Procurement Projects (Hansard, 7 May 1996)

§ 6. Mr. Hutton
To ask the Secretary of State for Defence how many of his Department's major procurement projects have late in-service dates. [26924]

§ Mr. Arbuthnot
The Ministry of Defence's most recent annual major projects report to the Public Accounts Committee showed that, of the projects covered, 21 were reported as having late actual or planned in-service dates.

§ Mr. Hutton
Is it a fact that the last National Audit Office inquiry showed that 90 per cent. of major 6 procurement contracts had late in-service dates? Are not there significant delays in placing major new contracts, particularly in respect of the batch 2 Trafalgar class replacement programme? Why should defence industry workers pay the price of the Government's total and complete incompetence in managing the nation's procurement budget?

§ Mr. Arbuthnot
It is not a question of incompetence. There is a natural tendency towards delay in a large number of defence contracts. That is partly because trying to match the requirements of different countries to a collaborative project is extremely difficult, and partly the effect of increasing and speedily advancing new technology. Delay can actually bring benefits. If there is delay in acquiring a piece of equipment, it can mean a better piece of equipment, and sometimes one that is cheaper.
The greatest example of a UK technological project was the Trident system. The hon. Gentleman may agree, although I suggest that he has a word with some of his colleagues on the Opposition Benches, who might not share his views. The Trident system has been an 11-year project that has come in on time and under budget. It has provided a defence of this country beyond all proportion to the amount of money that we have spent on it.

§ Mr. Mans
Does my hon. Friend agree that the one way to ensure that all procurement projects do not meet their in-service dates is to carry out a full-scale defence review, as advocated by the Opposition? That would have a devastating effect on jobs in the defence industry, especially in my county of Lancashire, which depends so heavily on defence industries.

§ Mr. Arbuthnot
My hon. Friend is right. I have always believed that the Opposition want to carry out a major defence review because they lack the courage to say what they really want to do, which is to make deep defence cuts. We know that they want to do that. My hon. Friend raises the point that a defence review would mean that equipment procurement would come to a standstill, and that would be the effect of electing a party that we know we cannot trust on defence.