Defence Contracts (Hansard, 14 January 1997)

§ 7. Sir John Cope
To ask the Secretary of State for Defence how many British jobs are sustained by his Department's defence contracts; and if he will make a statement. [8977]

§ Mr. Arbuthnot
We estimate that in 1994–95—the latest year for which figures are available—my Department's contracts for equipment and other goods and services sustained some 270,000 jobs in the United Kingdom. We estimate that a further 90,000 United Kingdom jobs depended on defence exports.

§ Sir John Cope
My hon. Friend has just agreed that the defence base, and hence MOD contracts, is a necessary 122 pre-condition for arms exports. In providing the figures for those whose jobs are sustained by arms exports, will he bear it in mind that, in the last defence estimates debate, 21 Labour Members of Parliament called for a total ban on British arms exports?

§ Mr. Arbuthnot
I will indeed. An interesting letter has been received from the right hon. Member for Yeovil (Mr. Ashdown), who attacked the possibility of selling Westland Lynx helicopters to Indonesia. If he is prepared to do that to his constituency, I dread to think what he would do to the country.

§ Mr. Madden
As both India and Pakistan have nuclear capability and the long and unresolved conflict between the two countries over Kashmir makes the region one of the most exceptionally dangerous in the world, how does the Minister justify British sales to India of Hawk 100 aircraft, which clearly could, and probably will, be used to suppress the popular insurrection by the people of Kashmir in pursuit of their right to self-determination?

§ Mr. Arbuthnot
Article 51 of the United Nations charter gives every country the right to defend itself. We have very close relations with India and, fortunately, also with Pakistan. We shall do everything that we can to preserve the stability of those regions. We shall not try to undermine our defence industry—unlike the hon. Gentleman, who would clearly like to undermine it by preventing exports to countries that have been friendly to the United Kingdom for many years. I suggest that he has a word with his Front Bench about that, but unfortunately I fear that he represents the views of many Labour Members.

§ Mr. Mans
Does my hon. Friend agree that one way not to sustain jobs in the defence industry would be to carry out a defence review, which would delay procurement of much-needed weapons systems? Does he further agree that it is particularly worrying to workers in the defence industry in Lancashire that the Labour party has made no commitment whatever to exclude the Eurofighter project from its defence review, which means that it could be cancelled, or at the least the Royal Air Force would not get the number that it wants?

§ Mr. Arbuthnot
My hon. Friend puts his finger on a point of huge importance. The instability of a strategic defence review would undermine the certainty of our negotiations in the Eurofighter project and would be damaging not only to this country but to the entire European defence industry. If the Labour party were able to bring in a strategic defence review, that would undermine not only this country's defence industry but the aims of Europe to bring its industry together and to be able to compete properly to the world market. My hon. Friend makes an extremely important point.

§ Mr. Grocott
Is the Minister aware of the announcement made last Friday of 270 redundancies at GKN Defence in my constituency? That is 270 out of a total work force of 700. Those are skilled people who have given years of service to the defence needs of the country. Does he recall his letter to me of 13 December, in which he turned down a suggestion from GKN that it provide 87 armoured vehicles? If that contract had gone 123 ahead, it would have secured a number of important defence jobs. I do not expect an instant reply, but in the light of the redundancies that have occurred, I ask him to reconsider that decision, because he must appreciate that, if those skills are lost, they will be difficult, if not impossible, to replace.

§ Mr. Arbuthnot
I understand the points that the hon. Gentleman made and I considered the decision very carefully indeed because of those points. Obviously, we regret hugely any loss of defence jobs or other jobs, but it is true of any company that, in the long term, it has to match the number of its employees to its order books. The Warrior system that GKN proposed to us for early purchase has been hugely successful not only in this country but in Bosnia, the Gulf, Kuwait and around the world, but in the long term we decided that our requirement was not sufficiently well established to enable us to accept its very interesting and in many ways attractive proposal. GKN is an extremely successful company. We have seen recently an order from Qatar for Piranha vehicles. We know that there are plenty of prospects for other Warrior vehicles throughout the world, so let us not attempt in any way to undermine the possibility of GKN winning many other orders elsewhere.

§ Sir Anthony Grant
When coming to what I hope will be an early decision on the Tristar contract, will my hon. Friend bear in mind what I have repeatedly told him: that what is at risk is not merely jobs in Cambridgeshire but, for the nation, the remarkable expertise of the Marshalls company, which has been built up over many years?

§ Mr. Arbuthnot
My hon. Friend has, on many occasions, raised this competition with me. I shall certainly bear in mind the points that he makes when I come to a decision, which will be very soon.

§ Mr. Murphy
Contrary to what the hon. Member for Wyre (Mr. Mans) just said, does the Minister accept that it is the firm intention of the Labour Government to be elected later this year to be absolutely committed to Eurofighter? Secondly, instead of talking about Yeovil, will the Minister reflect on what my hon. Friend the Member for The Wrekin (Mr. Grocott) said: that nearly 300 highly skilled and well-paid jobs have been lost in my hon. Friend's constituency? Is the Minister telling the House that it is too late to stop this cruel blow to Shropshire, to the company and to a dedicated work force?

§ Mr. Arbuthnot
No, I am saying that a strategic defence review—the point with which the hon. Gentleman started—would undermine the stability of our defence industry. In addition, it would undermine our credibility in international negotiations over matters such as the multirole armoured vehicle, the Horizon frigate and crucially, at this important stage of the project, the Eurofighter. How can we have a strategic defence review—unless the hon. Gentleman is saying that he would exclude the Eurofighter from it, which would make it pretty meaningless—and continue to negotiate sensibly with countries that are partners in the Eurofighter project? The answer is that there cannot be such a review on that basis.

§ Mr. Atkins
Does my hon. Friend recognise the importance to jobs in Lancashire of British Aerospace, 124 Leyland Trucks, Rolls-Royce, Royal Ordnance and many other firms? Does he also recognise the enormous effort that is made by Lancashire Conservative Members to represent and fight for the interests of those companies? Is he aware that the electorate in Lancashire do not take kindly to Johnnies-come-lately jumping on bandwagons at short notice? My constituents still remember TSR2.

§ Mr. Arbuthnot
I acknowledge with gratitude and admiration the work that is done by Lancashire Conservative Members. When I was last in my right hon. Friend's constituency, he drew my attention to a number of competitions involving the defence industry. By contrast, he drew my attention to the approach of the hon. Member for Preston (Mrs. Wise) to the export of Hawk aircraft to Indonesia. My right hon. Friend is completely right. The Labour party wishes to be all things to all men. It wishes in some areas to encourage exports, but in reality it knows that it wants to destroy the British defence industry.