Chevaline: Development Costs (Hansard, 18 January 1982)

§ Lord Jenkins of Putney
My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

§ Viscount Trenchard
My Lords, as was said in the Statement on Defence Estimates—Cmnd. 8212–1—the estimated cost of Chevaline is about £1,000 million and development work is close to completion.

§ Lord Jenkins of Putney
But was not the original estimate for this rather less than £450 million and not £1,000 million? Can the noble Viscount say when the original Chevaline decision was taken and by whom? When Parliament first learned of the decision to spend up to £1 billion or more on modernising this weapon, how long was that announcement after the original decision to go ahead with the expenditure?

§ Viscount Trenchard
My Lords, the original funding decision was taken in 1974 by the last Administration and the estimate at that time was £240 million, in 1974 prices. The Administration previous to the last Administration—that is, the Heath Government—had taken a decision in principle to pursue the Chevaline route, but the main funding decisions were taken by the Labour Administration. If there be any doubt about all-party belief in the development of Chevaline, noble Lords will have noted that leading members of the SDP on a recent programme on television were clearly party to the 1974 decision.
I would only add that since 1974 there has been a considerable quantity of inflation, which would of course put up the price in any event. We were also developing something at the frontiers of technology, which I believe will be finally proved very soon, and that is always hard to estimate. So the Government generally believe that, at £1,000 million or thereabouts, we have got very good value in maintaining our independent deterrent in the cause of peace.

Lord Bruce of Donington
My Lords, could the noble Viscount, Lord Trenchard, inform the House just how much of the work done was performed under contracts which guaranteed a profit? Is the noble Viscount aware that there is some anxiety in the country following recent reports that the guaranteed profits on certain defence contracts have been grossly exceeded in many cases? Will the noble Viscount inform the House whether any of the Chevaline contracts were involved in this?

§ Viscount Trenchard
My Lords, the noble Lord, Lord Bruce of Donington, has raised two questions. The vast majority of defence contracts, if they are not competitive contracts, are controlled closely and within a very small percentage of certain targets which have been agreed by successive Administrations. So far as the Chevaline contract is concerned, I believe that the major part of this is a non-competitive contract, but it is very closely regulated in accordance with the procedures for ensuring that undue profits are not made.

§ Lord Avebury
My Lords, I thought that I heard the noble Lord, Lord Jenkins of Putney, ask whether the noble Viscount Lord Trenchard, could say when the original announcement was made in the Defence 415 Estimates. If it was not in the 1974 Defence Estimates when the decision to fund this programme was taken, could the noble Lord say in what year this announcement was first made? Could he also say under what heading of the Defence Estimates the Chevaline programme was contained before it was publicly announced?

§ Viscount Trenchard
My Lords, I am af[...]aid that I do not have the exact date of the first announcement to Parliament and I will have to write to both noble Lords who have raised this question.

§ Lord Mayhew
My Lords, may I ask the noble Viscount, Lord Trenchard, whether the Government will take into account the very heavy cost of Chevaline, and also the very heavy cost of replacing the motors in the Polaris missiles, when they come to consider whether they should proceed with the Trident project?

§ Viscount Trenchard
My Lords, the point which the noble Lord raises has of course been examined in great detail and continues to be examined. I would only say to the noble Lord at this stage that the planning for Trident extends to the maintenance of an independent deterrent well into the next century and different considerations apply to the considerations which will make it necessary for some degree of Polaris remotoring to take place in this decade.

§ Lord Brockway
My Lords, would the noble Viscount the Minister agree that this is a great gamble? Is it not the case, hopefully, that the Geneva talks may make it quite unnecessary? Would [...]e not agree that it is the case objectively that the next Government may not proceed with Trident and may even cancel Polaris? Cannot the Government delay a decision on this matter in order to take a consensus of the opinion of our electorate?

§ Viscount Trenchard
My Lords, I do not agree with the noble Lord, Lord Brockway, that this question is a gamble. It is quite clear from all current opinion polls that the public do not think so either. So far as the outcome of Geneva is concerned, should in the future any disarmament talks affect our own nuclear weapons, there will be no hesitation in taking the correct action. But at the moment the Government are quite clear that we have to deal with the facts of the situation as it is and continue to deter aggression. I believe that any future Government—and we have aspirations in that respect—will have to pay attention to the facts of the situation.

§ Lord Harmar-Nicholls
My Lords, will my noble friend bear in mind the reply given by President Reagan—If not us, who? If not now, when?—when we are thinking in terms of protection in the future?

§ Viscount Trenchard
Yes, my Lords.

§ Lord Mayhew
My Lords, may I just ask the noble Viscount the Minister to clarify his answer to me? Did he say the Government are proposing to carry on with the Trident project?

§ Viscount Trenchard
My Lords, the Government have decided to replace Polaris in the 1990s with Trident. There is now the question which the Government have been studying which stems from the United States' decision to move from the C4 Trident missile to the D5. The Government's decision on that matter is not yet ready but will he announced as soon as it is reasonably possible.

§ Lord Brockway
My Lords, the noble Viscount the Minister referred to Gallup polls. Is he aware that the recent Gallup poll showed a large majority against the adoption of Trident?

§ Viscount Trenchard
My Lords, I think we are getting into different questions. I have debated public opinion polls with the noble Lord before and will do so again.

§ Lord Jenkins of Putney
My Lords, was it not the case that the original decision to go ahead with a modification for Polaris was concealed from both Houses of Parliament at the time? Considering that we have had to go ahead with this without an opportunity to discuss it, this must raise the question of whether we are similarly tied in relation to Trident. The increase from £240 million to over £1,000 million is tied to some extent to American decisions and we are liable to be equally tied in relation to Trident. Therefore, will the noble Viscount ask his colleagues to look again at the Trident position, which might involve us in a totally untenable position if we go ahead with it?

§ Viscount Trenchard
My Lords, that too is an entirely separate question. We shall conduct our affairs in the way that this democratic Government have always done in matters of supreme importance such as defence.