the matter might be handled. I hope that that advice will be heeded by both hon. Gentlemen.

Mr. Jamieson

I will again follow your advice, Madam Deputy Speaker, and I shall not respond further to the hon. Member for Sutton, as I have made clear my views on the matter.

The debate is of great importance to the Royal Navy, to Plymouth and to the south-west region. The south-west economy relies heavily on defence spending and defence-related work. Plymouth, in particular, and Devonport are totally committed to the defence of the country, but how committed is the Navy to Devonport? In particular, how committed are the Government to Devonport, and to the men and women who have given many years of loyal service to the Navy, in both military and civilian capacities?

In recent years, cuts have been made in services generally, but naval cuts and closures, in particular, have had serious effects on Plymouth. As promises to maintain jobs in the dockyard and the supply depots have been cynically broken, a feeling of betrayal pervades the work force and the local people, not only because of the cuts and those broken promises, but because there is no support and no planning. The Minister made it clear that the Government have no aspiration to find new employment for the people who have lost their jobs, many of whom have skills in that sector.

The Ministry of Defence has consistently failed to provide help for redundant workers, and support for service personnel. Only recently, following considerable pressure from me and from others, it started working with the local authority in my area and with other bodies to secure the best use of redundant land.

Mr. Soames

I am sure that the hon. Gentleman would wish to clarify his comment that the Government have done nothing for service personnel. The Government's resettlement programme for service personnel is unmatched by any other institution in this land. It is widely regarded as the most effective organisation of its type. The hon. Gentleman should clarify what he said.

Mr. Jamieson

I thank the Minister for that and I will tell him exactly what I mean. The Minister must bear some responsibility for the thousands of people who have lost their jobs in Her Majesty's royal dockyard over the years. Most of them have not found alternative employment, and the Government have failed them by not helping to find them new employment. The Minister may be interested to know that the unemployment figures rose this week in the south-west region and in Plymouth, in particular. The main reason for the increase is the cut in defence, over which he is presiding.

Workers in the dockyard in Plymouth are justifiably disappointed by job losses, but they become angry when they see massive waste and injustice in the system. The MOD justifies redundancies by saying that they will save money, but then wastes millions of pounds on the refurbishment of official residences, on consultancy fees, and on gross inefficiency of breathtaking proportions.

Recently, Tory Members have been trying to blame local authorities for cuts in education, saying that the authorities were wasteful, yet when it comes to waste and inefficiency, the MOD has cornered the market. In the past three years, £55 million has been written off in lost rent on empty homes alone. Only four years before HMS Andromeda was offered for sale, £27 million was spent on its refit, and we hear that the asking price may be as little as £1 million. Those are just are two examples of waste.

Usually, the debate on the Royal Navy rightly concentrates on weapons, hardware and logistics, but I want to examine some of the issues that are important to the people who keep the Navy going, either by serving on ships or on shore, or by working in a civilian capacity to ensure that the Navy is fit to respond to any situation. The MOD is guilty of paying too little attention to the welfare of its employees in relation to housing, jobs and education. On Tuesday, the Minister announced the loss of jobs in Royal Navy supply depots at Devonport, Exeter and Wrangaton, all in my part of the country. The total loss amounted to 734 jobs, 427 of them in my Devonport constituency. That constitutes a further dismantling, of Europe's most efficient naval supply network. Those decisions defy logic and common sense.

How can it be sensible to dismantle the supply stores for naval ships based in Devonport so that they are to be supplied from Portsmouth, 170 miles away, and through the narrow roads of Hampshire, Dorset and South Devon? What sort of logic states that having three depots close at hand in Devon to supply ships in Devonport is, as the Minister said, fragmented by nature and difficult to manage but that supplying them from somewhere 170 miles away will be more efficient, despite the fact that £9.5 million will be spent on "modernised infrastructure" at Portsmouth? How can the Minister claim in his letter to me that Devonport is and will continue to be the principal Naval base on the South Coast when he admits that the current situation of more ships being based at Plymouth than at Portsmouth will change as the 4th Frigate Squadron builds up at Portsmouth, and as the type 22 frigates are paid off?

Under "Options for Change", and as recommended by the defence costs study, the total reduction in stockholdings will be in excess of 50 per cent. over five years. That is disproportionate to the reduction in the size of the Royal Navy and does not reconcile with the perceived work load. I can conclude only that there is a hidden agenda of further cuts in the size of our Navy, and a threat to the very existence of Devonport as a major naval base.

Mr. Soames

So that the hon. Gentleman does not wander off down that fantastic lane, may I assure him that no further cuts are planned to the front line of the Royal Navy and to Devonport?

Mr. Jamieson

I am pleased that the Minister has been able to reassure me. However, he must realise that those who have been in Plymouth for a long time know that similar Ministers have given similar assurances over the past 10 years. In 1983, when we said that there would be massive job losses at Devonport, we were told that we were scaremongering and that there would he no cuts.

Nearly 14,000 people were employed at the dockyard at that time. We were told the same in 1987 and 1992. No doubt at the next election we will be told the same again. However, I am pleased that the Minister has given me that assurance, and I promise that I will repeat it many times, which I am sure will bring him pleasure.

The Government recently offered for sale the royal dockyards at Devonport and Rosyth for total privatisation. The Government have made the dockyards so unattractive that, even after spending £7.2 million on consultants to help sell off the dockyards, there was only one bidder for Devonport and one for Rosyth. The Government spent £7.2 million to tell Devonport Management Ltd. and the Babcock International Group about the dockyards that they already occupied. That money could have been better used to help the many thousands of people in Devonport and in Scotland who have lost their jobs in the past few years.

My hon. Friend the Member for Dunfermline, West asked who will underwrite the redundancy payments. I ask the Minister again. Will it be the Government or will the private company that takes over be expected to do that? The total redundancy estimate for Devonport is £140 million.

Quite rightly, workers want to be reassured about their rights and their conditions of work. The Government have previously given assurances that those would not change after privatisation. Will the Minister confirm what legal rights the workers will have after privatisation? Can he categorically assure workers that their loyal service over many years will be rewarded by the continuance of the contracts that they have enjoyed in the past and that they will still enjoy the same pension and redundancy rights?

The privatisation threatens the economy of Plymouth and the surrounding areas partly because it creates uncertainty about employment. Already, many people in the Devonport dockyard receive redundancy one week and are taken on a week after on short-term contracts and reduced pay. Privatisation will not bring any benefits for the work force at Devonport and it is hard to see what benefits it will bring for the Royal Navy. Only the Treasury will benefit. It is a defence policy run from planet Portillo or asteroid Aitken. The Ministry of Defence now offers better career prospects and job security to merchant bankers and financial consultants than to those serving and supplying the Royal Navy in defence of the realm.

Another matter that is of great concern to my constituents, and to people throughout the country, is naval housing. While my constituents who have loyally served their country lose their jobs, inefficiency and waste run riot throughout the Ministry of Defence. Let us examine the running of the naval living quarters. The Ministry of Defence owns, as at 31 December 1994, 12,408 vacant properties—15 per cent. of its stock of houses. Some 236 of those are in my constituency of Devonport. Those 12,408 houses would be the equivalent of a town such as Canterbury, Banbury or Taunton.

The Ministry of Defence housing policy is disastrous. It lacks planning and is riddled with incompetent management. The number of empty homes is increasing almost daily. The empty homes have resulted in loss of rent of £55 million in the past three years. There is also the loss of council tax to local authorities as well as the cost of security and maintenance, which, by the Minister's admission to me in a written answer, has been £355,000 in the past two years. Is the Minister aware that 118 former wives of naval personnel were evicted from their homes in the past five years? Last year, Plymouth city council had to rehouse 77 ex-service families who had been declared homeless and evicted by their former employers, the Ministry of Defence.

Mr. Peter L. Pike (Burnley)

Will my hon. Friend recognise that there is a similar problem at Deal, where the properties of the Royal Marines are deserted and where there is temporary housing? It is appalling and the Royal Navy and the Admiralty must do something with those properties.

Mr. Jamieson

I agree with my hon. Friend. They must be part of the 12,408 homes to which I had referred, or perhaps they will be added to that figure in the next few months. Perhaps the Minister will clarify that.

Is the Minister aware of the case of my constituent, Sharon Terrell, who lives in Barne Barton in St. Budeaux in Plymouth? She separated from her naval husband after being assaulted. She is facing eviction from naval quarters despite the fact that she can see 15 empty Ministry of Defence properties on her estate from the window of her kitchen. She is still paying rent. In the next few weeks the Minister's Department will evict that woman and her former home will lie empty. Would it not make more sense to allow her to continue to live in the property, paying the rent and looking after it on behalf of the Royal Navy rather than having another empty house and a homeless young woman?

The evictions, inefficiency and failure to act continue despite the devastating criticism of Ministry of Defence housing management by the Government's own task force, set up by the Department of the Environment. It published its report in July 1994. It may be instructive to hear what that task force said about the Ministry of Defence. The report states: Between £30 million and £100 million is lost by the taxpayer each year by 10,000 homes remaining empty. It goes on: The MoD, as the largest holder of empty homes, has not been amenable to influence. It also said: Effective action by Defence Ministers is urgently needed and should not be further delayed. Most tellingly it said: For more than two years, frequent and energetic efforts have been made to persuade the MoD to reduce their vacancies … Regrettably our assessment is that the Ministry of Defence appears to have been unwilling to accept many of these suggestions. Is that not a major condemnation of the Ministry of Defence by another Government Department?

On the evictions of former wives of service personnel, the report accused the Ministry of Defence of "shortsighted, anti-social activity". Will the Minister comment on those matters?

The Government responded to the report in July 1994. They said: Since the Task Force report was written, vacancies have now started to fall. That is blatantly untrue. The number of vacant homes increased by 2,000 between January and December 1994. They then said: The Government proposes to set annual targets and to publish the Department's achievements at the end of each year. Will the Minister tell us whether the Royal Navy achieved its targets for empty homes last year, and tell us when this year's figures be published? Will he freeze all evictions of naval families from their quarters until the scandal of empty properties has been resolved? He could make inroads into the mass of empty properties by releasing the 94 married quarters on the Furse Park estate in Barne Barton in my constituency to either a housing association or to Plymouth city council, which is desperate for family accommodation.

The Government's response to the increase in the number of empty naval homes was to set up the Crown housing trust, yet another Tory quango gravy train. We are told that the chief executive was given a salary of £80,000 a year and even offered £20,000 performance-related pay. I look forward to the Minister telling us how much performance-related pay that man will get because the number of empty properties has increased since he got the job.

The "new arrangements" for service housing have cost £5 million since 1991 and, of course, consultants were paid £3.3 million for the failed project. The Secretary of State for Defence said that the trust "encountered difficulties"; then it was scrapped and replaced by the Defence housing executive, an agency—so-called—with responsibility for privatising the whole MOD estate. In other words, the MOD continues to set up quangos and agencies while the number of empty home grows.

Is the Minister aware that a report published last year by Crisis said that 25 per cent. of all the single homeless had previously served in the armed forces and that the advice and help given to those coming out of the services was not adequate? I stand by my earlier comments.

Negotiations are currently under way in Plymouth about a matter in which the MOD might be able to help. It is an example of how the Ministry could assist my constituents and the health service at the same time. The Ministry of Defence must become more responsive to the needs of the community that surround it and should be helpful rather than obstructive. There is the opportunity for the Ministry to act positively in Plymouth and to help the health service and the taxpayer instead of considering only the narrow remit of its own balance sheet. I am referring to the negotiations about the Cumberland house site in Devonport.

The Plymouth Community Services NHS trust—trusts are one of the Government's favourite creations—has been attempting to purchase MOD land and property for the development of a much-needed health facility for the local community in Devonport. However, the Ministry is setting higher hurdles and costs for the purchase of the site and adjoining property, which will restrict the trust's ability to fund the project. Unless the deal can be struck by the end of March this year, the project is likely to founder, thus denying a deprived area of Plymouth of a much-needed local health facility. It appears that the Ministry's desire to gain as much profit as possible from the trust could put the deal in jeopardy. I ask the Minister in all sincerity to intervene personally in the negotiations between the Defence Land Agents and the trust to ensure that the negotiations are completed successfully and without delay for the benefit of the local community, the MOD and the taxpayer.

Another issue connected with naval establishments, and one which is giving rise to great concern, is hunting. As I discovered after tabling a number of written questions, the taxpayer is underwriting the cost of paying for service men to go hunting during duty hours. Some of the costs for the maintenance and upkeep of kennels are also paid by the MOD.

Mr. Henry Bellingham (Norfolk, North-West)

Why not?

Mr. Jamieson

I can tell the hon. Gentleman why not. The vast majority of decent people in this country are affronted not only by hunting but by a Department that underwrites and encourages it.

Mr. Colvin

I have never seen a sailor on a horse, and this debate is supposed to be about the Royal Navy. Let us remember that this year we are talking about VE day celebrations. I recall, when I was very small, watching the victory parade in 1945. There was great difficulty in finding four admirals to get on the four grey horses for the parade, so I really do not understand what connection there is between hunting and the Royal Navy.

Mr. Jamieson

I can assist the hon. Gentleman. Naval personnel are riding to hounds from military establishments across the country. He may be interested to know that the right hon. Member for Richmond and Barnes (Mr. Hanley), who was previously the Minister of State for the Armed Forces and is now the chairman of the Conservative party, said that hunting promotes "good tactical ground appreciation" and that the hon. Member for Rutland and Melton (Mr. Duncan) recently said that hunting "developed character" and that there was nothing cruel in the great and glorious death of a fox in the field".—[Official Report, 31 January 1995; Vol. 253, c.836] Like the hon. Member for Romsey and Waterside (Mr. Colvin), I do not know where they are keeping the horses on the submarines and ships.

Mr. Pike

The Royal Navy has as one of its sections the Royal Marines. When I did my national service in the Royal Marines, the adjutant always used to ride his horse during inspections.

Mr. Jamieson

I thank my hon. Friend for that information.

Will the Minister deny rumours that bell-bottomed trousers are to be phased out by the Navy as a cost-cutting exercise? Will he be supplying the men with jodhpurs and red coats instead? Has the MOD hatched a new strategy to introduce men riding into battle on horseback? Will the Minister be replacing the battleships and nuclear submarines with sailors in red coats on hunters patrolling our shorelines and shouting "tally-ho" and blasting bugles at unwanted intruders?

Dr. Reid

I am fascinated by my hon. Friend's detailed examination of expenditure cuts. Has he come across any reports that the Ministry of Defence is to cut the cavalry to one spur on the basis that, once one side of the horse is moving, the other is likely to follow?

Mr. Deputy Speaker (Mr. Michael Morris)

The cavalry is not part of the Navy.

Dr. Reid

But the marines are.

Mr. Deputy Speaker

The cavalry is not the marines.

Mr. Jamieson

I am grateful for your guidance, Mr. Deputy Speaker.

Unfortunately, hunting and riding on horseback are part of naval expenditure and my point is that they should not be. Why does the Ministry of Defence support the continuance of cruel and barbaric hobbies? Will the Minister give an assurance that not one single penny of taxpayers' money will be spent on hunting, either directly or indirectly?

I shall now deal with the education of service children, especially children whose parents are serving in the Navy. Last year, £133 million was spent on the Ministry of Defence boarding school allowance. I accept that service children need stable education and agree that the Government should provide assistance, but the whole system lacks accountability. Accountability is especially important in this instance as so many parents are abroad and unable to monitor their children's education.

I have written to the Ministry many times, so the Minister will know that many of the private independent schools benefiting from the scheme have poor examination results. We are not sure how most of the schools are performing because only nine HMI/Ofsted reports have been published on schools that receive the Ministry's boarding school allowance.

Finborough school in Suffolk and Rodney school in Nottingham both had mediocre reports from HMI and Ofsted but continue to receive hundreds of thousands of pounds of taxpayers' money through the boarding school allowance scheme. Why is the Ministry supporting such low standards in private schools? A constituent of mine, who is a serving member of the Royal Navy, has children at Finborough school. The principal at the school refused to send out the Ofsted report to parents, even after repeated requests. Eventually, those reports had to be sent out by the Minister's Department. Why does not the Minister use more local education authority boarding schools? The Service Childrens Education Association admits that the results in those schools are often better than those in the private, independent sector, and, of course, they are always cheaper, because the non-boarding costs are met by local education authorities.

I also ask the Minister to look carefully at the role of the Service Childrens Education Association. How does it monitor the schools which it has on its admissible schools list? Does it have the resources to carry out checks and inspections or does it use only word of mouth? Many service children are being short-changed by some of those schools. Moreover, the taxpayer is being short-changed. Will the Minister consider introducing more accountability to the system? Will the Government look at ways in which to check the standards of those schools, which receive millions of pounds of taxpayers' money?

I ask the Minister to make a firm commitment to Devonport as the major dockyard and naval base. Will he give the assurances, for which my hon. Friend the Member for Dunfermline, West asked and for which I am now asking, that when or if those dockyards are privatised, the work force will retain the pension and other rights that they currently enjoy? Will he examine carefully the inefficiency and waste that is destroying jobs in my constituency and is burning the heart out of our naval capacity?

8.1 pm

Mr. Michael Colvin (Romsey and Waterside)

It was a good thing that my hon. Friend the Member for Plymouth, Drake (Dame Janet Fookes) was presiding over our debate earlier, as the exchanges between the hon. Member for Plymouth, Devonport (Mr. Jamieson) and my hon. Friend the Member for Plymouth, Sutton (Mr. Streeter) became quite heated. I very much hope that the two gentlemen can join together for a game of bowls at Plymouth this weekend and that my hon. Friend the Member for Drake is around to umpire the game—otherwise that, too, might come to a sticky end.

We are debating the Royal Navy five years after the collapse of communism, the withdrawal of the iron curtain and the end of the cold war. It is time to assess the peace dividend, if there is such a dividend. Hon. Members have referred to the new world order. I would call it disorder, with 15 conflicts now in progress around the world, many of them involving United Nations forces on deployment, and with another 15 or so situations almost at flash point, where hostilities could break out at any time. It is a very uncertain world in which we now live, following the certainty that persisted during the cold war.

In that respect, we need to think carefully about our defence role three, which is to contribute to promoting the United Kingdom's wider security interests through the maintenance of international peace and stability. I have long maintained that there are insufficient resources—in fact, hardly any resources—set aside specifically to honour that commitment to role three. Her Majesty's Government can meet their commitments on those international obligations to assist the United Nations in its peacemaking and peacekeeping roles only by taking resources from roles one and two. Role one is the defence of the United Kingdom and its dependent territories and role two is the resisting of threats to the United Kingdom and our allies such as NATO.

The hon. Member for Leeds, Central (Mr. Fatchett) referred to the matching of resources with commitments, which is quite right. One has to ask what are our commitments under role three, as set out by my right hon. and learned Friend the Secretary of State for Defence? Obviously, in this day and age, maximum flexibility is a very important principle of war. However, it is difficult to determine precisely Britain's national interests in the international scene. What are our interests in places such as Cambodia, east Africa or Kashmir? Should we be involved in such operations?

I argue that no other country in the world has a wider interest in free and uninterrupted trade. Britannia may no longer rule the waves, but she has tremendous interest in world peace and stability. Our overseas investments are huge. I suspect that, as a percentage of our overall investments—internationally and domestically—our overseas investments are probably as large as that of any other country. It is against that background that we debate the state and the role of the Royal Navy.

I shall concentrate on three specific aspects, because many of the points that I would have otherwise made have already been covered by hon. Members. Defence is bedevilled with acronyms and I shall try a few on the House. I shall talk about DIB, ACP, STUFF and the TSCS. To enlighten hon. Members, those acronyms stand for the defence industrial base, the arms conversion project, ships taken up from trade and the tri-service chaplains school.

I welcome the emphasis of my right hon. Friend the Minister of State for Defence Procurement on preserving the viability of our defence industrial base and on the importance of keeping a watchful eye on the reliability of our overseas partners in collaborative defence projects, from a political as well as from an industrial point of view. He referred to 45 different collaborative armaments projects which are proceeding at the moment. It is important in international collaboration that the United Kingdom has a proper share in the development of the projects and not only in their manufacture, because if we forfeit the development aspects of our armament projects we throw away the seed corn that keeps industry going and enables Britain to maintain the essential leading edge in technological advance.

Hon. Members have referred to the importance of value for money in defence procurement. No one would question the importance of buying the best possible equipment for our armed forces. However, there is also a case for taking into account what I would call the social cost of not buying British. If one buys from overseas, one may end up with a very good product at a unit cost slightly less than that on the home market, simply because some of the production runs of equipment in big overseas manufacturers such as those in the United States enable unit costs to be reduced. So, one must bear in mind the importance of maintaining Britain's industrial defence capability and ensure that it grows.

A case in point is the Westland EH101 helicopter and the order for 25 support helicopters to which several hon. Members have referred. At the moment, we hope that that order will be confirmed. However, it is important that the order is confirmed for the full 25 and not fewer because of the importance of sales to third countries. There is no doubt that that helicopter, which is in the forefront of technology and available in a number of different versions, is attractive to many potential overseas buyers. But those buyers will be looking at how many Her Majesty's Government order. If the order is for any fewer than 25, they will ask why the British Government are buying fewer of those aircraft than they had originally said they would. I want there to be a full order for 25 and I think that that view is shared by all hon. Members.

It is important to consider carefully the value of so-called offsets when we buy from overseas. There has been a big debate about heavy transports for the Royal Air Force. I know that I am digressing slightly from the Royal Navy, but I believe that this point is applicable to naval projects as well. It is important that when we have to buy from overseas, the offsets that we obtain for British industry to compensate for those purchases contain proper development work and are not just what is called tin-bashing. The work must have real technological value to maintain the viability of our industry.

The hon. Member for Leeds, Central also referred to the decline in our defence industrial base. He spoke of the restructuring taking place world wide and he raised the question of a possible European common procurement policy, which he suggested would be damaging to British industry. To some extent, that is true, but it is important that we collaborate with our European partners to spread the capital and development costs of new projects and that we do not, when looking for overseas partners, always look across the Atlantic to the United States. The United States seems to get the best of most deals. I remember that when the Conservative Government took office in 1979, the so-called two-way street across the Atlantic was 15:1 in favour of the United States. It is now about 2:1 and diminishing. It is important that the two-way street, if it is to be maintained, is balanced. We must, however, have partners in Europe as well as partners across the Atlantic.

Mr. Fatchett

There is a danger in the European argument of expressing our position in absolute terms. That was not my intention. There are substantial benefits from European co-operation. My point is that we should work out the extent of that co-operation both in procurement and production. At a certain point, there is a potential downside. I am not saying that I am against European co-operation. I would encourage it, but we must be aware of the downside when it occurs.

Mr. Colvin

I concur with that point of view.

Opposition Members have referred to Labour's pledge for a diversification agency; I wonder how it would be funded. If it was not funded straight from taxpayers' money, from where could it get funds other than those available from the Konver fund within the European Union? Would the agency be an interventionist board, such as the National Enterprise Board of which we do not have good memories in terms of what it fulfilled during its existence?

Mr. Bennett

It did very well.

Mr. Colvin

It did not.

The questions raised about the importance of our defence industrial base almost anticipated what has already been decided by the Select Committees on Trade and Industry and on Defence. In our wisdom, we too felt that this was a matter that needed to be addressed. That is why the two Select Committees have combined to set up a joint Sub-Committee to investigate this precise matter with a fairly broad brief. The intention is to report before the summer recess. I very much hope that the Sub-Committee, which is a hybrid, will produce the vigour that one usually sees in hybrids; I speak as a farmer with some knowledge of genetics and breeding.

We are all concerned about the risk to our defence industrial base because another important principle of war is defence in depth. In view of the importance of maintaining supplies for our armed forces and of providing them with equipment that will be supreme. we must ensure that the defence industrial base is sound. In the defence costs estimates, much is said about our stores set-up. The Select Committee's report on the naval stores proposals, which have been addressed by a number of hon. Members today, is valid. With the reduction of stores, which is intended to save money, one cuts the output required from Britain's factories. That, again, is bad news for our defence industries and makes it even more important that we address the problem.

I was interested to see a pamphlet, which most hon. Members have probably received, entitled "Networker". It comes from the arms conversion project which was set up to look at the whole question of diversification and conversion. It seems to be almost a blueprint of the Labour party's diversification and conversion programme. Under the objectives for the project—which I shall not bother to read out—there is nothing about reacting to closures, nor about how to deal with the mobility of those made redundant. There has been much more scope for labour to move around the country since the Government introduced shorthold and assured tenancies which have breathed new life into the private rented sector. People who lose their jobs are no longer stuck; they can move around the country to find jobs where they are available.

Nor does the arms conversion project deal with retraining. Although my hon. Friend the Minister of State for the Armed Forces has stressed the importance of the Government's resettlement programme, more could be done to retrain those made redundant from the armed forces. Here I pay tribute to the Royal British Legion and the establishment of its training company at Tidworth which is doing a great deal in this respect.

The second acronym I mentioned was STUFT, which stands for ships taken up from trade. An important principle of war is mobility. All hon. Members have drawn attention to the rundown of our merchant fleet, which has been torpedoed more effectively by the Treasury than by any Exocet missile. There is no doubt that the scrapping of the 100 per cent. investment allowances which were available to shipowners did a great deal to reduce the size of our merchant fleet. It is important, therefore, in terms of the importance of maintaining international United Nations operations, that we have adequate merchant ships so that we can fulfil such requirements.

I recall that during the Falklands operation, in addition to 43 Royal Navy ships, 44 merchant ships were involved. We could not have mounted that operation or our operation in the Gulf without the support of the merchant fleet or the crews to man the ships. It is all very well chartering ships from overseas, but if one does not have the crews to man them, one is in considerable difficulty.

I know that the Ministry of Defence has said that it will carry out a paper exercise, which it calls a scenario-led discussion, some time in the coming month. That is not good enough. I would prefer, on an irregular basis, perhaps once a year, the Secretary of State for Defence to blow the whistle and say, "We are off tomorrow." He could say exactly what he wanted by way of tonnage and he could then see whether the Baltic Exchange and the merchant navy could respond and produce the ships. That would be quite a simple desk exercise which should be carried out irregularly without notice to test the ability of the merchant fleet to respond to what is required.

I am also concerned that the Ministry of Defence may not have adequate powers to requisition ships. In the case of national mobilisation or a threat to the security of the realm, it probably has adequate powers under existing legislation. However, that may not be the case with overseas operations in support of the UN, such as supplying humanitarian aid. Such operations may not be covered by the legislation giving the Government the power to requisition ships. I should like to know whether the powers are adequate for that purpose or whether the Government merely have to rely on normal charter operations for additional shipping if they have to mount such international operations for the United Nations.

One passing thought is that the former Soviet Union countries desperately need foreign currency. If we want proof that it is important from a defence strategic point of view to have a strong merchant fleet, one has only to consider the size of the fleet that the former Soviet Union had in the days of the cold war. It was massive, and it was not just to earn the Soviet Union foreign currency; it was because the Soviet Union took the view that it was an essential resource in what might become a hot war.

Most of the former Soviet Union's ships are still around. Many of them are sitting in dock doing nothing. When we see the former Soviet Union and its economic plight, there is scope for considering an arrangement with countries in the former Soviet Union which have joined the partnership for peace under NATO to make their hulls available to western powers, if they need them, in order to provide resources to carry out international operations for the United Nations.

There has been some debate about the tri-service chaplains school. I am aware that the chaplains school which, at the moment, is at Amport near Andover, is already a combination of Royal Navy and RAF chaplains. Army chaplains, who are moving out of Bagshot park, will amalgamate with them. Several alternatives have been put forward for consideration, including Eltham, Guildford, the Royal Naval college at Greenwich and Amport house. Eltham and Guildford have now been eliminated from the contest, so it is a straightforward choice between Amport and the Royal Naval college at Greenwich.

Many rumours have been going around. The matter is local to my constituency, so I am concerned about the future of Amport house. Building consultants have looked at Amport house and considered how it could be extended to provide facilities for a tri-service chaplains school. I believe that the cost of the extension to Amport is about £600,000. One must compare that with the £15 million or more that would be involved if the tri-service chaplains school were to go to the Royal Naval college at Greenwich.

It is important also to consider the cost per student day. Amport has now succeeded in bringing down its costs from £79 to £73 per student day. If the amalgamation can go forward and there is a tri-service chaplains school at Amport, the cost could go down to about £56 per student day. That seems to be economical. It gives rise to two questions: first, which would be the best base for the tri-service chaplains school? Secondly, what should be done about the Royal Naval college at Greenwich? It is a very important listed building of great historic and architectural importance.

The time has come for my right hon. and learned Friend the Secretary of State for Defence to shed responsibility for historic buildings. We now have a Department of National Heritage. It should be a simple bookkeeping transaction to transfer those buildings into the responsibility of the Secretary of State for National Heritage. That would remove from the Ministry of Defence what could be a very burdensome liability in the future.

I applaud hon. Members' support for our Royal Navy and their calls for stability. That is what our armed forces and the country want. We may no longer be able to boast the biggest Navy in the world, but I am certain that hon. Members will agree that we can still say that we have the best Navy.

8.23 pm

Mr. Nick Raynsford (Greenwich)

I hope that the hon. Member for Romsey and Waterside (Mr. Colvin) will forgive me if I do not follow his wide-ranging comments on a variety of issues, although I will pick up some of his comments on the tri-service chaplaincy. I intend to focus narrowly on issues relating to the future of the Royal Naval college and the Joint Service Defence college, currently located in the historic former Royal hospital buildings in Greenwich.

In a previous debate—I think that it two years ago—I spoke about the Royal Naval college, and I paid tribute to its impressive record and excellent work. My view is shared by hon. Members, particularly those who are familiar with the college's work and have visited it.

In last year's defence costs study, the Secretary of State set out proposals for merging the existing separate service colleges into a new joint service command and staff college. That proposal, I believe, was widely agreed as a sensible response to changing needs for staff training that allowed economies to be made in current spending. There is no dispute about the recommended merger of the existing separate colleges into a combined tri-service college.

There is, however, a very serious question about the subsequent process of determining where the new tri-service college should be located. In the defence costs study, it was confirmed that a review was being conducted to determine whether the Army staff college site at Camberley or the Royal Naval college site in Greenwich would be the best location. On 8 December 1994, the Secretary of State announced the Government's decision in favour of Camberley, claiming that Camberley is by far the most appropriate and cost-effective site".—[Official Report, 8 December 1994; Vol. 251, c. 303.] The statement concluded that staff training at Bracknell and Greenwich should cease.

Following that announcement, I corresponded with the Secretary of State and the Minister of State for the Armed Forces, seeking further clarification of the basis on which the decision had been reached, in particular requesting sight of the relevant papers and costings. In reply, the Minister of State for the Armed Forces wrote to me on 22 December, promising early publication of a consultation document which will contain all relevant information including costings. The consultation paper was issued last month. On a superficial reading, the decision in favour of Camberley appears to be clearly justified on financial grounds. The table of comparative costs showed costings for Greenwich coming out at about £40 million more over a 10-year period, discounted to net present values. A more detailed analysis of the accompanying tables showed that the great bulk of that additional cost was accounted for by the capital costs of works to convert the existing buildings at Greenwich. Those tables showed the cost of capital works during 1995–96 to 2001–02 at more than £60 million, compared with costs of about £30 million at Camberley. They are broad figures because, in each case, there were two separate options for a different size of college.

The consultation paper did not demonstrate how those costs were made up, but it indicated that they were based on a report by the firm Building Design Partnership, which had been commissioned by the Ministry of Defence to conduct a study of the matter. I therefore asked that a copy of that report should be placed in the Library. The Minister, in his reply to me on 26 January, declined to do so on the grounds that the report contained information that was classified and that it comprised advice to Ministers.

I have to say that I was surprised by that response on two counts. First, the suggestion that a report on the conversion of 300-year-old historic buildings to provide lecture theatres, offices and residential accommodation constitutes a classifiable military secret seems to stretch the bounds of credibility rather far. Secondly, the refusal to make the information available on the ground that it constitutes advice to Ministers clearly flies in the face of the pledge that I had previously been given by the Minister of State for the Armed Forces, to which I have already referred, that all relevant information, including costings, would be made available.

Not surprisingly, I challenged the Minister on that, and, after further correspondence with him, he agreed on 10 February to release to me the executive summary of the Building Design Partnership's report. Although that was a welcome step in the right direction, it did not provide very much more information than was already in the public arena, and in particular it did not demonstrate how the various additional capital costs, which made the Greenwich option appear twice as expensive as Camberley, were made up. In his covering letter, the Minister of State for the Armed Forces commented: you are right to conclude that the principal reason for the difference in cost between the Greenwich and Camberley options is the need for significantly greater capital expenditure in the early years at Greenwich. This difference is almost entirely due to the fact that the Greenwich site is a Grade 1 listed building and scheduled Ancient Monument and the costs of meeting this substantially larger JSCSC requirement within the statutory constraints associated with that status not surprisingly are high. Were the Minister here, I would thank him for the care that he put into his lengthy letter, even if he did not provide the information that I requested. The letter continued by identifying specific issues, including difficulties of installing networked IT systems; the problems of floor loading (since the upper floors are of a wooden construction); Health and Safety and fire requirements arising from the change of use: and engineering services, in particular the need to double the output of the electoral supply system. All those points would appear entirely reasonable and plausible, but for the revelation towards the end of the letter that similar costings are unlikely to be applied in respect of the proposed alternative use of the historic buildings at Greenwich, which it is now suggested might house the defence school of languages, or possibly the tri-service chaplaincy.

Clearly there will be some differences in specification for different users, but if it transpires that the cost of adapting the grade 1 listed building at Greenwich to house the defence school of languages can be reduced substantially below the costings assumed necessary for the JSCSC, that raises automatically the question of whether similar economies might have been achieved in the JSCSC specifications.

Before leaving the issue of the suggested alternative uses for the Greenwich site, I have to say that I see no evidence that any financial provision has been made for the costs of transferring alternative Ministry of Defence uses to Greenwich. Unlike the site at Camberley, which could be disposed of if it is not used for the JSCSC, the historic buildings at Greenwich are held in trust by the Greenwich hospital estate, of which the Secretary of State is the sole trustee.

If the Greenwich site is no longer used as a naval or joint service college, the Secretary of State cannot just dispose of it, despite the suggestions of the hon. Member for Romsey and Waterside. The Secretary of State has a responsibility and he is clearly seeking to discharge that by trying to find an alternative use. No financial provision for that alternative use appears to have been included in the costs of the location of the JSCSC, either at Greenwich or at Camberley.

There is an element of doubt not only about whether the costs of the Greenwich option may have been unduly inflated, but about whether some additional costs which, of necessity, flow from a decision to locate the tri-service college at Camberley have been taken into account.

That is not the end of the story. The consultation paper recognises that if the army staff college site at Camberley were no longer required—that would presumably be so if Greenwich was the preferred option—it could be sold. Yet no allowance appears to have been included in the table of comparative costs for the disposal of the Camberley site.

In parliamentary questions to and correspondence with the Minister of State for the Armed Forces, I have sought further clarification of the point. You can imagine my surprise, Mr. Deputy Speaker, when I was told that the information could not be made available for reasons of commercial confidentiality. I am grateful that, on this occasion, the Minister did not try to pretend that the sale value of the Camberley site was a classifiable military secret. Nevertheless, his answer had exactly the same effect of denying the information.

Further correspondence and another parliamentary question established that of the 883 acres of MOD land at Camberley, 70 acres were solely occupied by the Army staff college. Inquiries to local estate agents have suggested that the current value of the land suitable for residential development in the Camberley area would be between £400,000 and £500,000 an acre. On that basis, a rough estimate of the potential value of the site would be somewhere between £28 million and £35 million.

The significance of the figures will not be lost on anyone looking carefully at the issue, for that is roughly the same sum as the difference between the costs of the building work at Greenwich and the building work at Camberley, according to the Building Design Partnership report and consultation paper.

From the information that I have been able to extract from a clearly secretive Ministry of Defence, I suspect that there is no allowance in the table of costings for the disposal of the Camberley site. I have written to the Minister on this, but I have not yet had a reply. In fairness to him, he has probably only received my letter within the last two days. If I am wrong on this matter, I shall happily withdraw my claim, and I hope that the Minister will tell the House whether such provision has been made and what the provision amounts to in total. However, if I am not wrong, it is clear that the figures on which we are invited to agree that Camberley is, in the words of the Secretary of State by far the most cost-effective option are a serious distortion of the respective costs of the two sites.

Unless the Minister is able to give a clear, categorical and specific assurance and the information that I am requesting, the only conclusion that we shall draw is that the figures set out in the consultation paper are highly misleading and do not accurately represent the respective costs of the Camberley and Greenwich options. The consultation paper should therefore be withdrawn and new costings prepared, taking account of the various elements which I have highlighted—savings on the conversion cost of the historic buildings at Greenwich, the additional costs of relocating other Ministry of Defence functions in Greenwich and the savings attributable to land sales at Camberley.

If the Ministry of Defence is not prepared to do that, it is only right that the Public Accounts Committee should look into the way in which the exercise has been undertaken and also the validity of the estimates being advanced by the Ministry of Defence.

Finally, I shall say a brief word about other elements in the consultation paper. It is not, I fear, only in respect of the figures that the odds have been stacked against Greenwich in this consultation exercise. The paper contains passages that reveal an inherent bias against Greenwich—for example, the section headed "Domestic Considerations", which states: Camberley is well served by local schools and medical care is easily accessible. Also the local community in Camberley and Surrey Heath is excellently placed to provide sponsorship to overseas students and their families, giving them a favourable view of Britain and the British way of life, and acting in concert with the college to help them overcome the difficulties of moving in and out. The shopping facilities in the Camberley area are excellent. Hon. Members must compare that with the tone of a paragraph in the same paper oil Greenwich, which states: Greenwich has good access to the facilities of London but is less well served locally. Historically the majority of staff and students at RNSC and JSC are unaccompanied by their families and so domestic considerations have played a lesser role in the development of the college than at Camberley". That is all. There is no reference to local schools or medical care, leaving the implication—no one has the guts to put it in writing, of course—that local schools and medical care are inferior. There is no reference to the shopping facilities in London, but I find it difficult to believe that they do not compare with Camberley.

There is no reference to the historical location and the exceptional cultural facilities in Greenwich and London. Nor is there a reference to the ability of the local community in Greenwich to make overseas students welcome. It says something about the sense of values of the person responsible for penning that paragraph that he or she clearly assumes that overseas visitors and their families will form a more favourable view of the British way of life in suburban Camberley than in historic Greenwich, where they would be studying in a complex of buildings designed by the greatest names in British architecture—Inigo Jones, Christopher Wren, Webb, Hawksmore and Vanbrugh—and eating their meals in a building as splendid as the Painted hall.

That blatant prejudice sadly distorts the consultation document, and is another reason why the recommendation should be reconsidered. The Royal Naval college and the Joint Service Defence college at Greenwich have, over the years, performed an outstanding service. The site they occupy is one of the jewels in Britain's crown. Greenwich deserves better than the shabby treatment it is being given by this biased and flawed consultation exercise.

8.38 pm

Mr. John Hutton (Barrow and Furness)

Debates in the House on the Royal Navy are always important occasions, and tonight's debate has been given special significance by some of the comments made by the Minister of State for Defence Procurement about the future of Britain's defence industries and the Government's newly emerging policy on defence procurement. The debates are also important because the Royal Navy is the senior service, and as a country, and as Members, we should pay tribute to the men and women who serve, and who have served, in the Royal Navy. We owe them an enormous debt.

A theme which has concerned me consistently during my time in the House is the way in which the Government handle the principle procurement issue within the Ministry of Defence.

There has been much discussion during the debate about the extent to which defence expenditure has been reduced, where the cuts have fallen and the resultant implications for our defence industrial base. I believe that the Government, in reducing defence expenditure, have hit systematically at procurement, which has therefore taken the brunt of the Government's reductions in defence spending. I am not sure that that is the best course of action to take. If our fighting forces are to retain their maximum capability, by definition they must also have the most effective equipment.

Between 1990, the year of the"Options for Change" review, and 1994–95, expenditure on sea equipment fell by more than expenditure on land and air equipment. In real terms, the decline in that period in purchasing new sea equipment was 27.5 per cent. In the same period, the defence budget increased in cash terms from £21,709 million in 1990–91 to £22.51 million in 1994–95, which, in real terms, represents a decrease of 17.4 per cent. Those are two interesting figures; the defence budget has fallen by 17.4 per cent. in that period but expenditure on new sea equipment has fallen by 27.5 per cent. If those figures come as a surprise to Ministers, let me tell them that the figures were produced by the House of Commons Library.

That is a significant issue, because we all understand, and we accept on both sides of the House, that in the post cold war climate there is a reduced need for defence expenditure. That is common ground between us. The way in which the Government manage that process of reduced defence expenditure causes concern, not only to me, but to my constituents who bear the brunt of those cuts in procurement. In my constituency, that has a special resonance because of our long association with the Royal Navy.

There is a disturbing trend in the way that the Government are handling the country's defence budget. I think especially that the bulk of that economy in terms of new equipment has affected the Royal Navy more than forces on land and in the air. I have a simple question to ask Ministers—"why?" Why have the Government chosen to inflict those economies on new sea equipment? What is the rationale for that? What is the defence justification?

In my constituency, the direct consequence of the Government's reduced expenditure on sea equipment is the loss of 8,000 jobs at VSEL with, I am sorry to say, the probability of even more job losses to come. It has also meant the end of apprentice training.

In my constituency, the Vickers shipyard has been the heart of the local economy ever since the town was established. For the hundreds of young men and women who have acquired valuable engineering skills in my constituency, that prospect has ended. There is no apprentice training, and there has been no recruitment since 1990–91. The consequence is catastrophic. VSEL used to recruit about 400 men and women to their apprentice training programme every year. I am no mathematician, but that means approaching 2,000 lost engineering apprentices in a community that is 40 miles from a motorway and more than 100 miles from any other approximate centre of population.

The hon. Member for Romsey and Waterside (Mr. Colvin) said that people can simply move to find work, but in this case they cannot. I know that the hon. Gentleman is about to leave the Chamber and I do not wish to embarrass him, but let me tell him that in my constituency it is almost impossible for a young couple, one of whom or both have lost their job at VSEL, to sell their home and move, because the housing market in Barrow-in-Furness has been in the doldrums for many years. There is a substantial problem of negative equity. It is extremely difficult for skilled workers in my constituency to move to find new jobs. That is not on the realistic agenda.

The probability of extra redundancies continues to hang over us. Many of the men and women who currently work in VSEL, and their families who depend on the wages that they earn, live constantly under the threat of their principal wage earner losing his or her job. That is unacceptable.

I contend that the Government have added to the burden of redundancy unnecessarily by delays in key procurement decisions. The principal example that I give to the House and Ministers is the decision to delay procurement of batch 2 Trafalgar class submarines. The Minister of State for Defence Procurement was gracious in allowing me to intervene on his opening speech, but if one examines the records of parliamentary proceedings on earlier occasions, one finds that in 1992 the following answer was given to a written question by the then Minister of State for Defence Procurement, now the Chief Secretary to the Treasury. He said: Studies into the design of a batch 2 Trafalgar class are in progress … we expect to invite tenders for design and build of the first submarine during the course of next year"—[Official Report, 21 May 1992; Vol. 208, c. 258.] That was 1994. It is now 1995. I understand, from what the Minister said today, that it no decision is likely to be made before summer 1996 to order any of those batch 2 Trafalgars. That is a delay of two and a half years. The Minister must understand the consequences that the delay has had, and will have, on employment at VSEL.

The Minister gave the House a possible explanation for the delay. Unless I am misquoting him, which I do not wish to do, the delay was due to the fact that the Government wanted to create competition for the batch 2 Trafalgars. We know what that means—the Government paying money to GEC to put together a rival bid to construct the batch 2 Trafalgars.

The Minister has admitted to the House, which he is right to do because it is correct, that only one shipyard in Britain is licensed to construct nuclear submarines—VSEL. What on earth have the Government been doing, spending what may be as much as £20 million constructing a bogus and fabricated competition for the new batch 2 Trafalgars? There is no doubt, in my opinion, that those submarines will be built at VSEL. I very much hope that that is so.

On the Trident programme, VSEL has an established record of producing value for money, and of producing vessels to quality, to standard and to time. The Trident contract is a perfect example of the ability of VSEL to produce high quality equipment that provides value for money for the taxpayer. I do not believe that that would have been any different with the contract for the batch 2 Trafalgars. So I am worried about the Government's policy on that issue and the way that they have handled the ordering of the batch 2 Trafalgars.

My final concern relates to the Government's stated policy, with which I agree, of maintaining 12 operational SSNs. I hope that the Minister is able to answer the following question: will the delays in ordering the batch 2 Trafalgars affect in any way the ability of the Royal Navy to maintain and deploy 12 operational SSNs? The programme for constructing the batch 2 Trafalgars is now two and a half years behind schedule, and that will necessarily, I understand, require the continued operation of now aging vessels for that extra two and a half years if we are to maintain an operational fleet of 12 SSNs. I am very worried about the way that the Government have mishandled the issue.

I am also worried about the length of time that the Government appear to spend on processing some of those tenders. I understand that the landing platform dock tenders, which will be submitted in March 1995, are expected to take as much as nine months to be assessed by the Ministry of Defence. Batch 2 tenders are likely to take at least 12 months to assess.

I fully appreciate, and am happy to concede, that the tender documents will be very technical and will require proper assessment to ensure, not only that the Navy obtains the equipment that it wants, but that the taxpayer obtains value for money. However, the longer that the Minister takes to assess those tenders, the greater the consequences that there might be for employment at VSEL. I hope that he will reconsider the length of time that he proposes to take to investigate the merits or otherwise of those tenders.

I also hope that the Minister might be able to say something to the House tonight, because other hon. Members have mentioned the subject, about what is happening to the Upholder class submarines that are currently in my constituency waiting for sale. What progress has been made on the sale of the Upholders? Are the Government in a position to say something more concrete about their future?

I am happy to support the Government in their decision to invite tenders for the replacements for HMS Fearless and HMS Intrepid. I support that completely and I hope that the Government will say that they intend to order two vessels to replace Fearless and Intrepid. From an operational point of view, if those amphibious ships are to be deployable, I imagine we would need a bare minimum of two, and I hope that the Government will confirm that that is their intention.

I want to say one or two words about the reductions in the Royal Naval Reserve and the decision to disband the Royal Navy Auxiliary Reserve. I am sure that the Minister is aware that a new organisation, the Maritime Voluntary Service, has been set up. It has recruited up to 1,500 volunteers in a uniformed, disciplined service to provide some continuity now that the RNR has been reduced and the RNAS has been disbanded. Because of those reductions, there is a danger that the nation could lose key maritime skills and traditions that are vital to the security of the nation and fulfilling our NATO commitments. The Government should be considering what steps they can take to encourage the retention of that maritime tradition. Ministers have a particular responsibility in that respect, given the continued popularity of the Sea Cadet Corps and the great difficulty that many of those who emerge from it at 18 will have in pursuing a career in the Royal Navy. Those people want to continue to develop their maritime skills so that they are available to the nation in times of emergency.

The Maritime Voluntary Service can provide a useful service to the nation and it deserves the support of the Ministry of Defence. I am interested to know what consideration the MOD has given or is giving to allowing that newly formed service the first option to buy some surplus craft, such as inland minesweepers and fleet tenders, which are now lying idle around the country. It would be a positive step if the Ministry could say that it planned to make those vessels available at a competitive and reasonable price, of course, for the taxpayer. I emphasise that that service is not asking for taxpayers' money to support its work, but it is looking for some sign from the Government that they are interested in retaining traditional maritime and naval skills.

The Minister of State for Defence Procurement mentioned important industrial defence issues to do with procurement and stabilising our industrial base. It is common knowledge that defence industries around the world are undergoing major structural change. The GEC—British Aerospace bid for VSEL is simply part of that wider process of change. I am glad that the Government have referred that bid to the Monopolies and Mergers Commission. I am particularly glad that one aspect of that reference includes consideration of the public interest in addition to the traditional concern about ensuring competition and avoiding monopolies. I hope that that reference and the MMC's report will include an assessment of employment prospects in our naval shipyards and what needs to be done by Government and industry in partnership to ensure the continuation of those vital engineering skills.

The bid for VSEL raises a number of important questions. First, it highlights the importance of export markets in terms of securing employment in the naval shipyards. We know that the MOD's budget is subject to continuing pressure and we also know that, quite simply, not enough of work is coming from the MOD to keep all the present naval shipyards fully employed up to their maximum capability. For that reason export markets are extremely important. I hope that their importance is also included in the Government's assessment of the defence industrial base.

The VSEL bid also calls into question the future of smaller defence companies. They will face particular difficulties in the future, because if the process is one of rationalisation, with large companies coming together to form bigger groups, where will that leave some of our smaller but highly proficient and technically expert defence contractors?

Another problem relates to competition and monopoly—a central issue that the MMC reference must address. There is not enough business coming out of the MOD to enable the Government to rely on competition alone as a mechanism to influence the structure and shape of the defence industry. There is not enough business to keep three yards fully occupied. Not long ago there were five naval shipyards, but, sadly, in the past two years we have lost Cammell Laird and Swan Hunter.

I agree with my hon. Friend the Member for Leeds, Central (Mr. Fatchett) that the possibility of greater European collaboration within the European Union must be considered. I would be interested to know whether the Government are currently considering amending article 223 of the treaty of Rome and proposing any changes in that regard at the intergovernmental conference in 1996. Are the Government considering a case for the creation of a single European market for defence goods? What would be its implications for the United Kingdom?

On the question of collaboration and greater co-operation between European defence contractors, will the Minister of State for the Armed Forces give us slightly more information than that offered by the Minister of State for Defence Procurement? The right hon. Gentleman referred specifically to the Government's belief that they need to retain a capability to build hulls. I asked him whether that involves the key operation of fitting out. With respect, I do not think that the right hon. Gentleman quite understood my question. Naval shipyards are not just places where hulls are built, but where equipment is installed and ships are finished, for example, by fitting engines, propulsion units and weapons systems. The right hon. Gentleman is well aware of that, but he did not say that the Government saw the need to protect fitting out as an operation conducted within the remnants of the United Kingdom's warship building industry.

In the light of what the right hon. Gentleman said, hulls could be completed in the United Kingdom but towed somewhere else to be fitted out with kit and equipment that may be British or foreign. It is important that, in order to retain the skills base in the naval shipyards, those fitting-out operations are also completed in the United Kingdom.

A large proportion of the equipment fitted in the type 23 frigates is not built in the United Kingdom. That fact was not at the heart of the question that I put to the Minister of State, but if we want to retain a hull-building capability in the United Kingdom—I strongly urge that we want to do that—are we also committed to retaining that technical ability to fit out and finish off those hulls and platforms? I strongly urge the Minister to make it clear that that is the Government's intention, because that key fitting-out operation is just as important in terms of retaining our shipbuilding capability as is the ability to complete a steel hull.

I hope that once the MMC report on VSEL is published there will be an opportunity for right hon. and hon. Members to discuss its implications. It has always been my contention that the issues raised by the VSEL takeover go far beyond the future of the Barrow and Furness economy. They affect the whole structure, size and location of the British defence industry. That issue is critical to the future of the Royal Navy and our armed services in general.

8.56 pm

Mr. Andrew F. Bennett (Denton and Reddish)

I am pleased to have the opportunity to contribute to the debate. In common with other hon. Members, I should like to begin by paying tribute to all those who serve in our armed services, particularly those in active service now in support of the United Nations. Since this is a debate on the Navy, I should like to pay particular tribute to those who are serving in the Royal Navy.

I should also like to pay tribute to my hon. Friend the Member for Leeds, Central (Mr. Fatchett) on his thoughtful opening speech. I welcome him to his new role on our Front Bench. I should also like to thank the Government Whips, because, in the past, I have sat through many other debates on services and been called right at the end only to see the Government Whips pull in Conservative Back Benchers to speak who had not sat through those debates. I appreciate the fact that the Government Whips have not done that on this occasion. In the 20 years in which I have served in the House it is interesting to note how support for debates on the services has steadily declined within the Conservative party. There was a time when it was extremely difficult even for Conservative Members to get called.

The speech by the Minister of State for Defence Procurement was also extremely helpful. I do not blame him for drawing attention to the difference between the Opposition Front Bench and people like myself. I am certainly not ashamed of my position as someone who has always supported unilateral nuclear disarmament and I shall continue to do so. I have no need to wear a badge as I have always supported those views. If they were right at the height of the cold war they are still right.

What disappointed me was the Minister's reluctance to accept that there is common ground between the Government, the Opposition Front Bench and people like myself. We are all committed to getting rid of Trident; we disagree on the method not the desire. It is important for the House to stress just how expensive the Triclent system is, the £30 billion in expenses that are likely to be involved and the unimaginable horror that would result if the weapons were ever used or if they were involved in an accident. Even if the weapons were never used, considerable environmental problems would be involved in getting rid of the ships and the weapons.

I had hoped that the Minister would spend some time telling us how the Government envisage the removal of the weapons systems. In particular, I would have liked him to tell us what progress is being made in the preparations for the non-proliferation treaty discussions and to give the House the assurance that they have always been reluctant to give—that Britain is not in breach of the current non-proliferation treaty by the introduction of Trident and the number of weaponheads that may be involved, and that it will not make the negotiation of the new treaty that much more difficult. I was disappointed that we did not hear it from the Minister of State for Defence Procurement; perhaps we will hear something from the Minister of State for the Armed Forces when he replies to the debate.

What progress is being made on getting a complete test ban on nuclear weapons? The Government have reluctantly accepted that we can do all the testing that we want with simulation rather than actual tests, but there is still a question mark over what the Chinese do. If the Chinese test, the Americans may test and that will lead to the issue of whether we do. It would be helpful to hear more about the Government's views.

As the whole idea was that Trident would be a deterrent, there should be more transparency about the Government's proposals and their policy towards it. If it really is a deterrent, the more we tell people about it the more likely it is to deter.

The hon. Member for Upminster (Mr. Bonsor), the Chairman of the Select Committee, pointed out the continuing military capability of the former Soviet Union. What are the Government doing about that? There must be fear in people's minds that a changing regime within the former Soviet Union might return to a rather more warlike and aggressive stance. How far are the British Government helping to scale down the military industrial complexes within the former Soviet Union? Only if they can be scaled down and their resources reallocated to consumer production—the sooner that happens, the better—will there be less likelihood of a new threat developing from that part of the world.

Therefore, it is very important that when we discuss arms conversion, we do not limit our debate to the United Kingdom and western Europe, but explore what can be done to aid arms conversion within the former Soviet Union.

We have also to examine other threats. Conservative Members talked about the threats from fundamentalists and terrorist groups. The theory of deterrence does not work when we face a threat from those groups of people. It is important that we rethink how we are going to deal with such threats. In respect of both the fundamentalists and the terrorist groups, it is essential throughout the world to ensure that nuclear materials are not readily available. I fear that some of those groups may not be deterred—if deterrents have ever worked against anyone—by the threat of us having nuclear weapons, that may even spur them on to action.

I had hoped that the Minister could have said a little about what we are doing to prepare for the decommissioning of nuclear-powered submarines that already have been laid up and the Polaris submarines and their nuclear fuels. The United States and the former Soviet Union have increasing numbers of nuclear-powered submarines rusting away in various coastal inlets. Their disposal will create problems. When we are talking about creating jobs, any country that can come up with the technology to become involved in decommissioning nuclear submarines has good prospects for some excellent jobs in the future, not only providing employment opportunities but making an important environmental contribution.

I turn briefly to the question of the diversification of defence industries. The Minister said that we could not expect the Government to provide subsidies for arms conversion. However, the Government have provided subsidies for most of our defence contractors over the years in the form of defence research and development work. I suggest that the Government continue that research and development, but at the same time encourage some of our military contractors to look at civil uses for their equipment.

If we are not careful, any chance of competition for military contracts will decline steadily and it will cost far more money to purchase goods and equipment from a single supplier. It would be a better use of taxpayers' money to encourage the existing suppliers to diversify their operations and give them an alternative base.

The alternative—which the Government seem to be very keen on—is to encourage our defence contractors to sell military equipment to any country in the world. I believe that that is a very dangerous policy. Time after time we have sold defence equipment to allegedly safe, favourable regimes which, five or six years later, have changed totally and, in some instances, have become extremely hostile to this country.

I do not believe that we should try to subsidise and maintain defence contractors in this country through a policy of selling military equipment to any country in the world which is not acting aggressively towards us at that time. It would be far better to spend a small amount of money to ensure that defence contractors can develop alternative, peaceful uses for their factories and their skilled workforce. Factories could then have a military production line as well as an economically viable civil production line. That would be better than pushing defence contractors out of business, or forcing them to sell military equipment to undesirable countries.

I hope that the Minister who replies to the debate will tell us what progress the Government have made with regard to the nuclear non-proliferation treaty. Will he inform the House when the Government hope that the Soviet Union will move to reduce its capability for producing all sorts of ships, many of which have nuclear capability? Will he explain what the Government are doing about decommissioning the existing nuclear-powered submarines in this country? I also seek the Minister's assurance that the Government will look more carefully at the countries to which they encourage British arms manufacturers to sell weapons, because we may be storing up problems for the future.

Mr. Deputy Speaker

I call Dr. Reid.

Mr. Soames

Hear, hear.

9.7 pm

Dr. John Reid (Motherwell, North)

Thank you, Mr. Deputy Speaker—and thank you for the groans of support from the Government Front Bench. In a wide-ranging debate such as this it is obviously impossible to address all the points that have been made—although I am sure that the Minister of State for the Armed Forces will do his best in his wind-up speech.

My hon. Friend the Member for Thurrock (Mr. Mackinlay) raised a specific point about HMS Caroline being retained in the north of Ireland. Having consulted my colleagues, I can assure him that a future Labour Government will be well disposed toward that matter.

The hon. Member for Upminster (Sir N. Bonsor) made his usual formidable contribution to the debate. I usually quote him at great length when criticising the Government, but in his speech today he challenged our commitment to the defence review, as did the hon. and learned Member for Fife, North-East (Mr. Campbell). I will return to that point later.

The contributions of my hon. Friends the Members for Dunfermline, West (Ms Squire) and for Plymouth, Devonport (Mr. Jamieson), as well as the hon. Member for Birmingham, Hall Green (Mr. Hargreaves), were spiced with the knowledge and experience that they gained through the armed forces parliamentary scheme. However uncomfortable that experience may make the Government of the day—I am sure that it will happen to us when we are in Government—it is a worthy scheme. In the decades following the end of conscription, fewer Members of the House have had experience of or personal contact with the armed forces. I know that the scheme is widely supported.

The hon. Member for Hall Green emphasised the importance of our carriers. I think that he was one of only two people to raise that matter tonight and he was correct to do so. I hope that the Minister will have something to say on it. He also mentioned amphibiosity, and I concur with the views that he expressed. If I heard him correctly, however, he referred to a "subtle escalation" in nuclear war. I know that there may be nuances of difference between on us on that subject, but did he really say that?

Mr. Hargreaves

The hon. Gentleman misheard me. I think that I was suggesting that submarines could be used for the subtle escalation or projection of force. That would be in conventional terms, of course, rather than nuclear.

Dr. Reid

I am greatly reassured by that comment.

A number of hon. Members raised an important issue—the ratio of shore leave to time spent at sea—which I shall deal with briefly. That does not mean to say that I deem it to be less important than other issues. During debates on the Army, it is common for us to raise the subject of the time between roulement battalions—I suppose that this is the parallel in the Navy. I know that the Minister will be concerned about it. Perhaps he will assure us that, as the downsizing feeds through and the world position changes, and our Northern Ireland commitments diminish, the problem will ease. Hon. Members on both sides of the House are concerned because the material condition and welfare of our troops is essential. It is a good thing in itself and is a vital component of morale.

The hon. and learned Member for Fife, North-East, who challenged the defence review, did so in a sustained and intellectually coherent fashion, which we found refreshing, as it has often been dismissed over the years by Conservative Members, without any real basis of intellectual argument against it. I listened carefully, as did my colleagues, to what he said. There is, perhaps, much wider agreement than at first appears—certainly with the first two of his points—on the relationship between defence and foreign affairs and the nature of matching resources and commitments. Indeed, were they not official spokesmen, both Ministers would agree with those points. I take it that he is arguing that a review was right all along and that the Government have got it wrong all along. But having got it wrong and imposed all the burdens on the services, for God's sake do not impose yet another burden. He can be assured that we are aware of that difficulty and will take it into account in our own thinking.

The hon. Member for Plymouth, Sutton (Mr. Streeter) spoke of the anxiety and the reality of job losses in Plymouth and Devon and the sensitivity of the Minister of State for the Armed Forces when dealing with sackings. There was, of course—we all want to forget—a long and rather unedifying discussion on membership of the Campaign for Nuclear Disarmament. I am of the opinion that if everyone in the House who is accused of CND membership was actually in CND at one time, its coffers would have been swollen well beyond what they were.

One hopes that if the hon. Gentleman ever joins the armed forces parliamentary scheme again, his target practice will be slightly more successful than it was tonight, because when—at around dinner time—only five or six Labour Members were present, he picked two who, supposedly, were in CND, and was wrong on both occasions. If in one's previous political incarnation in the SDP one has stood on the same platform with CND representatives, and proudly displayed it in one's election leaflet, one should not, when one later becomes a Tory Member of Parliament, stand up and accuse Labour Members of being in CND, when they were not in the first place.

My hon. Friend the Member for Devonport gave a pretty damning indictment of the Government's policy on personnel, housing and education. No doubt the Minister will wish to reply.

The hon. Member for Romsey and Waterside (Mr. Colvin) made pertinent points on the defence industrial base and the size of the merchant navy.

I was increasingly convinced by the defence of Greenwich advanced by my hon. Friend the Member for Greenwich (Mr. Raynsford). I hope that the Minister was listening as carefully as I was. He suggested the existence of huge and significant omissions from the consultation document which must put its validity and objectivity in question.

As usual, my hon. Friend the Member for Barrow and Furness (Mr. Hutton), who attends nearly all our defence debates, delivered insights into procurement management and enlightening statistics relating to naval expenditure. My hon. Friend the Member for Denton and Reddish (Mr. Bennett) again raised the general subject of the Government's approach to the nuclear non-proliferation treaty, targeting his points successfully. He also pointed out—and it is worth noting—that very few Tory Members have been present for the debate.

This must be the first occasion in living memory on which the Conservative party has run out of speakers during a defence debate, and it demonstrates beyond doubt that the defence argument is being won by the Labour party—a party whose defence stance is confident and assured. That contrasts with the performance of the Minister. As we know, the Minister of State for the Armed Forces approaches the Dispatch Box in a timid, faltering and directionless way, scratching around for solutions.

What do we ask from a debate such as this? We normally seek elucidation, enlightenment and education; that is the nature of our parliamentary exchanges, is it not? What have we learnt from today's debate? We have learnt about a number of interesting minor details: I was amazed to learn, for instance, of the emphasis that the MOD apparently places on subsidies for foxhunting. It seems that foxhunting adds immeasurably to the tactical judgment of sailors in particular. I look forward to studying the underlying reasons when my party is in government.

We also learnt that the vast majority of soldiers, sailors and airmen have experienced a cut of over 15 per cent in their salaries and remuneration since the Conservatives came to power in 1979. Having drawn attention to that, we were accused of stirring up subversion in the armed forces. Apparently, it is now a treasonable offence to point out to a soldier, sailor or airman that the Tories have cut the amount of money that he receives. Not only hanging but drawing and quartering is the fate that awaits those who commit the even more treasonable offence of pointing out that, during the same period, admirals, commodores, brigadiers and generals have been given a 17 per cent. pay increase. Of course, those who will decide the matter are members of the armed forces, who will make their opinion known in the secrecy of the ballot box.

We learnt that during the periods since the war when Labour has been in government a higher percentage of gross domestic product has been spent on defence than under the Tories: 6.4 per cent. per annum, rather than 5.8 per cent. Those are interesting statistics, given the Conservatives' record in maligning our position on defence.

We also heard again something that we had heard only 24 hours ago. Yesterday, for the first time in years, we heard an admission—from the Minister of State for Defence Procurement—that what we have said for the past four years is true: that in the decade between 1985 and 1995 the defence budget has fallen by 25 per cent. in real terms. It has been—I quote the Minister— a much sharper fall in recent years for the support services."— [Official Report, 15 February 1995; Vol. 254, c. 960.] The Minister may think that that is not the first time that the fall in the budget has been admitted publicly. I cannot expect him to know this, because he has not been around for the past four or five years, but some of us were accused of misleading the House by suggesting that a 25 per cent. cut was scheduled in that decade's budget.

Naturally, we fully expect the Treasury to seek financial solace from the Ministry of Defence, particularly in the aftermath of the cold war. Our charge against the Government is not that they have slashed defence expenditure; it is the simple but damning charge that, in the course of those reductions, they have proceeded without strategy or coherence; have cut, are cutting and will continue to cut in a piecemeal fashion; and, in the course of cutting, they wasted finances, squandered skills and thrown away equipment. In so doing, they have undermined both capability and morale in our armed forces.

No wonder a recent paper from the Institute for European Defence and Strategic Studies concluded: Far from being able to claim that 'defence is safe in our hands', the Conservatives must hope that defence will not be an issue at the next election. Trying to make a virtue out of a necessity, the Government claim that the big upheavals are over and imply that the cuts have finished.

Mr. Colvin

To demonstrate the invalidity of what the hon. Gentleman has just said, may I point out that, first, the United States of America, which is accepted as being the most powerful country in the world in terms of defence, has cut its defence expenditure far more strictly than this country, with reductions of some 40 per cent. Secondly, it is responsible to cut the teeth first, to the extent required for our commitments, and only then deal with the tail. That is why recent reductions in support services have been of a higher percentage than front-line reductions, which is precisely what "Front Line First" is all about.

Dr. Reid

Two points arise from what the hon. Gentleman says. First, people should be careful before accusing others of wanting to cut defence and not being patriotic. I do not say that the hon. Gentleman does that, but it has become a habit among Tory Members. The present Ministers are too courteous to do so, but on one occasion I was accused of being almost treasonable, so I pointed out that those who had betrayed this country, whether in our intelligence services or armed services, up to and including Lord Haw-Haw, did not have the same background as my comrades. We question no one's patriotism or commitment to defence.

Mr. Colvin

Nor do I.

Dr. Reid

I know, but some of the hon. Gentleman's colleagues occasionally do. When it comes to testing the statistics, whether they are on wages, expenditure or on a historical basis, people should be careful. Who formed NATO? Ernie Bevin was not a leading member of the Conservative party. I said that we do not attack Ministers just because they cut defence expenditure. I gave a list of how they have cut defence expenditure and said why they should fear that when they face the electors.

We have now been told that the big upheavals are over. In the previous debate on this matter, we asked the Secretary of State to confirm that no more cuts would be made, but he would not do so. We asked whether more changes would be made, but no Minister will say that no more changes will be made because cuts are already in the system and the world is changing. So the Government should not make a meal of saying that there will be no more big upheavals.

The Minister of State for Defence Procurement was on BSkyB television last week and said that he expected a surface fleet of fewer than 35. If he is now prepared to guarantee that 35 is the minimum beneath which we shall not go in the foreseeable future, we shall accept that.

Mr. Freeman

I made it plain in my opening statement that the Government's policy on the escort ships is clear. For the foreseeable future, we plan to have 35. On the interview to which the hon. Gentleman refers, perhaps he will do me the justice of watching the entire programme, although I cannot guarantee that all my remarks have been included in it. No one can guarantee that. I implied that the number of platforms is not the sole determinant of defence capability; equipment on the ships and aircraft are also determinants. That point may have been slightly too complicated and sophisticated for the programme, but that point differs from my clear commitment about the number of escort vessels.

Dr. Reid

That was a more courteous end to the sentence than I had expected at one stage. I have not seen the whole programme because the television station would not give me all of it. I do not think that it has been broadcast yet. I saw and studied only the section that was on the news. I did not claim that the Minister said that the number would be below 35, but we did worry. He has cleared that matter up and we accept it, but he will understand why we have such misgivings.

In the past, when faced with demands for assurances, Ministers have always been what Churchill called—if I may quote other hon. Members' family members—"resolute in their equivocation." The role being played in this matter by the former Minister of State for Defence Procurement worries me. I am not sure that he has gone that far away in his new job as the Chief Secretary to the Treasury.

When Churchill was put into an eminent position in a period of dark crisis for this country, Royal Navy ships were signalled with the brief telegram, "Winston is back." I doubt whether a telegram is being signalled around all the ships saying, "Jonathan has gone for good", because I suspect that Jonathan is taking a closer interest in the matter than it appears.

It is not just that cuts are being made; they are being made in a non-strategic fashion. There are three examples of that: Rosyth, the Upholders and the merchant navy, all of which have been mentioned. Strategically, the closure of Rosyth assumes that we will never again require substantial naval operations in the water to the north of the country. Is that a wise decision? Operationally, it undermines our primary obligation to defend our home waters by minehunters, minesweepers and offshore patrol vessels. It also undermines our ability to protect our oil, gas and fishery resources.

The Select Committee on Defence referred to the danger of blind cuts imposed by the Treasury axe". When it comes to cuts, there is a mad axeman there who knows where the bodies are hidden.

Mr. Freeman

There is a distinction between the fleet's operations in the north-eastern approaches, and the facilities required to support the minesweepers and minehunters. There will still be facilities at Rosyth to support, in certain circumstances, those vessels. The hon. Gentleman is wrong to confuse those two issues.

Dr. Reid

Unfortunately, I cannot give way on every point, although I appreciate that a dialogue might be enlightening for all of us. The second example is the classic case of the Upholder. I will not go through all the details of the Upholder saga, which were mentioned earlier, but I wonder if the Ministers have thought over the history of the matter. The Upholder design contract was awarded in 1980. The first building contract was placed in 1983. The remaining three were contracted in 1986. The final boat went into service in mid-June 1993. The decision was made to take them out of commission at the beginning of July 1993.

Do Ministers realise what that means? It took 13 years to put Upholder in the water and 13 days to sink it. That is an incredible comparison, quite apart from the money involved. Thirteen years were spent getting a new submarine in the water and, within roughly 13 days of the final boat going in, a decision was made to decommission. That is a classic example of planning and procurement shambles in the MOD.

Merchant navy tonnage has fallen to one third of the tonnage that it inherited, with its strategic, industrial and political importance to this country. That is a fall of enormous magnitude. It is no good Ministers telling us that they are keeping their eye on it. I had to use this example once before. I am always suspicious of Ministers who tell us that they are keeping their eye on things because, as a very young lad, I had to watch a Scottish goalkeeper called Frank Haffey at Hampden Park keeping his eye on the ball, but Scotland lost 9–3. The fact that his eye was on the ball was of no benefit because the ball kept passing him. Could we have some action?

The Government have no coherent defence and industrial policy. The state of our amphibious capability should be a particular cause for concern. Perhaps the Minister can reassure me about the worrying case of Intrepid, which, as far as I am aware, still lies in dock, is unable to put to sea, and has been stripped of spares to keep other ageing assault ships going. It is in a state of extended readiness. Where I come from we used to call that mothballed. What we used to call cuts is now downsizing. We have been told that there will definitely be an order for two replacement ships. However, when announcing that order, the Minister said that the Government would order, "up to two". That must be the epitome of equivocation. How can there be any doubt about the numbers one or two? Perhaps it includes none. Apparently, in the euphemisms employed by the Ministry of Defence, that has now been changed to ordering "one (plus one)". Is the Minister having two, one or none?

I will not go on at great length about the Government's response to waste. However, I want to put one thing on the record. I do not intend to be offensive to anyone personally, but it should be a matter of honour in the House that when wastage is on such a massive scale, running into hundreds of millions of pounds, and is serious enough for Ministers to demand the resignation of a public servant—a serving officer—surely it should be serious enough for one of the Ministers or the Secretary of State to resign. How is it that in a Cabinet full of people who have brassnecked their way through scandal after scandal without resignation entering their mind, suddenly a scapegoat is found and a demand for resignation is levied against someone who, at this stage, cannot answer for himself?

I have already mentioned the increase in salaries for the other ranks as compared with that for the top brass. We have no objection to anyone in the armed forces receiving a salary, remuneration, back-up, education or housing that befits the sacrifices and risks that those personnel take. However, at a time of constraint, when morale is being tested and when sailors are being asked to spend longer periods away from home, we do object to a settlement that increases the top salaries by 17 per cent. and decreases the bottom salaries by 15 per cent. We make no apology for our objection to that.

As we approach the extension conference of the nuclear non-proliferation treaty, the Government's record has hardly been calculated to convince others of the wisdom of an unconditional extension. We have warned the Government about that continually. They have refused to limit the number of warheads on Trident, they have stood out against a moratorium on nuclear testing and they had to be dragged away from the development of a new sub-strategic nuclear system—TASM, the tactical air-to—surface missile. They have constantly refused even to consider a policy of no first use of nuclear weapons. Is it any wonder that there is now such resistance among non—nuclear states to an unconditional extension of the non—proliferation treaty? Can the Government tell us what they will do if they become the victims of their own behaviour and the non-nuclear states refuse to endorse the treaty?

This year, we set the Royal Navy the tasks which, in essence, have changed very little over past decades or even centuries. It has the task of safeguarding our home shores and mainland. We have asked it to fulfil a vital contribution to our allied effort and to represent our interests abroad, in war and peace. This year, as ever, our Royal Navy has responded with the discipline, dedication and professionalism that we have come to respect and to expect from the senior service.

The Opposition join others in the House in recording our gratitude to the men and women of the Royal Navy. That includes those involved in the protection of our territorial waters and fisheries, those in the national carrier task group, the ships of Operation Maritime Guard in the Adriatic and the Sea Kings at Split, all of which stand ready to provide close air support, casualty evacuation and additional assistance to our ground troops in Bosnia. It also includes those in the Armilla patrol in the Gulf who, for a decade and a half, have protected peaceful commerce in that region, and the men and women who serve our country, whether on shore and at home or abroad, in the warm waters of the Mediterranean or the icy flows of the south Atlantic. Tonight we signal our appreciation and our debt to them all. We firmly believe that their professionalism, commitment and dedication deserve a better Government than they have at present, and we pledge ourselves to ensure that they have such a Government in the not too distant future.

9.34 pm

The Minister of State for the Armed Forces (Mr. Nicholas Soames)

That was, as usual, a tidy and polished speech by the hon. Member for Motherwell, North (Dr. Reid) who seemed to be getting a little ahead of himself by regarding these Benches with goggle eyes. We shall do our very best to fight him off.

I hope to deal with most of the issues raised today but any specialist points relating to procurement will be dealt with separately by way of a letter from my right hon. Friend the Minister of State for Defence Procurement. I therefore hope that the House will indulge me if I deal only with the more general issues.

Clearly, this debate has been interesting and important, as such debates always are. I share the disappointment expressed by the hon. Member for Motherwell, North that so few hon. Members have come to debate a matter of extreme importance to the interests of the United Kingdom and of our services. Before I embark on the substance of my speech, I, too, pay a warm tribute to the men and women of the Royal Navy as they continue to play a crucial role in the defence of the United Kingdom. It is a great privilege to be Minister of State for the Armed Forces and have the opportunity to deal for a time with such admirable people.

My right hon. Friend the Minister of State outlined some of the important operations in which the Royal Navy has taken part in the past 12 months. The hon. Member for Motherwell, North paid a handsome tribute to the Navy's extensive operational role. In addition to its operations in the Adriatic and its contribution to the international task group off Somalia, the Royal Navy continues to operate vessels all over the globe. As we have been debating here tonight, in the south Atlantic HMS Dumbarton Castle is returning from a deployment to the Falkland Islands while HMS Endurance, the ice patrol ship, is on her annual deployment to the Antarctic—rather her than me. HMS Marlborough is making her way to the South Atlantic and, far out underneath the oceans, 24 hours a day, seven days a week, 365 days a year, the independent strategic deterrent patrol, is on guard for the life of Britain.

In warmer climes, the current West Indies guardship, Broadsword, and her tanker, the Royal Fleet Auxiliary Brambleleaf, represent our interests in the security and stability of the independent territories in the Caribbean. As my right hon. Friend rightly said, they regularly take part in anti-drugs operations in support of civilian authorities and seize the drugs that are increasingly bound for Europe.

In the far east, the Hong Kong patrol craft continue their duties to patrol the waters of the colony and support the civil authorities in very difficult anti-smuggling operations in which they demonstrate exceptional courage and skill. HMS Liverpool is also in the region, having just completed a visit to Malaysia, and is on her way to India.

As some hon. Members said, closer to home several Royal Marine units are in Norway for winter training and have this week participated in a major exercise in the Norwegian sea. They are being supported by several ships, including the assault ship HMS Fearless. Next week, all those units will move on to participate in NATO's major exercise, Strong Resolve. It is a large amphibious exercise, also in the Norwegian sea, and one that I very much look forward to visiting.

While on the subject of the Royal Marines, I am delighted to be able to say that Brigadier Thomson and General Le Pichon, the commanding officers of 3 Commando Brigade Royal Marines and the French 9th Marine Infantry Division, have today signed an exchange of letters promoting closer links between the two formations. The letters identify a wide range of opportunities for co-operation, ranging from exchanges of personnel to observing and participating in exercises. That link between marine units represents a valuable and practical step in building closer links between France's armed forces and our own.

Coming closer to home and to an interest close to your heart, Madam Deputy Speaker, the Navy remains busy in home waters around the United Kingdom. Her Majesty's ships Anglesey, Guernsey, Lindisfarne, Cattistock and Shetland are all on fishery patrol tonight on duties around our coastline. A number of ships are undergoing their operational sea training—indeed, today they will have been fighting the Thursday war before deployment on operational tasks—and several others are undertaking trials. That is extremely demanding and important work. A major joint maritime exercise off the north coast of Scotland, involving numerous Royal Navy and Royal Fleet Auxiliary ships, alongside those of our NATO allies, completes tomorrow. Meanwhile, 42 Royal Marine commandos are on patrol duties in Northern Ireland.

Although by no means exhaustive, I hope that that list adds to the quick spin that my right hon. Friend gave of the Royal Navy's commitments. It justly claims to be and remains a worldwide, blue-water Navy, of whose achievements we may be truly and justly proud. We are privileged to have a force of dedicated, highly trained, skilled and well-motivated men and women to undertake such important roles and to maintain a state of high readiness in what is often a fast-changing scene.

In any fighting force, great care must be taken to protect the well-being of the uniformed people. The Royal Navy is keen to deploy its assets effectively to meet a wide range of commitments, but, in so doing, it is keen to ensure that reductions in uniformed strength should not place undue pressure on individuals through stretch. In praising their commitment I would not wish to overlook the contribution made by the civilians who support the modern Royal Navy. They perform an increasing variety of essential work, whether as industrials, stores officers, engineers, scientists or administrators, working in tandem with Royal Navy service men and women to maintain the Royal Navy's presence around the world.

I shall deal with some of the points made by hon. Members. I begin by welcoming the hon. Member for Leeds, Central (Mr. Fatchett) to the Opposition Front Bench in his first service debate. He did a pretty—well he did a job. Indeed, by the end of it, he convinced me, and I suspect that he successfully reinforced the views of all of us on the Conservative Benches and of most people in the country, that there is no field of politics in which the Labour party is less convincing than defence.

I suppose that the hon. Gentleman gained a good deal of experience of the services when he was a junior research assistant at the London School of Economics. None the less, he made a detailed speech into which he had obviously put a good deal of effort and I shall try to deal with some of the points that he raised. Clearly, he made a sensible and important point about matching resources to tasks, with which we all agree. The Royal Navy is busy. That is exactly what it is there for and that is just as it should be. It is true that it has borne this year a heavy operational load and everyone agrees that it has done so with remarkable success. It is trained and equipped to influence events in the interests of this country, to exercise control of the sea and to be able to project power from the sea. Those are the principal roles of the Royal Navy, of which we should not lose sight.

The hon. Member for Leeds, Central talked about the housing trust—a familiar hobbyhorse. He knows that we are setting up a new tri-service housing organisation to be known as the Defence Housing Executive, whose sole purpose is to manage and maintain better the married quarters estate on an integrated basis, rather than on single-service lines. We remain extremely confident that the Defence Housing Executive will make an important and significant contribution to improve management of service housing for the benefit of service families and taxpayers alike.

The hon. Gentleman made some criticisms of the chief executive, Mr. Robinson, who was recruited on a three-year, fixed-term appointment. It is certainly not Mr. Robinson's fault that the trust proposal did not succeed. On the contrary, he has done a very good job for us in reorganising our housing effort.

The hon. Member for Leeds, Central made some points about the services' pay. Indeed, we have seen a rush-job, cack-handed press release put out by the shadow Secretary of State for Defence. The House should know that since 1979, we have always implemented the recommendations of the Armed Forces Review Body. These recommendations and this body have the full confidence of the services. The hon. Gentleman is quite wrong to attack an independent body in that way.

The hon. Member for Leeds, Central went on to discuss the naval stores consultation, a matter also raised by my hon. Friend the Member for Upminster (Sir N. Bonsor), the Chairman of the Select Committee on Defence. As they know, the Government have responded to the Select Committee's report and have welcomed the Committee's qualified endorsement of our naval stores proposals. We consulted widely on those proposals with the work force and the local authorities. Decisions were not taken until all the representations had been received and thoroughly dealt with.

The hon. Member for Leeds, Central also mentioned the disposal of the Upholders. It was clearly a difficult decision, which was taken in the light of a changed strategic environment. Their primary task was to patrol the Greenland-Iceland-UK gap where their shorter endurance and slower speed compared with SSNs—strategic submarines nuclear—was not a disadvantage. The relative importance of this area of operations is declining. A greater requirement now is for flexible and mobile forces capable of responding to the more diverse range of tasks that we face world wide. The greater speed and endurance of the SSNs is better suited to the new security environment.

My right hon. the Minister of State for Defence Procurement set out the position on procurement in a full and detailed speech. The hon. Gentleman—

Dr. Reid

Will the Minister give way?

Mr. Soames

No, because I must get on. The hon. Member for Leeds, Central praised my right hon. Friend on his enlightened approach to procurement. Clearly, procurement is an important matter industrially and militarily within the United Kingdom. The hon. Gentleman also raised the question of a defence review. I tell him, as the hon. and learned Member for Fife, North-East (Mr. Campbell) rightly said, that nothing could be more calculated to damage and destroy the morale of the armed forces, for no good reason, than such a review. The Government will maintain balanced forces who are well equipped and well maintained.

I shall deal now with my hon. Friend the Member for Upminster. The House listened with respect to the powerful contribution by my hon. Friend, who has done a distinguished job as Chairman of the Select Committee. My right hon. and learned Friend the Secretary of State, my right hon. Friend the Minister of State and I noted with care his fears about Russia, about Islamic fundamentalism and its insidious spread and about the need to keep our defences in robust good shape. My hon. Friend speaks regularly and authoritatively.

My hon. Friend the Member for Upminster was pleased with the progress made in a number of our procurement projects. I share his pleasure at the announcement of the two assault ships which the hon. Member for Motherwell, North called into question. Clearly, there are two assault ships to be ordered and the landing platform helicopter HMS Ocean. I noted the points that my hon. Friend made about Manadon and the type 23 simulator. My right hon. Friend the Minister of State will let him have the details on that price. My hon. Friend congratulated my right hon. Friend on the way in which he is handling these complex procurement matters.

My hon. Friend made an important point about the Merchant Navy. I am pleased to have the opportunity to deal with that matter. The size of the merchant fleet has decreased, but studies by the Government have shown that despite that, there are generally still sufficient vessels on the British registers for defence purposes and that we would have no difficulty in manning chartered or requisitioned ships with British crews if that were necessary. We are not, however, complacent and we maintain a continuing dialogue with the Chamber of Shipping and the Department of Transport on manpower issues.

My hon. Friend also expressed concern about the impact of funding constraints on Royal Navy exercise programmes. I hope that I can reassure him that an appropriate level of training is an integral part of any ship's programme. Each year, such a programme is drawn up for each vessel, including ministerially approved operational tasks, other operational commitments and exercises, and is then funded accordingly.

The hon. Member for Dunfermline, West (Ms Squire) made a thoroughly thoughtful and interesting speech. I congratulate her whole-heartedly on what has obviously been her own admirable deployment with the armed forces parliamentary scheme and the Royal Navy. She has covered herself in glory. I am sure that the Navy will have greatly enjoyed showing her its splendid ships and people. I look forward to sharing her experience on a jackstay. I am not sure that they will not drop me in the middle, though.

I am very sorry, as my right hon. Friend will have been, to hear about Walter Strachan and about Lord Ewing. The House will wish to send them its best wishes.

The hon. Lady has been a doughty fighter and champion for her constituency interests. She dealt at length with Rosyth. As she knows, the decision was reached only after the fullest consideration of the many points that were raised during the most extensive consultations. In the final analysis, we did not accept that there would be any operational disadvantage arising from our proposals; on the contrary, there will be operational benefits.

Although we naturally regret the number of job losses, it is simply not possible to ignore the significant savings that will be available. There will continue to be 4,500 defence jobs in the Rosyth area. The dockyard will have a substantial allocation of ship refit work for some time to come. I wholly understand the hon. Lady's concern and anxiety—I will deal with the other points that she made by letter—relating to decommissioning submarines and how we will help the economic regeneration of the area.

The hon. Lady referred to my right hon. Friend's assurance on his recent visit to Rosyth that RD57 would not be used to store decommissioned nuclear submarines. Our policy in respect of those submarines continues to be that they will be stored safely afloat at the location where they are decommissioned. In regard to those at present stored at Rosyth, no decision has been made yet about their future storage. Should a decision be taken to move them at some point, there should be no difficulty in doing so.

The hon. Lady has had a bad week of it, I agree. I am sorry that she continues to receive the dreaded letters. I am sorry about Pitreavie, but the rationalisation of naval command, control, communications and intelligence facilities will generate savings of £22 million over the next 10 years. Again, they are substantial savings which, in the present climate, we could not possibly not take. We had to take them. No convincing rationale has been advanced that would justify forgoing them. I will be in touch with the hon. Lady in more detail on the rescue co-ordination centre.

My hon. Friend the Member for Birmingham, Hall Green (Mr. Hargreaves) made a thoroughly well-informed and detailed speech. Again, I am delighted to hear that he had such an excellent visit with the Royal Navy. Of course I shall pass on his thanks. I share his high opinion of those with whom he has been dealing. It is a great joy to deal with service people. Their can-do culture is a refreshing change from the rather banal world in which we live.

I noted my hon. Friend's views on aircraft carriers, and I shall certainly pass them on to my right hon. Friend. I wholly endorse his views. Early studies into a replacement for our current carriers are in hand. My hon. Friend was pleased with the order for the assault ships and the landing platform helicopter. I note his points about the joint rapid deployment force. He also mentioned a matter relating to the type 23 command system. If I may, I will let him have a letter on that matter.

I am delighted that my hon. Friend is pleased with the news about Tomahawk. As my right hon. and learned Friend the Secretary of State announced on 14 July, we are exploring the procurement of Tomahawk land attack missiles from the United States for fitment to our submarines, and we are grateful for a quick and helpful response from the United States Government. I wholly endorse my hon. Friend's assessment of the brilliance and great success of the Royal Navy and, above all, the fact that that service is in extremely good heart.

I hope that the hon. and learned Member for Fife, North-East will not be embarrassed when I say that he made a first-class speech. I found very little in what he said with which I could disagree. On stability, which he and I have discussed at great length, I refer him to an admirable remark made by the First Sea Lord the other day, that the storm has passed but the swell will be felt for some time. The hon. and learned Gentleman is right. As "Options for Change" continues, as the defence cost studies come to a conclusion and the changes go downstream, plainly there will be turbulence to come.

I wholly agree with the views which the hon. and learned Gentleman expressed in a thoroughly clear way about the defence review. He talked of the Bosnian lift, and he expressed the view—with which we would all agree—that a unilateral lift of the embargo would be a disaster. Plainly, if such an action were to take place we would find ourselves in an untenable position and we would have to withdraw. Everything has been done to try to ensure that that does not happen.

The hon. and learned Gentleman also remarked on the importance of Europe and of a future European security and defence identity. He will be reassured by the fact that, for the Government, NATO remains the bedrock of the UK's defence policy. For nearly half a century, we have chosen to organise our collective defence against major external threats through NATO, which is the only security organisation with the military means to back up its security guarantees. A good deal of work must be done in Europe, and it must enable us to retain our ability to respond in a flexible manner.

The hon. and learned Gentleman mentioned combined joint task forces, and plainly they will help to develop a European security and defence identity which is fully compatible with NATO. He spoke of the need for a balanced Navy and, in the judgment of my right hon. and learned Friend the Secretary of State and the service chiefs—particularly the First Sea Lord—we have an effective and balanced Navy which is adequately trained and equipped. I entirely agree with his view about the requirement to maintain absolutely our ability to fight at the very highest end of the spectrum. We are wholly and irrevocably committed to that.

The hon. and learned Gentleman welcomed the decision on Tomahawk. I acknowledge his views on Rosyth which he shares with the hon. Member for Dunfermline, West. I am sorry that that part of the world has had such a rough time. My right hon. and learned Friend has made the matter of allocation refits known to the hon. and learned Gentleman, and I again join him in paying tribute to the work of the Royal Navy.

My hon. Friend the Member for Plymouth, Sutton (Mr. Streeter) gave me notice that he had to do go down to his constituency tonight. I pay tribute to him for an excellent speech, and for the admirable work which he has done in representing to me and to all of my colleagues at the Ministry of Defence in a robust and vigorous manner the real concerns of his constituents. I acknowledge the difficulties which are being faced in the west country, and my hon. Friend was quite right to draw attention to the lamentable record of the Labour party on defence matters.

I noted with great sympathy my hon. Friend the Member for Sutton's calls for stability in Devon and Cornwall. I know of the anxieties about base-porting and assault ships, and I should like him to know that, following my visit to Plymouth, I have passed on the concerns to the First Sea Lord. I know that the Navy planners are looking at the matter.

I assure my hon. Friend and all those who represent the Plymouth area that, whatever happens at Chivenor, there will always be a substantial Royal Marines presence in Plymouth. I noted my hon. Friend's strictures about Bickleigh, which I visited the other day. It is an excellent camp which does need some work, and I will make sure that the matter is carefully considered.

The hon. Member for Plymouth, Devonport (Mr. Jamieson) made a breathtakingly trivial and ineffective speech. It was a ridiculous tirade which I am going to gloss over as it did not even dignify a serious reply.

My hon. Friend the Member for Romsey and Waterside (Mr. Colvin) dealt with a number of important points, including the questions of the EH101s and of the chaplains' school, which are receiving consideration.

I am sorry that the hon. Member for Greenwich (Mr. Raynsford) has found that our correspondence has been rather more prolonged than it should have been. I have noted the points he has made tonight, and I shall study his latest letter with the greatest care. I should be pleased if he would come in to have a talk to me about the letter. I wholly agree with his views on the beauty of Greenwich.

The hon. Member for Barrow and Furness (Mr. Hutton), as one would expect, made a thoroughly polished and sensible speech. He was, however, a little churlish about the Navy programme. One cannot possibly exclude Trident from the procurement programme, and by any stretch of the imagination, the programme has done extremely well. VSEL has done a marvellous job on Trident, and the Navy has a handsome procurement programme in the pipeline. I shall study the other points which he made about the reserves, and let him have a letter.

The hon. Member for Denton and Reddish (Mr. Bennett) made some important and significant points about the non-proliferation treaty. It is a sad loss for all of us that, even though he is still a member of CND, he fails any longer to wear his button. We do understand that, in these politically correct times, he must no longer wear the single battle honour or medal he is ever likely to win.

The hon. Member for Motherwell, North in, as usual, an excellent and sensible speech—except when he started being silly towards the end—endorsed almost everything that the Government believe about the need for a stable front line. I wish to tell the hon. Gentleman that the Government have made it absolutely plain that the major cuts in defence are over and finished; the front line is now safe and secure; we are delivering a stable front line, which will represent well-trained men and well-equipped ships. That is vital, because only with a stable front line can we build and plan for the future, for a Royal Navy that we can continue to be proud of and grateful for.

It has been an excellent debate. I congratulate almost everyone who has spoken, and I look forward to the Army debate next week.

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.