HC Deb 03 July 2000 vol 353 cc5-7
4. Ms Christine Russell (City of Chester)

What progress is being made in achieving the target for disposal of surplus assets contained in the strategic defence review. [127259]

The Secretary of State for Defence (Mr. Geoffrey Hoon)

In the past two financial years, more than £400 million has been realised from the sale of surplus property assets. We are fully on course to achieve the £700 million target for gross receipts which is set out in the strategic defence review. The Defence Logistics Organisation was set a target to reduce the book value of spares holdings by some 20 per cent., and is on target to meet that by 2001.

Ms Russell

I thank the Secretary of State for that reply and congratulate the MOD on achieving its target. May I further congratulate my right hon. Friend on the estates strategy that has recently been published? My constituency has a long military history and therefore significant MOD assets. I noted a strong commitment to sustainability in the strategy. The MOD has announced—I have no criticism of it—that it intends to dispose of Saighton camp on the rural fringe of my constituency. I therefore seek an assurance that it will conduct a full environmental impact assessment, as promised in the strategy, and consult local planning authorities prior to the disposal of that asset.

Mr. Hoon

I was about to say that I suspect—but I know that my hon. Friend knows a good deal more about the site than I do. None the less, I shall certainly ensure that the case is looked at and will write to her in due course. I hope to be able to give her the answer that she seeks.

Mr. Menzies Campbell (North-East Fife)

Is not it a rather fragile and inadequate basis for the Secretary of State's budget to depend to such an extent on windfalls from surplus assets? Does he understand that there is great sympathy for him in the House as he prepares, once again, to repel the predatory swoop of the Chancellor of the Exchequer in the comprehensive spending review? Indeed, there is some sympathy for him in the House owing to the fact that briefing against him appears to have started already in this morning's national newspapers. Will he insist in the comprehensive spending review on a settlement that allows the MOD a proper budget, and one that does not rely on speculative returns from surplus assets?

Mr. Hoon

The right hon. and learned Gentleman is wrong to describe asset sales as windfalls. All Departments—the MOD is no exception—must concentrate their activity on areas that they require, whether for training of people or testing of equipment. It is crucial that we retain only those assets that we need at any given time. Therefore, there is a vigorous programme of selling assets, as it is clearly important that land and sites are used for proper purposes rather than remaining redundant as part of our property portfolio. I disagree with him profoundly when he talks of the sale of such assets as windfalls. They are assets that the country can use more effectively than merely leaving them idle on the books of the MOD or any other Department.

Mr. Barry Jones (Alyn and Deeside)

Will the comprehensive spending review, to which the right hon. and learned Member for North-East Fife (Mr. Campbell) referred, consider the successor identification friend or foe system, and if it does, as I suspect it will, will there be sufficient funding for it from my right hon. Friend's Department? My constituency, Raytheon and RAF Sealand want to help my right hon. Friend and offer their services on the contract—

Madam Speaker

Order. We are getting quite a way from the original question. I shall try Sir Michael Spicer, who I hope will return to it.

Sir Michael Spicer (West Worcestershire)

One organisation that seems to be coming quite close to being surplus to requirements in the Government's mind is the Defence Evaluation and Research Agency. In the light of the Select Committee's report on DERA and its importance to Anglo-American relations particularly, will the Government reconsider their position on it?

Mr. Hoon

The Government have put out a further consultation paper in relation to the proposed sale of DERA. The hon. Gentleman refers to Anglo-American concerns; I assume that what he really means is anxieties in the United States. If he checks the situation carefully, he will find that the United States is content with the latest proposals, so that criticism does not arise. I have studied carefully and discussed with members of the Select Committee their reservations about the proposals. Clearly, we will take that into account before any final decisions are taken.

Mr. Dafydd Wigley (Caernarfon)

I welcome the statement of the Secretary of State with regard to the disposal of surplus land and buildings. Will he give an assurance that if there are opportunities to dispose of those in a way that is economically helpful to those communities, he will not stand by the last penny that he can get by holding out, but that he will co-operate with other Departments for the general benefit of those communities?

Mr. Hoon

I can give the right hon. Gentleman an assurance that I may not stand by the last penny, but I shall certainly stand by the last £100 million.

Mr. Peter L. Pike (Burnley)

I welcome the progress announced by my right hon. Friend in the disposal of surplus assets. Instead of the cash value, can he tell the House how many housing units have been released and how many acres of land have been disposed of by his Department?

Mr. Hoon

As my hon. Friend knows, the great majority of houses in the possession of the Ministry of Defence are owned by a private company, from which we lease them—a decision taken by the previous Government. We have 63,000 families quarters, but some 53,000 of those are leased from a commercial company. The remainder are owned, and we have a further 20,700 houses in our overseas garrisons, so there is a considerable amount of property. We review it carefully and, as I said earlier, we ensure that we retain only the property that the country needs at any given time.