HC Deb 06 June 1995 vol 261 cc7-8
6. Mr. Milburn

To ask the Secretary of State for Defence what assessment he has made of the efficiency gains arising from the defence costs study process in his Department. (25097]

Mr. Rifkind

The defence costs study was a great success. We now estimate that the measures arising from or related to the DCS will result in annual savings in excess of £1 billion by the end of the decade.

Mr. Milburn

How can the Minister claim success in reducing inefficiency when his Department continues to waste public money hand over fist; for example, £2 billion overspent on the Eurofighter project; £800 million overspent on the Trident works programme and £7 billion wasted in total in the past two years? Is it not a national scandal that financial incompetence and mismanagement continue to be the order of the day in his Department when defence jobs and defence budgets are being cut?

Mr. Rifkind

If the Labour party wants to conduct a campaign on the basis of waste in the Ministry of Defence, it really should do its homework a little better than it has.

In the recent document published by the hon. Gentleman's friends, they claimed as a supreme example of Ministry of Defence waste the fact that the costs of the Challenger tank programme had increased by £920 million. They appeared to be unaware that the £920 million was the cost of the extra 259 Challenger 2 tanks that we announced some months ago, which were warmly welcomed by the Army.

Mr. Bill Walker

Does my right hon. and learned Friend agree that the savings that have been achieved are substantial, and that any large organisation —which is what the Ministry of Defence is —can always make savings and improve efficiency? However, would it be right to say that much of the saving has been achieved because of the reductions, and that if we are considering, as we may well in future, enlarging, for example, the volunteer reserves and the cadet force, it may be wise not to reduce their structures and command situations until the decisions on expansion, if any, are taken?

Mr. Rifkind

We have borne those considerations very much in mind in the decisions that we have announced with regard to the Territorial Army, the other reserve forces and the cadet forces, which are being maintained at their present levels. I can also tell my hon. Friend that what was unique about the "Front Line First" study was that we excluded, from the beginning of that consideration, any proposals the effect of which might be to reduce the operational effectiveness of our armed forces.