Commons Sitting of 27 October 1997

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
WRIT ISSUED DURING THE ADJOURNMENT
MADAM SPEAKER acquainted the House that she had issued, during the Adjournment, a warrant for a new writ for the borough constituency of Paisley, South in the room of Gordon McMaster, Esquire, deceased.
Oral Answers to Questions
  HOME DEPARTMENT
  The Secretary of State was asked—
  HOME DEPARTMENT

    Community Constables
    Mr. Healey: What plans he has to increase the presence of community constables on the streets; and if he will make a statement. [11655]
    The Secretary of State for the Home Department (Mr. Jack Straw): It is for individual chief constables and police authorities to determine the level of police presence on the streets in their area. The Government are working with the police to relieve them of unnecessary bureaucratic burdens, to allow chief constables to put more officers back on the beat. In the crime and disorder Bill, we shall give the police new powers to enable them to deal with street disorder.
    Mr. Healey: I thank my right hon. Friend for that answer, but does he agree that beat bobbies are often a unique source of local intelligence and play a special part in practical, preventive policing? Does he further agree that, although they are very highly valued by the people they serve, they are sometimes not as highly valued by the forces that employ them? What specific steps does he plan to reinforce the role of community police officers?
    Mr. Straw: I accept entirely what my hon. Friend says. His point about the value of police officers on the beat was emphasised by the Audit Commission's report last year and, indeed, by evidence from the Police Federation. We are making quite clear to all police authorities and chief constables the emphasis that we place on the importance of community police officers, and in the crime and disorder Bill we shall give police and local authorities greater powers to deal with disorder generally.
    Mrs. Laing: Will the Secretary of State join me in expressing the grief and sorrow of the House at the tragic
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    death of young WPC Nina Mackay, who lived in my constituency, and in sending her family the condolences of all hon. Members? Is the Secretary of State aware that the person charged with her murder was, at the time of the murder, out on bail? Given those circumstances, will he order a review of the conditions on which bail is granted by magistrates courts?
    Mr. Straw: I will indeed join the hon. Lady, who speaks for the whole House, in expressing our total revulsion at that vile crime against an unarmed WPC, Nina Mackay, who lived in the hon. Lady's constituency, my home town. That makes it all the more poignant for me. Of course I join the hon. Lady in that. The whole country is revolted by this crime against her family and against her whole community.
    The hon. Lady asked whether I will look at the availability of bail conditions to magistrates courts. I understand her point, but she will appreciate that, since a number of judicial and semi-judicial inquiries have to take place, it would not be appropriate for me to comment on that until those have been completed; when they are, I shall certainly bear very thoroughly in mind the points that she made.
    Mr. Sheerman: Does my right hon. Friend agree that we could transform the situation in the community if we made better use of the special constable? Is it not about time that we took special constables seriously, and paid them a proper amount to do the valuable job that they do in helping the community? Will my right hon. Friend note the experiment which has been such a success in my constituency in improving law keeping on the inner-urban estates?
    Mr. Straw: I entirely agree with my hon. Friend about the importance of special constables. I know that his view is shared throughout the House. It is an open question whether paying special constables would increase their number or availability, but of course we keep the matter under review.
    Mr. Maginnis: May I, on behalf of my party, associate myself with what has been said about the death of the young police constable? We are fully aware of the dangers that our police face in carrying out their duties.
    Is the Home Secretary not placing community constables at a disadvantage by expecting retailers—those who sell on the streets—to police the behaviour of young people, especially in connection with the sale of alcohol and cigarettes? Is it not time that he gave those retailers some statutory authority, for instance, by introducing identity cards, so that the community constable does not find himself at loggerheads with the retailer whom he is policing, unnecessarily and—it often seems to the retailer—unfairly?
    Mr. Straw: I am grateful to the hon. Gentleman for the first part of his question. No one knows better than someone who represents the north of Ireland the enormous danger in which police officers can be placed daily.
    As for the hon. Gentleman's second point, we accept that retailers experience a severe problem when trying to check the ages of people attempting to buy drink or

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    cigarettes. That is one of the reasons why we are supporting the proposals of the Portman Group, which wants "proof of age" cards to be introduced.

    Police Constables
    Sir Geoffrey Johnson Smith: How many additional police constables were recruited in the year to April 1997. [11659]
    Mr. Straw: The number of police constables in England and Wales increased by 460 during 1996–97 to 98,132.
    Sir Geoffrey Johnson Smith: I welcome the fact that the Sussex police have increased recruitment over the past two years. I am grateful to the last Government for that initiative.
    Will the Home Secretary ensure that basic pay is increased to an adequate level, so that we can encourage more young people to join the police force—and not just more people, but people of adequate calibre?
    Mr. Straw: I am not sure why the right hon. Gentleman is so generous in his gratitude to the last Administration, given that there were 11 fewer police officers in Sussex during the period in question than in the previous year. As for his second point, about pay, we intend to maintain the arrangements for police pay that were introduced following the Edmund-Davies report late in 1979.
    Mr. Winnick: Would there not be one more police constable alive today if the court concerned had not granted bail, in opposition to what the police and the Crown Prosecution Service said at the time in giving their reasons why bail should not be granted? Does not the foul and terrible murder of the WPC demonstrate the dangers that some police officers face day in, day out? The House should recognise those dangers, despite the criticisms—often justified—of one or two officers.
    Mr. Straw: As I said in answer to the hon. Member for Epping Forest (Mrs. Laing), I entirely understand the point that has been made. I hope that the House will appreciate, however, that until various inquiries have been completed—including the inquest—it would be wrong for me to comment on the precise circumstances in which the court came to issue bail.
    Mr. Greenway: Does the Home Secretary agree with the police, who estimate that there were 3,000 more constables in post in spring this year than in 1992? Will he confirm to the House his intention to provide the funds for, and go ahead with, the recruitment of a further 2,000 police officers, as the previous Government planned?
    Mr. Straw: As the electorate found out, there was a huge difference between what the previous Government planned and what they were able to do. The hon. Gentleman's intervention was as unwise as that of the right hon. Member for Wealden (Sir G. Johnson Smith). The simple truth is that, despite two successive promises to increase the number of police officers by 2,000 during the previous Parliament, the number in post fell by 469. That was the Conservative record.

    Primary Purpose Rule
    Ms Beverley Hughes: What progress has been made in implementing changes in the primary purpose rule. [11660]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. Mike O'Brien): The primary purpose rule was abolished on 5 June. A review of outstanding appeal cases has now been completed, and those involved should have been informed. Some people will make applications in the light of the change to the rule, and they will be dealt with through the normal procedure.
    Ms Hughes: Does my hon. Friend agree that the abolition of the primary purpose rule has removed a discriminatory practice that affected many genuinely married couples, and that its removal has meant a great deal to the people concerned? I congratulate my hon. Friend on the successful completion of the review. I am sure that he will agree that future applications must be dealt with fairly and swiftly. What steps has he taken to ensure that they will be dealt with within a reasonable time?
    Mr. O'Brien: A series of steps is in process that should ensure that cases are dealt with quickly. I am grateful to my hon. Friend for her support. The primary purpose rule was without a purpose, except to cause misery to many families. The mess that it caused to family life was deplorable. I am pleased that we were able to remove it and thereby show that we support families.
    Mr. Hawkins: Does the Minister realise that the abolition of the primary purpose rule and the other changes that the new Government have introduced have led to the problems that he has been trying to explain away on Czech television in the past couple of weeks? Is it not quite clear that the previous Government were absolutely right to have a sensible, firm and fair policy? The minute the new Government took office they started messing about and caused enormous strains on the system through illegal, bogus asylum seekers trying to come to this country. Is that not a recipe for disaster?
    Mr. O'Brien: The hon. Gentleman does not seem to know the difference between immigration controls and the asylum system. If this change in the primary purpose rule was so bad, why did the right hon. Member for North-West Cambridgeshire (Sir B. Mawhinney) not pray against it, not seek to have a debate on it and not oppose it? The reason is that it was a fair change. It will ensure that the Government will do what they promised at the general election, which was to maintain firm and fair immigration and asylum controls.
    Mr. Lock: Does my hon. Friend agree that the changes that he has made to the immigration laws, although they may not have been accepted by Conservative Members, have been widely accepted by people in the country? Does he further agree that those who have lined up to condemn the changes, whether from the xenophobic or the homophobic tendency, are to be deplored?
    Mr. O'Brien: My hon. Friend is right, but he does a disservice to some Conservative Members, such as the

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    hon. Member for Rochford and Southend, East (Sir T. Taylor) who was conspicuous in welcoming the changes to the primary purpose rule. However, my hon. Friend is right: it is the same old Tories. At the Tory conference, the Tory leader said that his party would now be more open and tolerant. Within hours of that statement, we made an announcement on same sex couples which brought out rent-a-quotes from people, from Lord Tebbit to the ex-Member of Parliament, Sir Ivan Lawrence. The hard, intolerant, right-wing core of the Tory party is still there: we know it, no matter what the Leader of the Opposition now says.

    Police Pensions
    Mr. Gray: What representations he has received on the effect on police pensions of the removal of the advance corporation tax credit for pension funds. [11661]
    The Minister of State, Home Office (Mr. Alun Michael): It should come as no surprise to the House that we have received no representations on the effect on police pensions of the removal of the advance corporation tax credit. The police pension scheme is not based on a pension fund: it is financed on a pay-as-you-go basis.
    Mr. Gray: Is the Minister not aware that, although what he says is of course correct, he has entirely missed the fact that civilian employees in the police force will be affected by the removal of this tax? In Wiltshire alone, the removal of ACT will cost the police force an extra £80,000. That money should be spent on policing Wiltshire's streets rather than being handed to the Chancellor of the Exchequer.
    Mr. Michael: The hon. Gentleman should read his own question before asking supplementaries. He asked specifically about the effect on police pensions. The distinction that he makes does not apply to some police pensions, especially some in the Metropolitan police.

    Intoxicating Substances (Supply) Act 1985
    Mr. Hanson: What plans he has to review the operation of and scope of the Intoxicating Substances (Supply) Act 1985. [11662]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): Although we remain concerned about that problem, we have no plans to review the operation of the Act at this time.
    Mr. Hanson: Will my hon. Friend take this opportunity to welcome the recent appointment of the drugs tsar, who will help in the overall co-ordination of Government policy on the prevention of substance abuse?
    On solvent abuse in particular, which is the topic of the Act, will my hon. Friend ensure that there is greater education and stronger enforcement of the Act? In particular, will he ensure that the dangers of butane gas abuse, which has killed nearly 40 young people this year alone, are brought to the attention of the community at large?
    Mr. Howarth: I join my hon. Friend in welcoming the appointment of the new drugs tsar. There is a case for co-ordinating Government policy and I am sure that that is the function that the drugs tsar will carry out.
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    My hon. Friend asks about solvent and lighter gas abuse. We receive advice from the Advisory Council on the Misuse of Drugs, and the Department of Trade and Industry is currently looking at the difficulties of enforcing policy. The Department will involve the council, and if anything positive results we shall certainly be willing to act. The advice that we have received, and that which the previous Government received on two occasions, is that it is difficult to legislate in this area. If anyone can come up with a sensible way to do that, we will obviously look at it.

    Closed Circuit Television
    Mr. David Atkinson: What assessment he has made of the use of closed circuit television in combating crime. [11663]
    Mr. Michael: The experience of closed circuit television partnerships and recent research has shown that CCTV can be effective in preventing crime and, indeed, the fear of crime when it is used as part of a wider crime prevention strategy. The CCTV schemes which the Home Office has helped to fund are required to provide details of how they plan to evaluate the success of their systems, and we are continuing to monitor these.
    Mr. Atkinson: Is the hon. Gentleman aware of the dismay of my constituents that a European regulation which is to be implemented next year will prevent the use of video evidence alone, however conclusive, being sufficient for a court to convict? Will he resist such Napoleonic practices from Europe, which can only hinder the Government's ability to be tough on crime?
    Mr. Michael: Often, things are blamed on Europe which Europe is not even trying to introduce. I shall certainly look at the hon. Gentleman's point, but I think that he is misinterpreting what is coming from Europe. Certainly, one of the strengths of CCTV is that on a number of occasions it has provided clarity of evidence and has increased the certainty of successful prosecution. We all know that the fear of being caught and punished is the most effective deterrent to crime.
    Ms Christine Russell: Does my hon. Friend agree that, although CCTV is no substitute for police officers on the beat, it makes a great contribution to reducing crime, especially street crime and shoplifting in city centres? Would he and his Department be prepared to do more to encourage retailers and city centre businesses to enter into funding partnerships with local authorities so as to extend the provision of CCTV?
    Mr. Michael: My hon. Friend is absolutely right that there are benefits from CCTV schemes, particularly when they are part of a response to crime by a partnership involving the public sector and the business sector. The crime and disorder Bill, which we shall introduce later this year, will strengthen and encourage those partnerships and will involve the whole community in the fight against crime. CCTV needs to be a part of that community response where its targeted use is particularly appropriate.
    Mr. Clappison: But the Minister is conspicuously not offering anything in the way of new resources. He will

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    remember that, before the recess, he promised a decision on the future of Home Office support for rounds of closed circuit television, and he has done nothing. Is it not time that the Government stopped dithering and showed some commitment to this highly effective weapon in the fight against crime, or will the Government more readily find money to put television sets into prison cells to please prisoners than put cameras on the streets to protect the public?
    Mr. Michael: I think that the hon. Gentleman is confusing who was in power when television sets were put into cells. I appreciate the difficulty that he is in: he has taken over a difficult brief, which has been left in an awful mess by Conservative predecessors. For instance, the previous Home Secretary had £15 million to spend in this financial year and he appears to have spent £20 million. We are trying to sort out the mess that we have inherited. It is also clear that, despite the interesting comments by the Conservative party in the run-up to the general election, it had made no provision whatever for CCTV past the coming financial year—so the hon. Gentleman needs to do his homework before coming to this Chamber.

    Border Controls
    Dr. Ladyman: If he will make a statement on Britain's border controls with the rest of the European Union. [11664]
    Mr. Straw: Our first resolve is to retain the United Kingdom system of frontier and border controls. One of the many achievements of my right hon. Friend the Prime Minister in Amsterdam in June was to obtain legal confirmation of the right to maintain controls at our frontiers with other European Union member states—something that the previous Administration had conspicuously failed to achieve.
    Dr. Ladyman: I am grateful to my right hon. Friend for that reply. Will he also confirm that the problems in east Kent are almost entirely a consequence of the previous Administration's failure to put in place fair and effective asylum and immigration controls? I thank him for the efforts he has already made to reduce significantly the number of unfounded asylum seekers. What further measures does he intend to implement to help asylum applications to be dealt with more quickly?
    Mr. Straw: I am grateful to my hon. Friend for his remarks. We have acted swiftly and firmly to seek to stem the flow of unfounded asylum seekers at Dover and elsewhere, against a background in which the previous Government signed up to the Dublin convention, apparently without even reading the text, something that has made the procedure much more complex and much more difficult.
    In answer to my hon. Friend's second question, I can announce today the introduction of a new procedure to speed up the decision-making processes in abusive asylum cases. Under the new procedure, the time allowed for people with abusive claims to make further representations after interview will be cut from the
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    existing 28 days to five working days. The new procedure will have national application at all ports with immediate effect.
    Mr. Gale: The right hon. Gentleman will have heard his junior Minister confirm on the radio this morning that his civil servants were reviewing entry procedures for people coming into the United Kingdom and passport controls, and that there was therefore some substance in the newspaper story that was carried. Given that the Minister said that this morning, why should we believe for one moment that our frontiers are safe, particularly in the light of the fact that his Department took absolutely no action to stem the first wave of immigrants from the Czech and Slovak Republics until that news hit the press?
    Mr. Straw: Almost every assumption behind the hon. Gentleman's question is incorrect. The truth is that we took firm and effective action. That is now working, as the numbers show.
    Mr. Prosser: I thank my right hon. Friend for meeting me last week to talk about the serious problems that Dover and my constituents in Dover face. Does he agree that the sudden impact of bogus asylum seekers on a small community such as Dover can have major social impact and disrupt good racial harmony? Would he like to contrast the practical and responsible way in which the Government are working to find solutions to those sensitive problems with the irresponsible and inflammatory statements made by some Conservative Members?
    Mr. Straw: I am grateful to my hon. Friend for his remarks and for the compliment that he paid to my hon. Friend the junior Minister, who has been working so hard to deal with those problems. The truth is that the previous Government's practice on asylum applications was chaotic. That led to a wholly unsatisfactory burden being placed on local authorities, about which Conservative right hon. and hon. Members used to complain. But that burden is there. The previous Government's inefficiency also led to a backlog of more than 50,000 applications. They created the problem; we are attempting to provide a solution to it.
    Mr. Beith: Has not the document that appeared this morning revealed that neither the right hon. Gentleman nor, perhaps more significantly, the previous Conservative Government set aside anything like enough money to provide enough immigration officers to inspect every one of the millions of passports that are shown at our port controls? Does that not demonstrate that the right hon. Gentleman must use more sophisticated systems, particularly given that the current one allows many illegal immigrants through in any case, and seek more European co-operation, not less, to control in particular the flow of criminals across boundaries?
    Mr. Straw: One of the reasons why the Liberal Democrats ended up with such a small number of seats after the election and are the third party was their spend, spend, spend policy, which convinced nobody. The right hon. Gentleman spent the one penny on income tax about 55 times over.
    Fiona Mactaggart: I invite my right hon. Friend to refute the suggestions made in some newspapers today

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    that Britain is planning to abandon its border controls. May I also ask him to provide further information about the announcement that he has just made about speeding up the processing of abusive asylum claims? What measures will be put in place to ensure that those whose claims are genuine will not be pushed into the fast track and will be able to make full representations on their cases?
    Mr. Straw: The procedure according to which we have cut the time from 28 days to five days for port applicants—something which the previous Government never did—is designed for abusive claims. Those who have a genuine, well-founded claim will not be caught by the change.
    As for the first part of my hon. Friend's question, the simple fact is that the previous Government failed to secure proper legal protection for our border controls. That is not just our view but the view of the former Conservative Immigration Minister, the hon. Member for Bexhill and Battle (Mr. Wardle). It was not until my right hon. Friend the Prime Minister went to Amsterdam that any proper legal protection of our border controls was obtained and written into international law.
    Sir Brian Mawhinney: First, may I associate the Opposition with the remarks of my hon. Friend the Member for Epping Forest (Mrs. Laing) and those of the Home Secretary on the tragic death of the woman police constable? We join everyone else in extending our condolences to her family.
    Given the Government's apparent determination to undermine our border controls and the fair but firm immigration policy which they inherited from the previous Government, can the right hon. Gentleman confirm that the terms of reference of the spending review made it legitimate for civil servants to bring forward for the right hon. Gentleman's consideration the sort of proposals outlined in today's edition of The Guardian?
    Mr. Straw: I am grateful to the right hon. Gentleman for his remarks about the appalling death of WPC Nina Mackay.
    On the right hon. Gentleman's question, he should do a little more research on his Government's record on border controls. They had no legal basis for their claim about such controls. Moreover, I have discovered that, under the Conservative Administration, they cut the proportion of embarkation controls from 100 per cent. to 60 per cent. of passengers, but never announced that—hardly "firm but fair": unfair and not firm at all.

    Asylum Seekers
    Mr. Allan: What plans he has to revise the practice of keeping asylum seekers in prison. [11665]
    Mr. Mike O'Brien: A review of detention policy, including the use of prisons, is being undertaken. Interested groups have been asked to comment on the principal proposals and the final conclusions will be made known shortly.
    Mr. Allan: Is it the Minister's intention to consult Her Majesty's chief inspector of prisons on his view of the
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    use of prison and detention centres for asylum seekers? Under the review, is it still intended to minimise the use of prison in line, with the Home Secretary's commitment to the Charter '87 group for refugees?
    Mr. O'Brien: The answer to both questions is yes. I have discussed the detention review with Sir David Ramsbotham and asked him to compile some specific reports, including one into the situation at Campsfield, where there were some disturbances a few months ago. I have also asked him for some details of his views on the matter. The objective, as always, is to minimise the use of detention.
    Mr. Malins: Many Conservative Members think that the Government are a soft touch for asylum seekers. Will the Minister confirm that it costs more than £500 a week to keep an asylum seeker in detention? How many asylum seekers are currently in detention and what is the total cost to the Exchequer? How long will the taxpayer put up with the fact that the Government appear so soft?
    Mr. O'Brien: It sounds very much as though the hon. Gentleman is saying that the Government are a soft touch, which we are not, and then complaining that it costs too much to detain people. We detain the minimum number of people and ensure that we detain only those whom it is necessary to detain because of a fear that they might abscond. We were committed at the general election to maintaining firm immigration controls, we are committed to it today and we shall be committed to it throughout our time in office.
    Mr. Linton: Does my hon. Friend the Minister agree that the real problem is that his predecessor left a backlog of 76,000 asylum cases that had not been dealt with when the Conservatives lost the general election?
    Mr. O'Brien: That is certainly one of the key problems that we face in trying to resolve the difficulties of the asylum system. We have been handicapped not only by the backlog but by the complexities of the Dublin convention, which came into force on 1 September and has made it much more difficult to return asylum seekers to other countries, causing many problems in Dover, for example. We have also inherited the system of having 28 days to deal with manifestly unfounded asylum claims; it is bizarre, but it was the previous Government's rule. We are at a loss to explain why they had it, but they did. They bequeathed us a messy asylum system, and we are intent on cleaning it up, sorting it out and making it work efficiently and effectively.

    Crime Prevention
    Mr. Amess: What recent representations he has received on measures taken by his Department in respect of crime prevention. [11666]
    Mr. Michael: As of last Friday, 24 October, we had received 114 responses to our consultation document, "Getting to Grips with Crime—a New Framework for Local Action". I am especially pleased at the positive response from both the police and local authorities. A variety of representative and voluntary organisations

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    have responded positively to our invitation to join us in developing proactive strategies to cut crime. We have also had a positive response from many business leaders.
    Mr. Amess: Is the Minister aware that policing in Westcliff and Leigh-on-Sea is shortly to be reorganised? Will he join me in congratulating all those involved in trying to improve the quality of people's lives by high-visibility, community-based, intelligence-led policing—all, I understand, at no extra cost to the Exchequer?
    Mr. Michael: I am grateful to the hon. Gentleman for his interest in the policing of Westcliff and Leigh-on-Sea, about which I would not otherwise have been as well informed. About a year ago, it was discovered that 25 per cent. of crime in the division was occurring on one beat in the town centre, and staffing levels were adjusted accordingly, although I understand that there is no reorganisation as such, leading to a cut of 14 per cent. in crime in that division last year. That is a good example of crime being analysed and properly understood—that is right at the heart of our policies—and then being tackled by the police, either alone or in conjunction with local authorities and others.
    Mrs. Brinton: Does my hon. Friend agree that urgent measures are needed to combat youth crime, particularly after 18 years of Tory lawlessness and disorder? I should like to draw his attention to the state of siege in Kingsley road in Peterborough, where gangs of teenagers and children as young as 10 daily set houses on fire, burn out cars and force young families to flee their homes in the middle of the night leaving all their possessions. Will he ensure that the proposals for youth curfews are enforced when the crime and disorder Bill becomes law?
    Mr. Michael: I am grateful to my hon. Friend for her comments, and for the stress that she has placed on dealing with youth crime. That is a measure of the extent to which we have concentrated on youth crime and on preparation of measures in the crime and disorder Bill throughout the summer. We await comments on several consultation documents that include some of the measures that will address the problems to which she referred. The curfew proposals are practical and will work in the situations that she described, with youngsters of 10 and younger running roughshod around an area. We need to build confidence back into the system; we are determined to do that.
    Mr. Evans: Has the Minister received any representations about the abuse of laser lights? I am sure that he has recently read in the newspapers about the abuse of what are normally presentational aids. When abused, they can cause temporary blindness; if stared at over even relatively short periods, they can cause more sinister damage to the eye. Will he ensure that his Department will spread the message loud and clear to people who abuse laser lights that they will face the full rigour of the law?
    Mr. Michael: The hon. Gentleman raises an important point, which arises whenever something legitimately available for sensible business and other purposes is misused or abused to the detriment of other people.
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    The issue has certainly been raised with us, not least by the Police Superintendents Association. We are considering the medical evidence about the problems that can be caused and we wish to address the issue. We are awaiting evidence from some of the police associations about the extent to which their members have discovered problems. We need to understand the problem to address it properly. Many people will share the hon. Gentleman's concern.
    Mr. Sutcliffe: Further to the point raised by the hon. Member for Ribble Valley (Mr. Evans), at the weekend in my constituency a laser pen was pointed into the eyes of a bus driver, who was temporarily blinded. While I accept what my hon. Friend says about what his Department can do, will he ask the Minister for Competition and Consumer Affairs to look at the availability of those pens and at who can buy them?
    Mr. Michael: My hon. Friend makes a good point: we need to work across Departments. That is why I mentioned that we are discussing items that are available for legitimate use but that are being used by some people in the wrong way. We shall certainly consult colleagues about the best way to respond to the problem highlighted by the incident in his constituency.

    Scottish Parliament
    Mr. Dalyell: What consultation he has had with the Scottish Office since the referendum on the transfer of those responsibilities which are currently his to the Scottish Parliament. [11668]
    Mr. Straw: Our proposals for devolution are set out in the White Paper, "Scotland's Parliament". There are no plans for my responsibilities to be transferred to the Scottish Parliament.
    Mr. Dalyell: What will be the demarcation between Edinburgh and Westminster in relation to the delicate issue of responsibility for drugs?
    Mr. Straw: The White Paper, "Scotland's Parliament" makes it clear that the criminal law in relation to drugs will be a reserved matter and will remain the responsibility of my Department. The Scottish Executive will inherit the current responsibilities of my right hon. Friend the Secretary of State for Scotland and my right hon. and learned Friend the Lord Advocate. Those responsibilities include drug misuse, health, treatment and education, as well as responsibility for the police and prosecution authorities' enforcement in Scotland of drug misuse legislation, which will be set by this House and Parliament.
    Mr. Hogg: Does the right hon. Gentleman agree that, if the Government's proposals for devolution are enacted, the House will have no say over policies relating to Home Office type affairs, which are now the responsibility of the Secretary of State for Scotland? Would it not be wrong, therefore, for Scottish Members of Parliament sitting in this House to have any say on Home Office affairs in so far as they relate to England?
    Mr. Straw: I do not accept the assumption behind the right hon. and learned Gentleman's question, not least

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    because I have made it clear that issues of criminal law relating to drugs will be a reserved matter for this Parliament. Therefore, it is entirely right that Members of Parliament, whichever constituencies they represent, should not only speak but vote on those matters.

    Asylum Seekers
    Mr. Corbyn: What is his latest estimate of the number of asylum seekers held in custody under the Immigration Acts. [11669]
    Mr. Mike O'Brien: As at 30 September 1997, the most recent date for which information is available, 772 persons who had sought asylum at some stage were recorded as being detained solely under Immigration Act powers. As I have already stated, we announced a review of detention policy before the recess.
    Mr. Corbyn: I thank my hon. Friend for his reply. When he undertakes the review of the policy of internment of asylum seekers, will he bear it in mind that many of those who have been detained for many months have a deep sense of injustice? They have fled from oppressive societies where they have lived in great fear and have often suffered racist attacks, only to arrive in this country and find themselves in custody for several months. Does my hon. Friend recognise that that is an abuse of their rights? We should not have a routine policy of imprisonment—no other European country does. The measure should be used only in the most extreme circumstances and we should not keep more than 700 people in custody.
    Mr. O'Brien: I do not accept what my hon. Friend says. There is no routine detention of persons. I would not accept that, and I am sure that the Government would not accept it. People are not detained merely because they are seeking asylum; other factors will always have a bearing on the likelihood of people complying with the conditions of temporary admission which determine the need for detention. At any one time, only about 1.5 per cent. of those who may have sought asylum are actually detained.
    Mr. Brooke: Is the Minister contemplating an increase in the amount of provision in detention centres in order to reduce the pressure on prisons?
    Mr. O'Brien: That is one of the issues that we shall have to examine as part of the review of detention. It is obviously preferable, where possible, to detain people under immigration powers in detention centres rather than in prisons but, given the numbers and pressures and the nature of some detainees who have been unable to adapt themselves to the more relaxed regime in detention centres, we sometimes have to use prisons.
    Dr. Harris: Detaining up to 500 asylum seekers in prison establishments costs up to £20 million to £30 million a year. Does the Minister agree that that money could be better spent on providing prison places for the criminals who are currently in overcrowded prisons? Given that, at my suggestion, Sir David Ramsbotham has visited Campsfield House in my constituency, and given the critical report on Rochester prison and the likely critical report on Tinsley House,
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    how many critical reports will the Minister have to receive before he ends the barbaric practice of using prisons? The Liberal Democrats have welcomed the Government's ethical foreign policy. How long do we have to wait for an ethical Home Office policy?
    Mr. O'Brien: Presumably, the hon. Gentleman is saying that nobody should be held in detention. I was interested to hear that he asked Sir David Ramsbotham to act—probably before the hon. Gentleman did, I asked Sir David Ramsbotham to act. He conducted an inspection of Campsfield House at my request; he has briefed me on the result of his inquiries and will shortly be letting me have a full and detailed report of the situation. It is necessary to examine the way in which we use detention, and we are doing that. The prospects of releasing everybody are extremely unlikely. We need to use detention in certain cases. We want to apply a firm immigration policy; that is the Government's policy and that is what we shall deliver.
    Sir Brian Mawhinney: I share the Minister's view that documentation is an important part of determining whether asylum seekers should be permitted to remain in this country, but may I take him back to the broader issue of border controls? I shall ask a question that the Home Secretary either did not know the answer to or would not come clean to the House about. Will the hon. Gentleman, who has direct responsibility for these matters, confirm that the terms of reference of the spending review made it legitimate for civil servants to produce the sort of proposals outlined in today's edition of The Guardian?
    Mr. O'Brien: I make it clear that the Government will maintain firm immigration controls. Nothing will be done that undermines our ability to enforce firm immigration controls. My right hon. Friend the Prime Minister secured our legal right to do that at Amsterdam, which is something the previous Government singularly failed to achieve. We shall maintain the enforceability of immigration controls. The document to which the right hon. Gentleman refers would appear to be merely a think piece—a summary of the views of some officials. Our determination and our commitments are clear: those commitments will be delivered. The people of Britain have voted for them and the people of Britain will get them.

    Air Rifles
    Mr. Hinchliffe: If he will review the licensing arrangements for the use of air rifles. [11670]
    Mr. Michael: No firearms certificate is required at present to possess or use an air weapon unless it exceeds the statutory maximum power levels. There are, however, restrictions on purchase, possession and use, particularly by young people. Hon. Members will understand that we have concentrated on the Firearms (Amendment) Bill in order to ban private ownership of .22 pistols and to fulfil an election commitment with that measure. When that legislation has been dealt with, we shall consider carefully whether further restrictions are necessary, as part of a wider look at what other firearm controls may be needed to safeguard the public.
    Mr. Hinchliffe: Does my hon. Friend accept that air weapons are increasingly responsible for injury to,

    577
    and destruction of, wildlife to an alarming degree? Is it not a fact that children and young persons are increasingly responsible for the problems caused by the misuse of air weapons? I urge my hon. Friend to consider, as a matter of urgency, increasing the restrictions on ownership and use of air weapons. Will he consider banning them completely?
    Mr. Michael: As I have said, we shall consider what is needed—particularly for the protection of the public—after the present legislation has been dealt with. On my hon. Friend's specific question, killing or injuring any bird or protected animal carries a fine of up to £5,000. Especially powerful air weapons—that is, rifles with a muzzle energy of more than 12 ft per pound and air pistols with a muzzle energy of more than 6 ft per pound—must be kept on a firearms certificate. Persons under 14 years of age may not be in possession of an air weapon unless as a member of an approved club, in a shooting gallery or under the supervision of a person over the age of 21. Purchase by persons under 17 is not permitted, nor is possession in a public place. There are laws in place regulating matters relevant to my hon. Friend's point, but I shall be happy to look at any evidence that he or others bring forward when we consider those issues further, in due course.

    Criminal Justice (Voluntary Organisations)
    Mr. Letwin: What meetings he and his colleagues have held with voluntary organisations concerned with the administration of justice and the treatment of offenders in the Home Office since 1 May; and if he will make a statement. [11671]
    Mr. Michael: Since 1 May, my colleagues and I have held 10 such meetings in the Home Office. We have also attended a number of events outside the Home Office at the invitation of voluntary organisations concerned with the administration of justice and the treatment of offenders.
    Mr. Letwin: Does the Minister accept the previous Government's extraordinary record in encouraging voluntary organisations in that sector? Does he have any proposals to improve on the measures that have already been taken?
    Mr. Michael: I certainly agree that the measures taken by the previous Government were extraordinary, but voluntary organisations concerned with the administration of justice and the treatment of offenders feel that a great weight has been lifted from their shoulders. We are receiving a great deal of co-operation and enthusiasm from them in our measures to deal with crime and the problems arising from crime.
    Mr. O'Hara: Does my hon. Friend the Minister agree that the voluntary sector has an enormously important contribution to make to the implementation of important Government policies, not least in winning back our communities? Will he therefore express my personal appreciation that responsibility for the voluntary sector and volunteering has now returned to the Home Office and to Labour Home Office Ministers who have an
    578
    appreciation and understanding of that important role, as was most certainly not the case under the previous Government?
    Mr. Michael: I am grateful to my hon. Friend for his remarks. My right hon. Friend the Home Secretary welcomed the return of the voluntary and community unit to the Home Office and there is a great deal of enthusiasm on the part of Ministers for cementing the essential partnership between the voluntary sector and Government.
    Mr. Beith: Will Ministers be meeting one of those organisations, the Howard League, to discuss the report that it published today? The report reveals the trebling of the number of teenage girls held in adult prisons, where they are subject to many risks and not provided with adequate rehabilitation. That is especially troubling when many of them are first offenders and could not be described as regular or hardened criminals.
    Mr. Michael: We do meet the Howard League regularly and recently I spoke at its conference. The report is interesting. The Howard League takes a particular view on those matters—one that we discuss with it regularly.

    Election Broadcasts
    Mr. Soley: What proposals he has to review the Representation of the People Acts in relation to broadcasting during general elections. [11672]
    Mr. George Howarth: My hon. Friend will be aware that we have no specific proposals to do that. However, the election that took place in May is the subject of a consultation exercise. I understand that broadcasters are to meet officials in the Home Office to discuss the operation of section 93 of the Representation of the People Act 1983. If they come up with any proposals, obviously we shall consider them on their merits.
    Mr. Soley: There is considerable and growing concern among broadcasters, politicians and the public about the way in which our elections are covered; that coverage should allow open and fair debate in a political situation. Would it not be a good idea, if we did conduct a radical review of the Representation of the People Acts, to consider ways in which constituencies are covered in general elections and by-elections, to allow a more free and open debate?
    Mr. Howarth: My hon. Friend is right. There is a problem in as much as, if one or two candidates in a constituency are covered in a broadcast, a minor candidate further down the list can prevent the broadcast proceeding because of the need for equal coverage. However, it is a complex matter and I believe that, before I give my particular view on it, it would be right to receive representations from the broadcasters. That process is in train.
    Mr. Ian Taylor: Given that, by the time of the next election, 40 or more digital television channels will be available to viewers, what restrictions does the Home

    579
    Office intend to place on the Prime Minister against the multiple showing of the type of video that we saw at the Commonwealth Heads of Government conference?
    Mr. Howarth: The hon. Gentleman should be very careful. I think that the more that the general public see of the Prime Minister, the happier they are.

    Crime Victims
    Mr. Watts: If he will make a statement on the treatment of victims by the criminal justice system. [11674]
    Mr. Michael: The Government are firmly committed to helping victims of crime and to taking action to redress the balance of the criminal justice system in the favour of victims. We have already taken several steps to achieve that. We are giving Victim Support an extra £1 million a year to develop its work with victims and witnesses and to establish a national telephone helpline for victims. We have established an interdepartmental group to undertake an urgent, wide-ranging review of ways to assist vulnerable or intimidated witnesses. There are several other proposals, including sentencing proposals.
    Mr. Watts: Can my hon. Friend give the House an update on any progress that has been made in speeding up the process of dealing with cases that involve young persistent criminals?
    Mr. Michael: The steps that the Government are taking are intended to halve the time that it takes for persistent offenders to come before the courts. As the Audit Commission showed last year, it currently takes, on average, a ludicrous four-and-a-half months to get young offenders before the court. [Interruption.] I take it that that was applause for our intention to cut that time. We intend to halve that time, so that persistent young offenders are dealt with quickly by the courts.

    Illegal Drugs
    Mr. Flynn: What new measures he intends to introduce to reduce the demand for illegal drugs. [11675]
    Mr. George Howarth: My hon. Friend will be aware that we intend to advance the proposal for a treatment and testing order in the new legislation that will be coming forward shortly and that a United Kingdom anti-drugs co-ordinator was appointed recently. The Government are determined to combat the menace of drugs in our society.
    Mr. Flynn: Did my hon. Friend read the report this weekend, in the newspaper Disability Now, of the results
    580
    of a survey of 200 severely disabled people, who said that they are using cannabis as a medicine and that they are breaking the law to do so, because of its unique medicinal effects for the treatment of multiple sclerosis, cerebral palsy and glaucoma? Why is it that heroin and cocaine can be legally prescribed, but the tens of thousands of people who use the much milder drug cannabis for pain relief have to depend on criminals and the illegal market?
    Mr. Howarth: My hon. Friend will be aware that all drugs used for medical purposes have to be scientifically tested. If cannabis succeeds in those tests—if it is proved that it has medicinal qualities—my right hon. Friend the Secretary of State for Health has already made it clear that he would be willing to consider allowing medicinal use of it. Unfortunately, as of now, there is no such evidence.

    Community Policing
    Mr. Laurence Robertson: If he will list the steps he is taking to establish the levels of public satisfaction with community policing in each area. [11677]
    Mr. Michael: The Police Act 1996 requires police authorities to obtain the views of local people on the policing of their area. That is done by a variety of means. Once our new statutory duties on local authorities and the police to establish local crime prevention partnerships are in place, there will be an obligation on those two bodies to conduct a crime and disorder audit in their areas and to consult the local public on it. That will improve the way that the police consider the local public's views on, and experience of, crime and the fear of crime.
    Mr. Robertson: The hon. Gentleman will be aware of the public's concern about community policing. He will also be aware that the police do not view bobbies on the beat as the most effective way of policing. Given the importance of the public's perception of policing in their areas being favourable, how does the Minister intend to deal with that?
    Mr. Michael: I am not quite sure what question the hon. Gentleman is asking. We intend to ensure that the police, with local authorities and the wider community, fully understand and analyse the problems of crime and disorder in their areas so as to target them specifically and to cut crime. Our target is to cut crime, not to watch it go on increasing.

Viscount Tonypandy
3.30 pm
Madam Speaker: All Members of the House have heard with sorrow of the death of Viscount Tonypandy, who was our Speaker from February 1976 to June 1983. I wish, on behalf of all parties and of each and every right hon. and hon. Member of this House, to pay a tribute to the memory of one of my most distinguished predecessors. [HON. MEMBERS: "Hear, hear."]
Born in the mining communities of south Wales, George Thomas became a schoolmaster and, at the age of 25, a Methodist lay preacher. He entered the House in the vast intake of new Members in 1945. He quickly adapted to the ways of the House and, rather unusually, was chosen as a member of the Speaker's Panel of Chairmen at an early stage of his parliamentary career.
On the return of the Labour Government in 1964, George Thomas held junior office in the Home Office, the Welsh Office and the Commonwealth Office. It was a cause of great pride to him when, in 1968, he was appointed to succeed Mr. Cledwyn Hughes as Secretary of State for Wales. When his party returned to office in 1974, he was asked to take the post of Chairman of Ways and Means, and such was his distinction in that office that it came as no surprise when, two years later, he was unanimously elected Speaker on the retirement of Selwyn Lloyd.
For the next seven years, George Thomas was a dominant figure in the Chair. His presence was magisterial, but at the same time he appeared human and friendly. He was particularly adept at breaking tensions in the House with his own brand of humour. Radio listeners—this was before television was brought into the Chamber—became familiar with the attractive Welsh lilt of his voice.
Outside the Chamber, Viscount Tonypandy's influence was considerable. He was the first Chairman of the House of Commons Commission. In Speaker's House, many Members of all parties, including younger ones, had reason to be grateful for his wise advice and friendship. On his retirement, the then Prime Minister summed up the feelings of all Members when she said:
"You have upheld with a special combination of impartiality and authority the dignity of your office and of this House".— [Official Report, 12 May 1983; Vol. 42, c. 920.]
After his retirement, George Thomas became a valued contributor from the Cross Benches in that other place, and despite lengthy periods of ill health, he kept up his many outside charitable and other activities, most notably as chairman and later president of the National Children's Home. But the place where he liked most to be in his later years was in his beloved south Wales.
In saluting Viscount Tonypandy's memory, I know that I speak for the whole House in thanking God for his distinctive life of service to this House, to the country at large and to all his fellow men and women. We offer our condolences to his family and friends.
Hon. Members: Hear, hear.

Winchester (Election)
3.34 pm
Madam Speaker: I have one other duty to perform. It is my duty to report to the House that I have received a communication from the Queen's Bench division of the High Court of Justice, in which two of Her Majesty's judges have informed me of their determination in the matter of the election of a Member for the constituency of Winchester on 1 May last.
The court's determination, reached in accordance with the provisions of the Representation of the People Act 1983, is that: there were breaches by the returning officer's agent of rules 20 and 37, as set out in schedule 1 to the Act; that the result of the election was affected thereby; that Mark Oaten was not duly elected and returned as Member of Parliament for Winchester; and that the election on 1 May 1997 is void.
I shall cause the full text of the court's communication to be recorded in the Journal. The next step is for a writ to be issued for a new election, and I hope that the necessary notice will be brought before the House in the very near future.
We now have a statement by the Chancellor of the Exchequer.

Economic and Monetary Union
3.36 pm
The Chancellor of the Exchequer (Mr. Gordon Brown): With permission, Madam Speaker, I want to make a statement on economic and monetary union.
Since the end of the second world war, Britain has faced no question more important and more contentious than that of our relationship with Europe. Divisions within Governments of both parties, and hence indecision, have made British policy towards Europe over many years inconsistent and unclear. The economic consequences of those weaknesses have been a loss of international initiative and influence, recurrent instability and continuing questioning of our long-term economic direction.
To break with this legacy and to establish clear national purpose, which has eluded us for decades, economic leadership is essential, and Britain must now make the difficult decisions on Europe, however hard.
The decision on a single currency is probably the most important question that this country is likely to face in our generation. Yet until now, there has been no detailed examination by Government of the practical economic issues of EMU and no proper preparation for a decision, because no previous Government could agree on whether they supported it in principle, nor whether there was an overriding constitutional objection on grounds of sovereignty; nor whether, even if a single currency worked and worked well, the Government would wish to be part of it. Forms of words like, "keeping the option open"—while no preparations were ever made to render that option practicable—have similarly served as a pretext for postponing the hard choices.
Now is the time to make these hard choices and set a long-term direction for our economic future in Europe. So I shall deal in turn with the question of principle of economic monetary union, the constitutional implications and the economic tests that have to be met. In each area, I shall set down the Government's policy.
When we came into government, I asked the Treasury to carry out an assessment of the economic tests that have to be met. Accompanying my statement is a detailed and comprehensive Treasury assessment, which I am publishing today, copies of which are available in the Vote Office.
I start with the question of principle. The potential benefits for Britain of a successful single currency are obvious in terms of trade, transparency of costs and currency stability. Of course, I stress that it must be soundly based. It must succeed. But if it works economically, it is, in our view, worth doing. So in principle, a successful single currency within a single European market would be of benefit to Europe and Britain. Secondly, it must be clearly recognised that to share a common monetary policy with other states represents a major pooling of economic sovereignty.
There are those who argue that this should be a constitutional bar to British participation in a single currency, regardless of the economic benefits that it could bring to the people of this country. In other words, they would rule out a single currency in principle, even if it were in the best economic interests of the country.
This is an understandable objection, and one argued from principle, but in our view it is wrong. If a single currency would be good for British jobs, British business
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and future prosperity, it is right in principle to join. The constitutional issue is a factor in the decision, but it is not an overriding one. Rather, it signifies that, in order for monetary union to be right for Britain, the economic benefit should be clear and unambiguous.
I therefore conclude on the question of principle that if, in the end, the single currency is successful and the economic case is clear and unambiguous, the Government believe that Britain should be part of it.
There is a third issue of principle—the consent of the British people. Because of the magnitude of the decision, we believe, again as a matter of principle, that, whenever the decision to enter is taken by Government, it should be put to a referendum of the British people. Whenever this issue arises, under this Government there will be a referendum. Government, Parliament and the people must all agree.
We conclude that the determining factor as to whether Britain joins a single currency is the national economic interest, and whether the economic case for doing so is clear and unambiguous.
I turn now to the Treasury's detailed assessment of the five economic tests that define whether a clear and unambiguous case can be made. These tests are, first, whether there can be sustainable convergence between Britain and the economies of a single currency; secondly, whether there is sufficient flexibility to cope with economic change; thirdly, the effect on investment; fourthly, the impact on our financial services generally; and fifthly, whether it is good for employment.
Of these, the first and most critical is convergence: can we be confident that the United Kingdom business cycle has converged with that of other European countries, so that the British economy can have stability and prosperity within a common European monetary policy? That convergence must be capable of being sustained and likely to be sustained. In other words, we must demonstrate a settled period of convergence.
Currently, Britain's business cycle is out of line with those of our European partners. British interest rates are 7 per cent.—the level set by the Bank of England in order to achieve the inflation target—but in Germany and France, interest rates are close to 3 per cent. Across the continent, because business cycles are more coincident, short-term interest rates have been converging for some time.
This divergence of economic cycles is in part a reflection of historic structural differences between the United Kingdom and other European economies, in particular the pattern of our trade and North sea oil. These differences are becoming less distinct as trade with the rest of Europe grows and the single market deepens. However, divergence is also a legacy of Britain's past susceptibility to boom and bust—the damaging boom of the late 1980s, the severe recession of the early 1990s and the previous Government's failure to raise interest rates early enough in the current economic cycle.
Since coming into office, the Government have introduced long-term measures to ensure that we are capable of maintaining stability, by giving operational responsibility to the Bank of England for interest rates and by implementing our deficit reduction plan for public borrowing.
We will need a period of stability with continuing toughness on inflation and public borrowing. The Treasury's assessment is that, at present, the UK's

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economic cycle is not convergent with our European partners, and that this divergence could continue for some time. To demonstrate sustainable convergence will take a period of years.
To be successful in a monetary union, countries will need even more flexibility to adjust to change and to unexpected economic events once the ability of countries to vary their interest rates and their exchange rates has gone, and the euro and a single European interest rate are in place. Flexibility may be particularly important for the United Kingdom if there is any risk that our business cycle has not fully converged with those of other European countries.
The Treasury assessment on the second test—flexibility—is that, in Britain, persistent long-term unemployment and lack of skills, and in some areas lack of competition, point to the need for more flexibility to adapt to change and to meet the new challenges of adjustment. The Government have begun to implement a programme for investing in education and training, helping people from welfare to work and improving the workings of our markets.
Of course, other European countries need to tackle unemployment and inflexibility to make sure that Europe as a whole is able to withstand any shocks that arise. The Government will continue to argue that employability, flexibility and stronger competition policies must be a top priority so that monetary union can be successful.
The third test is investment: whether joining monetary union would create better conditions for businesses to make long-term decisions to invest in Britain. The Treasury assessment is that, above all, business needs long-term economic stability and a well-functioning European single market. It concludes that membership of a successful single currency would help us to create the conditions for higher and more productive investment in Britain. The worst case for investment would be for Britain to enter EMU without proper preparations and without sufficient convergence, with all the uncertainty that that would entail.
The fourth test asks what impact membership of the single currency would have on our financial services industry. EMU will affect that industry more profoundly and more immediately than any other sectors of the economy. The Treasury's assessment is that we can now be confident that the industry has the potential to thrive whether the United Kingdom is in or out of EMU, so long as it is properly prepared. However, the benefits of new opportunities from a single currency could be easier to tap from within the euro zone, and that could help the City of London to strengthen its position as the leading financial centre in Europe.
For millions of people, the most practical question is whether membership of a successful single currency would be good for prosperity, and particularly for jobs. The Treasury's assessment is that our measures to create employment and for welfare state reform must accompany any move to a single currency.
Ultimately, we conclude that whether a single currency is good for jobs in practice comes back to the question of sustainable convergence. A successful single currency would provide far greater trade and business in Europe. The Treasury assessment is that, in vital areas,
586
the economy is not yet ready for entry, and that much remains to be done. The previous policy of keeping options open without actively making preparations has left parts of the economy unprepared. Our overall assessment is that Britain needs both a period of preparation and a settled period of sustainable convergence—and both require stability.
Applying those five economic tests leads the Government to the following clear conclusions. British membership of a single currency in 1999 could not meet the tests, and therefore is not in the country's economic interests. There is no proper convergence between the British economy and other European economies now, and to try to join now would be to accept a monetary policy that would suit other European economies but not our own. We will therefore be notifying our European partners, in accordance with the Maastricht treaty, that we will not seek membership of the single currency on 1 January 1999.
The issue then arises as to the period after 1 January 1999. We could simply leave the options open as before, but with no clear direction either way for the rest of the Parliament. That would be politically easy, but it would be wrong. There would be instability and perpetual speculation about "in or out", "sooner or later", that would cause difficulties in the financial markets and for business and industry. It would make it harder to prepare for the possibility of a single currency because every step in preparation every time the issue was discussed would feed fresh bouts of speculation.
It must be in the country's interests to have a stable framework within which to plan. We are fortified in this because, on the economic tests that we have set out, the practical difficulties of joining a single currency in this Parliament all point to the same conclusion.
There is no need, legally, formally or politically, to renounce our option to join for the period between 1 January 1999 and the end of the Parliament—nor would it be sensible to do so. There is no requirement to do so under the treaty, and, what is more, no Government can ever predict every set of economic circumstances that might arise. What we can, and what we should, do is to state a clear view about the practicability of joining monetary union during that period.
In applying our economic tests, two things are clear: there is no realistic prospect of our having demonstrated before the end of this Parliament that we have achieved convergence that is sustainable and settled rather than transitory; and Government have only just begun to put in place the necessary preparations that would allow us to do so. Other countries have for some years been making detailed preparations for a single currency. For all the reasons given, we have not.
Therefore, barring some fundamental or unforeseen change in economic circumstances, making a decision to join during this Parliament is not realistic. It is therefore sensible for business and the country to plan on the basis that, in this Parliament, we do not propose to enter a single currency.
There are those who urge us to seek consent in principle through a referendum now or soon, with a view to entry some time later. Any serious gap between the referendum and the actual entry date would undermine the conclusions of the referendum. Because the essential decision is economic, it can be taken only at a time when

587
the Government and the people can judge that sustainable convergence has been established. So, in our view, the interval between the decision to join and our joining must not be unduly protracted.
I have said that, if a single currency works and is successful, Britain should join it. We should therefore begin now to prepare ourselves so that, should we meet the economic tests, we can make a decision to join a successful single currency early in the next Parliament. At present, with no preparation, that is not a practical option. We must put ourselves in a position where Britain can exercise genuine choice.
The questions of preparation are immense—practical questions for business as well as for Government. For example, euro notes and coins will be circulating across Europe from 1 January 2002. Some companies, such as Marks and Spencer, have already decided to accept euros in Britain; others will want advice on what is best for them.
Because both the Government and business must prepare intensively during the next few years, we will commence work on the detailed transition arrangements for the possible introduction of the euro in Britain, including notes and coins, should we wish to enter. We will step up the work on what business should do now to prepare for the introduction of the euro in 1999, whether we are in or out. We will work with business on what Government must do to prepare for EMU should we decide to join in the next Parliament.
To help with essential preparations, I have invited the Governor of the Bank of England and Sir Colin Marshall, president of the Confederation of British Industry, to join me and the President of the Board of Trade in leading a standing committee on preparations for EMU. I am pleased to say that they have agreed. I am also inviting the president of the Association of British Chambers of Commerce to join us.
I can also announce that, from January, a series of regional and sectoral conferences on preparations for monetary union will be held. In addition, my right hon. Friend the Prime Minister has today decided to extend Lord Simon's Treasury responsibilities to include European business preparations in this Government, covering the long-term planning of the new standing committee.
In addition to those practical preparations, there are reforms we can make that are right in themselves in the national economic interest, and will help us to meet the five economic tests. We will promote greater flexibility in the UK economy and in Europe through the "getting Europe to work" initiative. We will introduce new competition legislation that draws on the best of European and wider international policy and practice, as well as continuing to negotiate to secure the best interests of our financial sector and for the opening up of the single market in financial services. We will set as one of the key objectives of our European presidency completion of the European single market.
In my Mansion House speech, I said that, if we succeeded in strengthening the ability of the British economy to sustain growth without inflation, and if international conditions permitted, I would hope to lower the inflation target. So we will monitor our inflation target, and will do so in the light of the European central bank. We will ensure that our fiscal rules and our deficit
588
reduction plan continue to be consistent with the terms of the stability pact, thus underlining our commitment to avoid an excessive deficit under article 104c of the treaty and supporting greater co-ordination in ECOFIN. In Britain's interests, we need to keep inflation low and public borrowing firmly under control.
The single currency will affect Britain, in or out. It is in the British national interest for it to work. Vital decisions will be made during our European presidency in the first half of next year. We will use our position constructively and supportively, and we will play a full part in ensuring that the single currency's launch is successful—something that is in Britain's interests as well as in Europe's interests.
To sum up, we believe that, in principle, British membership of a successful single currency would be beneficial to Britain and Europe; the key factor is whether the economic benefits of joining for business and industry are clear and unambiguous. If they are, there is no constitutional bar to British membership of EMU.
Applying the economic tests, it is not in this country's interest to join in the first wave of EMU starting on 1 January 1999, and, barring some fundamental and unforeseen change in economic circumstances, making a decision in this Parliament to join is not realistic. To give ourselves a genuine choice in the future, it is essential that Government and business prepare intensively during this Parliament so that Britain will be in a position to join a single currency, should we wish to, early in the next Parliament.
On Europe, the time of indecision is over. The period for practical preparation has begun. Today we begin to build a new consensus—modern and outward looking—for a country that throughout its history has looked outward to the world. We are the first British Government to declare for the principle of monetary union, the first to state that there is no overriding constitutional bar to membership, the first to make clear and unambiguous economic benefit to this country the decisive test, the first to offer our strong and constructive support to our European partners to create more employment and more prosperity.
The policy that I have outlined will bring stability to business, direction to our economy and long-term purpose to our country. It is the right policy for Britain in Europe. More important, it is the right policy for the future of Britain. I commend it to the House.
Mr. Peter Lilley: Does the Chancellor accept that his statement today was forced out of him by the confused, contradictory and improper briefings by his own office in recent weeks—briefings that have displayed contempt for the House, which should have been told first; contempt for financial probity by releasing to selected journalists market-sensitive information that caused turmoil in financial markets; and contempt for the truth, since the briefings, which we must assume he authorised, are shown, at least in part, to have been false? Would the Chancellor like to take this opportunity to apologise to the House and to the savers and pensioners whose investments have been put at risk by the cavalier way in which he has treated them?
I shall deal briefly with the confusion—the Chancellor's private office assured me today that he would deal with this in his statement, but he did not—that

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led up to the statement. Who was the "unnamed Government Minister" quoted on 26 September in a Financial Times story which said that the Government would make a
"declaration shortly on UK entry soon after the EMU launch",
which caused the biggest movement in financial markets in recent times? Who was he? Has the right hon. Gentleman inquired? Does he know?
Why did the Chancellor allow a false market to persist for some three weeks before effectively repudiating that story? Does he realise that, if any private individual did that, they would be guilty of a very serious offence? Is the Chancellor aware—[Interruption.] Is the Chancellor aware of anything? [Interruption.]
Madam Speaker: Order. The Chancellor was heard. We have just been listening to a very crucial statement, a very serious statement. I hope that the House will deal with it as such.
Mr. Lilley: Is the Chancellor aware that I have just received a letter from the chairman of the Securities and Investments Board saying that he will look into some of the matters that I have raised, but that he cannot investigate the main allegation, because
"where allegations of market misconduct are of a criminal nature, they will not fall naturally for the SIB to pursue"?
Will the Chancellor and his staff co-operate with any inquiry by the market authorities or by the Treasury Select Committee?
Was not the confusion caused by the Financial Times story, amplified by the diverging statements that the Chancellor and his press officer gave to The Times on 18 October? Can the Chancellor tell the House whether he authorised his press secretary to give certain newspapers—not to mention the denizens of the Red Lion—information which should have been given to Parliament, and which was highly market-sensitive? Did he authorise that? Will he tell the House, yes or no? Can he now say whether he authorised the briefing by his press secretary?
If the Chancellor refuses to say that he authorised the briefing—if he dissociates himself from Mr. Whelan's announcement—surely Mr. Whelan should resign. If, however, the Chancellor accepts responsibility for the release of market-sensitive information, can he tell the House of any Treasury Minister who has released such information to a journalist and has subsequently remained in office?
It was that briefing that precipitated today's statement. The question is, was the policy forced to fit the briefing, or did the briefing reflect what was already settled Government policy?
Did the Foreign Secretary know before that briefing that this was Government policy? Did the President of the Board of Trade know that it was policy? Clearly not. We know that the Deputy Prime Minister had no idea that it was Government policy; we are pretty certain that the Secretary of State for Health did not know, when he appeared on television to defend it. Was the Prime Minister himself fully aware of what his Chancellor
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intended to release? [Interruption.] I think that the Prime Minister is telling the Chancellor that his position is unassailable.
The fact is that the dither, dodge and denial of the past three weeks have been a rollercoaster ride on the stock market that has wiped billions of pounds from pensioners' savings. Is that what the Chancellor meant when he said that his priority was ensuring a "period of stability" in the financial markets? Can he now give the House a cast-iron assurance that, in future, the release of all market-sensitive information of this kind will be carried out by democratically accountable Ministers in the House, not by unelected spin doctors in secret briefings?
Now we turn to the substance of this belated statement—[Interruption.] I understand that Labour Members are embarrassed by the confusion and ambiguity of their previous briefings. The fact is, however, that, although we were promised an unambiguous and totally clear statement, even today's statement by the Chancellor allows the possibility of entry during the current Parliament, in the light of what the Chancellor calls a possible unexpected or "unforeseen change in … circumstances". Can he give us examples of circumstances that might cause him to change his mind? [Laughter.] Can he tell us the type of thing of which he is thinking? Is it not the case—[Interruption.]
Madam Speaker: Order. I would be obliged if the House would now come to order.
Mr. Lilley: Is it not the case that we now know when we probably will not enter the single currency, but do not know when, if ever, we will be ready to enter the single currency?
In essence, the Chancellor's policy remains that we will join when the time is right, but that it will probably not be during this Parliament. Does that move him forward? Is he not trying to have it both ways—trying to please those who do not want us to enter, including his friends in the Murdoch press, while declaring a commitment in principle to entry?
The Chancellor said that he will prepare the country and industry for entry, but there is nothing in his statement about one condition of entry that is laid down in the treaty: the two years' membership of the exchange rate mechanism. Why is there no mention of that? Is he saying that we will not abide by, or that he has sought a waiver of, that condition? If so, why is he afraid of Britain paddling in the shallow end, when he is prepared later to dive in the deep end of EMU?
Is the Chancellor planning in the next few years to apply for money from the European Union's propaganda fund to persuade the British people to abandon the pound? Has he already asked for such money? If he does so, does he intend that all sides of the argument should receive finance? Would it not be odd for the Government to accept European money given that they seek to ban foreign donations to political parties?
Is the Chancellor asking British industry to prepare now for entry at an unknown and unforeseeable date? Where does that leave small businesses: should they invest at this stage in cash registers and accounting systems to deal with the single currency?

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The Chancellor said that he has five tests. The truth is that none of those tests is objective, measurable and capable of independent assessment. Does not the fact that the ERM would have passed all his five tests show that they are not a very effective measure?
Does the Chancellor not realise that this is the most momentous decision that this country will take? It is more significant than joining the ERM, than going back on to the gold standard in 1925 or than joining the Bretton Woods system: they all had an exit door, whereas the single currency is intended to be permanent and irrevocable. We must be convinced that it is good for Britain not just at a moment of time, but for all future time; that it will be beneficial not just in good times, but in bad times; and that it will benefit not only some companies, but the whole country.
The Chancellor's first test is the business cycle. He is right to say that our cycle is out of line with the rest of the Community. Surely he realises that it has been getting further out of step, and there is no reason to suppose that it will move back in step in the short term.
The Chancellor says that he wants more flexibility of labour markets. Why, by signing up to the social chapter, have we handed over to countries with inflexible labour markets the power to set our rules? Does he agree that France and Italy are moving towards less flexible labour markets, as they insist on legalising a 35-hour week and imposing that on their companies?
Financial services are an important part of our industry. Why does not the Chancellor refer to the danger mentioned in previous Treasury documents that membership of a single currency would mean centralisation of regulation of financial markets, which would deprive us of the flexible regulation that has enabled the City to become a pre-eminent financial centre not just in Europe but in the world?
The greatest weakness of the tests that the Chancellor has laid down is the absence of any political or constitutional test. He cannot wipe aside—as he tried to do in his preamble—the constitutional issue as if this matter merely concerned monetary policy. The key issue is whether entry into the single currency requires centralisation of taxation and of borrowing powers. Will there be the power at the centre to transfer resources from prosperous countries to those that are handicapped by joining the single currency?
Does the right hon. Gentleman not recognise that, to most of our continental partners, this is not primarily, or to some extent even at all, an economic venture, but a political venture? Does he not recognise that, up to now, there has never been a currency without a Government to run it, or a Government worthy of the name without a currency to run? The attempt to establish a single currency in Europe without a Government to run it is intended by many to be temporary, not permanent.
Why does not the right hon. Gentleman tell us where the Government stand on that pre-eminent issue? Does he want to see, will he connive in, will he agree to, the centralisation of political power over tax, borrowing and the transfer of resources to other countries in the single currency area? Until he answers that question, we cannot accept that it is right to sign up in principle to a single currency.
Mr. Brown: I shall answer the substantive points one by one.
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It is remarkable that the shadow Chancellor of the Conservative party, which has been talking about this issue for 18 years, can come to the House, even after his session in Eastbourne last week, to draw conclusions, and not be able to tell us where the party stands on the issue of principle. Where does it stand not as to whether there are constitutional implications but as to whether there is a constitutional bar to membership? It cannot say whether the economic tests will be decisive, and the shadow Chancellor now tells us that he even opposes preparations for a single currency. [HON. MEMBERS: "Answer his questions."' I have to ask him these questions.
I have to ask the Conservative party these questions. Does it support the principle of a single currency? We do. The Conservative party cannot say, because it is divided. Does it believe that there is a constitutional bar to membership of a single currency? Some say yes, some say no. They cannot agree.
Do Conservatives believe that economic tests should be decisive in this matter? The shadow Chancellor could not tell us, but Conservatives must tell us what they believe. Equally, do they believe that sustainable convergence, once achieved, is a means by which we could move forward to a single currency? On each of those issues of principle, it was striking that the shadow Chancellor was absolutely silent: he did not address them.
I come to the shadow Chancellor's specific questions. He asked about what he called stock market movements in relation to statements. I shall read to him the letter that was sent to him by the Governor of the Bank of England. It states:
"Neither the Government nor its agent … benefited in any way from the recent movements in the gilt market … The movement you highlight—sterling's rise on Friday 17 October … was in our assessment unrelated to the interview that the Chancellor published in the Times the next day."
When he was reading the letter from the SIB, the right hon. Gentleman might have told us exactly what was in it—that there has been no notification of the determination of an infringement whatever. The shadow Chancellor would do better to withdraw his allegations.
I come now to specific questions. It is not our intention to join the ERM. There are no additional powers related to taxation in relation to the single currency; and, of course, on taxation matters there is the British veto. The shadow Chancellor asked in what circumstances we would change our view. I said precisely in my statement that they were unforeseen circumstances, which means that they cannot be foreseen. On the question of convergence, I made it absolutely clear—as I think the shadow Chancellor will acknowledge—that I was not talking about convergence at one point in time as being the decisive test for a single currency. I was talking about a sustained and durable period of convergence—a settled period of convergence—which in our view would be necessary.
It comes back to this one question. We say that, if the economic benefits are clear and unambiguous, in the national interest, we should join, if the public are prepared to support it. The shadow Chancellor cannot say whether, even if the economic benefits to the country were compelling in terms of jobs, industry and commerce—even if it were proven to him that those economic benefits were compelling—he would be prepared to recommend joining. In other words, whether it be for reasons of

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division, dogma or anti-Europeanism on the part of the Conservative party, the national interest would come second to sorting out its internal problems.
The leader of the Conservative party reflects those problems. He said at one stage that it would not join the single currency on principle. Then he said that it would not join for 30 or 40 years. Then he said that it would not join for five years. Then he said that it would not join for the foreseeable circumstances. Now he says from Eastbourne that it will not join for two Parliaments. That is a recipe whereby there will be no Conservative Government for five years, for 10 years, for 40 years, for all the foreseeable circumstances.
Mr. Malcolm Bruce: We Liberal Democrats can and do accept much of the tone, and some of the substance, of the Chancellor's statement. If the Chancellor and the Government are aiming to build a national consensus in favour of a single currency, they will have our unqualified support, but, if that is to be achieved, does he not accept that we need some clarity and some leadership, and that beneath the warm words in his statement there is still doubt and indecision?
Does the Chancellor not accept that he is effectively saying that Britain will not join monetary union in this Parliament? He has not bolted the door, but it does now appear to have been closed. Does he not remember saying in July that Britain should take its decisions on EMU for economic reasons and
"not on the basis of a timetable that has been set politically"?
But is not today's statement all about setting a political timetable?
Does the Chancellor no longer agree with the director-general of the Confederation of British Industry that there is "no economic case" for ruling out entry to the single currency in this Parliament? Does he really believe that business will invest valuable time and money in something as uncertain and distant as what he is offering today? Does he really expect business to make that commitment? Can he not accept that, despite the good intentions in the statement, the danger is that it risks replacing a strategy of "wait and see" with one of "wait, and wait, and wait"?
If that is true, will Britain's economic interests not be fundamentally damaged? The five economic tests that the Chancellor has set out are so elastic that they could stretch to the moon and back. Will he not explain how they are to be met in terms that people can understand, so that they can make a judgment as to when and how entry will be made?
Finally, will the Chancellor recognise that, if we leave ourselves out for this Parliament and, by implication, for much of the next Parliament, we rule ourselves out of giving a lead to shaping monetary union in terms of achieving convergence and being successful? Does not the national interest require us to be there?
Mr. Brown: I am grateful to the hon. Gentleman for his contribution to the debate. I will tell him where we are agreed. We are agreed on the principle. We are agreed that there is no constitutional bar to membership, that national economic interest must be the decisive test, and that we should prepare to join; but the question that I have
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to ask him is whether he believes that we should join irrespective of whether it can be demonstrated that there is sustainable convergence. It is a question whether we get it right or we get it quickly.
The hon. Gentleman suggests that it is important to get it quickly. I suggest to him that, for the British national interest, it is important to get it right. That is the only disagreement on this issue between him and me. The setting of an artificial economic or calendar timetable for Britain in this matter—when he knows perfectly well that, under the previous Government, preparations were not made, and that the business cycle is out of synch with that of our continental partners—is not in the best interests of Britain.
Where the hon. Gentleman should agree with us is that a national consensus can now be built on the need to take the preparations actively that are necessary, so that, if the country so wishes, it can join a single currency early in the next Parliament.
Mr. Giles Radice: Is my right hon. Friend aware that he and the Government deserve great credit for committing themselves to the principle of a single currency and for putting forward a programme of preparation which will, I hope, enable us to join it? In short, in that respect, today's statement is an historic step forward for this country.
My right hon. Friend knows that I share the concerns of the CBI and the TUC that the Government are virtually ruling out joining a single currency in the lifetime of this Parliament. May I just add that, the longer we wait to join a successful single currency, the more we are at risk of being marginalised not only in Europe but in the world?
Mr. Brown: I am grateful to my hon. Friend, who is a long-standing supporter of the European cause and who has written widely on such matters. I am sure that it is true to say that he would have liked to join the single currency in January 1999, but he must accept that, while we agree on the principle and agree that there is no constitutional bar, the fact is that the proper preparations for Britain were never made under the previous Government. The structural and other reforms that are necessary to bring us to the point of decision have not been made.
It is not realistic to plan on the basis that we will join in this Parliament, and the reasons for that must be absolutely clear to people who have listened to the statement today: it is stability that matters; we must achieve sustainable convergence, and that cannot be achieved overnight; and we must make the proper preparations as a country. Once the country looks at the analysis by the Treasury on the whole question of economic tests, it will agree with what I have said today.
Mr. Kenneth Clarke: Does the Chancellor agree that the bizarre incompetence of his team a week ago has forced him to come to the House and concede, as I have long suspected, that he essentially agrees with me on the main point of this great issue?
Does the right hon. Gentleman accept that, if the other member states of the European Union go ahead with economic and monetary union, and if they create a sound monetary structure, it is inevitable, sooner or later, that it will be in this country's interests to join that economic

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and monetary union? If we mishandle the timing of that decision, we run the risk of a period when we will have second-rate economic prospects, when this country will be a second choice for inward investment, and when we will play a second-division role in the affairs of the European Union.
If what we are considering today is the handling and the timing of that decision and what is or is not foreseeable, does the right hon. Gentleman also accept that the timetable that he suddenly produced today to put flesh on the bones of Charlie Whelan's timetable of a week ago has nothing to do with a lack of preparation, because he inherited contingency work which he is now bringing to fruition in the Treasury where he took over? It also has nothing to do with when our economy is synchronised with those on the continent, which is extremely important but unforeseeable, but has everything to do with the obsession of the Prime Minister and the Chancellor with the management of the press, Rupert Murdoch's press in particular, and the fact that they are in a total panic about when and how they will face a referendum, if they ever get around to joining.
Does the right hon. Gentleman realise that that approach causes great damage to the very stability that he says he wants to see in our affairs; causes great damage to people's confidence in this country's economic prospects; and causes immense damage to any confidence in the decision-handling abilities of himself and his right hon. Friend?
Mr. Brown: The former Chancellor says that he agrees with me; his problem is that he does not agree with the leader of his party. In fact, very few in his parliamentary party agree with him. I said earlier that I was the first Chancellor in a Government to say that we supported the principle of monetary union, but that is not strictly true: the right hon. and learned Gentleman said that he supported it, but the problem was that he was speaking in a personal capacity. It was not the then Government's official policy—and now we find that even the Prime Minister of that Government did not agree with the official policy at the time.
We are agreed on the principle. The right hon. and learned Gentleman says that preparations have been properly in hand—perhaps he did not tell the then Prime Minister about what he was planning in the Treasury at the time—but I can tell him that we are not prepared to enter a single currency, and that preparations have not been made here as they have been made in other European countries. If he reflects on it for a minute, he will recognise that that is the case.
We have to be satisfied that we have met the five economic tests that I set out. If we do so, it will be appropriate to put the question to the country, but if we cannot, it would be irresponsible for a Government to recommend entry, and I will not do so. We will make a decision only when we know that we can meet the substantial economic tests that we have set out: that will be the true test of national economic interest.
Mr. Tony Benn: Is my right hon. Friend aware that his statement will be remembered not for its economic analysis but because he has told us that the Government believe that the electors have no right to determine our economic policy through the ballot box,
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that Parliament has no right to play a part in determining that policy, and that the Government will not in future claim to control the key levers of power that determine our people's standard of living? On that question, fundamental differences cut across all parties.
With 18.5 million unemployed in the European Union, few people will accept that the move into a deflationary system will be beneficial. I agree with my right hon. Friend that the issue is probably the most important to face this generation, so will he give a categorical assurance on behalf of the Government that, when the debate takes place, all members of his party and everyone else will be able to speak their mind on every aspect of European policy without any gags being imposed to prevent them from expressing an honest opinion?
Mr. Brown: I do not think that the right hon. Gentleman has been prevented from speaking his mind for some time. On unemployment, it is precisely because of that problem that we have a welfare-to-work programme; we are dealing with that issue. On the consent of the British people, I think that he would recognise that our decision to hold a referendum if a recommendation is made by Government and approved by Parliament means that the people will have the final say. That is absolutely as it should be.
Sir Michael Spicer: If one gives up all control of interest rates, exchange rates, money supply, national reserves and—through the stability pact—fiscal policy, has not one ceased to be an independent nation state?
Mr. Brown: The hon. Gentleman has got it wrong. There is no question of our giving up our ability to make decisions on tax and spending. That is what we do, and will continue to do, through our Budgets. This afternoon we have seen the two sections of the Conservative party: the one, led by the former Chancellor, is for going in almost immediately, and the other is for never going in at all.
The shadow Chancellor and the leader of the Conservative party tried to bridge the gap by saying that entry would take 10 years. On what basis? If it is wrong in principle, why do they not rule it out for 100 years? If it is not wrong in principle but depends on the economic situation, why do they not apply the economic tests exactly as we do? The Conservative party must grow up.
Mr. Tam Dalyell: If one wants to catch a train, is it not prudent to get on that train at the point of departure rather than trying to catch up with it when it is well on its journey? Is it not, and I say this very sadly, an historic mistake not to go in on 1 January 1999? What did John Monks, speaking on behalf of the General Council of the TUC, tell my right hon. Friend?
Mr. Brown: I am grateful to my hon. Friend, who has been a long-standing supporter of European integration, but I have to tell him that his proposal for 1 January 1999 is not a realistic prospect. Interest rates in Britain are 7 per cent., while on the continent they are 3 per cent. There is no convergence of the economic cycle that could make entry in 1999 possible. We have to make a decision based on the economic tests that we are applying.

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On that basis, it is not a realistic prospect, in our view, to decide to join then, nor is it a realistic prospect to decide to join during the course of this Parliament, barring something unforeseen. I believe that, when he considers those issues—and particularly the Treasury assessment—on all the economic tests, my hon. Friend will agree that 1999 is unrealistic. I think that he will find John Monks and the TUC supportive of the facts that we favour the principle and that we will make proper preparations so that a decision by the country to join can be made at an appropriate time.
Mr. Douglas Hogg: Does the Chancellor agree that, following the report in the Financial Times at the end of September, a false market in shares was created? Does he agree that the principal cause of that was the remarks of an unnamed Minister to the effect that early entry to the single currency was to be anticipated? Given that a false market had been created and could have been dispelled, why did not the Chancellor make his position clear much earlier—or had he not made his mind up?
Mr. Brown: I must refer the right hon. and learned Gentleman to the letters from the Bank of England and the Securities and Investments Board on his points about the shares market. On making definitive statements, with the detailed assessment, I have done it, as people would have expected me to do, in very great detail, and I have done it in a statement to this House.
Mr. Stuart Bell: Does the Chancellor agree that the country will welcome what my hon. Friend the Member for North Durham (Mr. Radice) described as an historic decision? It is historic because the principle of entering into a single currency is confirmed and the option of not entering is foreclosed. Does he agree that the City will be pleased to hear that the Government will adhere to the stability pact? The emphasis on preparation and convergence will be important.
Does my right hon. Friend agree that preparation will mean that the time lag between the decision to enter the single currency and actual entry after getting the approval of the people in a referendum will be reduced, so that we can play the part that the Prime Minister has described at the heart of the Europe, influencing European affairs?
Mr. Brown: I am glad that my hon. Friend realises the importance of preparation—something that has been lost on the Conservatives. It is very important that the standing committee that we have set up with the Governor of the Bank of England, the president of the CBI and the Association of British Chambers of Commerce gets to work to look at these issues in great detail and to make recommendations to us. We would be failing in our duty if we did not set up that committee and make preparations now.
My hon. Friend mentioned the importance of the City of London and financial services. It is one of the tests that we are applying on entry to monetary union that jobs in the City and in financial services, which are a rising part of employment in our economy, can be enhanced by a decision to enter.
On the general question of jobs, I believe that our test on jobs is the most important one for the British people. We are pressing right across Europe, through our plans for the
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special employment summit and other things, for Europe to direct its attention to solving the problems of unemployment.
Mr. Dafydd Wigley: Does the Chancellor accept that we in Plaid Cymru see considerable benefit from being in the single currency for industry, agriculture and home owners, always provided that there is a real mechanism to deal with regional discrepancy? There is as great a need to deal with that, both in the UK and in other parts of Europe, as there is to deal with convergence between states in Europe. In his statement, the Chancellor did not refer to dealing with regional disparity. Will he now address it, and accept that we would very much like to have been in the single currency in 1999, as the Irish Republic will be?
Mr. Brown: I am grateful to the hon. Gentleman for his general support of the statement of principle and the practical measures that we are taking for preparation. Unemployment and regional policy are right at the heart of the debate about EMU. If he looks at the Treasury's economic assessment, he will find that the worries about flexibility relate to the ability of regions and parts of the European economy to withstand any shocks that may arise owing to changes in their economic circumstances. It is precisely for those reasons that we must be satisfied that there is an ability to adjust to change within the European economies so that regions cannot and do not lose out at a time of great economic change.
It is most important for Wales, Scotland, Northern Ireland and other regions of this country that we attack the persistent problems of unemployment and the lack of skills in the economy—it is central to our test for economic and monetary union that progress is made in those areas. Our proposals for education and training, which have come from the Department for Education and Employment—and from the Welsh Office in the case of the hon. Member for Caernarfon (Mr. Wigley)—and our proposals for reform of the welfare state are vital if we are to put our economy on the right lines.
Mr. Dennis Skinner: Will my right hon. Friend accept from me that it is not a good idea to catch the first train that leaves the station as it might be run by Branson and get you nowhere? Does he accept that the issue of the Common Market and the European Union has blighted every Government for the past 30 years? He is right to be careful about the progress that is being made at this time. When the previous Government decided to join the exchange rate mechanism last time and we were taken in by the previous Prime Minister but one, wonderful, meticulous preparations had been made. However, notwithstanding that, 16 September 1992 ended in a calamity for Britain—£10 billion was lost, the Prime Minister was locked in a lavatory and the Chancellor of the Exchequer was running about trying to find a portable radio to discover the Financial Times index. I hope that that will be etched in my right hon. Friend's memory. Although he is not catching this train, he wants to be careful about catching the next one.
Mr. Brown: It is precisely because of the danger of making economic decisions on political grounds that we are going to be absolutely careful, both about the preparations to make a decision on monetary union and about insisting

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that the economic tests are met. When my hon. Friend looks at the documentation provided he will see that in relation to the business cycle, flexibility, employment and investment, we must be satisfied that the economic tests that we have set down for both convergence and sustainable monetary union are met. It is part of my job at the Treasury to ensure that.
Mr. John Butterfill: I wish to question the right hon. Gentleman on convergence, particularly the convergence of interest rates. He has said today that interest rates in this country are more than double those in continental Europe. There clearly needs to be convergence before we can enter and it is also clear that it is fairly unlikely that interest rates on the continent will rise significantly over the intervening period. Is the right hon. Gentleman giving a commitment today that there will be a progressive reduction in British interest rates? Is that his policy as from today? If so, how will he deal with the problems of inflation? Will he reduce public expenditure or increase taxation?
Mr. Brown: The hon. Gentleman should understand—I hope that he does not misunderstand this—that there is no weakening of the inflation target. I have said that if we can make a success of our economic reforms, over time I should like to reduce the inflation target. It is precisely because interest rates have diverged—in Britain, to deal with an incipient inflationary problem that we inherited from the previous Government—that it is not realistic either to enter in 1999 or to make a decision to enter by the end of this Parliament. The aspects that the hon. Gentleman mentioned in relation to convergence are not only making progress—our institutional reforms in the Bank of England to get control of inflation and our fiscal deficit reduction plan to get control over public borrowing are essential in the national economic interest. That is the policy that we shall pursue.
Mr. Robert Sheldon: Now that the decision has been taken, is my right hon. Friend aware that we must avoid any parallel with the situation 40 years ago, when we failed to become a member of the Community, and accepted disadvantageous conditions on our subsequent entry? I would like to ask one question in particular: how will he deal with the danger of decisions crucial to us being taken against our own national interest?
Mr. Brown: My right hon. Friend, who has taken a great interest in these matters over time, ought to be reassured about two things. First, our statement of principle today—the first statement of principle on a single currency made by a British Government—will send a signal to our continental neighbours that we are serious about the project. Secondly, I am determined that economic decisions are made in the ECOFIN Council—the Council of Finance Ministers—and I will continue to make proposals to ensure that that is the case.
My right hon. Friend is absolutely right to say that we missed opportunities in the past; we must not miss opportunities again, but we must make sure that, in seizing the opportunities available, we are sure that the economic benefits can come to this country and sure that the economic tests that we set down are not passed over to meet an artificial timetable, but are actually met.
Mr. Robert Jackson: I agree with the Government that popular consent is necessary before we
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can enter monetary union. Is the Government's commitment to a referendum as the device for securing that popular consent absolute; or is it possible, in the Government's view, that that requirement could be met by getting a mandate in a general election?
Mr. Brown: I said that it was the policy of the Government to put us in a position where a real choice, after preparations had been made, could be made early in the next Parliament. That is based on our assessment of the economic difficulties and the problems of preparation that we must now face. I said that there would be a referendum at that time if the Government made a recommendation and if Parliament so decided.
Mr. Austin Mitchell: I congratulate my right hon. Friend on his statement. I am delighted that he has placed so much emphasis on participation in a successful monetary union, because it will not be successful. It would be a mistake to rush to buy a non-flying pig in a deflationary poke.
As the attempt to go into monetary union in Europe—even if we are not going to be part of it—will cause uncertainties, what are my right, hon. Friend's plans for these foreseen circumstances? First, there is the uncertainty as to whether or not monetary union takes place. Secondly, there is the uncertainty about whether it is a hard or a soft euro and a wide or narrow monetary union. Thirdly, there is uncertainty created by what amounts to a speculators' charter, like the ERM, once rates are fixed before the euro emerges in 2002. The danger is that all that will bring a flight of funny money from Europe and its uncertainties into the pound to push sterling higher. How can we cope with that?
Mr. Brown: My hon. Friend should bear it in mind that one of the purposes of a common currency is to avoid systematic currency speculation between 15 or a number of different currencies on the European continent, and that, in the long term, the development of a single currency would work against the speculators and not in their favour. He is right to say that a time is needed to assess how monetary union is working, as well as a time for preparation for Britain. I hope that he will agree that that is what we are doing.
However, I challenge my hon. Friend's analysis that our economic policy in Britain is in any way being imposed by policies from other parts of Europe. The decisions we have made on interest rates and public borrowing are the decisions that are right for Britain. We must get away from a situation in which we have a stop-go economy—where, every time we expand, inflation rises, we have to cut back, and we end up with the boom and bust cycle that caused so much damage during the Conservative years. It is to get away from Conservative instability that we have put in place the policies we have.
Mr. John Swinney: The Chancellor has laboured the points on convergence, and they are obviously important, but does he recognise the concern felt in the Scottish economy about the fact that the interest rate policy being pursued by the Bank of England and the Government is higher than is required by the Scottish economy, which is not experiencing the overheating seen in the economy of the south-east of England?

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There would be many economic advantages to exporters and the Scottish business community from earlier entry into a single currency. What would the Chancellor like to say to those in the business community in Scotland to enhance their preparations for the single currency and to give them any more certainty than ever existed when the Conservatives were in power?
Mr. Brown: I am not sure whether the hon. Gentleman wants separate currencies in the United Kingdom or a single currency in Europe—he is not absolutely clear about what his policy is. However, I can tell him that this Government's policies to tackle the problems of unemployment in Scotland and the problems that cause unemployment, which include the lack of skills in Scotland, and to deal with some of the structural problems of the Scottish economy are the policies that are best suited to getting people in Scotland back to work.
Mr. Martin O'Neill: In stating the criteria very clearly, my right hon. Friend also made the point that it is important that we get it right, rather than that we go in quickly. Will he bear in mind the fact that, for some industries in this country, and some people whose jobs depend on those industries, the prospect of not going in quickly presents great difficulty, because we are labouring under the problems of an overvalued currency and fluctuating interest rates? In getting it right, will he make sure that not too many jobs are lost too quickly as a consequence?
Mr. Brown: My hon. Friend has an important role in the House as Chairman of the Select Committee on Trade and Industry, and he is right to draw attention to any difficulties facing industry resulting from the inflation generated by the policies of the previous Government. I am aware that it is more important to get it right than to get it quickly; however, I understand that what people need is a framework within which to plan, and that is why we have made the decisions we have announced today. There will be a time of preparation, followed by a time of decision.
Sir Teddy Taylor: I welcome very much the unambiguous commitment to the referendum given by the Chancellor today. Will he make it abundantly clear that, while preparations are being made for joining in the event of the single currency being a success, he will make comparable proposals and preparations in the event of the single currency turning out to be an almighty disaster—as some of us think it might? Will he bear it in mind that there is a sincerely held and deep-rooted feeling among members of all parties in the House of Commons that a single European state, without democracy and based on a single currency, will inevitably result in mass unemployment, misery and the sort of instability that we saw at the time of the gold standard?
Mr. Brown: I am not sure whether the hon. Gentleman wants us to make preparations not to join, but I have to tell him that the single currency will affect us whether we are in or out, and it is important that the nation addresses itself to both the difficulties and the opportunities that arise from it. As I said in my statement, only a few days ago Marks and Spencer announced measures that it was taking, and
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yesterday National Westminster bank announced training measures in respect of the euro. It is not right for Conservative Members to ask us to have our heads in the sand when events are occurring that affect us directly.
As for our policies on the economy, the policies that we are pursuing to tackle inflation, to keep borrowing under control and to create jobs through reform of the welfare state, are right for Britain anyway.
Mr. Dale Campbell-Savours: Is it not true that, if a hard core of countries proceed with EMU at an early stage—before the United Kingdom does so—the inevitable consequence will be a large volume of euro currency circulating within the United Kingdom before the next general election? Personally, I would welcome that.
Does it not follow that, before the next election and before the referendum, many firms in the United Kingdom may well be paying salaries in euro currency, and perhaps even entering into transactions at retail level? In many ways, the approach adopted by my right hon. Friend, which is based on consensus, will ease the path towards the inevitable decision, which I believe will be in favour.
Mr. Brown: My hon. Friend makes an important and telling point both about the need to prepare and about the fact that this matter will affect us. It is true that euro notes and coins will be in circulation on 1 January 2002—indeed, it may be earlier than that if certain decisions are made—and, although I cannot say when the next election will be, it is possible that it might be held before or after that date. The fact of the matter is that it affects us; we have to be alert to that fact, and we have to prepare. That shows the wisdom of a new policy from the Government today to make preparations.
Mr. William Thompson: Does not the Chancellor's statement today about active preparations for a single currency in effect mean that the Government have taken a decision to go in? Will the markets not see it as that, and will business men not see it as that? More important, does not the decision today prejudice any referendum that will be held, because the Government will then say, "All the preparations are made; we can't say no now"?
Mr. Brown: I think the hon. Gentleman would acknowledge the importance of the European Union, not just in other areas of the continent, but in Northern Ireland, through the work of the European investment bank and other institutions. But I have to tell him that, if we have a Government—as we do—who support the principle of monetary union, who see no constitutional bar to joining, but who realise that the nation is in many ways ill prepared even to take a final decision on these matters, it is right to make these preparations, and that is what we will do. I repeat to the hon. Gentleman: the European monetary union affects us whether we are in or out, and I would be failing in my duty as Chancellor if we did not make the preparations to deal with that.
Mr. Ted Rowlands: May I suggest to my right hon. Friend that rather greater constitutional issues are involved than perhaps his statement indicates? For example, surely a decision that will lead to imposing public expenditure limits and public borrowing limits on all future British Governments is a constitutional issue. If it is a constitutional issue of such

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significance, is that not the reason why, rightly, my right hon. Friend and the Government are offering a referendum: because it is not only an economic issue, but a constitutional one, that we put to a referendum?
Mr. Brown: I think that, when my hon. Friend reads my statement in detail, he will see that it says that I accept that there are constitutional implications. What I do not accept is that there is a constitutional bar that outweighs the economic tests as the decisive reason why we might join a single currency. As for his point about public expenditure and taxation, I repeat to him: the measures that we have taken both in the Budget, and in the decisions on other issues around Budget time on public expenditure and everything else, are the measures that are right for Britain. It is right that we follow the fiscal rules that we have set down. These are rules that we set for ourselves.
The decisions that we have taken about inflation and interest rates are also decisions that we have taken for Britain. They are within the terms of the stability pact and within the likely operation of monetary union, and I do not see an inconsistency between pursuing the policies that are right for Europe and the policies of convergence that can make possible a decision on monetary union.
Mr. Eric Forth: Can the Chancellor tell the House what the constitutional implications are of British membership of economic and monetary union, to which he apparently attaches so little importance?
Mr. Brown: I said—I hope that the right hon. Gentleman will also read my statement—that we are talking about a pooling of economic sovereignty. I do not deny that that is the case. If monetary union takes place, interest rates are set at a European level and there is European action to deal with the problems of inflation, but I do not myself see that that is a bar to monetary union—that there is a constitutional bar to it. Instead, I believe that the economic advantages outweigh the constitutional implications that no doubt the right hon. Gentleman would want to emphasise.
Mr. Denis MacShane: The Chancellor referred to setting up a committee of the Governor of the Bank of England, the heads of the CBI and TUC and the heads of the Association of British Chambers of Commerce to discuss this issue, but I invite him to go a little further, because we need to decontaminate the whole terrain of European discussion, which has been poisoned by five years of xenophobic anti-Europeanism, of which we have heard no little expression again this afternoon.
I invite my right hon. Friend to look to the regions: in my constituency, great exporting firms such as British Steel and Beatsons Clark will welcome this clear statement of principle. I invite him to look to the universities; to the representatives of all the employees involved in this. They, too, can take part in this discussion and preparation, so that, when the decision comes, we are ready for it, having made up for the ground lost as a result of the anti-European hostilities of the Conservative party.
Mr. Brown: One of the problems with what happened during the time in office of the previous Government was that, not only were no preparations made to the necessary level, but no information was flowing about the practical implications of monetary union. As my hon. Friend may
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know, during the summer we published a pamphlet on the pros and cons of monetary union for business. We published a major study on that, and set up a business advisory committee.
Today I have announced that there will be regional conferences for my hon. Friend's region, for Northern Ireland, for Scotland and for Wales, in which the practical implications of monetary union can be discussed. I believe that that is the responsible way to proceed.
Mr. Howard Flight: What the Chancellor has said today is dramatically different from that which appeared on 26 September in the Financial Times. I should like to know why the Chancellor did not contradict it at the time, if Government policy was as described today. I should like to know that the Chancellor and the Prime Minister realise that they have lost the confidence of the financial community that they have been talking about, not just in London but elsewhere, and I should like the Chancellor to assure the House that, on matters as serious as this, leaks of the sort that we have had this summer will cease.
Mr. Brown: The hon. Gentleman should note that I have come to the House at the earliest available opportunity. I have made a detailed statement, and published the Treasury assessment. I would say to him that none of that detailed assessment published by the Treasury appeared in any newspaper before we came to the House.
Mr. Peter L. Pike: My right hon. Friend will know that most industrialists in a constituency such as mine believe that it is essential that we should get into the single currency as soon as possible. They recognise that 1 January 1999 is impossible because of the failures of the previous Government. The commitment that has been given today now needs a commitment from those industries that invest and keep jobs in this country, because I believe that it is an important commitment on both sides and will benefit places such as Burnley, and the whole of the country, in the years ahead.
Mr. Brown: I am grateful to my hon. Friend, because he reflects the views of industry and business in this country that Britain should not be left behind on vital issues of principle affecting the future of our economy. It is for these reasons that the preparations will start, it is for these reasons that there is a consultative committee with business, and it is for these reasons that the standing committee has been set up.
The Conservatives' failure to say that the test of monetary union will be the economic benefits—indeed, their view that, even if benefits could be proven for monetary union, they would still be against it—shows that they are now the anti-business party in Britain.
Miss Anne McIntosh: Given the right hon. Gentleman's comments on strengthening employment and improving the competitive situation, will the Chancellor of the Exchequer now advise the House to reject the employment chapter of the Amsterdam treaty, and will he inform the House whether he consulted the Governor of the Bank of England before briefing The Times on 18 October?
Mr. Brown: I am in regular contact with the Governor of the Bank of England about many issues. As far as the

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employment chapter of the Amsterdam treaty is concerned, we take some pride in the fact that employment issues have become central to the discussions of the European Union.
I still have not heard an answer to the question whether the Conservative party still wants a referendum on the Amsterdam treaty—one of the other proposals that came from the leader of the Conservative party.
As far as employment is concerned, the British Government are leading in Europe in making issues related to employment, and skills and education for employment, central to the European agenda; that is absolutely right.
Mr. John Hutton: I congratulate my right hon. Friend on his statement, which I warmly welcome, and on his clear rejection of the Luddite economics of the Conservative party. Is it not a matter of plain common sense that any decision on the part of the British Government to join a single currency should be based on the economic evidence that prevails at the time, not on the basis of any arbitrary timetable, which now appears to be Conservative party policy?
Mr. Brown: I agree entirely with my hon. Friend. It is now Conservative party policy that the Conservatives will not join a single currency or consider it for two Parliaments. They have been unable to explain, since the excitement of their get-together at Eastbourne, why they have retreated from their previous view that they would not enter in the foreseeable future, and suddenly it became 10 years. Indeed, the retreat to Eastbourne became the Eastbourne retreat on policy as a result of what they had decided.
It is economic logic that will take the decision as far as the Government are concerned, and until the Conservatives make up their minds whether they support the single currency on principle, they are like people without a route map, and they will inevitably get lost.
Sir Edward Heath: Is the Chancellor of the Exchequer aware that his whole-hearted commitment, and that of the Government, to a single currency is extremely welcome, and that it will be widely welcomed by industry and by finance in this country, by Europeans, and by all those who have invested here from outside?
On the other hand, the right hon. Gentleman's refusal to accept the single currency immediately and to become one of the first members participating in it is bitterly disappointing. He and the Government will lose all influence in the European Union in all financial questions and in everything concerned with the single currency—he cannot expect or hope for any influence. That means that the other countries that are debating it and settling it will have their own way. What is more, there will be a general loss of respect for the British among all the other member countries because the right hon. Gentleman has decided to take no action.
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Secondly, is the Chancellor aware that he will now find it extremely difficult to keep up the pressure in the way he claims to desire? I cannot have much confidence in a committee that contains the Governor of the Bank of England, who said at the IMF Hong Kong conference, "Why is everybody in a hurry?" That does not seem to be a sign of someone working towards the end which the Chancellor himself wants.
I am one of those who was here in 1950, and I cannot banish from my mind the recollection of the ghastly blunder made by Mr. Attlee and his Chancellor of the Exchequer when they refused to have anything to do with the initial negotiations over the Coal and Steel Community. The result was that we were left outside all the institutions for 22 years, until I signed the treaties in Brussels in 1972. During those 22 wasted years, we had not a scrap of influence. [Interruption.] I quite understand the attitude of my colleagues who say that we should never have joined at all—because they have lost the day.
The Chancellor should also bear in mind the fact that a perfect match of economies will never be achieved outside the single currency; it will come only when countries are inside the currency. That will force them to take the measures necessary to bring about the unity which the Chancellor rightly requires.
Mr. Brown: Despite some of his comments, I am grateful to the right hon. Gentleman for continuing to argue the case in principle for monetary union over many years. We are agreed that monetary union is a good thing in principle if its economic benefits can be proven. We are further agreed that there is no constitutional bar to joining; and the right hon. Gentleman would agree that it would be wrong of the Government to put their head in the sand, and that we should make proper preparations so that we can reach the point of decision.
I would part company with the right hon. Gentleman in that I do not think it right for the Government to join without being sure that the economic benefits to the British economy can be shown to be obvious. We must pass the necessary economic tests before locking ourselves into what will be a major change in the way our economy works. The tests that we have set—on convergence, flexibility and the effect on jobs—would have to be met before it would be responsible to argue that we should definitively go in.
The Europeans will be pleased that we have made this statement of principle. It was the right thing to do. They will also be pleased that we have removed any constitutional bar to joining and that we are making preparations. The right hon. Gentleman will agree, on reflection, that it is right to have the Bank of England represented on a committee looking at euro coins and euro notes. The Europeans will be happy that we are making active preparations to join.
Several hon. Members rose—
Madam Speaker: Thank you. We shall now move on—[HON. MEMBERS: "Oh!"] I am sure that we will return to this question, but Members must understand that it is quite impossible to call everyone who has an interest. We have had a good exchange of views in the past hour and a half.

Points of Order
5.3 pm
Mr. Douglas Hogg: On a point of order, Madam Speaker. I think you know that I tabled an application under Standing Order No. 24 to adjourn the House so as to enable it to debate the fact that the Government are gagging Euro Members on matters of major constitutional importance. Your Secretary informed me that you had decided not to allow me to move that application. I told your Secretary that that power was not obvious in the text of the Standing Order. Indeed, the Standing Orders were redrafted in March of this year.
Your Secretary, Madam Speaker, was good enough to refer me to the statement that your predecessor made in 1991, when he held that the Speaker had a power not to allow such applications even though that was not apparent in the text of the Standing Order.
You will appreciate, Madam Speaker, that there have been many occasions when the Government have made announcements outside the House; and I am sure that you would not wish to prevent Back Benchers from raising issues of constitutional importance. You will also be aware that the Procedure Committee, at the end of the 1980s, did not wish to give the Speaker the power that your predecessor asserted existed.
In these circumstances, will you look again, Madam Speaker, at your predecessor's ruling, to determine whether it is still appropriate? If you decide that it still is, can you suggest to those who draft the Standing Orders that the fact that you have such a power should be apparent in the Standing Orders themselves?
Madam Speaker: In the first place, it is not the procedure of this House that any hon. Member who has made an application to me under Standing Order No. 24
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should raise it on the Floor of the House. The right hon. and learned Gentleman is an experienced Member and former Minister, and I would have expected him to understand the procedures of the House.
Secondly, it is not incumbent upon the right hon. and learned Gentleman to repeat a conversation that took place between my office and him. My office tries to assist hon. Members, and I deprecate the repetition of such conversations on the Floor of the House.
I have no wish to embarrass the right hon. and learned Gentleman, but I have to tell him that his Standing Order No. 24 application did not even reach first base. If he considers that an issue of parliamentary privilege or contempt has arisen, he should write to me, and I will then consider the matter. Apart from that, I see nothing in what he is saying that should properly engage the Speaker of this House.
Mr. Andrew Robathan: On a point of order, Madam Speaker. It relates to the freedom of Members of this House, and I should be grateful for your ruling.
When my party was in government, I noted that hon. Members from both sides of the House went around planting oral questions—a practice you and I both deprecate. You can therefore imagine my surprise when, this afternoon in the Table Office, I was given a question by the Member who I believe to be the parliamentary private secretary to the Minister without Portfolio, who asked me to raise this planted question with that very Minister. Will you rule that asking Opposition or Government Members to raise planted questions is quite improper?
Madam Speaker: I would have looked forward enormously not just to the question but to the hon. Gentleman's supplementary, because that is when the knife goes in. I am sure that Ministers will have learnt their lesson.

Defence Policy
Relevant documents: Minutes of Evidence taken before the Defence Committee on 29th July (Gulf War Illnesses), HC 222-i, and 30th July (Strategic Defence Review), HC 138-i, and the First Special Report from the Defence Committee (Government Replies to First to Sixth Reports of Session 1996–97: HC 94 (Sale of the Married Quarters Estate), HC 211 (The Army Terms of Service (Amendment) Regulations (S.L, 1996 No. 2973)), HC 142 (Defence Medical Services), HC 127 (Defence Spending), HC 233 (Heavy Lift) and HC 158 (Gulf War Illnesses: Latest Developments)), HC 153.
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert Ainsworth.]
5.7 pm
The Secretary of State for Defence (Mr. George Robertson): It is a great honour to address the House in my first defence debate as Secretary of State for Defence.
Our armed forces and the civil servants and other civilians who support them are a great credit to our country. Wherever they are called upon to serve in the world, from the Falklands to Bosnia, from Iraq to Northern Ireland—and many other places, too—they earn the respect of those whom they are called upon to defend. They perform a difficult and often dangerous task with great distinction, and it is my privilege to pay tribute to them today.
Those brave men and women are now participating in our strategic defence review, which is the central part of the Government's defence policy. When I launched the review at the end of May, I said that I wanted it to be open and inclusive, unlike the secretive and often partial reviews of the recent past.
I firmly believe that there is a consensus on defence in the British nation, and I want the review to reflect it. The British people are tired of petty squabbling by politicians over important national matters where little real division exists. My confidence that such a consensus exists has led me to embark on an unprecedented amount of consultation in this review. I am sure that it will be possible to establish a wide base of support for the conclusions that the review will eventually reach.
The consultation process has a number of strands. First and most important, we are holding this two-day debate in the House so that hon. Members can give their views on the priorities that Britain should set for its security policy and armed forces. My Ministers and I will listen with great care to what is said during the debate. Secondly, in the run-up to the debate, the Foreign Secretary and I held two open seminars attended by the principal Opposition spokespeople and others, and I shall hold a third seminar shortly. Thirdly, I invited anyone with an interest to submit his or her views in writing, and so far we have received more than 450 contributions. Of those, some 370 authors have given permission for their contributions to be placed in the Libraries of both Houses, where they are now available for reference. Another consultation with a panel of individuals, both expert and non-expert in defence matters, and with the armed forces, is also in hand.
In addition to what I say today, I outlined the Government's thinking in recent speeches that I made to the English Speaking Union and the Royal United Services Institute, and those will be available in the Libraries of the House.
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All that is in stark contrast to the methods used by Governments in the recent past. This review is different: we are consulting, so let no one say that they have not had a chance to express their view in this open review process. We have listened to many people in the past five and a half months, and I shall now outline some of the Government's views on our security priorities.
We believe that the British are by inclination internationalist, not isolationist. When the British people voted new Labour on 1 May, they did so in part because they trusted us to represent them in the great councils of the world. The British people also trusted new Labour because they believed that we would protect and improve the tools that underpin Britain's place in the world, particularly our armed forces, which are held in such high regard abroad. We will not betray the trust of the British people.
Mr. Nick Hawkins: In that case, why did not the video of new Britain shown to Commonwealth leaders at the Edinburgh summit mention Her Majesty's forces?
Mr. Robertson: If the hon. Gentleman is as obsessed as some of his colleagues seem to be with those videos, he will realise that the Commonwealth is not an institution with a defence dimension. Perhaps he suggests that it should have one. The Government's commitment to our armed forces and the job that they do is beyond question.
Just as we are determined to play a positive and active role within the European Union, so we shall play a leading role in NATO and the United Nations. The transatlantic link remains vital to our defence and our country, so we can and will be involved in the world. We shall not stand aside from the new threats and problems that face the international community because that is not our way. We intend to be persuaders for our values and points of view. Britain will continue to be a force for good in the world.
Such a role, however, carries obligations. If we are to discharge them properly, we must have well-equipped, modern, capable armed forces, able to counter the problems that we are likely to encounter in the 21st century. The Opposition patently missed that vital point in all their long years in government.
The world has changed fundamentally in the past 10 years. The fall of the Berlin wall and the collapse of the Warsaw pact removed the monolithic threat facing the peoples of Europe. The end of that terrible confrontation is greatly to be welcomed, but it has left problems in its wake. Other tensions, sometimes long submerged, have been able to surface now that the super-power confrontation has been dissolved.
I remember calling that new and complex picture a "bonfire of the certainties". The world is now a much more complex and confusing place. However, some people continue to say, "Who is the enemy now that the Warsaw pact has gone?" I have a clear answer for them: the enemy is the instability that can threaten the peace and prosperity that we now enjoy. Only last week, we saw an influx of migrants, of refugees to this country from Slovakia, which created a great stir in Britain. Just imagine the population migrations that could result if the economies of central and eastern Europe failed in their brave reform programmes.
Ethnic disputes, such as that in the former Yugoslavia, and territorial ambitions such as those displayed by Saddam Hussein, have caused major conflicts in the

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1990s. Other problems exist as well. Religious tensions, the competition for scarce resources, including water, and the new security challenges posed by the drugs trade, organised crime and terrorism must all be dealt with.
The previous Government sadly failed to recognise that agenda. The armed forces inherited by this Government are doing difficult jobs extremely well in very demanding circumstances, but they were subjected to a series of savage and arbitrary cuts, which shocked the British people as they became widely known.
Mr. Jonathan Sayeed: If those essential commitments demand extra spending, will the Government provide it? If not, how can this be called a review? Is not it just a cost-cutting exercise?
Mr. Robertson: The hon. Gentleman asks whether we shall increase spending, then implies, by answering his own question, that we shall cut expenditure. There are demanding commitments and holes in capabilities, which I shall outline. We shall have to rethink priorities inside the Ministry of Defence. I do not think that the Conservative party suggests that we increase defence expenditure—it would be bizarre if it did, given that it cut £9 billion from the defence budget in the past nine years. The hon. Gentleman would be wise not to go on about expenditure cuts but to stay silent and listen to the catalogue that we were left to deal with and the problems that we must face.
Since the mid-1980s, under the Conservative Government—Mrs. Thatcher's Administration—defence expenditure in the United Kingdom has declined by 29 per cent. in real terms. It now stands at 2.7 per cent. of gross domestic product—the lowest level since 1934. That is an interesting date for Conservative Members to ruminate on for a moment.
Mr. Keith Simpson: Will the right hon. Gentleman give way?
Mr. Robertson: I shall come to the hon. Gentleman's insider knowledge in a moment, but let me remind him what the Conservative Administration were doing, so that the House has a full picture of what we inherited.
Since 1990—the year after the Berlin wall collapsed—the strength of our armed forces has been reduced from 315,000 to 215,000. That is 100,000 out of our armed forces and a fall of some 32 per cent. The number of conventionally armed submarines has fallen from 28 to 12. The fleet of destroyers and frigates in the Royal Navy has been reduced from 48 to 35. The number of infantry battalions in the British Army has been reduced from 55 to 40, while the number of tanks is down by some 45 per cent. and the number of aircraft in service with the Royal Air Force has fallen by more than 30 per cent. That is what the Conservative Government did between 1990 and 1997. Would Conservative Members like to speculate on what they would have said if a Labour Government had done that?
Rev. Martin Smyth: In the light of the reductions and the possibility that we shall continue to try to keep a small number in regular service, will the Secretary of State give a commitment that that which has been at the heart of our nation—the volunteer aspect—
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will be maintained in the future and not whittled down further? In particular, will he give a commitment to maintain defence medical services as a front-line rather than rear-line operation?
Mr. Robertson: A strategic defence review that came up with all the answers in advance and protected every area that people felt to be precious would not be a strategic defence review. Indeed, a mistake made by at least one Conservative Administration was to call a pre-established list of cuts in one service a defence review. All the options will be given careful consideration, to see what is in the best interests of the effectiveness of our armed forces and what is required for our country. I shall speak briefly about the defence medical services later, and my hon. Friend the Minister for the Armed Forces will deal with the matter at greater length tomorrow on the second day of the debate.
Mr. Keith Simpson: Will the Secretary of State give way?
Mr. Robertson: The hon. Gentleman will get his moment of glory when I choose.
I appreciate that reductions in the front line were justified by the new strategic circumstances, but arbitrary cuts elsewhere have left serious holes in the capabilities of our armed forces, and we must put them right. Those mistakes must be rectified. We are determined to refashion Britain's defences to produce the flexible, modern, high-capability, mobile forces that we shall need to meet the new challenges. I shall say a little more about our thinking on those issues in a moment.
We are determined to create modern, strong defences, but make no mistake about it, that commitment is not a blank cheque for the Ministry of Defence. Obtaining greater efficiency from defence spending is a central part of the strategic defence review. I am committed to ensuring that every pound spent by the Ministry of Defence is necessary for our country's defence and security, so I have instructed my staff to look at all aspects of the way in which we support and equip the front line, to make sure that defence capability is delivered as cost-effectively as possible.
In that connection, perhaps I should say a word about the so-called fine that was levied on the Ministry of Defence recently. Contrary to the impression given by some newspapers, the deduction of £168 million from this year's budget occurred because of an overspend in the previous financial year, which ended a month before we came to office. According to long-established practice, such overspends are clawed back from the following year's budget, as the shadow Secretary of State, the right hon. Member for North-West Hampshire (Sir G. Young), a former Treasury Minister, will know only too well. As in so many other cases, that fine is a legacy of the previous Government, which we shall have to bear. It is one more reason why I must push to produce ever greater efficiency at the MOD.
Mr. Gerald Howarth: I am grateful to the Secretary of State for giving way. So the £168 million fine has been taken on the chin by his Department. Can he tell us where the money will be found from within this year's Ministry of Defence spending budget?
Mr. Robertson: The hon. Gentleman should have a word with the Ministers in the previous Government who

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were responsible for the overspend. It had nothing to do with me or other Ministers now on the Front Bench. The hon. Gentleman will discover that a large part of the reason for the overspend was that bills that should have been paid in the current financial year were paid in the previous financial year. Clearly, if they were paid in advance, they will not be paid this year. We shall keep to the spending plans that were already laid down for 1997 and for 1998 and 1999, but spending will have to be reduced to accommodate the fine.
That is one of the legacies that we inherited. We must also live with the so-called efficiency savings of 3 per cent. that we inherited from the previous Government. That is one of the results of what they put in place. I have explained what that was and the effect that it will have.
Mr. Crispin Blunt rose—
Mr. Robertson: No, the matter has been effectively dealt with.
We shall put pressure on resources and on efficiency not just because that is right, but because we need to free resources inside the Ministry to tackle the legacy of problems left to us by the previous Government. I shall not detain the House with an exhaustive list of problems, but let me highlight a few examples.
First, there has been a series of spares shortfalls with our Challenger 1 tanks and Tornado F3 aircraft. Secondly, we cannot transport some of our major battle-winning equipment by air. Thirdly, our defence medical services, as the hon. Member for Belfast, South (Rev. Martin Smyth) observed, have serious personnel and equipment shortfalls and reduced morale as a consequence.
The problems that we have inherited are not restricted to equipment. The armed forces are chronically short of personnel. As well as a shortage of well over 4,000 regular soldiers, there are widespread shortages of specialists such as logistics experts and signals personnel. As a result, many of our troops have to spend much longer periods in high-stress postings such as Northern Ireland and Bosnia than is officially recommended.
For example, more than 1,000 soldiers were deployed to Bosnia last year within six months of completing a previous operational tour. Some of them had only three weeks in the United Kingdom between serving in the Falklands and moving on to service in Bosnia. Small wonder, then, that we have difficulty in recruiting and especially in retaining personnel. It is a remarkable tribute to those people and their families that they take the strain of those problems with so little complaint.
Mr. Nicholas Soames: I share the Secretary of State's admiration for the way in which the families and the service men coped with those difficulties. Does he accept, however, that for many young people joining the armed forces, the prospect of operations, the training for real operations and going on operations make it such an attractive career? That unique aspect of a career in the armed forces must be balanced with the requirement, as people get older, to allow them to spend more time with their families. I have every sympathy with the right hon. Gentleman as he wrestles with the problem.
Mr. Robertson: I welcome the hon. Gentleman's contribution. He had long experience in the MOD. The
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shortfall of troops is a deep and serious problem with which he tried to deal, even if unsuccessfully. Although many of the people in our armed forces enjoy the operations in which they take part and the challenge that they face, the pressure on their family lives—a critically important part of morale and their effectiveness—increases all the time. When I was in Split in Croatia last Monday, I listened with dismay to some of the personal problems that had been created by overstretch, which must be dealt with not simply on the ground of military effectiveness, but on the ground of pure humanity.
Mr. Tam Dalyell: My right hon. Friend and his Minister of State know very well the problems of those in Bosnia who are based at Fallingbostel or elsewhere in the Rhine Army with regard to local allowances. Is there any way in which the cut in local allowances can be reconsidered?
Mr. Robertson: We have examined the matter and I listened carefully to the complaints that were made. The local allowances paid in Germany are designed specifically to compensate for the very high cost of living in that country. Personnel who move to other theatres do not experience such a high cost of living. That is why the allowances are adapted to take account of the circumstances.
Mr. Norman A. Godman: On the issue of morale and discipline, may I say with what I hope is characteristic diffidence that I sincerely hope that Major Eric Joyce will not face a court martial on the charge of conduct prejudicial to good order and discipline? As someone who served in the ranks of the British Army, if only for two years, may I tell my right hon. Friend that I have great sympathy for some of the observations that Major Joyce has made about the class-ridden nature of the British Army and the racial and sexual discrimination that many young soldiers have experienced in recent days?
Mr. Robertson: I recall that my hon. Friend served in the military police, so he will know a little about discipline in the armed forces. He, more than most, will know that Queen's regulations clearly state that serving members of the armed forces should not comment publicly on issues of public sensitivity or take an active part in party political issues. Therefore, Major Joyce's activities were directly a matter for the Army and not for Ministers. Whatever Major Joyce may have said, the issue is the conduct of individuals in the armed forces. It is for Ministers to be involved in politics when there is a change of Government. I have chosen my words with great caution because that is a matter for the Army, and not for Ministers.
I promised to give way to the hon. Member for Mid-Norfolk (Mr. Simpson). If he can remember his point, I shall do so now.
Mr. Keith Simpson: Mr. Secretary of State, that is very generous of you. In the spirit of consensus, I return you to the crucial central issue of the strategic defence review—the budget—to which you have referred. I ask—through the Chair—whether you accept the results of a survey published in The Observer just after the general election. In a survey of Labour Back-Bench Members,

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some 80 per cent. urged that there be major reductions in defence expenditure and that those funds be transferred to other areas of priority upon which Labour fought the election. How does the Secretary of State square his statement—that there will be no cuts in defence expenditure—with the opinion of most of his hon. Friends, while continuing to claim that there are many things wrong with the Ministry of Defence? I do not agree with those Labour Members, but no doubt their views are strongly held.
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I am all for cordiality of exchanges in the House, but they must be accompanied by a degree of formality in addressing remarks through the Chair.
Mr. Robertson: It is clear that the hon. Gentleman has greater expertise on defence expenditure than on addressing the rules of the House. However, I make no pedantry about that.
Labour was elected, in no small part, on our pledge to maintain the strong convention of defence of this country, and to conduct a strategic defence review that would create a balance between what the country wants, needs and is able to do and how best to achieve that. We are embarking upon such a review. We know—as does the hon. Gentleman—about the legacy of economic failure that we inherited from the previous Government and how difficult circumstances are. That is why there are so few Conservative Members of Parliament.
I am determined to get full value from the existing defence budget. I am determined to ensure that our troops are equipped in the best manner possible and to increase service morale. In that way, we shall ensure that they are able to do what the country asks of them. That is precisely why we are establishing the Government's foreign policy priorities before trying to establish the country's needs.
My criticisms regarding the capability holes that we inherited from the previous Government were not intended to score party political points. Many of those criticisms were expressed by the previous Select Committee on Defence, which had an in-built Conservative majority. Its reports were laid on the Table of the House for hon. Members to read. I point them up in order to illustrate the size of the task facing us in creating armed forces that are capable of meeting the challenges of the next century.
To those who claim that the review is not needed and that the armed forces have had to withstand enough change, I say that they should look at the problems and understand the different challenges that the forces will have to meet. They must then agree that we must act to ensure that our defences are strong. We should not have change for change's sake, but we need change if we are not to become a paper tiger. If we are to modernise our armed forces properly, we must also bring our personnel policies up to date.
Mr. Blunt rose—
Mr. Robertson: I have given way enough today. Many hon. Members wish to participate in the debate, and I must make more progress before I indulge in further generosity to Conservative Members.
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The armed forces must represent the society that they defend if they are not to become isolated from it. That is why I am announcing today the quantum change in the number of posts open to women in the British Army. I have decided that, with the present exception of the infantry, the Household Cavalry and the Royal Armoured Corps, all jobs in the Regular Army should now be open to women. That will increase the percentage of Regular Army posts currently open to women from 47 per cent. to 70 per cent.
Women already make a substantial contribution in many areas of the Army and, from 1 April next year, they will also be able to serve in all posts in the Royal Artillery, the Royal Engineers and the Royal Electrical and Mechanical Engineers. This decision follows a comprehensive review of policy on the employment of women in the Army, and I have ordered an investigation as to whether opportunities for women across the armed forces can be expanded still further. The results of that work will depend, in part, upon the introduction of appropriate gender-free physical selection tests and a full investigation of any potential impact on combat effectiveness that the introduction of women to forward units could cause.
That is another step in fulfilling our promise to modernise the armed forces. We have already launched initiatives to improve access for members of ethnic minorities. Our initiative won plaudits last week from Britain's leading black newspaper, The Voice. Commenting on the Army's launch earlier this month of its revised equal opportunities strategy, the newspaper said:
"If last week's announcement is anything to go by, the Ministry of Defence is certainly going the right way about putting its house in order".
I am personally committed to ensuring that access to the armed forces, and promotion thereafter, is based firmly on merit rather than determined in any way by social class.
We have also made it clear that the issue of homosexuality in the armed forces will be the subject of a free vote during this Parliament. The Government will advance proposals on that subject, having taken into account, among other things, the views of the armed forces and the European courts on the matter.
I shall also say something about another pledge that we intend to redeem. In meeting the needs of our armed forces, the Ministry of Defence and the British defence industry have invested heavily in advanced technologies. We intend to make the best use of the skills and technologies that have been acquired, by spreading the technological processes and skills developed for defence into new civil markets through a defence diversification agency. Such links will strengthen the country's industrial base and contribute to improving Britain's economic performance. We are, therefore, examining how we can build upon the activities of the Defence Evaluation and Research Agency, DERA, in encouraging the wider exploitation of defence technology.
Mr. Blunt rose—
Mr. Robertson: I shall give the former special advisers one last chance perhaps to parade their knowledge in this area.
Mr. Blunt: I am afraid that I must return the right hon. Gentleman to his earlier comments when I tried to

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intervene. He used the term paper tiger. I recall that the same term was used four years ago by his predecessor, who issued a warning to the Treasury about what was happening to Britain's armed forces as a result of defence expenditure levels at that stage. That resulted in a welcome commitment to the front-line strength of the armed forces at that time and in the exercise "Front Line First", which reinvested £250 million in the front-line strength of the armed forces. Will the right hon. Gentleman confirm that his use today of the term paper tiger means that he and his Ministers will stand firm, on behalf of our armed forces, in the face of Treasury pressure?
Mr. Robertson: The hon. Gentleman, who was a special adviser to a Conservative Secretary of State before the election, has the brass neck to lecture me about fighting the Treasury when the Conservative Government took defence expenditure as a proportion of GDP from 5.2 per cent. in 1985 to 2.7 per cent this year. The hon. Gentleman shows quite remarkable and blatant cheek. He should read the reports of the Select Committee, which had a Conservative majority in the previous Parliament, on the capability not only in the front line, but in the essential back-up for our armed forces. This new Labour Government intend to ensure that our armed forces have the relevant back-up that they require—which is more than the hon. Gentleman's Government did.
Mr. Blunt rose—
Mr. Robertson: The hon. Gentleman had his second chance in the election.
Work is now in hand on developing our proposals on diversification. We hope to publish a Green Paper next month and I hope that all those with interests in the subject will contribute to the consultation exercise, so that we can achieve a measure of consensus on the way ahead before final decisions are taken.
Mr. Bill O'Brien: I congratulate my right hon. Friend on the splendid way in which he is dealing with defence provision for our country. In his review, will he comment on the future of the Territorial Army? Is that subject included in the review?
Mr. Robertson: I thank my hon. Friend for his kind comments. Of course, the matter that he raises will be centrally addressed in the strategic defence review. The role of the Territorial Army and the other reserve forces is of enormous interest. I cannot predict the outcome of the review, but when I have met reserve forces serving in many parts of the world—including in Bosnia last week—I have underlined the value that they add to our armed forces.
The Government have also promised action to tackle the scourge of anti-personnel land mines. We have kept our promise—and in the early days of this Government—to ban the export, import, transfer or manufacture of those land mines. In the weeks since, we have successfully pushed for the Ottawa treaty, which will be signed in December. That will be a big step towards ridding the world of those dreadful weapons.
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Last week, in Bosnia, I announced a five-point plan to increase the contribution that the Army makes to humanitarian de-mining. That includes the creation of a mine information and training centre at Minley in Surrey and the establishment of a new military post within my Department to lead a Ministry of Defence co-ordination group on humanitarian de-mining.
My five-point plan will make a good start and I am confident that, together with the increase in resources for mine clearance announced recently by my right hon. Friend the Secretary of State for International Development, it will ensure that the Government play an honourable part in tackling this modern and dreadful scourge. Those redeemed pledges build on the record of success that we have achieved since we came to power a mere six months ago.
On the international stage, we have provided the strong leadership that Britain deserves. At the Madrid summit, we made sensible and successful progress on the enlargement of NATO. At the Amsterdam summit, we retained our national veto on defence while securing the explicit recognition, written into the treaty for the first time, that NATO is the foundation of our and our allies' common defence. In July, in the Bosnian town of Prijedor, British troops serving with the stabilisation force acted decisively to bring people indicted for war crimes to justice. It is all part of our plan: we promised strong defence and we keep our promises.
We said that we would retain Trident. We have kept that promise. The recent Trident missile bodies order reinforces our commitment to credible but minimum deterrence. At the same time, we are injecting a new sense of urgency into international disarmament negotiations. That will be followed up by my right hon. Friend the Foreign Secretary. I shall be travelling to Moscow next Monday to talk to my counterpart, General Sergeyev, and we are determined to build better relations with Russia. As part of our manifesto commitment, the defence review is also looking at all aspects of our nuclear posture, including the number of warheads carried by the Trident submarines, to ensure that our deterrent is kept to the minimum yet credible level.
Beyond our manifesto commitments, we have provided additional cash for the Government's medical assessment programme for Gulf war veterans, and I am proud to say that we have more than doubled the amount that the previous Government planned to spend on research into ill health among Gulf war veterans. My hon. Friend the Minister for the Armed Forces will deal with that matter in greater detail tomorrow.
The biggest and most central promise that we made in our manifesto was to hold a strategic defence review. I am now even more convinced that we were right to make that commitment. It has become increasingly clear to me that the criticisms we made in opposition were not only telling, but, if anything, understated. It was only through the overworked dedication of our forces, which had to get used to having to make do and mend, that we averted serious problems in the Gulf war and Bosnia. It is now our task to put that right.
Thankfully, we are no longer likely to face the same sort of all-out war in Europe which consumed our resources in the half-century up to the collapse of the Berlin wall. Yet paradoxically, now that the huge threat has gone, the newly emerging tensions may mean that our

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forces will be more likely to have to fight in defence of British interests in a wide variety of places. It is no coincidence that Britain has been involved in two major conflicts in the 1990s—in Bosnia and in the Gulf.
Of course, Britain's interests do not extend equally everywhere. Our assessment is that we are likely to be most directly involved in such problems in Europe, the Gulf or the Mediterranean, where our economic and security interests are most closely engaged. It is those interests and obligations that should primarily determine the size and shape of our armed forces. However, Britain also has wider security interests that could lead to us contributing to coalition operations and humanitarian missions elsewhere.
To achieve all of that change, we shall have to give our armed forces the ships and aircraft that they will need to transport their equipment to areas of tension. They will need the spares, ammunition and back-up support to work when they arrive and they will need reliable equipment if they are to fight. We shall also have to fix the sorry catalogue of problems left for us by the Conservative Government.
We shall reach out to the countries of central and eastern Europe, to work to extend to the newly emerging democracies the security that we have so long enjoyed in the west. I believe that defence has a substantial role to play here too, by positively engaging the militaries of Russia and the Ukraine, to show them how professional armed forces can operate happily under effective civilian control. In bilateral work and through NATO and the United Nations, we can ease the fears of other countries, to prevent them slipping into hostility once more.
Closer work with our former adversaries will make us friends and achieve a disarmament of the mind which is every bit as valuable as an international treaty. We must use the tools of preventive diplomacy and co-operation over development to help to eliminate problems before they occur. We are now looking for new ways to engage with our former adversaries, many of which will involve a positive role for our armed forces. This work I call defence diplomacy and I intend to make it a major theme coming out of the defence review.
We clearly have a substantial task ahead, especially as, in the current climate, we cannot expect any increased funding in real terms for the armed forces, given the other priorities that the Government must meet. Accordingly, we shall have to improve efficiency, release surplus assets and make hard choices about priorities if we are to release funds for the necessary modernisation of our forces. That is one of the reasons why we cancelled the previous Government's plans to spend £60 million on a replacement for Britannia.
That will be the task of the next stage of the review, and doubtless there will be screams from some vested interests as all the options are explored. But be in no doubt, I am determined to ensure that within the very limited resources budgeted for by the previous Government, whose plans we inherited, nothing is wasted within the Ministry of Defence.
Several hon. Members rose—
Mr. Robertson: Hon. Members would be very unpopular with their colleagues were they to prolong my speech. I intend to move swiftly towards a conclusion.
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I make the point that we have these difficulties, and we have to live within them. They were created by the previous Government, and we shall do our best with what we have. It is my duty to eliminate duplication and to cut waste, to look carefully at all the functions of the Ministry of Defence and its agencies to determine whether they are strictly necessary, and to make the tough choices that my predecessors shirked. I owe it to the armed forces, to the Government and, indeed, to the British people, to free up those resources, to ensure that I deliver our manifesto pledge of strong defences that are genuinely capable of fighting in the modern world. I promise the British people and the House that I for one will not duck that challenge.
5.50 pm
Sir George Young: Let me begin by agreeing with the Secretary of State: our armed forces have had a good summer. The Army has helped to keep the peace in Bosnia, arresting suspected war criminals. The RAF has been enforcing the air exclusion zone over northern Iraq, and our Navy has brought aid to the stricken island of Montserrat—but three varied examples of the tasks that we expect of our armed forces today. They remain a respected, disciplined, professional force. They discharge their duties, defend our country and keep the peace with courage, humanity and efficiency. We owe them an enormous debt. The video that was shown at the Commonwealth conference, which was about Britain, not the Commonwealth, might have found a few minutes to reflect on the role of our armed forces.
While the armed forces have had a good summer, their Secretary of State has not. He lost his battle to replace Britannia, meekly watching while other Ministers left their footprints all over his flower beds; he has seen his budget targeted for a fine of £168 million; his strategic defence review has been hijacked by the Treasury, which is now firmly ensconced in the pilot seat. As a result, his strategy of building a consensus on defence is already in disarray. Morale in his Department is falling, which in turn will have an impact on the all-important question of recruitment.
Like the Secretary of State, I pay tribute to the role of women in the armed forces. I give a cautious welcome to his initiative to recruit more women into the armed forces. Nothing should be done that prejudices the operational efficiency of the armed forces. It remains to be seen exactly how big will be the impact on recruitment of the initiative announced this afternoon.
Mr. Soames: I warmly endorse what my right hon. Friend has said but ask him to seek confirmation from the Secretary of State that the best people to judge the operational effectiveness of additional women joining the armed forces are the armed forces themselves. Decisions should not be made by politicians in some form of modern social engineering.
Sir George Young: I endorse that and hope that the Minister for the Armed Forces, who will be winding up tonight, will do the same.
In the time available, I want to focus mainly on the strategic defence review, NATO enlargement and Bosnia. I know that my hon. Friends will deal with some of the key issues that I omit. I shall begin with the strategic defence review. That was dreamed up by Labour

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Members not so much to secure a policy after the election, but to avoid having one before it. When it was set up, we were told that it would be foreign policy led, to establish Britain's security needs and the tasks for the armed forces for the 21st century.
The press notice announcing the review hardly mentioned resources at all. It has been the Secretary of State's blind spot throughout the summer. His speech to RUSI, only last month, gave no hint that there would be any resource constraints on this policy-driven exercise. Money was not mentioned. Indeed, at the Ministry of Defence seminar in July, which I attended, a number of people, including myself, questioned the role of the Treasury, but all reference by contributors to resources has been airbrushed out of the minutes. Yet before the review is half way through, his Department has had to bear the brunt of the Government's failure to meet their manifesto commitment on health within the cash limits to which they had committed themselves.
We were told that the Secretary of State has been fined because his Department overspent. Will the national health service be fined this year if it overspends? Did any other Government Department overspend last year and was not fined? What was the precise reason for the fine? Did the Secretary of State resist it, or did he simply roll over and accept it? Or did he resist it and was simply defeated in a battle with the Treasury? He owes it to the House to respond to the question raised by my hon. Friend the Member for Aldershot (Mr. Howarth) and tell the House where that £168 million reduction will fall. Was the Secretary of State aware of the cut in his budget before his speech to RUSI, in which he said that the forces were overstretched?
The key point is that the Secretary of State's strategic expense review is no longer about his Department changing defence priorities; it is about the Treasury changing spending priorities. The raid on his budget last month destroyed the integrity and the credibility of an objective foreign policy-led strategic defence review. There is worse to come. I invite him to look at the difficult options that his colleagues around the Cabinet table are having to consider: tuition fees for students, charges for GP visits, abolishing the income support lone parent premium, cutting tax incentives for small savers, cutting back passport control, and whatever else emerges from the reviews on which the Government have embarked. If he thinks that a Labour Cabinet will grapple with those issues, with all the political fall-out, and leave him with the defence budget set by an outgoing Conservative Government, he is guilty of extreme naivety.
The Secretary of State continues to paint himself into a corner by writing articles and making speeches saying that the forces are severely overstretched. In an article in The Independent in July, which will have enraged the Treasury, he boldly asserted:
"Slashing our defence spending … would in my view completely remove our capacity to mount operations such as those in Bosnia."
Slashing defence expenditure is exactly what many of his colleagues want. Indeed, some of them are on the record making the case, yesterday on television. Reductions in defence expenditure are exactly what the Treasury now proposes to his Department.
The Secretary of State is right, but his assertion sits uncomfortably with all the press reports that we have seen—for example, that the Government are now
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considering reducing the size of, even abolishing, the Territorial Army. Thousands of soldiers from the TA have served in Bosnia, where they provide an invaluable contribution in front-line operations and in support. Cutting back on operations such as the TA would have nothing to do with a strategic review and everything to do with a short-sighted, short-term effort to reduce costs.
Mr. Andrew Robathan: Did my right hon. Friend notice that the Secretary of State first paid great tribute to the flexibility of the armed forces but then said that they had to be modernised? Everything was about modernisation. Indeed, in his last few pages, he talked about modernisation. Does my right hon. Friend not think that this modernisation is just a way of saying, "That's how I'm going to cover up the cuts that are coming"?
Sir George Young: On that specific point, I was impressed with what the Chairman of the Defence Select Committee said—that modernisation or restructuring will cost resources. It is not the case that modernisation is a way of saving money. If one is to modernise and restructure, it will cost. I remind the House that, yesterday, the Chairman of the Defence Select Committee said that where we are at the moment is the base line, and
"any further cuts will endanger the defence of the realm".
The Secretary of State is a decent man. His reputation can absorb the hit of £168 million but if, as I suspect, the outcome of the review is a substantial reduction in his budget, the decency to which I have referred must lead him to consider his position in the Government. At least he will have been preceded by his Minister of State, now in another place, who is on the record as having said in last year's debate:
"I also happen to think that this country does not spend enough on defence."—[Official Report, 14 October 1996; Vol. 282, c. 506.]
Mr. George Robertson: May I just ask the right hon. Gentleman a simple question? I believe that he is a former Chief Secretary to the Treasury—
Sir George Young: No.
Mr. Robertson: Well, I am sure that he was a Treasury Minister for one ignominious part of his career. Is he in favour of increasing the defence budget now?
Sir George Young: The Conservative Government left a three-year profile for defence expenditure. That was our statement on defence priorities. I do not believe that the Labour Government will be able to adhere to that profile. I think that the Secretary of State will take a hit on his budget next year. I think that he is painting himself into a corner, and will make life very difficult for himself and his colleagues if, in six months' time, he comes back to the House and announces a substantial reduction in defence expenditure.
There are two other flaws in the way in which the review is being conducted. The Secretary of State is refusing to publish the foreign policy base line before he moves on to the next stage of the review. What is the point of the consultation process making the review—in the Secretary of State's words—
"as open to outside views and ideas as possible"

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if the key link in the logical chain is withheld? If we do not know what the foreign policy base line is, how can we comment sensibly—as we are invited to next month—on the defence requirements to deliver that foreign policy?
Will the Secretary of State also concede that the original timetable of six months is now in tatters, as the Treasury will not sign off the strategic defence review until it has finished with other Departments, and that the inevitable blight that the review brings with it will cast a longer shadow than he thought—not least over the procurement budget, with all the job consequences for the United Kingdom?
The second flaw is mentioned again in today's edition of The Guardian. Excluding defence equipment from the review poses a risk that equipment will dictate defence policy, rather than the choice of equipment being dictated by policy. The Secretary of State has not dealt with that point at any time during the criticism of the strategic defence review.
The right hon. Gentleman's strategy of trying to neutralise defence as a political issue is also fraying. It was always a bold strategy. Days before Parliament was dissolved on 11 March, his predecessor said in a speech to the Defence Forum:
"The policy issues I have broadly outlined today differ fundamentally from those of the Government."
Indeed, if the Secretary of State looks at his party's manifesto, he will see that he described our policy as
"intellectually inert, incoherent and incompetent."
We were therefore slightly surprised to be told after the election that there had been
"a remarkable convergence among the parties in recent years on the big defence issues."
Convergence is what happens when two parties move closer together. That is not what has happened on defence. We stuck to our principles, and Labour abandoned its principles. The Secretary of State rather delicately admitted that in his speech to RUSI, when he said:
"events in the 1980s showed that, without a clear and unambiguous commitment to strong defences as an essential part of Britain's foreign policy, the British people would not trust us with Government".
The Labour party's principles made it unelectable, so it decided to change them.
The world has changed since the Labour party thought that the best way in which to see off the Soviet threat was to abandon the nuclear deterrent. The end of the cold war—as the Secretary of State said—has replaced the old unpredictability of defence policy with much more complex problems. Britain's role in the world, and the demands on our armed forces, are changing. We have had to redefine our basic assumptions about security. There is no longer an enemy; there are only enemies—terrorism, dictatorships and regional instability, threatening wider destabilisation. There are, however, consistent themes in response. Those themes are the need to maintain a first-rate, well-equipped, flexible fighting force, the need to co-operate with our allies and the need to assess our security and foreign policy commitments in a global context.
NATO has provided the framework to meet those requirements since the second world war. It has been the bedrock on which peace and security in Europe have been built. We owe a continuing debt to our allies in the United
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States for playing the role of guarantor of peace in Europe for the past 50 years. If it is the European Union that has dominated the headlines in recent years and, indeed, today, it is the stability and security that NATO provided that have made the European Union possible.
The balance of power in Europe has now changed, and there is an opportunity to bring a number of the former Communist countries into the NATO alliance. Conservative Members whole-heartedly welcome both the continuation of the initiative taken under the last Government to begin negotiations with Poland, the Czech Republic and Hungary to enable them to join the alliance and the commitment to an open-door policy on further enlargement. It is a measure of how much we take peace and security for granted that the enlargement of NATO merits such small mention in the news bulletins, whereas, at any other time in our history, discussion about alliances such as these would have dominated the political debate.
Mr. Hawkins: Will my right hon. Friend confirm that Conservative Members are particularly keen for former Warsaw pact countries such as the Baltic states to be able to preserve their security in future? Will he also confirm that we intend to keep up the pressure on the Government to ensure that they are very much aware of the special position of the Baltic states?
Sir George Young: It is very important for the countries that were not recently invited to join NATO to know that there is an open-door policy, allowing the prospect of their joining later. My hon. Friend has made a good point. The significance of NATO has always been wider than its military purpose. It is about shared values, the spread of democratic institutions under civilian control and respect for human rights. While the applicant countries want membership because it brings them under a collective umbrella, providing stability and security that they have not had for centuries, the membership conditions in turn reinforce peace and stability in Europe as democracies do not declare war on each other.
There will, however, be costs as a result of NATO enlargement. On 9 July, in his statement on NATO enlargement, the Prime Minister told the House that there was no reason why Britain's contribution to NATO budgets—currently some £155 million—should rise significantly in real terms. Perhaps the Minister who is to reply will tell us whether that is indeed the latest assessment of the cost to the United Kingdom of NATO enlargement.
We need to be prepared to bear our share of the costs of enlargement. Although enlargement is being welcomed within the alliance, there are those in the United States in particular who will question whether there is a rationale for the US to extend its defence commitments to the east in the post-cold war era. Any failure on the part of NATO's European partners to bear their share of the costs of enlargement would play into their hands and put at risk ratification of the process, which is by no means a foregone conclusion.
Mr. Andrew Mackinlay: Many politicians, left, right and centre, repeat parrot fashion that there are enormous costs relating to the enlargement of NATO, and then stop. I invite the shadow Secretary of State to list those additional costs. I think that they are either

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exaggerated or wholly bogus. I should like him to tell us what he thinks the additional costs are, because I do not think that they are of the significance that he asserts.
Sir George Young: There is a collective agreement on security. If we incur new commitments to defend countries that we do not have to defend now, that may impose additional costs on us. The question is: what is the latest assessment of the additional costs to the United Kingdom? The hon. Gentleman says that there are no costs. He may have seen the estimates made by the Clinton Administration, which refer to several billion pounds of extra costs for existing members as a direct result of enlargement. The Library has produced a very interesting paper on the subject, to which the hon. Gentleman might like to address himself.
Mr. John Wilkinson: Will my right hon. Friend give way?
Sir George Young: For the last time; then I must make progress.
Mr. Wilkinson: Will my right hon. Friend, and Her Majesty's Government, bear it in mind that, whereas it may be incumbent on NATO—understandably—to bear infrastructural costs to ensure the enlargement of the alliance, the position relating to the European Union is in dramatic contradistinction? Its member countries, notably the United Kingdom, pay more and more, although it has not yet enlarged.
Sir George Young: That is an ingenious debating point, to which I do not propose to respond.
My hon. Friend the Member for Salisbury (Mr. Key) will have more to say later about procurement, but I think it appropriate, before I leave the issue of NATO enlargement, for me to mention the opportunity that exists for British defence manufacturers among the countries that are seeking to join the alliance. The British defence industry has continued to make great strides in recent years in improving efficiency and competitiveness. It is well placed to take advantage of the new market opportunities that closer defence co-operation with countries in central and eastern Europe will present.
Dr. Lynne Jones: Will the right hon. Gentleman give way?
Sir George Young: I must make progress, because many hon. Members want to make a contribution.
At some point, Europe will need to address the structure of its defence industries if it is to respond to the rationalisation of capacity that has taken place on the other side of the Atlantic.
My hon. Friend the Member for Salisbury and I have just returned from a visit to Bosnia, as has the Secretary of State. We saw at first hand the work of the British forces serving in SFOR. They are carrying out with the utmost dedication and professionalism and in the most difficult circumstances the task of helping to return Bosnia to the status of a functioning peacetime democracy.
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Some progress has been made in the two years since the signing of the Dayton agreement. The war is, for the moment, over. However, there is still a great deal to do: a huge number of refugees have yet to return to their homes; the new political institutions envisaged by the Dayton accord remain paralysed; there is a continuing political crisis in the Republika Srpska; there are territorial tensions in Brcko and in other areas; and, despite the shooting and arrest of two suspected war criminals in Prijedor in July, there has been insufficient progress in other sectors on the arrest of other indicted war criminals, notably Radovan Karadzic and Ratko Mladic.
Against that background, it is clear that the original deadline for the withdrawal of foreign troops when the SFOR mandate expires in June 1998 is now unrealistic. Unless British troops and those of our allies remain in Bosnia until the transition to peace is completed, all the work that they have done will be at risk and the region will return to bloodshed.
The road to lasting peace is long and difficult. The continued participation of the United States is absolutely essential, both for the strength that our allies can bring in ensuring that the local armies remain in their barracks, and for the signal that United States involvement sends to those watching developments in Bosnia from the sidelines. Our troop commitment must be sufficient to guarantee the continued involvement of US troops.
In many ways, what is happening in Bosnia is a good example of the type of operation in which British forces will increasingly be involved. They have gained invaluable experience in Northern Ireland, where they have won the trust of local communities while remaining resolute and impartial in preserving peace and protecting the civilian population. No other country has the ability to operate in twin mode as well as we do. We must also preserve the capability to engage in a high-intensity conflict should the need arise, or should a peacekeeping operation escalate into a more violent struggle.
The Opposition welcome the willingness of the new Government to build on the work begun by the previous Prime Minister and Secretary of State for Northern Ireland. The current cessation of violence has enabled a reduction to be made in the number of British troops on active service, which alleviates the drain on the Army's resources that the Province represents and allows more time for rest and training. We would welcome further reductions in the number of troops should circumstances allow, but caution that the security of the civilian population must not be compromised for financial considerations.
It is clear that the terrorist threat remains. On my recent visit, it was made clear to me that the guns and explosives are still in the hands of those who may resort to them should the peace process no longer suit their purposes. We must remain ready to meet that threat with force should the necessity to do so arise.
The Secretary of State mentioned land mines. No one should underestimate the contribution made by the Princess of Wales to the efforts to rid the world of the scourge of land mines. She raised the profile of the campaign and gave it added momentum, so that it made a significant breakthrough in the public consciousness. The campaign has lost a great champion of its cause. The best tribute is to ensure that her work was not in vain.

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A meaningful ban on land mines will come only when the major exporters of such weapons have also agreed to a ban. We welcome the signing of the Oslo agreement, but it is severely weakened because it does not include the major manufacturers of land mines: China, Russia and Pakistan. The land mines debate has rightly focused on negotiations for a future ban, but the problem requires a dual approach: working towards a ban and removing existing mines. Even if all countries signed up to a ban—they are not about to—the number of lives and limbs saved in the near future is likely to be small, relative to the number saved by a more aggressive clearance policy. I welcome the Government's announcement last week of an initiative to support the efforts of mine clearance agencies. We should accept that land mines have had a military purpose, so work to encourage the development of alternatives that can achieve that purpose without the same devastation is essential.
I cannot do justice to the many other defence issues, such as the disarmament talks, recruitment and personnel issues, training and defence co-operation within the European Union, without trespassing too much on the time of the House. I know that my hon. Friends will deal with those matters in their contributions. However, I want to end with a word about the royal yacht Britannia.
The previous Government had a clear policy. We announced it, we defended it before the House and, had we won the election, we would have done what we promised—but that is history. The new Government have decided not to replace the royal yacht. They prefer to spend £50 million on a Welsh Assembly, which will not generate any exports. However, I want to dwell not on their decision but on the disgraceful way in which that important national issue was handled, because of the Government's obsession with presentation, which got them into such trouble earlier, and the shameless way in which they are prepared to manipulate issues such as the royal yacht for party political ends.
We know that the Government exercise strong central control of the presentation of policy to the media, because the Minister without Portfolio told us so in an article in The Guardian on 18 September. He said:
"each departmental spoke comes together in a strong central hub"
and
"Effective co-ordination and presentation has been a key factor"
in the running of the Government's media operations. In a sentence that he may regret, given what subsequently happened, he said:
"we have no intention of repeating the shambolic way in which the last government was run."
That was an unhappy thing to say against the background of the statement made earlier.
On Sunday 3 August, a series of stories appeared in national newspapers saying that the Government had decided in principle to extend the life of Britannia through a deal for a refit with private sector companies. "Queen offered 'pay as you sail' yacht" was the headline in The Observer; "Britannia timeshare offer to Queen" in The Sunday Times; "Royal yacht may be saved" in the Independent on Sunday; and "Labour offers the Queen a reprieve for Britannia" in The Sunday Telegraph.
I wrote to the Secretary of State to ask why the Ministry of Defence had made no official press statement, why no Defence or Treasury Minister had appeared on television to
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substantiate or expand the story, and why The Sunday Times had reported that the Ministry of Defence said that it knew nothing of the decision until the story had been confirmed to the paper by the Treasury.
The Minister for the Armed Forces (Dr. John Reid): Sheer speculation.
Sir George Young: Does the Minister invite the House to believe that four or five Sunday newspapers decided, wholly independently, that the future of Britannia was a front-page story? It is more likely that there was a briefing. I want to know what briefing by Government officials or Ministers took place before that Sunday.
Mr. Gerald Howarth: Will my right hon. Friend give way?
Sir George Young: No, I must make progress.
If the briefing was not given by the Ministry of Defence and if it knew that it was inaccurate, who gave the briefing and why? Was it a smokescreen to obscure something that was happening at the same time? The ultimate humiliation for the Secretary of State was when not he but the Chancellor confirmed, in an off-the-cuff remark in a television interview with Sir David Frost, that the Government were not going to replace the royal yacht.
I mention that incident with Britannia because it shows the Government at their worst. Their spinning has gone beyond the stage of deceiving the batsman; it is deceiving the fielders. The cynical manipulation of news and non-news, leading to the resignation of senior members of the Government Information Service, is one of the most sinister developments since 1 May. The Secretary of State may have been an innocent party in the Britannia episode, but that makes the cynicism of those responsible even worse.
On the Secretary of State's performance as a whole, the jury is out. The clash between his rhetoric and the agenda of his Treasury colleagues will be resolved next year. The results of the strategic defence review will be known, so we shall be able to judge whether it was the objective exercise that he told us it would be. He will have our support in resisting those in his party who see his budget as a soft touch. However, if, next year, he discovers a new and burning ambition to be the first Scottish Prime Minister, we shall know that he has lost his battle and that, contrary to what we were told in the election, the defence of our country is not safe with Labour.
6.19 pm
Mr. Menzies Campbell: I, too, welcome the Secretary of State on his first appearance at the Dispatch Box in this annual debate. I also welcome the shadow Secretary of State. I hope that I do not insult both of them when I say that the speech that each delivered could as easily have been delivered by the other. In truth, the differences between the two sides of the House on defence issues are probably much smaller than they have been at any time over the past 20 years.
The debate takes place in a vacuum because, unlike such debates in the recent past, there is no White Paper upon which we can concentrate. In addition, the Secretary of State has made no clear statement on the foreign policy objectives that are to be served by the United Kingdom's

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defence capability. He has been consistent in that because, of course, just before the summer recess he answered a parliamentary question to the effect that he would not make such a statement. In his evidence to the Select Committee on Defence he also declined to give a clear statement of foreign policy objectives.
It was with some enthusiasm, even anticipation, that I read the speech that the Secretary of State delivered to the Royal United Services Institute on 18 September. As an analysis of what needs to be done and how to do it, the speech can hardly be faulted, but as an indication of Government thinking it gave very little assistance. I was driven to the conclusion that it could just as easily have been delivered by Sir Malcolm Rifkind or even Mr. Michael Portillo after the period of compulsory re-education that followed his first speech as Secretary of State for Defence to his party conference.
The question that will haunt the Ministry of Defence is the financial one. The Secretary of State is right to say that defence cuts are not new. As he said, the defence budget is now 2.7 per cent. of gross domestic product. That is the lowest percentage since the 1930s and since the mid-1980s there has been a 29 per cent. reduction in real terms. Throughout the period of the reduction since the mid-1980s, it could hardly have been argued that the Conservative Government had the overwhelming support of Labour or indeed of my party, the Liberal Democrats. Those reductions were driven through in the face of substantial opposition from all parts of the House.
As long as the strategic defence review is driven by Britain's long-term defence needs, it will be a valuable exercise. One could argue that when it has been completed it will be difficult for the Treasury to make drastic changes to the defence budget because the Secretary of State will have available on paper exactly how much it costs to ensure that Britain is properly protected. The Secretary of State asserts on this occasion, as he has on many others, that the review is foreign policy led and not Treasury led. That is an entirely logical position, but those of us who have an interest in these matters cannot escape the conclusion that the ghosts at this feast are Whelan, Balls and Brown. They sound more like a Dublin firm of pawnbrokers than those who might be responsible for the future of Britain's defence effort.
There are not three balls but three posts in this defence review. First, the Government say that they are committed to the Eurofighter—costing about £16.5 billion—with the support of the whole House. [Interruption.] I have always understood that to be the stance of the Conservative Front Bench. If it has changed its position, it will no doubt explain that to the House and the country.
Secondly, the Government are committed to a four-boat Trident force. Thirdly, it is clear to anyone who pays any regard to these matters that there is no possibility of increased defence expenditure in the United Kingdom in real terms in the foreseeable future. Those are three substantial inhibitions on the scope of any defence review.
The Secretary of State has declined to state clear foreign policy objectives. I shall be helpful to the Government by suggesting a series of foreign policy objectives that they should adopt. First, they should be much more active in seeking to develop a common foreign and security policy with our allies in Europe,
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maintaining, of course, the individual right of member states to decide whether their national forces should take part in any particular action. Against a background of static or even declining defence budgets, far greater integration in Europe is the only logical response.
Of course we must maintain the transatlantic link, but we should work for a more mature and less dependent relationship with the United States through NATO, with the emergence of the Western European Union as the agent for the European security and defence identity and as a strengthened European pillar of NATO. We should promote and expand joint European defence co-operation and force specialisation with our neighbours. We are already engaged in joint force operations with many of them. In conjunction with our allies we should also develop a comprehensive conflict prevention strategy to co-ordinate foreign, development, defence, trade and environmental policies.
There is a growing argument that the separation of the Foreign and Commonwealth Office and the Ministry of Defence is becoming increasingly difficult to justify. The bridge between those two Departments is the issue of security. There is great scope for considering the creation of one Ministry dealing with all Britain's external affairs.
The Government should resist the proliferation of weapons of mass destruction and they should undertake to implement their responsibilities under the nuclear non-proliferation treaty and encourage others to sign the comprehensive test ban treaty. We should press for a new strategic arms reduction treaty involving all the notified nuclear weapons powers. The Government should actively support and strengthen the ability of the United Nations in peace support and peacekeeping. That includes the establishment of permanent United Nations forces, enhanced intelligence gathering, improved military planning and a United Nations staff college. We should maintain our permanent membership of an enlarged United Nations Security Council and participate, as far as resources allow, in UN military actions across the spectrum of peace support and humanitarian relief.
Surely the Government recognise the need to work to control arms sales. We should end the sale of British arms or materials and dual-use technologies to regimes that abuse human rights. We should work with our European partners to create a European Union code of conduct that is clear, explicit and rigorous to prevent the transfer of weapons or weapons technology to countries that we know are likely to abuse them. We should certainly be concerned about a system of environmental protection and about free trade and human rights.
That is a set of foreign policy objectives for the Government. How much better would our debate about military matters be instructed if we heard from the Government about their foreign policy objectives. That would enable us better to assess whether the defence capabilities that they propose are apt to meet them.
Nuclear policy presents an opportunity for bold and innovative thinking. For the whole of my political life I have been committed to the independent nuclear deterrent. There is still a place for nuclear deterrence and it is still right for the United Kingdom to maintain that capability, but surely we have put aside the days when Trident drove defence policy, perhaps to the extent of eliminating all other considerations. When the utility of nuclear deterrence was obvious in the 1970s and 1980s,

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the Labour party spurned it. Now that the utility of nuclear deterrence can be given a lower priority, we are entitled to look to the Government for a great deal of imagination and innovation, so let us start.
First, there should be no more warheads on Trident than on Polaris, which it is to replace; it is independently targetable, it has greater range and it has greater accuracy. Secondly, we should abandon the Moscow criterion—the principle that says that we cannot have an independent nuclear deterrent unless we are satisfied that it can breach all the ballistic missile defences around Moscow.
Mr. Jeremy Corbyn: Will the hon. and learned Gentleman give way?
Mr. Campbell: If the hon. Gentleman will allow me, I shall develop the points that I want to make on nuclear matters and then, if he is still interested, I shall be happy to give way to him.
The Moscow criterion is wholly inconsistent with NATO's doctrine of minimum deterrence. The UK should make an annual declaration of the total size of its operational nuclear arsenal. No prejudice would result as a consequence of that. The United States and Russia have to do it as part of the strategic arms reduction treaty and it would help to promote transparency and assist in confidence building. The UK should promote an initiative whereby, so long as Russia and the United States continue to reduce stockpiles, Britain, France and China would bind themselves not to increase the size of their nuclear arsenals.
The UK should seek the establishment of a five-power nuclear forum before the non-proliferation treaty review conference in 2000, not only to improve safety but to strengthen security. We should also back an international nuclear weapons register as a means of increasing transparency.
All those things would operate in an effective and coherent way in continuing to reduce the extent to which nuclear weapons form part of the defence architecture of the UK and of others, and they could all be effected without any prejudice to the deterrent's independence or to its effectiveness in the purpose for which it has been conceived.
The fourth Trident submarine should not be cancelled. The financial savings from doing so would be relatively limited. Indeed, one could argue that a three-boat fleet would increase the risk of having to make an early decision on force replacement. The extension of the lifetime of the existing Trident system, so that consideration of a replacement can be postponed, is an entirely laudable objective. We should consider integrating patrol and refit schedules with those of the French and look with an open mind at the readiness of the nuclear deterrent.
I do not believe in formal declarations such as "no first use". It would be much better to emphasise NATO's doctrine of minimum deterrence and that these are weapons of last resort. In that respect, the declaration by the United States that it has no plans to deploy nuclear weapons in new NATO member countries is clearly helpful.
Mr. Corbyn: I have listened carefully to what the hon. and learned Gentleman has said about nuclear weapons.
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Will he tell the House exactly who he thinks is an enemy against which a nuclear weapon should be directed and in what circumstances he would be prepared to unleash a nuclear holocaust on the globe?
Mr. Campbell: I do not have my finger on that button and the hon. Gentleman will no doubt address his question to the Secretary of State for Defence, but he misunderstands the concept of deterrence. The point about deterrence is not whether one would press the button; it is whether a potential adversary is uncertain about whether that is the case. That is not my definition. I first heard it when Lord Younger of Prestwick, as he now is, was Secretary of State for Defence. The essence of deterrence is uncertainty in the mind of a potential adversary.
During the Gulf war—the right hon. Member for Bridgwater (Mr. King) will remember this better than most of us—there was a certain threat that Saddam Hussein might use weapons of mass destruction. The advice given back through the appropriate diplomatic channels was that if there was any effort to use weapons of mass destruction, the response—the word was chosen with some care—would be "disproportionate". Most people understood what the shorthand meant. A feature of the Gulf war was that Saddam Hussein—as we now know from the activities of Mr. Rolf Ekeus and others on the UN Special Commission on Iraq—had substantial capacity to use weapons of mass destruction, but never did so.
People often say to those of us who support nuclear deterrence, "Can you give us an instance where it has worked?" We can never prove this to a mathematical certainty, but I am willing to accept that the threat of a disproportionate response had a great deal to do with Saddam Hussein' s reluctance to use weapons of mass destruction. Those are the sort of circumstances in which deterrence is likely to be effective. Of course, if someone presses the button he has failed because the weapon has failed to carry out its purpose—to act as a deterrent—but until there are far fewer nuclear weapons I am not disposed to give up the UK nuclear deterrent.
Eurofighter is one of the constants in the defence review. Notwithstanding articles in The Guardian, which has somehow become a popular newspaper of reference in the House, I remain convinced of Eurofighter's military, economic and technological advantages. For the moment, I want to concentrate on the military requirements.
The UK requires an agile jet fighter. The Tornado F3 Interceptor, as its name suggests, was designed to intercept Soviet aircraft across the North sea. It is not an agile fighter in the term in which that is understood. Indeed, its limitations were shown in the Gulf war, when the scope of operations on which it could be sent was substantially limited.
Eurofighter was designed against the SU27, a Soviet, now Russian, aircraft, which, with its derivatives, is freely available. It is sold not quite at knock-down prices, but at economic and encouraging rates. There is every chance that, on some future occasion, Royal Air Force pilots carrying out operations on behalf either of the UK or, perhaps more likely, of the UN or NATO, might find themselves flying against aircraft of the capability of the SU27. It is right that we should provide those pilots with the best possible equipment in the form of an aircraft that is capable of dealing with that threat.

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No European option is as capable. Neither the French Rafale nor the Grippen has the capability. Of course, there are American choices; we flirted with some of them when Mr. Michael Portillo had stewardship of the MOD. It sounded rather paradoxical. We were going to hire second-hand F16s while leasing out F3s to the Italians, whose need for Eurofighter is probably greater than anyone else's.
The Americans supply countries with an aircraft at very low initial cost, but then they get their pound of flesh by the substantial through-life costs that necessarily attach to it. An F16 procurement would signal the end of that particular technical capability in the UK. Nor is there any guarantee that we would receive the top-of-the-range model. When the Saudi Arabians bought the F15E from the United States, because of the United States' political sympathy for Israel, they were given not the top-of-the-range model, but something called the F15XS, an Fl5E minus. Pakistan wanted to purchase 16 F16s, but that sale was blocked by Congress for political reasons. It would not be right for us to embark on a programme that allowed us to be so dependent on opinion in Congress which, if I may put the matter delicately, is not always entirely sympathetic to our foreign policy objectives.
Eurofighter is important for the future of the European defence industrial base, but we are entitled—here I pay tribute to what the Secretary of State for Defence said about the need for effective use of resources—to demand cost-effective procurement. The National Audit Office report on defence procurement, which showed that only five out of 25 products met the in-service target dates, that overspending on some projects was as high as 10 per cent. and that the procurement budget was overspending by about £1.3 billion, made shocking reading.
We are entitled to expect that, when substantial sums of that order are invested in procurement, we obtain value for money. We have to remind ourselves only that the C130J is now 16 months late and that the Challenger 2 main battle tank is not yet universally in service. Those were important procurement decisions. It is unacceptable that the aircraft and the main battle tank are not yet in service. The NAO report went so far as to say that procurement was so far behind schedule that Britain's defences were being put at risk and that outdated ships, tanks and aircraft were being patched up at a cost of £400 million.
I should like to refer to three personnel issues. There is and there can be no place for racism in the armed forces of the United Kingdom. It is often associated with bullying and occurs because of prejudice. I cannot resist the conclusion that it flourishes where non-commissioned officers and other officers either ignore it or are not alive to the fact of its taking place. I believe that the culture of the armed services should be such that responsibility for racism is part of the chain of command.
The Government know my view about homosexuality—I believe it to be an issue of fundamental human rights. Virtually every other NATO country does not need a policy of the kind that we have. It was a highly controversial issue in the presidential campaign when Bill Clinton was first elected, but even there a compromise was reached. I predict that the Government will be
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compelled by operation of law to change their policy. It would be far, far better to do it now with grace and without compulsion.
On the role of women, I welcome the principle that the Secretary of State has outlined. We should pause just for a moment, however, to remind ourselves that the armed services sometimes have to kill and are sometimes killed. Public opinion in this country would require some fairly careful tutoring before it was willing to accept the prospect of large numbers of women being killed in combat. I am an enthusiastic proponent of equality, as is, I am sure, the right hon. Gentleman, but we are obliged to take that prospect into account.
The right hon. Gentleman was right to mention the infantry. As I reminded him at a meeting of the Defence Committee, we should recall that Mount Tumbledown was cleared by soldiers of the Scots Guards and other regiments, who used bayonets to clear Argentines out of the trenches. We must ask ourselves whether that is the sort of role that a society such as ours would easily envisage for women. Indeed, one must ask whether it is a role that women would want to fulfil. Some brakes may be applied to that policy and the extent to which universal equality of opportunity is either available or is sought to be taken up.
Mr. James Gray: The House would be fascinated to know the Liberal Democrat party's official policy on homosexuals in the armed forces.
Mr. Campbell: I just said it. In the previous Parliament we debated the issue on at least two occasions. The then Opposition spokesman, now Minister for the Armed Forces, made probably the best speech of the debate, but when the Division came he and I voted in separate Lobbies. I take the view that there should be no discrimination against people on the grounds of sex, gender or sexual orientation in the armed services or anywhere else. I repeat that virtually every other member country of NATO is able to offer effective, well-managed and well-led forces to the NATO effort without having such a policy in place. There is no secret about Liberal Democrat policy and I am happy to spell it out once again.
I should like to discuss Bosnia, which was also mentioned by the Opposition spokesman, the right hon. Member for North-West Hampshire (Sir G. Young). We are entering a most delicate stage in considering the future of the NATO-led deployment in Bosnia and there will have to be some careful negotiation. Perhaps I could suggest some principles for consideration. First, we should not throw away the gains of the past two years, imperfect though some of them may have been. Secondly, I believe that the United Kingdom should be willing to continue to be part of an international force by whatever name it may be described with the intention—and one would hope the achievement—of maintaining peace support in Bosnia.
Thirdly, a substantial United States presence is required, but whether that can be on the ground raises some very difficult political issues, particularly for President Clinton and Congress. We should have some sensitivity towards them, although I do not shrink from the principle that the presence of the United States is important for both political and military reasons and that a presence on the ground would be an encouragement and an endorsement of the efforts of others.

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We should not shrink from assuming a greater role of leadership in Bosnia, consistent with the safety of United Kingdom forces, because we have a proficiency in peace support—it is probably unrivalled—as a direct result of our experience in Northern Ireland.
The Secretary of State has set his hand to a fundamental defence review. The consequences of what he and the Government decide will affect the nature of defence in this country for a long time because even if there is a change of Government in 2002, by then significant and important decisions will have been taken which will not be capable of reversal or will be capable of only minor modification. It is in the interests not just of the House but of the country that those decisions are as well informed as they can be and that they are in the long-term interests of the country.
So long as the Secretary of State maintains that principle, he will certainly have our support, but he must expect that we will want to be certain that the assumptions upon which he makes his decisions are valid.
6.45 pm
Mr. Bruce George: I rise to speak as Chairman of the Defence Select Committee. One of the great advantages of being the Chairman of a Committee is that one has the chance of being called in a debate. There was a time in the 1970s when a Labour Back Bencher had every likelihood of getting called, but as Labour took more interest in defence issues it became increasingly difficult. I am glad I stand a much better chance now.
I have served on the Defence Committee since 1979, when we still had sailing ships in the Royal Navy and rather imperfect weapons to defend the country. The reports of the Defence Committee that I have amassed since 1979 stand yards long on my shelves. One thing has characterised the near 200 reports that we have produced; virtually every one was critical of the Government, whatever aspect of defence we examined.
I am delighted to see that one of the old hands of our Defence Committee, the hon. Member for Salisbury (Mr. Key), is present. He will be able to advise his colleague, the Opposition spokesman, the right hon. Member for North-West Hampshire (Sir G. Young), when to keep his mouth shut, which should be for much of the time. I congratulate the right hon. Gentleman on his rapid deployment from Ealing to north Hampshire, which will provide a model for our armed forces in the future on how to get from one environment to a totally different one—to our collective advantage.
I have served under seven Chairmen of the Defence Committee, and in all honesty they have all been truly excellent. Unfortunately, membership of the Defence Committee carries with it something like the curse of Lord Gnome. Sir Nicholas Bonsor was Chairman; then he was relegated to the Foreign and Commonwealth Office, and then he lost his seat. Sir Nicholas Fairbairn died, and Winston Churchill did not stand for re-election. I hope that he is not signing on at his local employment exchange—I doubt it. Neville Trotter was a member of the Committee from 1992, but he did not stand for re-election. Keith Mans, another member of the Committee, lost his seat at the election. The curse of Lord Gnome even applies to the Secretary of State for Defence, and in recent years two of them met the same fate as most of the colleagues I have mentioned.
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I am sad to record that some of the stalwart members of our Committee, notably my hon. Friends the Members for Stockton, North (Mr. Cook) and for East Lothian (Mr. Home Robertson), and the hon. Members for Gosport (Mr. Viggers) and for Salisbury, no longer serve on it. I greatly regret that. The current membership of the Committee is new, because just four members of the previous Committee survived the election. We are all having to learn a great deal—some have a greater obligation to learn than others—but I am sure that, in time, that deficiency in our knowledge will be rectified.
The previous Select Committee, of which the hon. Member for Romsey (Mr. Colvin) was Chairman, gave the new Committee an agenda, asking us please to follow up some of its inquiries and produce reports, and we will do so. We will reflect on that period of change in our security orientation, but there will be a continuation of some of the almost inexorable features of British security policy since the second world war.
One such feature is the progressive, although erratic and unplanned, decline of defence expenditure. When Labour left office in 1979, defence expenditure had averaged 4.9 per cent. of gross domestic product; now it is 2.7 per cent., and under the previous Government it was projected to fall to 2.4 per cent. I know that not all my hon. Friends will agree, but I believe that, if we are to have a credible defence and foreign policy, we are approaching, or have reached, the bedrock. As the shadow Secretary of State said, and as the hon. Member for Salisbury agreed by signing up to the last report of the previous Select Committee, any further cuts would endanger the defence of the realm.
All Defence Select Committees since 1979 have critically evaluated the actions of the Ministry of Defence, and I have no doubt that the present Committee will do exactly the same and produce an endless stream of critical reports. We are gearing ourselves up for the publication of the strategic defence review report in the spring. We will visit Bosnia next week and the United States in January. We are evaluating the way in which the United States has conducted its quadrennial review process.
We have signed up some excellent advisers, have had several months to prepare, and eagerly await the fruits of the strategic defence review. I am not in any way opposed to an imaginative approach, but if it is true that the Treasury has got its hands on the review, that is very much to be regretted. Anyone who wants to evaluate the pernicious role that the Treasury has played in defence over the years should read much that has been written about the 1930s. The Treasury is not the most suitably qualified institution to evaluate our future strategic and security orientation. It must be there to advise, but I hope that the Ministry of Defence will not fall prostrate before it.
Several of our reports have recently been commented on by the new Government, and I hope that the new Committee will proceed, on the advice of the previous Committee, with inquiries into the sale of the married quarters estate, which was not one of the previous Government's wisest decisions. I certainly hope that we will follow up our third report on defence medical services.
I am sure that we are approaching a consensus, as the Labour party got so much better on defence just as the previous Government got so much worse. We have

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perhaps achieved parity, and both Government and Opposition spokesmen have a great deal of recent history to live down; I shall enjoy the spectacle as they try to do so.
Defence cost study 15 epitomises the way in which the previous Government managed the decline in defence expenditure. It was probably the worst researched and most disastrous part of the review. I will not bore the House with more than a few key sentences from a report that we all know had an in-built Conservative majority. It said:
"The current state of the Defence Medical Services is an indictment of MOD's ability to manage change. No amount of self-justification can disguise the fact that the country does not have a medical service capable of looking after the maximum number of soldiers the UK plans to deploy in a crisis."
We said that defence cost study 15 was a disgrace, and that shortage of staff remained a key issue. We recommended that the Ministry conduct an effective review of the operation of the defence medical services. I very much hope that that review will be conducted during this Parliament.
Our report said:
"staff shortages in the Defence Medical Services are so serious that it is not clear whether it will recover. It is possible that the military ethos of medicine in the regular armed forces has been destroyed. It seems incredible that the scaling down of the Defence Medical Services has been effected by MOD in such a manner as to allow a major and potentially critical staff shortage to develop."
I hope that our Committee and the Ministry of Defence will examine the sale of MOD estate and the rundown of defence medical services.
Mr. Julian Brazier: Before the hon. Gentleman, who is my Chairman on the Defence Select Committee, moves on from the sale of married quarters estate, does he agree that the future level of rent rises for armed forces married quarters is an important piece of unfinished business, especially in the light of the strain on families that has been emphasised by hon. Members of all parties?
Mr. George: I welcome the hon. Gentleman's intervention, as he was one of the few hon. Members who had the courage to abstain on the matter in the previous Parliament, after a great deal of pressure was exerted on him by the Whips. I hope that our Committee will follow the request of the previous Committee and revisit the issue, although it must be obvious to everyone that the die has been cast and the sale completed.
I also hope that we will return to the question of the Ministry of Defence police and security. Security cannot be compromised, and I hope that no more bits of Trident, or anything else, will go missing. Fraud in the MOD continues to be investigated, and if we continue to lose parts of Trident, as we apparently have in the past few years, supporters of the Campaign for Nuclear Disarmament will be able to claim that Britain has indeed denuclearised.
The Committee will return to the issue of heavy lift—I am profoundly disappointed that Lockheed Martin has failed as yet to deliver the C130J—and I hope that we will consider merchant shipping, most of which has disappeared in the past 15 years. I trust that we shall
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continue to investigate Gulf war syndrome—if that is the correct phrase—and I welcome the positive and supportive view taken by my hon. Friend the Minister for the Armed Forces; I compliment him, and I hope that he will soon repeat his visit of a few months ago to the Committee, because we are committed to monitoring continuously what is being done in the MOD to further research something that I believe was detrimental to our armed forces.
Mr. Peter Viggers: The hon. Gentleman, the Chairman of my former Committee, will remember that towards the end of the previous Parliament I spoke in the Committee about the difference between the Ministry of Defence's attitude towards serving soldiers, sailors and airmen and its attitude towards those who had retired. The latter often find it difficult to get justice for an injury sustained as a result of service. Will the Committee consider that matter?
Mr. George: I very much regret the hon. Gentleman's disappearance from our number, and I recall vividly that he persuaded the previous Committee to pursue the subject of the way in which the Ministry of Defence compensates those who have suffered as a result of service on behalf of the Crown.
We are still in the process of considering compensating the soldiers who suffered cancer as a result of the atomic tests of the 1950s. I would not encourage anyone to believe that the MOD moves at more than glacial speed. Nevertheless, the issue must be taken up, and I shall put it to the Committee when we have completed our strategic defence review inquiry, which will dominate our activities over the next few months.
I have a few more points on issues that the Defence Committee took up but on which it was not satisfied with the answers received. On the new defence college, I regret that the Greenwich Royal Naval college will no longer be put to the purpose for which it was devised. I suggested that that building or the new millennium park could serve as an exhibition of MOD, War Office or Admiralty foul-ups over the past 200 or 300 years, but I was advised that there was not enough room. I had a number of ideas about what could be included. Certainly the period 1979 to 1997 would have required a great deal of space.
The whole concept of the future defence college has been most maladroitly pursued over the past two or three years. I very much regret the fate of Greenwich Royal Naval college. Perhaps it is not entirely too late to reappraise.
The Defence Committee will visit Bosnia shortly. We have the second largest force there, and it is almost patronising to repeat how wonderful it is. I hope that the United States will not abandon its commitment to Bosnia or scale down its forces to a level that would render its contribution less than a critical mass. As was said in the press today, the US cannot deploy only its naval and air forces and withdraw its land forces; their presence is critical. I hope that the US Congress will see how very important is the continuing presence in large numbers of US armed forces.
In a few days, the hon. Member for Romsey and the hon. and learned Member for North-East Fife (Mr. Campbell) will join me on a visit to Bonn, where we shall discuss with our colleagues on the Defence

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Committee in Germany the future of the Eurofighter. I hope that Germany will remain in the programme. Germany's Government want it, our Government want it, and I hope that the German Parliament will accept that it is necessary.
I am sad that Vickers is getting out of car production. The next time that it appears before the Defence Committee and plays the Union Jack card, I shall politely remind it that, having sustained its production of tanks, and not yet having seen the product of the vast investment that the country has put into keeping an indigenous tank capability, Sir Colin Chandler and his colleagues should have considered more seriously the need to retain Rolls-Royce, which is surely the flagship of Britain's industry. Perhaps Sir Colin will soon visit the Defence Committee to explain how successful his company has been in producing the Challenger tank.
Lastly, I welcome the new defence teams to the first of many head-banging sessions. I hope that the House will be able to reach a degree of consensus. We require competent armed forces and competent doctrine. Competent forces can be provided only by adequate resources. As a legislature, it is our task not only to consider the threat now, next week or next month; the decisions of the strategic defence review will have to last for the next quarter of a century. That requires a far-sightedness for which neither Treasuries nor legislatures are well equipped.
I only hope that we can break the habits of a lifetime and provide properly funded armed forces that are not grossly overstretched, to serve our needs and those of our NATO and European partners and of the United Nations. I must repeat that we have reached the bedrock of defence expenditure, and that any further cuts will endanger the defence of the realm.
7.3 pm
Mr. Tom King: I am pleased to follow the hon. Member for Walsall, South (Mr. George), who has been a distinguished and active member of Defence Select Committees over many years. I congratulate him on his promotion to the chairmanship of the Committee. Without in any way wishing offence, I must say that the Secretary of State would have learned a lot more if he had stayed because the hon. Gentleman knows much more about defence than the Secretary of State has yet been able to learn.
The Secretary of State is a good and agile debater but the jury is obviously still out on whether he will be any good as Secretary of State. One of his colleagues shopped him before he even started. I hung on to a quotation in The Independent from a shadow Minister in January—I apologise for the language—who said:
"Look, none of us has the first sodding idea about what government means, whether any of us will be any good at it, or even what being good at it means.
In many respects the skills required in opposition are diametrically opposite to the skills needed in government. Some of my colleagues have made a career out of being a conduit for leaks from the civil service to the press. That's hardly going to be much good in government."
On today of all days, it is quite clear that some still carry on the practice.
I said that the jury must still be out on whether the Secretary of State will be any good in the most difficult job in a Labour Government. The Chairman of the
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Defence Committee spelt out that we have reached bedrock. In launching the defence review, the Secretary of State said that no one would seriously expect defence to get any more money. That was not the best foot to put forward with the Treasury in starting a review. It would have pocketed the quotation and realised that it was downwards only from then on.
This is our first debate on defence under the new Government. I appreciate that the Secretary of State has written to me to ask whether I would be prepared to talk to him about defence policy. I will do so. That is a constructive approach. On the defence of our country, we will certainly stand up for what we believe is right and, as a party, defend the policies that we have stood for in the past. We are proud of what we have done on defence. However, we all care about our country and defence is one of the areas where the US approach of being more bipartisan on defence and overseas matters is appropriate. We have managed to encourage the Labour party to a much more constructive defence policy than that which it adopted in the past. Its beliefs are going in the right direction; the challenge is whether it will be able to carry those beliefs through with the necessary resources.
I am afraid that in marking the card so far, it has been a difficult start for the Secretary of State. Under no circumstances should the position of Secretary of State for Defence be a consolation prize for not being Secretary of State for Scotland. Lord Younger of Prestwick has been mentioned. On more than adequately discharging his duties as Secretary of State for Scotland, he was promoted to Secretary of State for Defence. That is the relative order of importance of the two roles.
In not expecting more money and in his approach to the review, anyone who considers the problems of stretch faced by our armed forces must recognise that defence may require more funds if demands on and expectations of our armed forces grow. I heard what the Secretary of State had to say about the fine, but I noted the speed with which it was conceded and announced by the Chancellor of the Exchequer. My right hon. Friend the Member for North-West Hampshire (Sir G. Young) made the telling point that it was the Chancellor who announced the decision about the royal yacht. I have a nasty feeling that the Chancellor or the Chief Secretary will announce more defence decisions, leaving us faced with a fait accompli.
The Secretary of State's assumption that a fine was involved and money was automatically going to be taken from his budget is an entirely new concept. I do not know who gave him that idea—I am sorry that I could not have an earlier consultation with him as I might have stiffened his back on that issue.
We are having the first defence debate of this Labour Government and it is no secret—everyone in the House knows it—that the country and the armed forces are suspicious of the Labour party on defence matters. It is no good thinking that if the manifesto states that the party believes in a strong defence that will meet all the fears and anxieties of those who serve in our armed forces. They are waiting to see what is actually done.
One of the Labour Government's first deeds involved the Chancellor saying that the Government would put more money into the health service this winter and that that money would come out of the defence budget. Anyone who knows the armed forces or who has talked to service men will realise that that act immediately

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reinforced their fear that it would turn out to be the start of a process. The announcement has been very damaging to morale.
Nobody in the armed forces or the Ministry of Defence is encouraged by the theory that the review will not be Treasury led. Being foreign policy led is not necessarily a great credential either. Let us imagine what would have happened if we had had a foreign policy-led review in earlier years. The Foreign Office did not foresee the Falklands or the Gulf wars. It never said, "Some 10 per cent. of our armed forces will have to be committed to peacekeeping in Bosnia in five years' time." The Foreign Office did not foresee the collapse of the Soviet Union or the iron curtain with anything like the speed at which they happened.
I think that the hon. and learned Member for North-East Fife (Mr. Campbell) made the point that, quite apart from foreign policy, there must be a defence policy for this country. I did not go along with his quaint idea of amalgamating the Foreign Office and the Ministry of Defence. I had not heard the idea before and I shall have to reflect on whether that is Liberal Democrat policy.
There is a core defence requirement. The Foreign Office does not always foresee the problem, but once it comes along, it expects the Ministry of Defence and our armed forces to do whatever is necessary. That is why this country needs a defence-led policy that does not depend on the best guess and the best forecast of the Foreign Office. I do not necessarily criticise the Foreign Office because I do not think that, given a list of the 10 most likely things to happen, many hon. Members would have marked off the Falklands war or said that 45,000 of our men and women in the armed forces would be involved in the Gulf in a high-intensity conflict. We sold our desert uniforms about three years before the Gulf war and I do not blame the Ministry of Defence for that—people thought that our desert days were over. I am merely showing the difficulty of trying to make predictions, and stating why we need to have a flexible and mobile defence policy to meet the different, and always unexpected, challenges.
Mr. Blunt: I agree with my right hon. Friend. Having served in both Departments, the one conclusion that I have reached is that the Foreign Office believes that it can spend the MOD's budget much better than the MOD.
Mr. King: My hon. Friend understands my point very well.
I wish to turn to a muddled bit of the Secretary of State's speech. I am not sure whether he was attacking "Options for Change" or saying that it was about right, but that that was where we should now stand. He spoke of it being inert and incoherent; he should be careful.
I warn Ministers to be careful about what they say about "Options for Change". It was masterminded by Lord Vincent, who later became the Chief of Defence Staff and was widely respected. He then went on to become an excellent chairman of the military committee of NATO. "Options for Change" was a two-headed operation. Its second head was the present permanent secretary, who was widely regarded as one of the brightest minds in the Ministry of Defence at the time.
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"Options for Change" has effectively stood the test of time; it has not been reversed. The only significant change made to the options programme that I announced was that when the need for peacekeeping in Bosnia came on the horizon my successor, Malcolm Rifkind, took advantage of the provision within the programme which meant that, if necessary, the infantry level could be reviewed. We increased the number of infantry regiments by two battalions, from 38 to 40. Across the breadth of the Navy, the Air Force and the Army, the decisions recommended by Lord Vincent and Richard Mottram and their study groups in "Options for Change", and carried out with due dispatch, have all stood the test of time.
"Options for Change" was never intended to be a slippery slope down which people could slide. It was always intended that we should move from the cold war, when we faced the Soviet Union and the Warsaw pact, to a post cold war situation where our military requirements were at a lower plateau—not on a slope, but at a lower plateau.
I accept that there was a case for "Front Line First". We had done much work on what our front-line strength should be, and there was a case for examining the rear echelon, much of the military and MOD estate, and a range of other matters—what might be called the MOD's overheads. But that having been done, I have been saying to my colleagues—and I made it clear to my colleagues when they were in government—that that was the position at which we should stop. One cannot maintain morale in the armed forces of a country or the calibre of personnel required unless one makes it clear that, having made changes, that then is the stability.
The one great disappointment that we all share involves the problem of stretch. My ambition in announcing the reduction in the armed forces was to make it clear that when we moved to a lower level of commitment we would achieve—which we had not achieved before—the 24-month gap between operational tours. For various reasons—Bosnia, the varying requirements of Northern Ireland and recruitment difficulties have quite a lot to do with it—we have not achieved that aim.
There was an acronym in the MOD which I inherited and which many people have forgotten about: MARILYN, as in Marilyn Monroe, which stands for manning and recruitment in the lean years of the nineties. It involves a demographic problem and it was one of the issues that we had to take into account in "Options for Change" when deciding on what we thought would be a sustainable level. MARILYN and the demographic problem of the number of people of recruitment age has meant that it has proved even more difficult than we anticipated in "Options for Change". I hope that we can approach the challenge of enhancing recruitment to the armed forces on a bipartisan basis to ensure that we can return to the 24-month operational tour interval, otherwise there will be difficulties in maintaining morale in the armed forces.
The second challenge that we face is both a constituency and a national issue. It involves procurement problems that flow from lower levels of demand in peacetime, when essential national capabilities cannot be maintained because there is an inadequate level of national procurement.
I have in my constituency a Royal Ordnance factory, which is the only producer of military explosive in this country and on which a significant amount of our

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ammunition supplies depend. Other hon. Members have Royal Ordnance factories in their constituencies and know that the issues currently affecting Royal Ordnance are a real problem. Royal Ordnance is a subsidiary of British Aerospace, which is currently embarking on mergers and collaborative arrangements with various companies in different fields. We have just talked about Eurofighter, but in the Royal Ordnance field the company is considering a possible merger with a French company. I accept that, in the defence field, there are often many good or even essential reasons for international collaboration, but this merger involves a possible arrangement whereby certain manufacture will come to this country and certain manufacture will go to France and one of the current proposals might lead to the only source of ammunition explosive being transferred to France.
The first requirement of any defence policy is national security. Forget our international alliances: although they are important and we must play our international role and collaborate with our allies where we can, at the end of the day, it is any Government's responsibility to ensure that we can maintain our essential national security, and ammunition explosive is an absolutely key national requirement. I was Secretary of State when one of our NATO allies refused to supply us with ammunition under the collaborative arrangement that applied within NATO. They were able to claim that it did not apply because the Gulf war was not a NATO matter.
In the case of France, I am conscious that, no matter how many agreements have been signed, the French were not in agreement with us over the Falklands—as we know, Exocet was one of the biggest threats we faced in the Falklands—and nor were they initially in agreement with us over the Gulf war. There was a significant pause before the French Government decided to join in and it is no secret that my then opposite number at the French Ministry of Defence was also the chairman of the Franco-Iraqi friendship society, which slightly compromised his position. Only this week at the United Nations, where we and the United States are pressing for a tightening of sanctions against Iraq in connection with Mr. Ekeus and his efforts to get greater co-operation from the Iraqis, the French have opposed and obstructed our efforts because they are hoping to do a new deal on oil and starting to establish closer trading relationships.
France is our ally and a friend with whom we work closely, but it is impossible to say that we will always have an identity of interest on foreign policy. In addition, it has to be said that even when the Government of France are in favour and showing full co-operation, the capacity of French lorry drivers, farmers or others to make damn sure that supplies do not move down French roads or along French railways is legendary.
I am glad that the Under-Secretary of State is present, because he can speak on behalf of his right hon. and noble Friend the Minister for Defence Procurement, with whom I have been in close contact about these issues. This matter makes both a constituency point and a wider national point: we must ensure that certain capabilities are not lost altogether, even though they are less required at present. During the Gulf war, we found ourselves in a high-intensity conflict in which our Royal Air Force and our artillery fired quantities of ammunition and munitions that were beyond the scale of our previous expectations. We have a duty to our armed forces—to which I pay
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tribute as has every other hon. Member who has spoken—to ensure that, if we put them in harm's way, they have the resources they need.
Mr. Mackinlay: Will the right hon. Gentleman give way?
Mr. King: No—I hope the hon. Gentleman will excuse me.
My point is that we face a difficult procurement issue. I have suggested to Royal Ordnance and British Aerospace that they present to the Ministry of Defence an assessment of the cost of ensuring that we at least retain production capability. Although our current requirements may be low, we must retain in this country capabilities in line with our essential national security. I have great respect and admiration for those with whom I worked at the Ministry of Defence, but I am not sure that they appreciate the challenge presented by issues of this nature. Our ordnance requirement is one of those issues and a new approach is needed.
7.25 pm
Mr. Barry Jones: I am delighted to follow the right hon. Member for Bridgwater (Mr. King), who gave some of the vital statistics of the Ministry of Defence. He was a distinguished Secretary of State for Defence and a courageous Secretary of State for Northern Ireland. I appreciated the speech made by the hon. and learned Member for North-East Fife (Mr. Campbell), who made a measured set of remarks and, in a low-key delivery, evidenced some considerable attachment to principle.
Listening to the speech of the shadow Secretary of State, the right hon. Member for North-West Hampshire (Sir G. Young), I was reminded of those days when I was on the squash court with him and, now as then, he was gentlemanly in his proceedings. However, when he attacked spinning, he hit his own wicket, and his remarks about the Welsh Assembly were inexplicable. I shall pick up on his point about the jury being out on my right hon. Friend the Secretary of State. My right hon. Friend has made an excellent start and I have no doubt whatever that in the months and years ahead he will continue to dominate the important brief that he now holds.
I thank my right hon. Friend for his open and sincere speech, notwithstanding the many interventions that he had to field. I shall support his objectives of efficiency, value for money and flexibility. He made an historic set of remarks when he ran up the flag of equality of opportunity; I support him in that and wish him well. I shall watch with interest how he translates the ideal into practice. What is certain is that, for many years, our nation has been subjected to a huge social revolution, which is on-going and incomplete. We would be foolish to think that the armed forces could be insulated from the effects of that revolution.
I should like to express my gratitude to the junior Ministers. To me and my constituents, they have been very accessible. During the few months in which the Government have been in office, I have been able to take at least three deputations to see each of the Ministers who sit in this House. I am grateful for the time that they have given to the worries and hopes of my constituents. Within three weeks of taking office, my hon. Friend the Minister

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for the Armed Forces met three of my constituents who suffer seriously from Gulf war illness. It was instructive to see a Defence Minister personally, in his room, attempting to come to grips with the problems experienced by Mr. Ritchie Turnbull, Mr. Mark Doyle and Mr. David Robertson. Each of those men is ill; each was a good service man who gave his best for his country in the Gulf. Now, I find them to be in a deteriorating state of health and I am grateful to my hon. Friend the Minister for giving them a full hour of his time. I hope that those three constituents will obtain the best treatment and get full compensation in the fulness of time.
Rev. Martin Smyth: Does the hon. Gentleman share my concern that many people in that category are worried that the years are passing by and they could be out of term very quickly for any claims, on which they might be entitled to receive compensation?
Mr. Jones: That is a shrewd intervention. It is my fear, too. I choose my words carefully: at least one of my constituents is seriously ill, and he has received medical advice that he urgently needs a variety of treatments. I want him to make a full recovery, but I know that he is seriously ill. I accept all that the hon. Gentleman implies, therefore, and I would make that point as well. I am sure that other right hon. and hon. Members will have that in mind.
Regarding heavy lift, many of my constituents are employed by British Aerospace and by the Airbus company. More than 3,000 of my constituents make the wings of the Airbus aircraft. They are a superb work force, highly skilled and loyal, and they meet every challenge successfully. They hope to be able to make the wing of the future large aircraft.
I ask the Government: what is the status of the future large aircraft? How are our Government negotiating and working alongside, for example, the Governments of Germany and of France in that important project? Many thousands of families in north-east Wales, in the north-west, in Cheshire and especially in my constituency are anxious to have the answers about that big project.
I am bewildered by the fact that the C130J is behind time by, I believe, 17 months. I did not want the contract to go to the specific company that it went to—of course, I was biased because my constituents have a strong interest in the future large aircraft—but I am perplexed by the delay in delivery, and I believe that there are problems also in airworthiness, if that is not too simplistic a statement. My constituents would be appalled if the future large aircraft were not built and our Government bought the C17 instead. That is a constituency point, but it is also a European, and indeed a national, point. I feel no guilt whatever in making it on behalf of a superb work force.
I also have the Raytheon aerospace factory in my constituency. I emphasise to the Government that in the constituency we have the unique skills and expertise, developed over many years, for the manufacture of special commission aircraft, and that we are relying totally on the ASTOR—airborne stand-off radar—project to keep the skills base and associated jobs alive, for the benefit not only of Wales, the north-west and my constituency but, in this instance, on so massive a project, of the country.
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I want to be sure that the Government will make every effort to ensure that the ASTOR project goes to the team offering the best technical solution, the lowest risk and the best value for money. I believe that to be the Raytheon team; I am entitled to say that because I genuinely believe that it is not only a very important constituency matter, but important nationally.
My hon. Friend the Member for Vale of Glamorgan (Mr. Smith), one of the parliamentary private secretaries in the Department, has visited us. He came to my constituency, met the Raytheon Jets work force and toured the plant. He made a good impression, and we told him that we needed the ASTOR project and that we wanted to service the Department's Dominie aircraft. I repeat that message today.
There is in my constituency what I believe to be the best maintenance unit in Europe—RAF Sealand. Nearly 1,700 uniformed and civilian staff work there. It makes a massive contribution to the economy of my constituency, and the skills there are unbelievable. The unit's record during the Falklands war—when it worked around the clock—and the Gulf war was superb. I want the Department to invest further in the work of RAF Sealand. I find that, whenever the unit is challenged, it comes up with the goods. I invite the Secretary of State to visit RAF Sealand at an appropriate time to see how it works and how it has managed to keep our marvellous fliers in the air in several wars.
In terms of research and development, historically, our nation has neglected to invest sufficiently in the aerospace industry as it affects the responsibilities of the Ministry of Defence. I know from British Aerospace that, annually, there are about £5 billion of export sales, in which 400,000 jobs in Britain are involved. If in the next century we wish to maintain a lead over our competitors, indeed over our potential enemies, should there be any—surely there will be—the Government, not simply the Ministry, must address the problem of research and development.
Perhaps unsurprisingly, my last point refers to the contribution made to defence matters by British Aerospace. I am told that it has an order book of £20 billion—a massive amount; that it is involved in 28 collaborative ventures throughout the world; that its annual sales are equivalent to about £7 billion; and that about 72 nations are its customers. Most important for the future, as for now, there are 47,000 employees at British Aerospace. Happily, it has taken on about 500 graduates in recent times. Above all, that company now represents Britain's largest reservoir of skilled employees.
If we took away the company of British Aerospace and the aerospace industry, Britain would be in desperate straits. I emphasise to my right hon. and hon. Friends the Ministers the fact that they should never neglect those issues.
7.37 pm
Mr. David Atkinson: Mr. Deputy Speaker, thank you for calling me on the first day of this two-day defence debate. I have three points to make, to which I would greatly appreciate a response from the Minister. One concerns the ballistic missile defence of Europe. The second concerns the threat to our defences posed by the so-called millennium bug—the inability of most computer systems to recognise the year 2000. Thirdly, I shall repeat to the Government the appeal that

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I made to the previous Government, to inquire into the use—I would call it the abuse—of young national service men in research in Porton Down in the 1950s, which has permanently impaired their health.
I pursued the issue of ballistic missile defence in the annual defence debates in the House in 1994 and 1995, when I shared my concerns with hon. Members about the fact that neither this country nor Europe had a firm, clear or coherent policy on ballistic missile defence. I regret to say that that remains the case today. As the threat has come even closer now, I assume that the Government' s strategic defence review includes missile defence in its terms of reference.
In the March edition of Aviation Week and Space Technology, the assistant director of the International Institute for Strategic Studies, Terence Taylor, is quoted as saying:
"There is no coherent European view on missile defence. There is a confused situation about what is the real threat and what we would defend in Europe, and who is European. If you look into the budgets you don't find anything."
If that is true, it is very alarming.
There has of course been a missile threat to western Europe for the past 55 years, ever since the Nazis developed cruise missiles—the V1 s, which killed 5,000 British civilians—and then ballistic missiles—the V2s, which killed 2,500 Londoners. Today that missile technology which the Germans pioneered is more easily obtainable than ever before and it has been used several times in recent years. My right hon. Friend the Member for Bridgwater (Mr. King) has just referred to the two British ships sunk by Exocet missiles during the Falklands war; and during one phase of the Iran-Iraq war, Iraq rained down missiles on Tehran, killing 2,000 citizens. Then, during the Gulf war, Saddam Hussein used his strongest card to attack Israeli towns and an American base in Saudi Arabia—his Al Hussein-Scud missiles. In March this year, China fired four ballistic missiles into the sea near Taiwan during the latter's presidential elections. Although that did not intimidate the voters, it caused Lloyd's of London to refuse to insure any ship going to Taiwan. That certainly damaged its economy, and that of Japan, temporarily.
We should not ignore those recent events. Missiles have been used to destroy, to threaten and to intimidate. They can affect whole economies and foreign policies. Today a growing number of third-world Governments are buying or developing missiles, which are easier to man and cheaper to acquire than squadrons of fighter aircraft. According to Lancaster university, 35 non-NATO countries have ballistic missiles, and 18 of them are capable of installing nuclear, biological or chemical warheads on them.
As the House will know, the greatest menace are the five rogue regimes, some of which help each other's missile programmes: Iran, Iraq, Libya, Syria and North Korea. Fired from Libya, North Korean No-dong missiles with a range of 700 miles would threaten southern Europe, while the Taepo Dong two-stage rockets that it is developing, with a range of 2,500 to 4,000 miles, would threaten all the capitals of Europe—including London.
How long will we observe those developments without responding to them with a clear policy? Three years ago, when I referred to those developments in a report to the Western European Union, I caused a flurry by suggesting
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a worst case scenario of Algeria falling to the Islamic fundamentalists. That could have a domino effect throughout the coast of north Africa, with Morocco, Tunisia and Egypt falling to equally hostile regimes that would quickly be armed by Libya and Iran, with missiles trained on Europe as well as Israel.
All that could happen within weeks. No doubt the United States would seek to intervene; but who can say, as the carnage in Algeria continues every week, that such a scenario is implausible? The Lancaster university team also estimates that 67 non-NATO countries possess cruise missiles. Any future western rapid reaction force, including British forces, in an out-of-area operation will now need far greater protection than was provided during Desert Storm.
I look forward to the Minister's response to four questions about ballistic missile defences which I want to put to him. First, what is the Department's response to the British Aerospace-led pre-feasibility study on missile defence hardware? I believe that the study was reported to the previous Government earlier this year. Secondly, will the Minister take Britain into the medium extended air defence system project, with the United States, Germany and Italy, for international co-operation and cost sharing in the development of anti-missile systems; and will he urge France to return to the project?
Thirdly, will the Minister encourage NATO to be the instrument for developing and deploying a European ballistic missile defence system—the system for which Michael Portillo called in his speech in Brussels a year ago?
Finally, during a WEU visit to the United States in July, I was encouraged to learn of two new significant developments in missile defence—the first such for several years. One was a United States air force contract to Boeing Lockheed Martin to develop an airborne laser to shoot down ballistic missiles shortly after launch—the ideal time to shoot them down, while the missiles are still over the launching country and at their most vulnerable.
The second significant development is a laser defence system known as the infra-red advanced chemical laser which, either ground based or satellite based, would defend satellite systems from missile attack. Both projects, using lasers as weapons, run contrary to existing treaties. In the light of the perceived threats to which the development of those projects is a response, I must ask the Minister whether the treaties should now be renegotiated.
The House will recall the concern that I have expressed in several speeches and countless questions during the past two years about the consequences of most computer systems not recognising the year 2000, for this country and the rest of the world. I hope that the House will give a Second Reading to my Companies (Millennium Computer Compliance) Bill on Friday 28 November; it will do much to protect British business from those consequences.
As Governments and private businesses are discovering, although tackling the problem is a comparatively simple task for a computer programmer, the real issue is the sheer scale of the problem: there is not enough time left to avoid difficulties. It is a question of priorities. Earlier this year the Daily Mail, reporting the National Audit Office's report on the problem, warned that vital defence and weapons systems could suffer breakdowns and military computer systems could stop

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functioning altogether, leaving Britain defenceless at the turn of the century. It quoted Michael Clark of the Centre for Defence Studies as saying:
"In the worst possible scenario we could have unguided missiles flying around—or none at all. Anti-tank missiles could hit the wrong target, or simply not fire. We have no way of knowing exactly what will happen."
I hope that the Minister will tell us this evening how the Department is responding, and that he can assure us that our defence systems will remain fully operational at the turn of the century. I have a copy of the United States Department of Defence year 2000 management plan, showing the Americans' response to the situation. Does our Department have something similar? I hope, too, that he will say what discussions he has had with our allies to make sure that they are preparing for the problem as well. Even if our systems have been made millennium compliant, if other systems with which they are connected are not, ours will crash along with them.
Exactly a year ago in an Adjournment debate, I drew attention to the position of certain former national service men, including my constituent Michael Paynter, who volunteered for research into the common cold at the chemical and biological defence establishment in Porton Down in the 1950s and whose health has been permanently destroyed by the experience. The then Minister, my hon. Friend the Member for Mid-Sussex (Mr. Soames), refused my request for a public inquiry. I have now written to his successor with the same request and was delighted to learn from his reply last month that he has taken the trouble to meet representatives of the Porton Down volunteers association. I thank him for the personal interest that he has taken in the matter, but he has not told me the action that he intends to take in the light of his meeting. I think that the Under-Secretary of State for Defence was also present at that meeting. As Ministers will know, the matter is now being taken before the European Court of Human Rights. Is it not better to let the British Government deal openly with the matter than to have them respond grudgingly to the court's finding?
7.49 pm
Mr. Andrew Mackinlay: It is good to be back. The parliamentary summer recess was unacceptably long.
I am pleased that we are having this wide-ranging defence debate. I have enjoyed listening to a number of contributions, although I may not have agreed with all that has been said. I listened closely to the speech of the hon. and learned Member for North-East Fife (Mr. Campbell). Bearing in mind the spirit of ecumenicism between the Prime Minister and the leader of the Liberal Democrat party, I feel that I can safely say that I agreed with everything that he said. I make no apology for flagging that up.
The shadow Secretary of State referred to NATO enlargement and complained that there was no great debate on the issue in this country. To an extent, he and his colleagues are to blame. Regrettably, the only debate that I recall being held on the Floor of the House was initiated by the hon. Member for Ludlow (Mr. Gill) in private Members' time. Part of the reason why this
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extremely important issue is not discussed in the House is that the House does not ratify treaties. I hope that, when the Government discuss their constitutional agenda, they will look at the wider issue of the House being able to confirm or ratify treaties or amendments to treaties. That would be good in general and would ensure that we had, in the House and elsewhere, a full debate about the important matter of NATO enlargement, which I whole-heartedly support in principle.
I very much welcome the fact that the Madrid summit gave Poland, Hungary and the Czech Republic the prospect of early admission to NATO. My only regret is that Slovenia was left out for no other reason than that existing NATO members decided—for reasons that I accept—to tell Romania that it should wait for some time and, rather than leave Romania to face its disappointment alone, felt that they must leave out 1 million people in Slovenia to smooth over Romania's disappointment.
I welcome the extension of NATO because it is a matter of right. It is 51 years since Winston Churchill spoke at Fulton, Missouri and said:
"From Stettin in the Baltic to Trieste in the Adriatic an Iron Curtain has descended across the Continent behind which we must refer to it as the Soviet sphere."
What were the past 50 years about if not to acknowledge that, when countries are free, they are entitled to join an association of free nations? For half a century, we were telling the peoples of central Europe to look over the wall at how wonderful a market economy was. When communism collapsed, the Warsaw pact finished, the wall came down, the barbed wire was rolled up and they asked whether they could join the club, some people said, "Hang on a minute, not so fast." That is totally unacceptable. It is a moral issue that we should be able to invite countries that can demonstrate a robust and enduring parliamentary democracy into the NATO club, and we took that first step at the Madrid summit.
The hon. Member for Surrey Heath (Mr. Hawkins), who is no longer in his place, referred to the Baltic countries which can legitimately aspire to join NATO. We must not, however, devalue or dilute the security guarantees, which is why the extension of NATO should be taken in geographical stages. Another criterion for new NATO members is that they must make a commitment not just to parliamentary democracy but to internal human rights. At least one Baltic state has some distance to go before demonstrating that it can accommodate its minorities within a democratic constitutional structure. That is an important incentive or carrot. The aspiration of joining NATO has contributed to the rapprochement between Hungary and Romania, so it is good that nations are told that they can join defence organisations—an important symbol of democracy—if they are prepared to ensure the robustness of their parliamentary institutions.
I welcome this debate for a number of other reasons. I want to place on record my gratitude to the Minister for the Armed Forces for his initiative in the campaign with which I have been associated to seek pardons for soldiers executed in the Great War on charges ranging from cowardice to desertion, sleeping at their posts, throwing away arms and hitting a superior officer. He agreed that there is now widespread support for acknowledgement by the state that injustice was done to those men, albeit a long time ago. I welcome the fact that he has referred the matter back to the various sections involved within the Ministry and I look forward to a positive response. It will

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be welcomed by the men's families and the few remaining veterans from the Great War and, overwhelmingly, by British public opinion.
In the last Parliament, an early-day motion was signed by the majority of Back Benchers—perhaps even by a majority of the House—calling for a veterans Minister. I acknowledge that the present Government have gone some way, within the distribution of portfolios in the Ministry of Defence and other Departments, to meet the needs, aspirations and interests of people who have served in the armed forces and their widows or dependants. Nevertheless, I hope that a message will go back to the Prime Minister that there is a case for a Minister with a clear remit, among his other duties, to protect and promote the interests of veterans, their widows and dependants. It could be along the lines of the Minister for Sport. In all Administrations with a Minister for Sport, the Minister has had other responsibilities as well—for water, disasters and so on. This country, like most others, should have a Minister for veterans' affairs. I hope that the Prime Minister will consider that.
There are many veterans' issues. The hon. Member for Bournemouth, East (Mr. Atkinson) mentioned an ex-service man who volunteered for Porton Down. There is also Gulf war syndrome. I have taken a renewed interest in the disadvantage suffered by some war widows and war pensioners whose local authorities do not disregard their pensions in assessing housing benefit entitlement. I give a trailer for the Bill that I shall present on 5 November to try to end the exercise of discretion by a minority of local authorities. That is unfair both to pensioners in those areas and to local authorities that exercise their full discretion under the law.
I was pleased to go, during the recess, with a number of hon. Members, including the hon. Member for Salisbury (Mr. Key), to HMS Invincible on the initiative of Captain Clare, the commanding officer. We spent a day at sea seeing and experiencing the great skills and dexterity of the craft and its crew, which allowed us to understand more fully the importance of the facilities of that amphibious craft and, if I may use the words of the commanding officer on that occasion, the capacity of a carrier like the Invincible to be on a "global neighbourhood watch". I thought that that was an apt description of our role and of the capacity of our carriers and amphibious craft.
It is interesting that some 10 per cent. of the crew of Invincible are women. It was clear that that was not seen as a problem by the commanders or by the men and women who serve on Invincible. There was a period when that might have been novel, and when those women would have been pioneers, and there might have been some difficulties, but once one gets over the problem and embraces it, the issue goes away. [Laughter.] Hon. Members might find that a matter for levity, but I think that it is serious.
The shadow Secretary of State said that he gave a cautious welcome to what the Minister said earlier in his announcement about women in the armed forces. I thought that the shadow Secretary of State was less than generous. Intellectually, he knows that what was announced today was entirely sensible, demonstrably fair and long overdue. He knows that, but he has behind him some Blimps who cannot comprehend that a substantial proportion of armed forces roles can be filled by the
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female gender. It is a great pity that he could not say more robustly that he agreed with the Government on the matter.
Mr. Robert Key: I share the hon. Gentleman's admiration for the crew that day. My right hon. Friend the Member for North-West Hampshire (Sir G. Young) was not giving a cautious welcome in that sense. There are problems, and I shall refer to some of them tomorrow—for example, the need to review the Army, Air Force and naval discipline Acts and to consolidate them into one. That opportunity has been missed for a decade. When there is joint service, as on that aircraft carrier, there are real problems concerning the different moral codes of the three services. That has caused genuine concern in many cases.
Mr. Mackinlay: The matters to which the hon. Gentleman refers are not problems; they are matters that must be addressed. They are not reasons for not welcoming the principle of the announcement by the Secretary of State. I shall not labour the point, but the Conservatives could have embraced it more generously this evening.
Also during the recess I have been signed up, if that is the correct term, to the parliamentary armed forces scheme. I am grateful that the Minister for the Armed Forces has decided to extend the number of places for hon. Members, and I encourage all hon. Members to take advantage of the extension. It is enormous fun, but that is a secondary issue. More importantly, it is extremely good in terms of briefing and allows us to understand the philosophy, camaraderie and skills of our armed forces personnel and the equipment that they use. I welcome my secondment to the Royal Marines.
My family fell about laughing when they heard that I was connected with the Royal Marines, then my wife inquired about insurance. However, I have been in safe hands. It has been well worth while and I am grateful to the commandant-general, Major-General Pennefather, and his colleagues for facilitating my visits to Royal Marines establishments.
Mr. John Burnett: It may not be known in the House, and it should be known by the hon. Gentleman, that tomorrow is the 333rd anniversary of the formation of the Royal Marines. I hope that the hon. Gentleman and the House will join me in congratulating the corps—in which I am proud to have served—on a fantastic record, second to none, in defending Britain for centuries.
Mr. Mackinlay: This is an occasion on which I am delighted to have given way. It is pertinent for the hon. Gentleman to draw the attention of the House to that anniversary. I saw an absurd press report—in The Daily Telegraph, I think, so I do not take it tremendously seriously—of a suggestion that there should be a merger between the Royal Marines and the Parachute Regiment. I would welcome some reassurance from Ministers today or tomorrow that that was utter nonsense, which I am sure that it is. It would be important to those serving in the Parachute Regiment, the Royal Marines commandos and people associated with them for that nonsense to be put aside.

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One of my visits was to the Royal Marines school of music, whose relocation to Hampshire was the subject of considerable debate at the time of "Options for Change" and subsequently in the House. I can report to the House that the school is well accommodated in suitable accommodation, and standards are being more than maintained. Under Lieutenant-Colonel Waterson, great efforts are being made to offer the men and women in the Marine band opportunities to qualify for music degrees during their period of service. That is a relatively new development, but it is in line with what is happening elsewhere in the armed forces, which I welcome. Service men and women are to be given increasing opportunities to attain civil qualifications, which will give them a sense of achievement and help them with their later careers.
My activities this summer have reinforced in my mind the importance of the flexibility and benefits that the United Kingdom derives from its carriers and other amphibious facilities around the world. That is important politically and militarily. Often, they can be deployed in advance of political decisions, so that Governments can be told that our armed forces are already in place, whether for humanitarian purposes, to rescue people in dire circumstances, as happened in the Caribbean this summer, or for peacekeeping purposes, to intervene where that is urgently required.
In the past five or six years, our forces have been involved in numerous peacekeeping operations and in providing humanitarian relief. All too often, those activities go unreported. The television cameras are often not there, and our forces are taken for granted. Hon. Members expect our armed forces to have that capacity. It is important for our role in the world that we have the facility to intervene in troubled areas or in areas where a crisis has been brought about by natural disaster.
Will Ministers assure us that, in addition to HMS Ocean, which is being constructed at Barrow-in-Furness and will be a major additional facility enlarging our capacity to mount amphibious operations, replacements will be ordered for Fearless and Intrepid? It is important that we should have such capacity, for the reasons that I outlined, both military and political.
Mr. Paul Keetch: I also spent some time on HMS Invincible as part of the Commons defence study group. I endorse the hon. Gentleman's comments about the flexibility of aircraft carriers. Will the Minister consider not just Fearless, Intrepid and Ocean, but the Invincible class itself? Those are now old ships and we must start working on replacements for them as well.
Mr. Mackinlay: That is entirely correct. I am sold on the necessity for the United Kingdom to have the capacity to protect itself through its amphibious ability. A score or 25 years ago, we might have abandoned that facility. That would have been profoundly foolish, and one of the great historic mistakes.
Reference was made to the fact that our armed forces are under strength. The Royal Marines were short by 296 commandos in September 1997, and there are many thousands of vacant places in the Army, Navy and Air Force. I believe that the move to tri-service recruitment shops has not proved successful. I have taken the
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opportunity—I invite other hon. Members to do likewise—to interview young men and women in our secondary schools to discover whether their appetites have been whetted regarding careers in the armed forces. I find that the concept is put to very few young men and women who have the physical and mental capacity to serve in our armed forces. With a bit more effort and imagination, perhaps we could fill the vacant posts in our armed forces with good-quality youngsters. I hope that the Government will introduce some initiatives in that regard.
There is another area worth mentioning in a defence debate, which I wish to raise. I understand why, in light of the IRA and security situations, it was decided that men and women in the armed forces should not wear their uniforms in public. However, I believe that that was an appeasement to terrorism to some extent, and I suspect that those who wish to murder members of our armed forces will always identify them in any event. If the ceasefire endures—I hope that it will—perhaps the Government will review that policy. Unlike people in other countries, the British public do not see their armed forces in uniform—which may also have a knock-on effect in recruitment terms. I hope that the matter will be reviewed in this new climate. Even if no instruction were given, perhaps individuals in our armed forces could have the option of wearing their uniforms in public.
I suppose that the kernel of this debate is the armed forces review. I am somewhat saddened that, although it is considered all right for the Conservatives to conduct an armed forces review, apparently it is not appropriate for a new Government to do likewise—despite the fact that the Labour party has been out of office for 18 years. It seems both prudent and fair that Government should have the opportunity to review and take stock of our defence position.
We have been told that it is a foreign policy-led review, and I shall dwell on that point for a moment. I welcome that approach. I am aware of our foreign policy requirements in broad-brush terms, as well as the expectations of the people of this country and those of my right hon. and hon. Friends. I am at one with the Secretary of State on this point: if we have foreign policy commitments—of which we are all familiar—we must vote the means of fulfilling them. I agreed with everything that the Secretary of State—who, unfortunately, is not in his place—said. However, before he gets too excited, I must add that my election address did not contain the word "new"—I removed it completely.
Over the weekend, I noticed one or two of my colleagues who describe themselves as "new Labour" postulating in the media that there is scope for making major savings from Britain's armed forces. I do not share that view—especially if we are to maintain foreign policy expectations. At times of crisis, such as a natural disaster or genocide, Members on both sides of the House are the first to demand that the British Government—whether Conservative or Labour—intervene. By and large, I agree with that. However, we must remember—to put it bluntly and crudely—that, if we want to maintain our present role and capacity in the world, we must will the means. That does not come cheap. While there may be some opportunities to readjust the configuration of our role, we cannot use that possibility to support a reduction in the overall resources available to our armed forces. I am at one with the Secretary of State on that issue. Through you, Mr. Deputy Speaker, I tell those who think that they can have their cake and eat it that that is not possible.

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My penultimate point concerns the volunteer and cadet forces. My county of Essex—if I may be parochial for a moment—has only 459 all ranks in the Territorial Army. I believe that the county deserves more not because I am from Essex but because I think that our territorial armed forces should be distributed evenly throughout the country. Essex is close to London, near the motorway and major transportation networks and has a substantial population. I think that there should be no further reduction in the Territorial Army or in volunteer forces generally, and certainly no such reduction in my county. There will be some opposition if that occurs.
I acknowledge the great service provided by the volunteers who run our cadet forces. There is a case for examining the funding of those forces. Funding should be maintained, but distributed more equitably in order to ensure that the three cadet forces are resourced sufficiently so that they may continue and enhance their important community role.
The shadow Secretary of State is now in his place. He referred to NATO and I hope that, contrary to his better judgment, he might find time to read in Hansard my references to his comments earlier. As I have said, I feel strongly about that subject. It is a matter of fact that the United States Senate will have to approve the widening of NATO membership, and I hope that it will not fail to approve that increase. If the United States did not approve the widening of NATO membership as recommended by the Madrid summit, I believe that it would be one of the few foolhardy acts committed by that country and comparable to its failure to join the League of Nations.
For all its faults and deficiencies, the United States has a proud defence record: its long arm reached across the Atlantic during some of our most desperate times. The United States has sustained and led NATO for more than half a century, and it would be a great tragedy if it were to fail to finish the job by extending NATO membership to the new, free, robust parliamentary democracies in central Europe. I hope that remarks in this place and the actions of our Ministers elsewhere will encourage United States senators to approve that important historic event and achieve an extension of democracy and security in Europe.
8.17 pm
Mr. Ken Maginnis: I would be negligent if I failed to mention the contribution that the armed services have made in Northern Ireland over more than a quarter of a century. During that time, hundreds of young men and women have died in the defence of democracy and many thousands have been injured. The devotion to duty demonstrated by those young men and women is quite remarkable, given the fact that successive Governments have been without any coherent or cohesive policy on how to deal with terrorism in Northern Ireland.
It is certainly no compliment to the courage and discipline of those young people that we now have the IRA, represented by unreconstructed terrorists, at the table of democracy. However, I shall not deal with that matter during my brief speech tonight; I want to concentrate on how the Ministry of Defence acts and reacts in respect of this nation's arms procurement so as to sustain the interests of our defence industry.
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I move immediately to the development of our air-to-air capability. When the decision was made to equip our forces with Apache helicopters, it was recognised that they would require an effective air-to-air capability to defend themselves against enemy helicopters and other aircraft. There was what was called a mandatory option to equip with Starstreak or anything better. At that time, Starstreak had not been accepted into service, but it is now successfully deployed with United Kingdom forces as a vehicle-based, ground-to-air, very short-range missile system.
I do not need to remind hon. Members of the advantage that Starstreak's laser-guided, high-velocity missile system holds over infra-red systems—it is effective in typical battle-scene scenarios where there is clutter such as smoke, tree obstructions or heat sources. Starstreak has been designed to be immune to countermeasures, including jamming, flares, chaff or electronic devices. Its high velocity enables engagement times to be short.
Air-to-air Starstreak can take full advantage of the target acquisition range provided by the Apache helicopter's longbow radar and target acquisition and designation system—TADS. As it is not a fire-and-forget infra-red system, there is also a reduced risk of mistakes such as friendly fire, as the missile can be destroyed or steered away from the target following launch if the target is found not to be hostile.
The possible alternative to Starstreak—the United States' Hughes Stinger infra-red system—has been declared ineffective in the air-to-air role, whereas Starstreak had, by the end of last year, successfully completed phase one of a joint US-UK evaluation, with six Starstreak missiles successfully fired from the helicopter in the hover and forward flight positions.
Phase two, encompassing the integration of Starstreak's laser beam guidance system with the Apache's TADS and full integration with the programme, together with the recent selection of the Apache by the Ministry of Defence, could pave the way for joint missile procurement and inter-operability of common US-UK equipment. Between the US and the UK, we are talking about some 900 helicopters.
I come now to my point about the Ministry of Defence. Quite simply, it is not punchy enough; it is not positive in promoting this country's defence industry in the face of very aggressive opposition. Potentially, Starstreak is a huge winner and it could be ready for service within two to three years in its air-to-air role, yet the United States finds the MOD ambivalent and without enthusiasm on the issue of whether we are committed to our own system. There is a huge Stinger lobby in the US. It is therefore essential that Starstreak receives full UK support. The current perception in the US is that the MOD is not firm enough in its support for Starstreak and is simply waiting for the US to pay for and make the selection decision. That can only assist the Stinger lobby.
I encourage the Minister and the Secretary of State, who has just resumed his seat, urgently to address the fact that improvements in the ground-based air defence capability at short range and very short range are required through the introduction of a co-ordinating command and control structure working to individual fire unit level. No such change in the infrastructure of our ground-based air defence has yet occurred. In order to bring significant gains in the efficiency of our air defence assets—I refer

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specifically to Rapier and Starstreak—the sophistication of co-ordination in command and control needs to match that of other European nations.
The introduction, through technology insertion, of a command and control capability in the short range and very short range air defence systems would provide scope to increase the efficiency of the weapon systems, to allow the most cost-effective weapons mix to be deployed, to provide instantly the recognised air picture and local air picture to the fire units, and to ensure that Britain's air defence capability is compatible with the continuing adoption of such digitisation programmes by other NATO countries.
Finally, I want to touch on the airborne stand-off radar—ASTOR—programme, which is essential to the defence of our nation. Do the Government still regard it as a high priority? I point out to the Minister that, apart from my regional interest in the programme, it incorporates significant national interest. Of the two aircraft platforms proposed for the ASTOR programme, only one—the Bombardier Global Express—has significantly high British content. Shorts design and manufacture more than 25 per cent. of the aircraft in Belfast.
Following the loss of 1,000 jobs due to Fokker's collapse last year, this programme is of major importance to employment at Shorts and other UK companies. Up to 700 jobs in Belfast will depend on Global Express at full production. Other major British suppliers include Lucas Aerospace, Messier-Dowty, Westland and BMW Rolls-Royce, which supply the engines.
Due consideration should be given by the MOD and the Department of Trade and Industry to the high UK work content, in addition to the advantages that the all new design Global Express aircraft offers. Because of its all new design, Global Express offers major advantages to the MOD in that it provides 25 per cent. more cabin space with outstanding capacity for flexibility and development of interior layout. It incorporates the most advanced proven technologies available with superior systems, three times the amount of electrical power, superior performance and low operating costs.
If selected, Shorts would also manufacture components for the modified ASTOR aircraft, thereby providing even more jobs. There would be major export opportunities for Global Express, with more advantages available to the British companies that I have mentioned.
I believe and I hope that the Secretary of State agrees with me—although he is not paying much attention at the moment—that this nation's effective defence depends on our vital defence industry being maintained and given all the support and encouragement that other nations appear only too willing to give their industries.
I shall end as I began: we depend on our young men and women in uniform, but integral to our defence must be a healthy defence industry. I hope that the Secretary of State will pay due attention to that.
8.29 pm
Mrs. Linda Gilroy: In rising to make my first speech, I should like to say something of my constituency. It is particularly relevant that I should
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make my maiden speech in the annual debate on defence, representing as I do one of the leading defence constituencies in the country.
Called Sudtone in the Domesday book, Plymouth's original harbour is still called Sutton harbour. A developing trade and the shipment of armies to France led to its early growth, and by the 16th century it was flourishing and the home port to many Elizabethan adventurers, including Sir Walter Raleigh, who set off for Virginia from Plymouth, and Sir Francis Drake, who sailed with the English fleet from Plymouth to defend the country against attack from the Spanish armada in 1588.
Sutton harbour is now flourishing on a different basis as home to the fastest growing fish market in Europe. The Hoe, on its southern waterfront, is dominated by the citadel, built by Charles II, and now home to the 29th Commando Regiment, Royal Artillery. The east of my constituency is bounded by the royal dockyard, which was started in the late 17th century and became the focus for the town of Plymouth Dock, renamed Plymouth Devonport in 1824.
As a naval port, Plymouth has played a key role in the defence of the country. Partly as a result of this, during world war two, the city suffered severe bomb damage from air raids. Indeed, it was the most bombed city in England.
At the entrance to Sutton harbour, the walls carry plaques recording the historic voyages that started from Plymouth. They also include many to those who died at sea while fishing or working in the merchant service. Perhaps most famous among the voyagers are the Mayflower pilgrims, who finally set sail from Plymouth in 1620 for the new world. The plaque recording the pilgrim fathers was put up in 1955, but it was only in the early 1980s that the names of the pilgrim mothers—essential, I would have thought, to the new world—were added.
My right hon. Friend the Secretary of State referred to the potential huge movements of people in Europe, and some of the plaques at Sutton harbour mark the departure of some 450,000 people to Australia and New Zealand in the 18th and 19th centuries.
I was fortunate enough to visit Australia during the recess as a member of the Commonwealth Parliamentary Association delegation. We were able to see at first hand the impact that emigrants from the south-west made in establishing the roots of what is now a flourishing country. The links with Tasmania, as shown in place names, are particularly strong: Devonport, Exeter, Launceston, Staverton, Tamar and Cornwall, to name but a few.
We visited the Australian national war memorial in Canberra, which reminded us of the strong defence links with our Commonwealth allies. I should like to record my thanks to the many Australian members of the Commonwealth Parliamentary Association, the staff of the various Parliaments in New South Wales, Canberra and Tasmania, and our own high commission staff. They all contributed to making our visit purposeful and memorable.
The historic landings at Plymouth are less well recorded, with one notable exception. In 1956, Plymouth trade unionists put a plaque on the harbour wall to mark the homecoming of four of the Tolpuddle martyrs who landed back in Plymouth in March 1838, having survived their exile in Australia.

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Our waterfront has rich associations that have earned the city the titles of cradle of the Commonwealth and springboard for the new world. There are indeed some 40 places in the world that take their name from Plymouth. We are working to celebrate that millennial heritage in the regeneration of our waterfront. "The Shell Guide to Britain" refers to our waterfront as one of the premier waterfronts in the world.
The Mayflower steps, on the other hand, marking where the pilgrims left from, have been called the most underdeveloped heritage site in the country. We have much to do, and I hope to play a leading part in ensuring that the citizens and visitors of the next millennium know the role that the city of Plymouth played in defence in worldwide terms during the millennium.
Many famous men have been associated with Plymouth—explorers, adventurers, discoverers and scientists. Plymouth has also had some remarkable, courageous and dedicated women. They include several scientists, nurses and doctors. Dr. Mary Parke made her contribution in the 1940s to marine science, working in Plymouth's Marine Biological Association, a forerunner of our world-famous Plymouth marine laboratory, which now employs 200 people in my constituency.
Plymouth's medical women played a significant role in the services. Eight of them, trained under pioneer nurse Priscilla Sellon, worked with Florence Nightingale in the Crimea, and pioneer woman surgeon Dr. Mabel Ramsey worked on the battlefields in the first world war.
I welcome my right hon. Friend's announcement to extend the scope for women to be involved in our armed forces, as will many of my female constituents who serve in them.
Equally, Plymouth has a unique record in the representation of women in Parliament. There are many pictures in the corridors of the House that feature Lady Astor and mark her role as the first woman to take her seat, in 1919, representing the constituency of Plymouth, Sutton. Her maiden speech was made in a debate on one of her favourite campaigning issues, which she referred to as the "vexed question of drink". I think that she would have approved of the steps announced before the recess to control the sale of alcopops. She stood up for equal rights for women in the civil service, and I suspect that she would have been the first to castigate the former Minister for the Armed Forces and the present shadow Secretary of State for their somewhat lukewarm remarks on my right hon. Friend's decisions about the scope for women in the armed forces.
Lady Astor wanted to raise the school leaving age to 16 to reduce unemployment, and she made clear her annoyance at the lack of interest shown in social reform. Indeed, she would feel at home with much of the programme set out by new Labour, as we move to raise standards in education and to recognise the essential links that this has with sustaining employment in today's world. I think that she would also have been angry to know, at the end of the 20th century, that the constituency—on the 1995 index of local conditions—includes St. Peter's as the poorest ward in England.
Lady Astor was the first of an almost unbroken succession of women politicians to represent the city of Plymouth, which must be unique to our city. In the Labour landslide election of 1945, Lucy Middleton was elected the first Labour woman to represent the seat. In the
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aftermath of war, international co-operation and the role of food aid in achieving this was the subject of her maiden speech.
In 1955, Dame Joan Vickers was elected to the neighbouring seat of Plymouth, Devonport, and was the first woman to represent a dockyard constituency. Dame Joan lost her seat in 1974, the same year that a former Deputy Speaker, Dame Janet Fookes, now Baroness Fookes, became the Member for Plymouth, Drake, which she represented until this year.
The new Plymouth, Sutton is the successor seat to Plymouth, Drake. Baroness Fookes campaigned successfully for an Act to stop kerb crawling in 1995, and concluded her long service in Parliament, in this House, as Deputy Speaker, commanding the respect of hon. Members on both sides of the House.
As the fifth woman representing the city, and following such a distinguished line of women Members, I am proud to be the city's first Labour and Co-operative Member of Parliament. I shall be active in seeking co-operative solutions to the many challenges that we face locally and nationally, working alongside my 24 Labour and Co-operative colleagues on Government Benches.
I am also mindful that there is still much to be done to secure the proper representation of women in the House. There still have not been many more than 200 women Members since Lady Astor took her seat in 1919. In the same time, there have been more than 4,000 male Members of Parliament. I look forward to working with all hon. Members, particularly the 117 other women, to sustain the momentum that we achieved at the 1997 election.
Despite recent reductions, unemployment in the city of Plymouth continues to be alarmingly high. We have suffered from the decline of employment of our traditional industry in the dockyard. Indeed, it has been nearly decimated. The emphasis given by the Government on equipping people for work through their "new deal" programme is welcome, as are measures on education standards to help our citizens to compete in the global economy. Along with my colleagues on the city council, in the partnerships that they have forged with people in business and in the community, I shall work hard to ensure that we respond enthusiastically to those measures.
However, given that there are 11 people unemployed for every job vacancy in Plymouth in recent times, something must be done to ensure that the job market improves. There has been much anger about the destruction of key parts of our defence, particularly the naval industrial base. Skilled teams of workers have been cast wantonly to the inefficient vagaries of the unfettered free market. The country invested time, skill and money in training people who are now under-using their skills, or are not able to use them at all.
It is nearly 30 years since the United Nations identified more than 40 ways in which military engineering and technological skills could be used for civilian industrial research and development—particularly in one of the world's future growth industries, environmental technology. At long last we are taking that seriously.
We look forward to a major conference on defence diversification in Bristol next week. I also welcome the announcement that a Green Paper on our plans for defence diversification—as promised in our manifesto—will be published in the autumn. We must fight for opportunities

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to maximise those valuable industrial skills and knowledge, and I hope that we will pay particular attention to the role that green technology can play in the process of diversification.
Although we need to diversify our economy, the defence industry will remain a central part of it. At last we have a strategic defence review based on the foreign policy needs of our country, and the outcome of that review must ensure that we have the right sea, air and land capabilities to defend our economic and trading interests, as well as capabilities that enable us to be an effective ally with our partners in the global arena. Our defence and peacekeeping capabilities require the utmost in skills and discipline: they are something in which our country can and should take great pride. The city of Plymouth certainly does, and our contribution is still significant, despite the cuts to which I referred earlier.
From the 29th Commando Regiment, Royal Artillery at the citadel to 3 Commando Brigade, Royal Marines in Stonehouse barracks; from the MOD workers who work in support of the Navy and the dockyard workers at Devonport royal dockyard; from British Aerospace workers to the men and women of the Territorial Army based at Millbay who serve under the 4th Battalion the Devonshire and Dorset Regiment—in the south-west region, of which we like to think of Plymouth as being the capital, some 16,000 men and women earn their living, and spend their working lives in the service of us all. They deserve a review that acknowledges the importance of the vital role that they play.
I stress the importance to Plymouth of the royal naval dockyard. Despite its virtual decimation, it is an industry in which the workers and the city still take great pride. Again and again, Devonport Management Ltd. and its workers have been able to report completion of work ahead of schedule. In recent months, the efficiency of the docking and essential defects programme on the type 23 frigate HMS Montrose resulted in its being undocked four days ahead of schedule.
The three-year programme of refit work on the nuclear submarine HMS Tireless is well ahead, and the team expects to flood her up four weeks early in 1998. The quality of the royal dockyard work is also high: the DML team responsible for the recent refit work on HMS Turbulent has been praised by both the MOD and the boat's commander for the quality of its work.
An adequate quantity of surface fleet work is of vital importance to maintaining the viability of the dockyard work force that will be responsible for the maintenance of the Trident fleet. The company and the work force hope that they will win the contract for type 23 frigate HMS Argyll, which is due for refit in May 1998. There are serious fears that failure to secure the bid may affect the permanent work force at Devonport dockyard. I know that my right hon. Friend the Secretary of State will treat all bids fairly, and will consider value for money and the future strategic value of Devonport dockyard when examining bids.
The £339 million operation to create the world's best facilities to refit and refuel Britain's nuclear submarines is now well under way. It is an alliance of six international companies that are committed to building the engineering
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base for submarine work into the millennium and beyond—DML, Brown and Root, Rolls-Royce, Strachan and Henshaw, the Babtie Group and BNFL.
Each of the Vanguard fleet of four submarines—Victorious, Vigilance, Vengeance and Vanguard itself—has 44 miles of pipework and 300 miles of cabling. Each boat will need skilled refuelling and refitting, which will be Plymouth royal dockyard's critical future contribution to maintaining a British minimum deterrent into the next millennium. The skills required to do that work are of the highest order, and I know that they will not be found wanting among the work force of the royal dockyard.
Cradle of the Commonwealth, springboard for the new world, defender of the peace in the next millennium—the city of Plymouth has a proud heritage, and a challenging future. As I join my neighbouring colleague, my hon. Friend the Member for Plymouth, Devonport (Mr. Jamieson), in representing the city of Plymouth, I look forward to rising to my part in meeting that challenge.
After many years, our party has been given the trust and responsibility of government. The people of Plymouth lent us their trust on 1 May 1997, and I aim to play my part in retaining that trust. I commend my constituency's honourable track record in the defence of the country throughout the past millennium, and I invite my right hon. Friend the Secretary of State to take full account of it as he carries out his serious responsibilities in the conduct of our strategic defence review.
8.46 pm
Mr. Julian Brazier: It is a pleasure to follow the hon. Member for Plymouth, Sutton (Mrs. Gilroy). I congratulate her on her maiden speech, and on her obvious commitment to her constituency and her work here. I thank her for her kind remarks about her predecessor, who, I think, was popular throughout the House.
It is, perhaps, sobering to think that, if it was in the hon. Lady's constituency that the fleet was launched to deal with the armada, it was just north of the coastline of my constituency that the Royal Navy was humiliated a century later, when one of the bravest fleets that we have ever sent went to fight the Dutch in rotting warships almost without ammunition. Reference has been made to an article opposing the Eurofighter; we should think about how nearly we experienced a repetition of that half a century ago, when, in the skies above Kent and Essex, our gallant pilots flew the Spitfires and Hurricanes that they had received, with barely days to spare in the case of some squadrons.
I share the concern that my right hon. Friend the Member for North-West Hampshire (Sir G. Young) expressed about the £170 million that has been removed from the defence budget. The Secretary of State has assured us that it is just an accounting change resulting from an overspend in the previous year, but, be that as it may, many Conservative Members will watch carefully what happens to the defence budget.
I want briefly to consider the nature of the threat that we may be facing, and then suggest a method by which we could secure substantially more value for money from our armed forces, splendid as they are. Arguably, the three most serious contests in which we have been involved

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since 1945 are the Korean war, the Falklands war and the Gulf war. They have a number of characteristics in common. First, they all blew up at extremely short notice, with no proper warning. Secondly, each of them breached the defence planning assumptions of the time. Thirdly, in the case of Korea, conscription was available and, indeed, in use; and, in the case of the two subsequent conflicts, we were able to cannibalise the substantial slack in the system that existed because of the commitment to cold war regular forces, which have been substantially reduced since. Finally, each of those wars involved substantial-scale deployment of forces in high-intensity conflict.
The feeling in Foreign Office circles, in academic circles and even in some defence circles seems to be that we will have considerable warning of the next conflict in which we get involved. It has even been suggested by some of the people whose names appear on the list of participants at the various seminars that the Ministry of Defence is holding that we shall have a choice as to whether we participate and on what scale.
My hon. Friend the Member for Bournemouth, East (Mr. Atkinson) outlined some chilling scenarios. The idea that we would have a choice as to whether to participate if there were a substantial nuclear or high-intensity conventional threat either in the Gulf area, where most of the world's oil comes from, or in parts of the middle east and north Africa, which are much closer to western Europe, is completely wrong. We would have no choice: we would have to participate, because of our vital interests. We would need highly capable, large-scale and sustainable armed forces.
How can we square the circle? As hon. Members have acknowledged, our spending, like that of most of our allies, is much smaller than it used to be. How do we maintain a wide range of capabilities within a necessarily constrained defence budget, even if some of us would like it to be a little larger? Most other countries take one of two routes: either they have conscription, which France is now rightly moving away from, or, as in almost every other country in the developed world, they make much greater use of reserves. In the case of ground forces, reserves are typically one fifth of the cost of their regular counterparts.
Let me give the example of land forces. I am conscious of the fact that a distinguished ex-volunteer, the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis), is sitting in front of me, and a former territorial officer, my hon. Friend the Member for Gosport (Mr. Viggers), and a serving territorial officer, my hon. Friend the Member for New Forest, West (Mr. Swayne), are sitting next to me. In America, Australia, Canada and New Zealand, the reserve army is roughly the same size as the regular army. Britain's reserve forces are less than half the size of their regular counterparts. The combined populations of Australia and New Zealand are barely a third of ours, but they can raise almost as many reserve infantry as we can.
I have a splendid Territorial Army infantry unit headquarters in my constituency: the 5th Battalion of the Princess of Wales Royal Regiment. It took a full-strength battalion to camp: in fact, it had more than one camp this year. It is unbelievable that anyone could even contemplate cutting our reserve forces, particularly our reserve infantry, even further.
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We should also consider our air forces. Most of us want to be able to afford the expensive aeroplanes that we need. In America, a third of all strategic airlift capability—this subject has come up several times in the debate—two thirds of all tactical airlift capability and 100 per cent. of the strategic interceptor force are manned by volunteers. Britain is full of flying organisations, from the airlines at the top end of the spectrum to the organisations that service North sea oil rigs. We are just beginning to toy with the idea of having a few individual air volunteer reservists as flying crew on modern jets. The experience in America is that there is better value for money and lower wastage if people are in formed units rather than in pools. That applies even more strongly to the army. High-calibre people do not want to be part of a manpower pool: they do not want to be trained in individual skills, but they want to be part of a unit that trains as a unit or as part of a larger formation.
When we compare Britain, which tries to run a set-up that is four-fifths regular, with other English-speaking countries that make much greater use of reserves, we realise why we are so desperately short of money for equipment. There is something faintly funny about the fact that civilians who join volunteer forces as children of their own era and who are used to dealing with high technology are often presented with military technology that is a generation older than the technology with which they are familiar in civilian life. They are all too often told by patronising voices from the Ministry of Defence that the technology is too complicated for reservists to use.
The Americans sent 90,000 volunteer reservists to the Gulf. [Interruption.] Perhaps the hon. Member for Plymouth, Devonport (Mr. Jamieson) wants to enlighten us. He does not want to say anything. Fair enough.
The Americans sent 90,000 volunteer reservists to the Gulf. They included an artillery brigade, tank battalions from their marine reserves and air guard fighter squadrons. They are currently sending reserve units through Bosnia, including air guard and national guard units. Britain has sent many hundreds of volunteer reservists: at one point, they were 10 per cent. of the force. A regular commanding officer quoted by Field Marshal Lord Bramall said:
"Thank goodness for the Territorial Army! … Without wishing to appear melodramatic, the … Territorial Army soldiers who arrived before Christmas saved the REME bacon … To a man, they are enthusiastic"—
Perhaps he should have said "woman" as well, because there are a number of women in our force in Bosnia—
"they are enthusiastic, cheerful and willing."
We hear from the press and through direct contacts that our volunteer reserves in active service frequently spend months either with the wrong pay or even no pay in one or two cases. There have been muddles over their documentation, there has been a failure to liaise properly with their employers, and they often have family problems that are much more easily solved in the regular forces where we have our married quarter patches. Mobilisation should be organised by reservists, because they are familiar with the problems of people who have a full-time civilian as well as a military job.
That brings me to a wider point. The successful and imaginative use of reserves—finding new jobs that reservists could do at less expense than their regular

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counterparts—requires a set-up that goes with the grain of the civilian world and brings in the volunteer spirit. It is like the difference between the BBC, a public service of which we are extremely proud, and my favourite commercial radio station, Classic FM. They have a different ethos: Classic FM would not be the organisation it is if all its senior producers were provided by the BBC.
Alone among English-speaking countries, Britain has insisted that every general since 1945 with reservist responsibilities should be a regular who is parachuted into the job. I shall quote from a debate that took place in the House 90 years ago. Sir Charles Dilke quoted a letter in The Times from a colleague who said:
"The War Office has always hated the Volunteers and sneered at them and despised them. That prejudice is still as strong as ever".
Sir Charles went on:
"The language used is, perhaps, too highly coloured, but the fact is that the Regular soldier has never understood the Volunteer, and it is accordingly urged that steps should be taken to prevent the Volunteer from being put under the Regular Army, bound hand and foot."
We have recently done that with the "one Army" concept.
"I think the Volunteers ought to be represented on the Army Council itself."—[Official Report, 9 April 1907; Vol. 172, c. 115.]
Coincidentally, 90 years later Congress is debating a measure to put the head of the national guard on the chiefs of staff. The Senate has already passed the measure. I do not propose that we should put the head of the Territorial Army on to the chiefs of staff, but Australia, which has only 17 million people, has three part-time generals. It is ridiculous that Britain does not even have one. As an Australian paper recently stated, a country cannot expect to retain good-quality officers in the reserve forces if they have no opportunity to occupy senior positions. There has been a small step with the appointment next month of the first ever volunteer reservist as director of reservists. However, the appointment is at only one-star level.
America, Canada, New Zealand and Australia have reserve forces wastage rates of about 20 per cent. Our wastage rate is one half higher than that at about 30 per cent. Some of the initiatives in those countries go with the grain of civilian life. They have long officer courses that are tailored to university vacations. In Canada and Australia, reports are prepared for employers on the value of volunteer service to individual soldiers. Family support operations have been established in the national guard in many southern states, run by volunteers and not state funded.
Britain can do great things with its reserve forces. In the second world war, two of the three battalions that held Calais when the British Army was in terrible straits at Dunkirk were TA battalions. In a recent Swiss commando raid competition the 10 Para teams finished top worldwide of all the non-Swiss reserve teams, beating three of the four regular teams. We can do it and elements of the TA are showing what can be done now. If in an uncertain world with an uncertain threat Ministers wish to make our limited defence resources go further, they must begin to take advice from senior reservists rather than just from people inside the white building about imaginative ways in which volunteer reserve units can be given a greater role in all three services.
9 pm
Mr. Jonathan Shaw: I am grateful for this opportunity to take part in the debate and to make my maiden speech.
The armed services and the defence industry have long associations with my constituents, particularly those in the Medway towns and in the Royal British Legion village in Aylesford. The new seat of Chatham and Aylesford is drawn from the old Mid-Kent and Tonbridge and Malling constituencies. It encapsulates much of the rich variety that characterises Kent. The seat contains both urban and rural areas and important industries that have grown up around the River Medway.
My two predecessors are highly regarded hon. Members, and both have deserved reputations as hard-working constituency Members. The right hon. Member for Tonbridge and Malling (Sir J. Stanley) is a distinguished former Minister of State for the Armed Forces. He and I joined forces in a battle to seek noise mitigation measures for our constituents who live alongside the M20. The hon. Member for Faversham and Mid-Kent (Mr. Rowe) is my former Member of Parliament. He is independently minded, and we share an interest in the welfare of young people and in opportunities for them, particularly for those from disadvantaged backgrounds. An example of the hon. Gentleman's interest in young people became apparent to me recently, because when I was going through some old papers I discovered a letter from him wishing me a happy 18th birthday. Furthermore, in the letter he invited me to meet him at the Conservative club in Medway for coffee. The meeting was to be held in the Thatcher room. I politely declined his offer.
The royal dockyard in Chatham has long been at the heart of the Medway towns. Its closure in 1984 is well recorded and it is a credit to the local people that despite the inevitable pain that the closure caused, the dockyard has not died, but has been transformed. Part of it is now a thriving business community with new housing and leisure facilities, and the oldest part is an 80-acre historic dockyard. It is a popular, award-winning tourist attraction drawing more than 100,000 visitors a year. We were delighted to be visited recently by my right hon. Friend the Secretary of State for Culture, Media and Sport. During his visit, he announced a much needed £16 million cash injection from the national lottery and other sources.
Much of the excellent work that has led to the rebirth of the historic dockyard is attributable to the hard work of Admiral of the Fleet, Sir William Staveley, the chairman of the historic dockyard. Tragically, he died just a couple of weeks ago. Sir William was the flag officer at Medway from 1959 to 1961, and had a distinguished military career, which culminated in 1985 in his appointment as First Sea Lord and Chief of Naval Staff. I had the pleasure and honour to spend a morning and have lunch with him shortly after the visit by my right hon. Friend. His enthusiasm, energy and commitment were always evident.
We have lost a great champion, a man of great stature and vision, but it is perhaps some comfort to know that he secured for the historic dockyard the future for which he had fought so hard before his sudden and untimely death. He was a man of great stature, and I am sure that the House would wish to join me in expressing heartfelt condolences to his widow, Lady Staveley, and their children.

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Within this debate, we rightly acknowledge and pay tribute to the women and men of our armed services. Having a brother who served in the Blues and Royals Regiment for 18 years, I know the commitment and professionalism that they bring to their jobs, but it is also right to acknowledge the efforts of civilian staff who support our soldiers, sailors, marines and pilots. I wish to use the opportunity of my maiden speech to draw attention to the Chatham dockyard workers who worked on nuclear submarines between 1966 and 1983.
Thousands of jobs were secured in 1965, when the Government announced that Chatham dockyard would become a nuclear refit centre. In 1966, the Chatham Observer, the local paper, quoted dockyard managers as saying that two watchwords would govern the way in which the dockyard was run: safety and absolute care. They said that workers who came into contact with radiation would be checked and rechecked. As is usual practice, the MOD put in place a series of controls and checks to monitor radiation dose exposure and to ensure that exposure of the civilian work force was as low as reasonably practical.
The civilian work force at Chatham dockyard were all fit young men. Indeed, they had to have medicals to prove the case before they were given the go-ahead to work on the nuclear submarines. They were the cream of Medway, as the current mayor of Rochester described them. As the widow of one of the former workers and as an experienced nurse, she is well placed to make such an assessment.
It is estimated that between 2,000 and 3,000 men worked on the submarines between 1966 and 1983. In 1990, some six years after the dockyard was closed, there was growing concern in the Medway towns about the number of former dockyard workers who had contracted one type of cancer or another. Those men were frequently in their 30s and 40s and many had young families.
A campaign then ensued, primarily to persuade the MOD to carry out its duty of care and to provide annual medical checks to any former dockyard worker, as take place for other workers in the nuclear industry. At the head of the campaign was a former dockyard worker, Tim Robson, the late husband of Rochester's mayor, Linda Robson, to whom I referred. Having served his apprenticeship in the dockyard as a boilermaker in the 1970s, he, like many young men, took advantage of the extra pay on offer in the dockyard to work on the nuclear submarines. In the dockyard, two different types of workers were permitted to work on the submarines: classified workers, the mainstay of the operation, and the approved or written scheme workers, who were drafted in for extra help.
A year after he started the campaign to help his fellow dockyard workers, Tim Robson and his family were given the news that he too had cancer—Hodgkin's disease. Despite his illness, he continued his campaign and was overwhelmed with the number of inquiries from ex-workers and their families who were concerned about their health and reporting instances where safety and absolute care were far from being the watchwords.
During its time as a nuclear facility, Chatham was often under pressure. The work on the submarines, to refuel or to decommission them, was frequently behind schedule. What emerged from the campaign was a concern that, because of the pressure, proper monitoring and safety
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were not always in place. That is well illustrated in the case of David Spriggs, a refitter on a Dreadnought. He was working deep in the heart of a reactor when a pipe burst above his head and drenched him in water. The supervisor reportedly told him to carry on until the end of the shift, when the Geiger counter showed alarming levels of radiation exposure.
Following the accident, which the MOD called a serious incident, David Spriggs was told to take six months off, yet he was back at work within a couple of weeks because of pressure of work at the dockyard. When operations started, guarantees were given that any worker who had contact with radiation would be checked and checked again. As I said earlier, the watchwords were safety and absolute care. In 1995, David Spriggs died of cancer aged 38. His widow requested his dosage records, which should have been kept if he had had a high level of exposure—even though he was only an approved or written scheme worker—so that she might seek compensation under the scheme for radiation-linked diseases. The MOD informed her that no records could be found. Accordingly, David Spriggs must never have been in that reactor.
Despite a two-year battle to retrieve those records, David Spriggs's widow has yet to make any progress and she is now taking the MOD to court. The witnesses asked to appear are likely to come forward to say that they saw David and can testify that he frequently worked in the reactor compartment in nuclear submarines at Chatham dockyard.
A further concern to us in the Medway towns is that the MOD may not have done all that it could to ensure that all available safety systems were in place at Chatham. It failed to install the new safety system, Modex, an American invention, which was introduced in American yards in the 1960s and early 1970s. It was a significant development in dose abatement technology. According to the Defence Committee report of 1990, it reduces the dose burden within the reactor compartment by a factor of four to eight. As has been said, Modex was introduced at Devonport and Rosyth in about 1979, but it was never installed at Chatham.
Tim Robson, by then a leading local councillor, continued the campaign and won the support of Rochester city council in January 1994. The council used its resources to press the MOD to provide annual health checks for former dockyard workers, so that it would be possible for them to detect at the earliest possible stages whether they had a cancer that could be attributed to radiation exposure.
After years of campaigning, a significant step was taken in June this year, when my hon. Friend the Under—Secretary of State for Defence launched a local counselling scheme in partnership with Rochester city council. Under that scheme, expert doctors provide advice locally to former workers and their families. Since the scheme was launched, 210 inquiries have been made nationally for dosage records from the MOD, and 94 per cent. of them have come from people who worked at Chatham. That demonstrates the success and importance of a local scheme rather than having to rely on a national one.
On the same day, my hon. Friend announced that the MOD would invest £1 million on improving access to radiation dose records not currently held on computer.

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We very much hope that that will speed up the system. We in Medway welcome the Government's positive response to the city council's campaign. It has not been easy to take those two important steps, and I pay tribute to the officers of Rochester city council who have made so much extra effort and dedicated so much time to the campaign. Particular praise must be afforded to Mr. Dennis Holmes, the senior lead officer, without whose endeavours we might not have made the progress that we have.
We need more information to obtain a clearer picture of the safety standards applied, to discover whether they were as stringent as they should have been at Chatham dockyard. We in Medway believe that too many young men who worked on the nuclear submarines have died from cancer. They were not average men, but fit young men, the cream of Medway, as I described them earlier. The campaign is by no means over and there are other issues that must be dealt with in the future, such as the accident records. Will they be made available to assist people to make compensation claims? As for the compensation scheme, is it right that a no fault principle should stand if there is clear evidence of error or neglect?
What happens to the information collated from the counselling scheme? How many other people will discover, as did David Spriggs's widow, that records have not been kept? As for medical screening, we believe that annual medical checks are essential. We should also like research to be undertaken into the types of cancers arising from exposure to radiation.
Earlier, I described my constituency of Chatham and Aylesford and, as is the custom during a maiden speech, I paid tribute to the right hon. and hon. Gentlemen whom I have succeeded. Technically, however, as I represent a new seat, I have no direct predecessor. There was, however, a previous Labour candidate, my friend and colleague, the ex-dockyard worker, Tim Robson. He was selected at a time when we hoped that his health was improving, such was his determination to enter this House to represent the people of Chatham and Aylesford, in particular Chatham, a place where he had lived all his life and of which he was genuinely proud. Tim died in August 1995 at the age of 39, leaving his wife, now our much respected mayor, and two teenage daughters.
Hon. Members arrive at the House through a variety of circumstances, and as I enjoy the immense honour of representing the people of Chatham and Aylesford, I cannot help recalling that I am here partly through the tragic loss of someone who had a considerable influence on my life and whom I am proud to have known so well. I hope that this maiden speech will be a fitting tribute to Tim Robson's memory and the campaign that he started. He started that campaign, but it is by no means concluded.
9.14 pm
Mr. Michael Colvin: It is always a pleasure to follow a maiden speech, but it is especially so now because the hon. Member for Chatham and Aylesford (Mr. Shaw) has made his mark in a way that will be remembered here and will read well in Chatham, a town that I know quite well, as my father once commanded the dockyard there and I started my career as a retailer in Chatham high street. The town will respect him as its representative here, and I am pleased that he chose this debate in which to make his maiden speech.
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I congratulate my successor as Chairman of the Defence Committee, the hon. Member for Walsall, South (Mr. George), on his contribution to the debate. Our Committee has a reputation for always reaching unanimous decisions—we have never had to vote on anything—and that was the case in electing him to the chairmanship. I am very pleased that he is in that position; it is a proof that patience is a virtue, but I dare say that, in politics, honesty is not, because if anyone should be sitting on the Front Bench, it is he. I dare say that the Treasury would be less sanguine about some of his comments as a defence spokesman than about those that the Secretary of State is likely to make. My remarks may have finished the hon. Member for Walsall, South for good and all, but there we are.
The hon. Gentleman drew attention to the amount of blue paper lying on the Table, and it is true that the Committee had a pretty prolific turnout of reports, all of which were constructively critical, which should serve as an example for the work that we shall do in the future. The previous Government listened carefully to what we had to say and, I am glad to say, acted on our advice on many occasions.
The present Government have not reacted as constructively as they might to the report on defence medical services, in which we made it clear that, while we reluctantly recognised the need to reduce the manpower in our armed services by about 30 per cent. since 1989, the defence medical services have been reduced by 40 per cent.
Those services were studied in "Front Line First" rather than in "Options for Change", because they were regarded by the MOD as a support service, which they are not. Their duty is to put field hospitals on the ground, and it became clear in our inquiry that they would be unable to supply the number of hospitals that would be required if our troops were to perform their roles effectively.
In their response, the Government did not grasp the need for better use of reservists, and especially territorials, who have medical and technical expertise because of their work in hospitals, in manning our medical services in the field. Perhaps the Minister could say a little more about that.
Our defence industrial base was considered by the Select Committees on Defence and on Trade and Industry about three years ago. We produced a report on aspects of defence procurement. Since then, little has happened with regard to restructuring the European defence industries. In the meantime, the United States of America has tackled the problem of having 15 prime contractors. That number has been whittled down to only three: Boeing Douglas, Lockheed Martin and Raytheon Hughes. Each of those prime contractors is bigger than all the European defence industries put together. If ever there was a need for Europe to get its act together and start restructuring its industry, it is now.
The Western European Union is beginning to address the problem of reorganising the European defence industrial base. It is useful for the WEU to fulfil that role rather than trying to imitate NATO. The problem is that in Britain, we have addressed the problems of denationalising our industries while the Europeans have not. Until France and Germany tackle privatisation, the cross-frontier mergers that ought to take place will not happen. We shall be at a competitive disadvantage to the

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Americans. That said, I remind the House of the importance of the two-way street of defence-related trade between Britain and the United States. We do the lion's share of defence trade with the United States. I am glad to say that the two-way street is now only 2:1 in favour of the United States; it was about 10:1 before the Conservative Government came to power. The ratio has improved, but it could be improved further. Even if we restructure the European defence industrial base, we must not lock ourselves into a fortress Europe.
Lastly, I want pick up on the Defence Committee report on defence spending, which was the last one that we did. I remind the Government of the concluding sentence of our final recommendations. The Minister probably knows it by heart, but it is worth putting on record. The Committee said:
"We insist that the defence spending plans set out in the 1996 budget must at least be maintained in real terms in future years. Any further reduction would jeopardise the defence of the realm."
That is the view of this House.
9.21 pm
Mr. John Hutton: I congratulate the two hon. Members who have made maiden speeches. My constituency has a naturally close affinity with those of my hon. Friends the Members for Plymouth, Sutton (Mrs. Gilroy) and for Chatham and Aylesford (Mr. Shaw); it manufactured the Trident submarines on which the economic prosperity of the Plymouth, Sutton constituency largely depends and the nuclear submarines mentioned by my hon. Friend the Member for Chatham and Aylesford. We have a special affinity to him and the difficulties that his constituents are experiencing.
I congratulate my right hon. Friend the Secretary of State on his excellent speech and particularly on the emphasis that he placed on strong defence forces in future. The Government have made an auspicious start, with action on land mines, the recruitment of more women and ethnic minorities to the armed forces, a new deal for Gulf war veterans and the launch of a long overdue strategic defence review.
I am particularly encouraged by my right hon. Friend's reference to the expected Green Paper on defence diversification. We must find ways to end the haemorrhaging of vital industrial skills caused by previous defence spending reductions. That will be no easy task because there are no simple solutions. The Government cannot create the new jobs—only companies can—but they can help with support and advice. We need to learn the lessons of the experiences of other countries such as Germany and the United States. The Government have a special moral responsibility to help with the process because they are often the only customer of defence contractors. If an agency is to be established, I would like it to be set up in Barrow—the most defence-dependent constituency in the United Kingdom. I look forward to reading the details of the Green Paper in the near future.
As my right hon. Friend the Secretary of State said, the international security and defence environment has changed radically and fundamentally since the end of the cold war. The threat of all-out nuclear confrontation has receded; in its place has come uncertainty about the possible nature and location of future armed conflicts.
One thing is clear: the end of the cold war has not brought about an end to armed conflict. It could be argued that the exact opposite has happened. We cannot afford to
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be naive about the new post cold war environment; the world remains a dangerous place. It is also clear after the tragedy in Bosnia that individual states and the international community, acting through the United Nations, may well be called upon to intervene in future conflicts on humanitarian grounds and to attempt to restore peace and stability. That will have important consequences and implications for us as we prepare the new ground rules for British defence policy into the next century and it is why the strategic defence review is so necessary and timely.
I hope that the review will lay the foundations for a new national consensus about defence and security policy built on our firm support for the United Nations and the principle of collective security, acting through both NATO and the general mandate of the Security Council. The Government are entirely right to make Trident the cornerstone of that new security architecture.
I agree with what my right hon. Friend the Foreign Secretary said on 3 July at one of the two strategic defence review seminars. He said:
"you cannot have an ethical foreign policy if it is an isolationist foreign policy. That is partly why, in rejecting isolationism, we commit Britain to building a strong international community. If we take the view that the principles of the UN Charter are a matter of common concern, we cannot stand back when those principles are being violated."
The obvious conclusion, and one that I know from his comments my right hon. Friend the Secretary of State shares, is that Britain needs strong, highly mobile and flexible armed forces, clearly focused on meeting the new security challenges that lie ahead and equipped with the best in modern armaments.
An ethical and internationalist foreign, and therefore defence, policy must mean that, after the defence of the United Kingdom and our NATO allies is taken into account, an increasing priority will have to be placed on Britain's capacity to take part in allied expeditionary operations in trouble spots that potentially threaten either international or regional peace and security. This will have important implications for our defence procurement programme, about which I want to say a few words later, but first I wish to make one thing clear.
I am not arguing for a return to gunboat diplomacy, nor do I have a yearning for any sense of imperial grandeur—far from it. We cannot act as the world's policeman and we should not try to do so. I am talking of Britain, with the international community, assuming a responsibility to promote peace, to uphold international law and human rights and to maintain international stability. We have a unique opportunity to contribute to that process because of the excellence and experience of our armed forces. By an expeditionary capability I simply mean the ability to move forces promptly and safely from the United Kingdom to a distant operational theatre, via a secured route, with effective support and with the ability to perform a safe withdrawal.
Mr. Gray: Will the hon. Gentleman give way?
Mr. Hutton: No; I do not have not much time.
The Royal Navy will have a central role in ensuring that British forces can be deployed safely around the world. It is vital to retain and develop the Navy's amphibious capability. The new assault landing ships HMS Bulwark

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and HMS Albion, the new helicopter carrier HMS Ocean and the nuclear submarines, which we can deploy over a long range and which provide effective anti-submarine warfare capability, will be crucial in this project. All those vessels are being built in my constituency.
In short, as Sir Benjamin Bathurst wrote in 1995, the aim of maritime power is
"to place world wide operational options in the hand of the government".
Those options can then be used in support of international security, peacekeeping, combating international crime and supporting humanitarian operations.
If we are to retain an effective amphibious capability, we will need to develop a replacement programme for the Invincible class aircraft carriers. Invincible was built in my constituency and launched 20 years ago; Illustrious and Ark Royal are respectively 18 months and four years her junior. Key decisions will have to be taken some time during this Parliament if we are to bring any new vessels into operation by around 2012. Carriers are flexible platforms that can provide a mix of aircraft for specific tasks, including air cover for amphibious landings. We will not always be able to rely on mounting these operations from land bases and HMS Ocean will not be able to perform those vital tasks on her own—nor was she designed to do so.
Some difficult decisions will have to be made about the future carrier replacement programme. Above all, there is the question of affordability: significant capital outlay will be required both for the vessels—perhaps two or three of them—and for the aircraft. Carriers are expensive, but their military potential has never been in doubt. The choice we have to make will be strategic, not operational. I therefore hope that the issue will be addressed in the strategic defence review and that the review will make out the case in favour of the new carriers. At the very least, I hope that the options will be kept open so that design and planning work can continue.
In the brief time available to me, I want to make one or two remarks about the Government's procurement policy. Previous Governments have been rightly criticised for delays in key procurement decisions and for lack of effective consultation with the defence industry, which have led to confusion and unnecessary job losses. It is important that the new Government should avoid making those mistakes. I welcome the Government's smart procurement initiative, which is designed to eliminate cost overruns and delays in equipment programmes. We need to develop a closer dialogue with the defence industry and regularly to discuss future procurement requirements on a long-term basis. I want the Government to identify strategic partners in key areas of weapons and platform procurement and to work with those commercial partners to develop and deliver the equipment our forces want to an agreed timetable and price. There are huge benefits in such an approach, including continuity, expertise and stability.
In some areas, it is unrealistic to expect competition between rival companies to be the best guarantor of value for money. The defence industry reconstruction in the 1980s and 1990s has resulted in the emergence of many single-source suppliers and that is especially true in the case of large ship construction—Vickers Shipbuilding and
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Engineering Ltd. in my constituency is the only shipbuilder left in the UK capable of building the Navy's larger vessels. We should avoid artificial competition exercises. We should be prepared to use the NAPNOC—no acceptable price, no contract—procedures more frequently, because they can deliver good equipment at affordable prices, as was demonstrated by the landing platform dock replacement programme.
In 1946, Adlai Stevenson said that
"making peace is harder than making war"
and he was probably right, but it is because of the contribution we can make to improving the international security environment that Britain cannot afford to be a spectator in world events. We can be a positive force for peace, human rights and democracy, but none of those things comes cheaply. If we are to play that positive role, we will need highly professional, well-equipped and well-resourced armed forces. That is a simple fact of life. I have absolute confidence in the Government's stance on these matters and that in the years ahead Britain will continue to play an active part in maintaining international peace and security.
9.32 pm
Sir David Madel: First, I pay tribute to the hon. Member for Plymouth, Sutton (Mrs. Gilroy) on her excellent maiden speech. We especially noted her warm tributes to all her women predecessors in that constituency. The hon. Lady rightly also paid tribute to Plymouth's contribution to industry and to the defence of this country. We look forward to hearing her many times in the future.
I also pay tribute to the hon. Member for Chatham and Aylesford (Mr. Shaw). I noted his remarks about restoring industry because there was no more work in the dockyard—a casualty of defence policy. We in Bedfordshire have the same industrial difficulties because an order for civilian lorries for Libya was vetoed by the Foreign Office. I therefore felt an immediate accord with the hon. Gentleman when he referred to the problems in his constituency. Hon. Members also paid special attention to his remarks about safety at work and we look forward to hearing from him again in future, especially on that topic.
The Government have announced that they are considering a suitable memorial for the many people who have lost their lives as a result of the tragedy in Northern Ireland. That is perfectly relevant and I am grateful to the Government for saying that they welcome all views as to the nature of the memorial, but as remembrance Sunday draws near, we are also approaching the 50th anniversary of action taken by our service men and our allies to stop the cold war becoming a full-scale hot war.
Next June will be the 50th anniversary of the start of the Berlin airlift. That was one of the greatest humanitarian relief efforts ever undertaken, in support of 2.1 million people whom the late unlamented Joseph Stalin was trying to starve to death. Of course there was a price for that action. Thirty-nine British aircrew, 31 Americans and eight Germans were killed during the airlift, which lasted from June 1948 to October 1949. Their names are inscribed on the memorial at Tempelhof airfield in Berlin but, according to the imperial war museum, there is no memorial in the United Kingdom to the British service men killed in the Berlin airlift. As we are approaching the

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50th anniversary of what happened there, I hope that the Government will give thought and consideration to what should be done.
A mere two years later, in 2000, we shall remember the stand that we took in Korea and the number of British service men who lost their lives there—again stopping the cold war blazing into a full-scale hot war.
I shall say a word about the latest position on pay for the armed services. The Government will know that, in February 1997, we were introducing a new service personnel strategy, one of the main elements of which was a movement towards a system of pay bands. We were going to bring the armed forces' pay into line with pay practices in the civil service. We obviously want to know, as the Opposition, whether the Government are continuing with that.
I am aware that the Government have undertaken to implement in full the second stage of the 1997 pay award on 1 December. We all know that the Chancellor has made some austere statements about public pay, but I want an assurance that the Government will continue the work on the implementation of the new personnel strategy and that personnel and pay policies are not an object of fresh study in the strategic defence review.
I understand that some Territorial Army service men, especially those who have served in Bosnia, are receiving their pay three months late. We all know, do we not, the grim reminder on an income tax return that late payment of income tax can attract interest. If the Government cannot get that matter sorted out quickly, they might like to find out whether there may be a temporary adjustment of tax codes for these people, who have served in Bosnia and elsewhere, who would have been paid three months ago, but who have not been because of administrative difficulties. I should like the Government to say something about that, either today, when the Minister replies, or in the debate tomorrow.
It has emerged clearly from the debate that there must be no suggestion of cutting Territorial Army training. TA training levels must recognise the practical need to maintain continuity, credibility and interest against the many other distractions that motivated young people might take up at weekends or at other times. The Government will be aware, as we are, that the TA state of readiness has been reduced from R5 to R8. Now that that has happened, I hope that the Government can assure us that they will not cut training or turn away potential recruits to the TA.
Certain provisions of the Reserve Forces Act 1996 must be implemented this year or early next year. What is the position concerning the compensation that employers receive when employees go on TA duties? As I understand it, negotiations are in mid-stream. It would help our debate if the Government would bring us up to date on the progress of those negotiations.
I should like to say a word about the anti-personnel mines campaign, to which several right hon. Members, including the Secretary of State, referred today. The latter mentioned the Oslo agreement which is to be signed. One such weapon is the delayed action mine, which was dropped in the Gulf war after raids on concrete runways to stop people rushing out to repair the runways afterwards. We all hope that there will never again be a middle east war, but this anti-personnel mine is a purely defensive weapon designed to stop the aggressor rapidly
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repairing his airfields, from which his aircraft have taken off in aggressive action. We should like to know whether this particular kind of mine, used exclusively on concrete runways, will be covered by the Oslo agreement.
We are all aware of the high costs of certain operational capabilities, such as surveillance, intelligence and target acquisition. At the strategic nuclear level, there is also a long-term need to maintain a strategic balance in Europe—particularly with Russia, where the prospects for further nuclear reductions remain uncertain. The Secretary of State said today that he was looking to the Foreign Office to stake out some general principles that defence policy would follow. I refer to two comments made by the Foreign Secretary in May of this year at the Western European Union ministerial meeting in Paris:
"We think it is right and important to develop the European role in the defence area and for Europeans to take on an increased share of responsibility … We want to encourage the United States to remain fully engaged in Europe. And none of us can afford the wasteful duplication which would be the alternative to building on what we have created and tested in NATO."
I want to compare those remarks with our "Statement on the Defence Estimates 1991", which remains as relevant today as it was in 1991. The Conservative Government said:
"The requirement remains for armed forces that are properly manned, supported and well equipped. They should be able to engage in high-intensity conflict; to contribute to multinational formations; to deploy flexibly and rapidly in response to a spectrum of possible risks away from Europe; and they should retain the organisation, skills and military technology to permit a rebuilding of larger military capabilities to meet an increased threat should the need arise."
That statement certainly covered our action in the Gulf. It also made it clear that we would be able to engage in a high-intensity conflict in Bosnia, if necessary, once the United States brought in heavy weapons.
Our view is that if Britain drifts away from that 1991 statement, she will become an unreliable ally; and if that happens the American policy of support and commitment to European security will weaken. There is neither the political nor the economic will in Europe to replace what the United States does for us; and there is no sign that the European countries are anywhere near replacing that American commitment and all that it means.
I thought that the Secretary of State for Defence today sounded more confident and cheerful than he really felt. I believe he is in for an uncomfortable time as these reviews grind on and the Treasury makes itself felt in all the discussions on them. The Secretary of State will also find that Ministers who might have been friendly in the summer are not so friendly now. They are going to behave like a gang of bad Samaritans, passing by on the other side while the Secretary of State looks for help in getting enough money for the defence budget. He need not worry, however: help is to be found on our side of the House. The Opposition will always support a Labour Government if, on matters of defence, they act in the national interest and in concert with our allies to maintain the security of these islands.
9.44 pm
The Minister for the Armed Forces (Dr. John Reid): I hope that I do not stun the House with my first comment. I thank and pay tribute to someone who is not here tonight. I did not always agree with Michael Portillo.

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Like all of us, he made mistakes and I lost no sleep when he lost his seat—I was in bed and slept soundly. The whole House, however, will wish to recognise the fact that he was committed to his country and made a determined contribution to its defence. It is therefore right to place on record our appreciation for everything that he did while in this House.
I hope that hon. Members will forgive me if I cannot respond in the time available to all the points made tonight. I shall try to return to some of the themes tomorrow. I thank the hon. Member for South—West Bedfordshire (Sir D. Madel), who summed up the debate for the Opposition. I shall deal with personnel and pay matters more generally tomorrow. I inquired about the reserves issue at the beginning of this month and was assured that any individual cases that have been brought to light have been dealt with. The primary reason for the backlog was the transfer of pay and personnel issues to a new centre in Glasgow. I blame that on no one, although it did occur before we came to power. We are doing all that we can to deal with it. The hon. Gentleman mentioned a monument or memorial. He will be aware that, while I support and encourage that idea, it is the long-standing policy of Governments that money and financial backing for such issues are raised by public subscription rather than Government donation.
Debates of this nature usually produce their range of stars and stalwarts. Tonight, we had one or two stars and I congratulate on behalf of the House my hon. Friend the Member for Plymouth, Sutton (Mrs. Gilroy), who made her maiden speech. She spoke with great vigour and obvious commitment about both her present constituents and the history of Plymouth, Sutton. I was particularly interested in her reference to 1838 and the Tolpuddle martyrs. It reminded me that, some years previously, a huge Reform Act was condemned by some Tories as a dangerous act of social and political engineering. Some of tonight's responses to the announcement by my right hon. Friend the Secretary of State about opportunities for women suggested that that was a dangerous act of social engineering, which shows that, at least in some quarters of the Tory party, nothing changes although the years may pass.
I also congratulate another star, my hon. Friend the Member for Chatham and Aylesford (Mr. Shaw), who made a deeply moving speech regarding workers in his constituency. His deep conviction was felt throughout the House. I thank him for his kind words about the initiatives taken by the Under—Secretary, my hon. Friend the Member for Warley (Mr. Spellar). I am sure that he will serve his constituents as well as his predecessors did, and that we shall hear much more from him on this and other subjects.
I shall pass quickly from the stars to the shadow Secretary of State for Defence. I welcome him—an old friend of mine outside this Chamber—to the Dispatch Box this evening. He raised a number of points to which I shall try quickly to respond. The first was the course of NATO enlargement. As he will know, a wide range of figures have been given but they do not all appear to be based on a premise that the Government would accept.
The right hon. Gentleman ought to remember first, that even if no new members were joining, NATO would be going through a process of modernisation; secondly, that
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rationalisation of the old Warsaw pact structures in some of those countries will require a rundown—for instance, in the number of headquarters—and thirdly, that collective security generally is much cheaper than individual security. Those points should inform our judgment of the extra costs. We are convinced that the costs are manageable, but we shall reserve our comments until we have an informed judgment from NATO when it puts the figures to the Ministers' meeting next month.
As regards the defence budget, the right hon. Gentleman got into a lather about the fine. I shall make a couple of points about that. First, the Government are committed to living within the spending limits agreed by the previous Administration for this year and next. As regards the fine, the defence budget outturn in 1996–97 was £22,046 million—an overspend by the previous Government due to their incompetence, not ours, of £246 million against the cash limit.
It takes a bit of gall for the Government of the day, who overspent by £246 million, to condemn the present Secretary of State first, for spending the money, which he did not, and secondly, for having to pay a £168 million fine.
Sir George Young: Did the hon. Gentleman and the Secretary of State resist the approach from the Treasury?
Dr. Reid: If the right hon. Gentleman cannot work that out, I shall try to explain, within the limitations placed upon me with regard to divulging discussions. The overspend by his Government was £246 million. After negotiation over a period of time, the Secretary of State did not pay back £246 million; he paid back £168 million. If the right hon. Gentleman wishes, I shall give him further advice. One takes £246 million. One throws £168 million in the basket. Whatever is left represents what was achieved during the negotiations. It is entirely the fault and the incompetence of the previous Government—
Mr. Blunt rose—
Dr. Reid: I can do only one simple arithmetic lesson a night. I shall return to the hon. Gentleman tomorrow.
The shadow Secretary of State made an interesting point. Having mustered the combined strength of the Opposition and having decided that it was not sufficient to launch an attack on the Government, he pulled in that well-known pro-defence newspaper which the Tories have supported for many years—The Guardian. Joining forces with The Guardian, the right hon. Gentleman complained bitterly that, in the strategic defence review, "equipment had been protected"—that was the quotation.
Only two pieces of equipment have been protected. One is Trident, which I presume the shadow Secretary of State supports, and the other is the Eurofighter. We heard tonight for the first time a shadow Secretary of State abandoning the commitment of the whole House to support the Eurofighter. That will have been noted by thousands of workers throughout the country.
The hon. and learned Member for North-East Fife (Mr. Campbell) made a substantial contribution, as he always does on these occasions. I suspected that his combining the Foreign Office and Defence portfolios may have been informed by a search for someone who held

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both portfolios to lead the nation, but I know that he would not have such personal interest at heart. He raised a number of important issues, including Trident.
Let me make our position plain. The retention of Trident is one of the principles on which the strategic defence review is founded. Within that framework, the review will examine all aspects of our deterrence requirements, including nuclear warhead numbers. We have made it clear that we shall deploy only the minimum number of warheads required for credible deterrence in current circumstances on Trident submarines. If the circumstances allow reductions in the size of our capabilities, we shall be prepared to make those reductions while ensuring that we retain an effective deterrent.
Mr. Menzies Campbell rose—
Dr. Reid: I am sorry, but I have only six minutes in which to respond to all the issues raised during the debate. If I catch Madam Speaker's eye tomorrow, I shall give way to the hon. and learned Gentleman, who may return to the matter then.
I shall deal now with the contribution of that stalwart defender of strong defence for many years, my hon. Friend the Member for Walsall, South (Mr. George). I congratulate him on his position as Chairman of the Defence Select Committee. I know that, irrespective of his party affiliations, he will pursue robustly the interests of the defence of this country. I know that other hon. Members will want to pay tribute to him also.
My hon. Friend raised several issues, including the joint staff college. Ministers have made their position on that issue quite clear: we do not start from where we would like to be; we start from where we are. Negotiations with defence management about a Shrivenham-based proposal for permanent facilities to be delivered via a private finance initiative are proceeding. It would clearly be inappropriate to comment further while negotiations are on-going. However, I place on record the fact that we are committed conceptually to reaping the immense benefits of working jointly. A joint staff college contributes to that.
Several hon. Members—the hon. Member for Romsey (Mr. Colvin), my hon. Friend the Member for Walsall, South and the hon. Member for Belfast, South (Rev. Martin Smyth)—raised the question of the defence medical services. Only a fool would fail to acknowledge the parlous state of our defence medical services. There is a huge inadequacy, and it is one of the legacies with which the Government must deal. All hon. Members would agree that consensus on a framework should not stop our identifying the problems that exist within that framework. That charge is particularly true of the defence medical services. I shall refer to that matter tomorrow, but I make it plain that I did not wait the five years that I was allowed by the Defence Select Committee. Although it is only 15 months since reforms were introduced by the
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previous Government, I have ordered an urgent re-examination and requested that proposals for early action be sent to me about the matter.
The hon. Member for Mid-Sussex (Mr. Soames)—the ex-Armed Forces Minister who is not present for the winding-up speeches, for understandable reasons—asked about combat effectiveness and the extension of opportunities for women in the armed forces. That matter was discussed with the Chief of the General Staff and other chiefs of staff. Combat effectiveness—which, as hon. Members will know, is defined as a unit or formation's ability to carry out a mission successfully in combat situations—is considered fully whenever we look at any of these matters.
My hon. Friend the Member for Alyn and Deeside (Mr. Jones) raised the matter of strategic and heavy lift. Although I obviously do not want to prejudice the conclusions of the strategic defence review, I give away no secrets when I say that that is one of the issues that has informed our discussions in the past three months.
I always listen to the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) with respect. He has served his country, and therefore deserves our attention when he speaks. He raised several procurement issues, and I hope that he will not mind if I leave those matters to the Under-Secretary of State to address when he has considered the record.
A defence debate would not be complete without the presence of my hon. Friend the Member for Thurrock (Mr. Mackinlay). I remember past debates when he and I were the only Members in the Chamber. He spoke with great gusto tonight. As I expected, he raised a matter to which he has referred before: reviewing the cases of British soldiers who were executed following courts martial during world war one. He will appreciate that the Government fully understand the widespread concern and the feelings aroused by that issue. I undertook to examine the matter, but I said at the time that I wanted neither to raise expectations nor, by addressing one perceived injustice, to appear to bring other injustices to the surface. It is an extremely difficult and sensitive issue which, given the long passage of time and the extent of the records, is taking time to assess in detail—but it has not been forgotten.
The hon. Member for Canterbury (Mr. Brazier) raised an issue that he has raised previously in these debates. He is a stalwart advocate of the cause of the Territorial Army. That will be examined in the review—as will every other issue—with rigorous scrutiny. That is what the country and the House expect. There have been suggestions that the Territorial Army will be turned into a leisure brigade. I, like the hon. Gentleman, read the newspapers. I can say only that I am in the business of providing capable and relevant professional and volunteer forces and I am not interested in creating a leisure brigade—
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put, pursuant to the Standing Order.

Kent and Sussex Hospital
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Clelland.]
10 pm
Mr. Archie Norman: I am grateful for this opportunity to raise the question of the West Kent and East Sussex NHS trust private finance initiative. I am also grateful for the attention of the Minister on this serious matter.
My purpose in calling for this Adjournment debate is to raise the extremely serious position of the future capital funding of the trust. The hospital, which is spread between two sites in my Tunbridge Wells constituency—one in Pembury and one in the centre of Tunbridge Wells—serves the surrounding area of Tonbridge, Sevenoaks, East Sussex and Kent, down to the south coast. Until the PFI review in June, the trust was working with its partners on a substantial proposal for rebuilding the hospital on a single site.
I want to be clear that my purpose tonight is not simply a case of constituency special pleading. Indeed, I do not advocate that we should immediately fund the PFI in Tunbridge Wells; nor is it ready to be funded. Rather, there appears to be an acute need in this case, which may be illustrative of other NHS trusts, for proper forward planning and a better long-term framework to enable the trust management to move forward and plan for the future investment that is urgently needed.
The effect of the cancellation of the PFI proposal is not just to abort any future capital work, but to plunge the whole hospital into a state of relative uncertainty, which obviously has an effect on the morale of clinicians and staff. That problem now needs to be addressed.
The hospital's position is untenable in the long term. The trust delivers a good standard of clinical service, but that is despite, not because of, the state of the facilities, which is extremely poor. We rely on the energy, good will, hard work and dedication of the doctors, nurses and management to overcome the impoverished state of our facilities.
The hospital suffers from being split between two sites, both of which are old and have been developed piecemeal over the years. The first site at Pembury was, ironically, originally built as a workhouse in the 1890s. It consists of long, Florence Nightingale-style wards with 24 to 28 beds, an open-plan format, limited privacy and inadequate medical support facilities. For example, oxygen is not piped into the facilities.
Many of the support and related facilities at Pembury are housed in wooden huts. The operating theatres were designed as a twin operating suite some 30 to 40 years ago. The Pembury site includes all the major radiology facilities as well as obstetrics, paediatrics, gynaecology and care for the elderly. The net result is that, every time a patient needs radiology or similar treatment, he has to be transferred between the two sites.
The Kent and Sussex site is in the heart of a very congested part of Tunbridge Wells. It was built around the site of an old tuberculosis hospital, and has been developed higgledy-piggledy over the years. It is poorly laid out. It contains the main accident and emergency facilities for the entire area and is therefore crucial not just for my constituency, but for the surrounding areas.
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The effect of the dual site operation is to make the hospital more expensive to run, and also to hinder patient care. One can imagine that transferring patients in poor condition between hospitals, which can take half an hour or so, does not make any sense from a clinical point of view. It is expensive, and it is an unnecessary burden on the staff.
The general standard of the buildings is wholly inadequate for this day and age. On an aerial photograph, it looks like an industrial site. Shed-style buildings, wooden huts and warehouse roofing are simply not an acceptable standard for a modern hospital. Despite this, the staff manage, but it is important to note that there is an estimated £30 million backlog of capital maintenance, which is required to bring the facilities up to what are regarded as acceptable standards today.
Hon. Members will be aware that the capital maintenance allocation is related to turnover, not the state of the buildings. As a result, unless something is done, I fear that the situation at Kent and Sussex can only get worse.
Furthermore, the poor quality of the wards means that the trust is unable to provide patients with the privacy and dignity that they expect today. My constituents continually complain about the inadequate state of the wards and the fact that we have dual-sex wards with no privacy. Tunbridge Wells is—like it or not—the long-term location for accident and emergency and acute facilities. There is no alternative. The nearest hospital, in Maidstone, is far too far away to meet any standards of performance and service delivery on emergency facilities for constituents, particularly those living to the south.
The case for long-term investment, therefore, is very sound by any standards. There is simply no alternative. In my judgment, the PFI proposal should have been allowed to proceed to a state where it could have received mature consideration. It has, however, been turned down, but on technical grounds, not on grounds that can be weighed up as an economic case. In the long term, it will have to be revived.
The PFI was for £65 million to create 400 beds, which compares favourably with other PFIs that have been allowed to proceed. I believe that I am right in saying that the PFI for Dartford was for £120 million to create the same number of beds. The capital efficiency of the proposal was therefore very good. The revenue efficiency is also good, as there would be obvious revenue savings from consolidating a dual site.
Important landholdings would be released as a result of the PFI, because we currently occupy large acreages which are capable of being used for housing, or other uses. The economics of the proposal to rebuild the hospital on a single site is by any standards outstanding.
Why was the PFI turned down? First, it did not meet the criteria, apart from anything else, for readiness—a fact of life, but not a reason, surely, for kicking it into touch indefinitely. Secondly, the service requirement was not sufficiently strongly demonstrated, because the surrounding population are reasonably healthy—but unless we can sustain the quality of service that we have managed in the past, they are unlikely to remain so. The hospital is a centre of excellence today, and deserves our support to remain so. If we are not prepared to invest in it, it will not remain so. Surely the Government's policy for the NHS is not to level down standards but to increase standards everywhere.

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My fear is that, if a coherent investment plan is not developed, in the future there will be an obvious impact on morale—which there has been already—and a risk that our top physicians will migrate elsewhere. There is a risk that standards of care will deteriorate and it will not be possible to maintain and meet minimum standards of cleanliness, hygiene and clinical care.
There is also a risk to the economics, because, unless we have a plan, the temptation will be to invest in one site or another at the cost of meeting the long-term objectives. In other words, the costs will be wasted, because in the long term we want to consolidate on a single site. Today, it is simply not possible to ignore the deteriorating state of our buildings.
The Minister of State said in July:
"Today the Government is unlocking the PFI gridlock in the NHS".
In June, he said:
"I wanted to be the Minister that got hospitals built, not the Minister that only promised them."
Those are sentiments that I am sure we all share.
I fear, however, that, by selecting certain PFIs to go ahead and kicking the rest into touch, we may have deferred any sensible long-term planning for hospital building, particularly in this case. We have moved out of one gridlock into, potentially, another. Meanwhile, the hospital management are in a Catch-22 situation. They have been told not to invest in further developing the PFI proposal, so that has been shelved, and no more work can be done on developing the right proposal for the future of Tunbridge Wells.
I am also aware that the Minister said in July that it was "not the end of the road"
for the schemes that had been turned down, but it is unclear today what can be done to revive them. According to a letter sent to me on 29 July, it was the intention to
"prioritise all future major acute sector projects according to the key criteria of health service needs."
The point about needs is that it is not just a question of today's needs; it is a question of future needs and future trends. We are talking about a long-term building project, and we are considering not what happens today, but what should happen in five or 10 years' time. The NHS trust needs to know that in order to prioritise what it does with its expected investment now. Currently, it is being left in the dark.
We fully recognise that health service expenditure must be prioritised, and that some schemes must be selected to go ahead. That is not the issue; the issue is what happens to schemes when there is an acute need for redevelopment, but they have been booted into the long grass for the time being.
The Government made a great commitment to the health service in their election manifesto. In the past few years, they have been highly critical of the last Government's record on health, and have made much play of the need to improve facilities and reduce waiting lists—which in Tunbridge Wells, incidentally, are in serious danger of lengthening again this winter; but that is another subject.
Now is the time to reassure hospitals such as the Kent and Sussex about their long-term future. That is really all we are looking for—a plan for the long term. That means
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not a stop-go on PFI schemes, but a coherent framework in which to plan, and some understanding of how schemes will be run and of the wherewithal to fund them and bring them to a state in which we can advocate them and make a proposal to the Government.
In short, I am asking the Minister to reassure us that he will look favourably on future plans for the redevelopment of the NHS trust, and to ensure that, in the months ahead, the trust is provided with clear guidance on the type of capital expenditure programme that will be allowed to enable single-site relocation in the long term.
In other words, are we to invest in both sites, or can we start concentrating on a single site in the knowledge that in the future a scheme will be supported? I also seek the Minister's reassurance that the NHS trust will be allowed to incur the expenditure necessary in the future to get a proposal into the state in which it can receive his blessing.
I believe that the issue is vital not just to my constituents, but to constituencies in surrounding areas and, I suspect, to other NHS trusts in a similar position. Proposals for redevelopment of the trust have not just my support, but the support of all the surrounding Members of Parliament, the community health council, the area health authority, the ambulance service, patients, local GPs—to many of whom I have spoken—and, of course, the borough and county councils.
Now is the time to provide clear directions for the future of a sensible, and indeed affordable, proposal. We do not want our PFI to be kicked into the long grass and to become stuck in the treacle of bureaucracy; we want firm direction and positive action, in the interests of all concerned.
10.13 pm
Sir Geoffrey Johnson Smith rose—
Madam Speaker: Order. Has there been an agreement?
Sir Geoffrey Johnson Smith: Yes, Madam Speaker.
Madam Speaker: The Chair should always be informed.
Sir Geoffrey Johnson Smith: I apologise for that omission, Madam Speaker.
I congratulate my hon. Friend the Member for Tunbridge Wells (Mr. Norman) on raising this matter, and warmly support what he has said. My constituency abuts his, and the health authority that dominates the constituency pays some £5 million for special services from the hospitals to which he referred. There is clearly considerable collaboration between the health authorities concerned.
I understand that, when we are considering questions of adjustment, financial matters—although important—must not be the overriding consideration. As my hon. Friend recognised, important services are involved, providing important treatments that can benefit my constituents because the hospitals are so close to them. If we were not to have this relationship, and services were moved to Maidstone, it would put an unbearable burden on my constituents, who would have to travel 30 or more miles to the district hospitals on the south coast.
10.14 pm
The Minister of State, Department of Health (Mr. Alan Milburn): I congratulate the hon. Member for Tunbridge Wells (Mr. Norman) on his first speech in the House on health matters. The right hon. Member for Wealden (Sir G. Johnson Smith) gave him ample support. I welcome the hon. Gentleman's interest in the Government's programme to renew the national health service. I share his concern that the citizens of Tunbridge Wells—and, indeed, of every other constituency—should enjoy the best health care, delivered in the best facilities by the best clinicians. That is what the NHS sets out to deliver, and what the Government are determined to secure.
I also pay tribute to the staff of the hon. Gentleman's two local hospitals—one on the outskirts of town and the other in the centre—who deliver high-quality care, sometimes in difficult circumstances.
The hon. Gentleman has raised with me tonight and in correspondence his concern about the fact that the project to rationalise services of the Kent and Sussex Weald trust on to a single site at Pembury was not prioritised as a PFI project in July. I understand the hon. Gentleman's concerns, but it may be helpful if I briefly explain to the House precisely why prioritisation of PFI schemes was considered necessary, how schemes were chosen, and the implications for those such as Kent and Sussex that were not prioritised. I know that he wants to look to the future rather than rake over the past, but it is important that I address the issues that he has raised.
When the Government took office, we inherited from the previous Administration what I can only describe as a fantasy hospital building programme. Scores of hospital developments were trumpeted, with, as I remember well, capital values the size of telephone numbers and start dates that we were continually promised were just around the corner. We had been promised project signings at the rate of one a month. Unfortunately, not a single project materialised. Despite the promises of jam tomorrow, not a single hospital was built through the PFI process under the previous Administration.
The previous Government's overblown optimism about their hospital building programme was not matched by the private sector, which had invested much time and money in developing proposals that seemed to be going nowhere. There was confusion about the rules, uncertainty about the legislation, and an impossibly large number of potential schemes to manage and deliver.
The Government were elected on a mandate to sort out the mess that PFI had become. It was never going to be an overnight job, and the work continues today. I hope that the hon. Gentleman will acknowledge that we have made enormous progress. On taking office, the Paymaster General appointed Mr. Malcolm Bates to review the operation of PFI right across government, and he accepted every one of Mr. Bates's subsequent recommendations.
Meanwhile, the Department of Health undertook its own review. It was clear that, as a matter of priority, we had to secure the market for PFI, and we set about doing that in two ways. We prioritised the 43 major acute schemes in the pipeline, and we enacted legislation to clarify the powers of trusts to enter into PFI contracts.
As the hon. Gentleman rightly said, on 3 July I announced the outcome of prioritisation. I was able to announce 14 major new hospital schemes with a total
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capital value of £1,300 million: the biggest new hospital building programme in the history of the national health service. That unlocked the gridlock. Most importantly, it secured the confidence of the private and public sectors in the ability of public-private partnerships to benefit patients by providing new services on the ground. That confidence was given a further boost on 14 July when the National Health Service (Private Finance) Act 1997 entered the statute book. The Government promise was delivered. Just a few weeks ago I was proud to be able to visit the Darenth Park project at Dartford and Gravesham. The trust there already has the builders at work and ahead of schedule. I have no doubt that the concrete proof there will be replicated throughout the country as schemes are brought to fruition.
I am pleased to note that the bond that has been used to finance a new hospital for the people of Carlisle, the first NHS/PFI scheme to be funded through the capital markets, will be launched tomorrow. I fully expect work to begin on that scheme by the beginning of next month.
Mr. Eric Martlew: I invite the Minister to visit Carlisle when building work starts on the hospital. We have a split site, and we have been working for 20 years for a new hospital. The Minister's news will be welcomed in my constituency.
Mr. Milburn: I pay tribute to my hon. Friend for being at the forefront of the local campaign to secure a new hospital for Carlisle. That long campaign has had a rich reward in the new development, and I should be delighted to accept his invitation to see progress when building starts.
In the context of Kent and Sussex Weald, I draw no comfort from the fact that many schemes have had to be stood down. I have no doubt that there is a demonstrable health service need for such schemes, and that the NHS would be improved if the projects were given the go-ahead. If it had been possible to deliver all 43 projects, I would have delivered them, particularly if that could have been done at an affordable price. However, I am afraid that arguments continued to rage in the constituency of the hon. Member for Tunbridge Wells about the affordability of the scheme in the lead-up to the prioritisation exercise.
I have no apologies about the outcome of prioritising, because not all the schemes could have been delivered. A preferred bidder had not even been selected for Kent and Sussex Weald when prioritisation took place. As I think the hon. Member knows, more generally, resources were spread too thinly, expertise was lacking, and precious NHS cash was spent trying to breathe life into schemes that were just not ready.
The NHS spent a total of £30 million in management consultancy fees alone desperately trying to get PFI schemes off the ground, and there was not a single hospital project to show for it. I was not prepared to allow that waste to continue. Instead, we took the decision to prioritise on the basis of three criteria: health service need, project status and PFI-ability. We did that openly and objectively, and the results were published in full. Again I make no apology for that, because in my view health service need should always be the key determinant in progressing NHS schemes.
The hon. Member for Tunbridge Wells was right to point to the advantages that would have accrued to the Kent and Sussex Weald trust if its project had been

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prioritised. As he rightly said, the trust currently operates on a split site—on the outskirts of Tunbridge Wells and in the centre of town—and the operational and training difficulties that that creates have been well documented. He alluded to them.
It is perhaps a sad indictment of the recent history of the NHS and of the hon. Member's party's mismanagement of it that in terms of health service need, Kent and Sussex Weald, despite pressing needs, was a considerable way down the list and below other potential projects whose need was greater. For health service need, Kent and Sussex Weald scored three out of a possible five where five represents greatest need. In the categories of PFI status and PFI-ability, the project scored only one out of five and nought out of five respectively. It was therefore considered extremely unlikely to reach financial close within 18 months, not least because the support of local health care commissioners was likely to depend on a more affordable, and therefore restructured, proposal.
The question then, as the hon. Gentleman rightly said, is what happens to the schemes that were not prioritised for the first PFI wave. The answer is that schemes that were not prioritised for the first wave are eligible for consideration by the capital prioritisation advisory group within the NHS executive. The group will consider the merits of eligible schemes, including, specifically, their health service need. In future, the key determinant of where capital projects take place in the NHS will be a simple one: whether those projects are most needed.
As configured under the previous Government, the PFI system did not take NHS need into account as the key determinant of where capital projects were to be developed. Instead, the philosophy of "let a thousand flowers bloom" meant that a thousand flowers did not bloom. Unfortunately, no flowers bloomed. Instead, the NHS wasted precious resources, precious time and precious skill trying to conjure schemes out of nowhere. The consequences were clear for all people to see: it failed. This prioritisation exercise, where NHS need will be the determining driver, will ensure that the most needed capital developments take place quickly.
I hope that the hon. Gentleman will support that approach. He asked for sensible long-term planning, and that is what he will get through this route. The group will work closely with the Treasury task force in making its recommendations, and it will be for Ministers ultimately to decide which schemes should go ahead. Work is
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already under way to prepare for scheme selection, and I expect to be able to announce the next tranche of PFI schemes in the spring.
The hon. Gentleman asked what the best thing to do was. The best thing to do for his trust, for himself and for the right hon. Member for Wealden is to alert the regional office to the needs of their constituents, and to try to persuade the office that this is a much needed scheme. The office may therefore decide that this is the sort of project that it would like advanced for national prioritisation.
The benefits will be clear for all. In particular, the private sector will know that schemes selected on that basis have every prospect of success. We anticipate considerable competition to deliver them. Needless to say, the bid that succeeds will be the one that offers best quality and value for money. Those schemes that are not considered PFI-able—and there may be some—may be considered for available public sector capital.
I do not expect the hon. Gentleman to agree that his local trust should not have been prioritised, but I hope that he will acknowledge that, since the announcement on 3 July, the trust's perspective has changed. The fact that the trust did not appeal against my decision when it could have done is a sure sign of its realism about the poor status of its previous PFI bid.
More positively, and looking to the future, I understand that the trust is now working on a collaborative agenda with Mid-Kent Healthcare NHS trust, and that it is likely that any future project proposal will take account of collaboration on site strategy, and possibly involve all three major sites—at Maidstone, Pembury, and Kent and Sussex. I have no doubt that, if a successful partnership can be forged to effect a strategy for the whole region, the hon. Gentleman's constituents can only benefit.
The Government also believe in co-operation and in partnership. We will continue to pursue our successful strategy of public-private partnerships, of which the PFI is one model. Our review of the PFI in the NHS continues, with a review of the procurement process and of the PFI product. We want deals to be quicker, better value for money, high quality, even more innovative, but, most of all, driven by that key determinant of NHS need. The NHS, taxpayers and, most important, local patients will benefit from that approach. I look forward to receiving the full support of the hon. Gentleman and of the right hon. Member for Wealden in that endeavour.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Ten o'clock.