The Defence Estimates 1985

HL Deb 03 July 1985 vol 465 cc1199-270

3.48 p.m.

Debate resumed on the Motion moved on Wednesday last by the Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne)— namely, That this House takes note of the Statement on the Defence Estimates 1985 (Cmnd. 9430).

The Earl of Cork and Orrery

My Lords, welcome back to our adjourned debate. We have had an interval of a week and there may be disadvantages and advantages in having the debate split into two parts. So far as I personally am concerned, among the advantages I number is that I have the pleasure of being able to congratulate the noble Lord, Lord Mulley, upon his birthday, and wish him many happy returns. As a former Secretary of State for Defence he is enjoying a sort of busman's holiday, but it is certainly a pleasure to know that he is doing it on his birthday.

If I were to take a text as though I were preaching a sermon, I daresay that I may well take it from the White Paper and quote some such passage as, say: The prospects for arms control over the coming year are, as ever, difficult to predict". Or possibly: we must continue to pursue the path of balanced and verifiable measures of arms control and disarmament. That is the best way to a safer world". Or something pithy and original of that kind. But instead I appeal to my noble friend Lord Carrington, now Secretary-General of NATO, who said in a speech a couple of weeks ago: How on earth do we think that we are going to stay in the big league without investing big league money in research and development? And where do we think that money will come from if the Europeans are not willing to get together? He also recalled in his speech that 10 years earlier he had said: armies designed to fight on the same side in the same war on the same day might sensibly equip themselves with the same tank: Or at least with tanks firing the same ammunition through a similar gun". Finally, in the same speech he said: We must wake up to the fact that tomorrow's weapons are an extremely demanding area of high technology, in which the countries of Western Europe will have to combine if they want to remain relevant". Those were words of wisdom, though not always observed. I might add that co-operation is needed not only between European countries but between all the countries of NATO.

A particularly graphic example I can quote to illustrate that concerns air armaments. Armaments in the air consist of all kinds of missiles, what are known sometimes as iron bombs or dumb bombs, if one is an American, smart weapons, guided missiles of one kind and another, such as air to air, air to ground, of enormous elaboration, and getting more and more complex all the time. This is advanced technology right out on the edge of the expanding electronic technology of the present day. These weapons have been designed in the past individually without any concerted plan to ensure that they can be fired or dropped from any particular aeroplane. Therefore the aircraft in many of the NATO air forces now are debarred by the very nature of design and construction from firing the weapons that are used by other air forces, thereby contradicting the principles laid down by my noble friend Lord Carrington.

The word that is used in this connection is inter-operability, meaning simply that each must be able to use the other person's weapons. As an example, I shall quote a company not by name because I am not trying to grind any axe but simply to use it as a principle. There is a quite small British firm engaged in this field. It has secured contracts with the American navy and air force in precisely this work. It has also secured a further contract to look into the future and produce a means of making what is called interface between the aircraft, the pilot and his weapons so that an aircraft can take on any weapon used by any NATO air force. This is one of the biggest and most exciting breakthroughs that has been achieved so far in the electronic defence field and is of the most enormous importance.

Do the Government know anything about this? I do not know. I am not identifying this firm but presumably the Government do know it. They may have had in mind such a firm with such experience when on page 42 of the White Paper the Government stated: we have assisted in the setting up of Defence Technology Enterprises Ltd., a private company whose object is to help identify potentially marketable ideas and technologies generated in the establishments"— that is the Government's research establishments— and to promote their exploitation by the civil sector". This morning I telephoned the managing director of my small firm and asked him what were his relations with Defence Technology Enterprises Limited. He said "What?" and when I repeated the name he said he had never heard of it. I must be fair about this because the White Paper said that Defence Technology Enterprises Limited existed for the purpose of identifying, potentially marketable ideas and technologies generated in the establishments and to promote their exploitation by the civil sector". Would it not be sensible to examine projects invented in the civil sector and refer them to the establishments? We could go further than that and encourage the setting up of a nationwide consortium of firms operating in the electronics business so that together they might produce the necessary designs, weapons, apparatus or whatever it might be and then negotiate with our friends in NATO on both sides of the Atlantic, so that we can get the best weapons usable by all sides.

Among the information that I have is the calculation that if this could be done and every NATO weapon could he carried on every pylon, on every aircraft, the combined fire power of the NATO air forces would be multiplied by a factor of 10. This is a staggering figure. I make no claim for it but simply repeat it.

But in relation to setting up this super consortium I draw your Lordships' attention to what is happening in Japan where there is a government-organised consortium of precisely that kind in which all Japanese electronics engineering firms are combined under the general overall heading and supervision of a government agency. I am told, and I well believe it, that this is causing a good deal of concern among electronics engineers both in Europe and in the United States of America because there is not only the expertise of large, very powerful, experienced and ingenious Japanese firms but the whole lot put together. It is high time that we took notice of that otherwise our electronics industry and our aviation and armaments industries will look like going a considerable way down the drain.

I do not want to say anything in particular about the Army except that since the last White Paper we have had the largest exercise that has ever taken place, called Exercise Lionheart, in Germany which I was privileged to watch. We have a short report in this White Paper of what happened. The curious thing is that neither in this report nor anywhere else in the White Paper is there any mention worth quoting of the most important commodity, if one can use that word, in the whole of the defence scene, and that is men. This was a vast exercise with hundreds and thousands of men concerned, and there was but a passing reference in the White Paper to the professionalism of the Territorial Army. There was another sentence which said something of that sort, but the idea that people were taking part in this exercise does not emerge from the White Paper at all.

I should like to know, and perhaps the Minister can give some indication when he replies, what is it like to be a soldier nowadays in the preparation for war? What would it be like to be a soldier in war? Have we come some way towards not only the unwinnable war, which we are all aware of, but the unfightable war? What will it be like for the soldier in the future battlefield wearing his NBC suit which is totally airtight and gives him no possibility of eating, drinking or performing his natural functions for as long as he wears it, and he must wear it all the time he is under threat from a chemically-armed enemy? He has also now the doubtful privilege of being equipped with night vision so there is no longer any difference between night and day. It is not only convenient for him to look through, but it is convenient for the enemy looking at him. So he can neither eat, defecate nor sleep so far as I can see as long as the war shall last.

This exercise caused all the men taking part in it to be dressed in precisely that way. They wore their so-called Noddy suits for days on end and, as far as I know, for weeks. What was the result of this? When the report from the Ministry of Defence eventually comes out, I hope that something will be said about it. The brief report included in the White Paper refers to the lessons that were learned on that exercise; but I hope that they learned a number of lessons about man management as well because that is assuming more and more vital importance.

It is not only a question of what is going on in the armed services, which is the subject of this particular day's debate; there is a wider field which has to be considered as well. I am going to venture to step slightly outside this afternoon's terms of reference for this reason. I do not think in fact that you can divide this debate in this way. There are bound to be subjects which will overlap, one with another; for example, merchant shipping. We have heard something about that this afternoon in the form of question and answer; and the anxieties of the House have been made perfectly plain, and quite rightly, I think. Last Wednesday we had several speeches on the subject of the shortage of merchant shipping and notably a particularly powerful speech, eminently readable, from the noble Lord, Lord Kennet. I expect that we shall hear some more this afternoon, certainly from my noble friend Lady Airey of Abingdon who is going to speak on that subject.

My Lords, is one or other of these two days the more important for that particular subject? The answer, I think, must be, no. So I think that we can hardly be surprised or blame anybody if this particular division tends to break down. And I think it ought to break down for another reason. That is that we do not consider, and we ought to consider perhaps, what it is that we are defending. It is not a question that we ask because we think we know the answer: we are defending NATO or defending West Germany; or we are defending the central front, or whatever. Or we may go wider that that: we are defending freedom, the freedom of the West. I venture to suggest that what we are defending now has become something wider than that. We are defending mankind itself and we are defending mankind in a time when there are several revolutions going on simultaneously. There is the revolution of the virus, there is the revolution of electronics, the so-called third industrial revolution. There is even a sex revolution going on, in which for the first time for many centuries the patriarchal system of the world looks like breaking down in favour of a matriarchal one. I may mention in passing that we even have a male God, so far; though I do not know how long that is likely to last.

What sort of defence are we making, and against what? When we look at the Soviet Union we see something that is totally alien, not just different from ours in a rather nasty sort of way which we can refer to as evil. There is no point in using words such as that. It is totally other than we are. And it is a totally military dictatorship, with its armed forces completely integrated with and under the control of the Communist Party of the Soviet Union. The commander-in-chief of the armed forces is Mr. Gorbachev, the Secretary-General of the Communist Party. Whenever we get a new secretary-general or a new president, every Kremlin watcher in Fleet Street reaches for his typewriter and starts working out how this man differs from the others—whether he is more liberal, whether he has a nattier line in shirts or something or the other which we can pin on as being encouraging to ourselves. What they apparently do not remember very easily is the fact that these people all have something in common; and that is that they are all elected by the Politburo. This is a tightly-knit group of hard men who have come up the hard way in the rigorous communist tradition. And you can bet your boots that the new man will uphold that position unrelentingly!

But those things are not forever. Nothing is forever. Plotinus, in the third century, said, "All is flux". And we have the well-known French saying, "Everything breaks, everything wears out, everything wears away". So I have no hesitation in believing that the communist system in Russia will wear away, too. We may have to give it 50 years or 100 years, I do not know; but where, I ask myself at the moment, is our battlefield in a situation like this? And I think that this is a question that can be put in cold storage. There is no battlefield now in the ordinary military sense. What is required of us, I think, are three things. The first, obviously, is deterrence—and most of us are agreed upon that I think—in which we make ourselves too dangerous an opponent to be worth attacking. The second one is patience or, to put it bluntly, to sweat it out and to go on talking. I do not believe that by talking we shall ever change the Russian attitude to the cold war, but we have to do it because not to do so probably would represent a kind of defeat and also because it has its benefits for arms control.

The Soviet Union is surrounded by its own troops, the NKVD. There are 250,000 or 300,000 or so troops who are there spread round the country, right round the perimeter of the whole of the Soviet Union, occasionally for defence against, shall I say, the Chinese, but on the whole to seal the frontiers; sealing the frontiers meaning keeping the people in. The NKVD also has 30 divisions for internal security. How many divisions of infantry has our Home Office?

We cannot talk to these people sensibly at all in any terms that we can understand. I certainly do not think so. These expedients are totally astonishing and their result is pithily summed up by my right honourable friend Mr. Francis Pym in an essay in a magazine in which he says: the Soviet system can increasingly be seen as a failure, morally bankrupt; with no answers to internal dissent except suppression, unable to feed its people; its economy hugely distorted by its arms programmes; its satellites restive; and its ideology repellent to the rest of the world. The outlook from the Kremlin is bleak indeed". I said that there were three requisites that we have to recognise. The third was best expressed by my noble friend Lord Eccles in last week's debate, in which he said: our strategy must embrace assets beyond weapons and armed forces … The existence of a military presence represents only one side of our activity outside the NATO area. Our aim in the first instance must be to bring diplomatic and economic efforts to bear in areas of potential instability so as to help maintain peace and combat the activities of the Soviet Union and its proxies". He went on, finally: Winning friends outside the NATO Alliance …is an aspect of non-military defence that is bound to become more and more important as the world gets smaller and smaller and every continent is almost within range of the other", and so on. This is the key of the future, I believe: to make friends with people, committed people and uncommitted people, all over the world to make sure that they are on our side and not on the other side. I hope that my noble friend Lord Whitelaw will bear that in mind when, if ever, in Cabinet he hears mention of cutting grants to foreign students so that they cannot come here and thus have to go to other countries, or when there are requests from the Gulf states to send cadets to our academies for training and they are told by the Ministry of Defence that we have had to cut down the number of instructors for economy reasons and therefore we cannot accept as many as they ask to send to us. Perhaps my noble friend will have some comment to make on that at the end of the debate.

Finally the late Lord Wingate, who commanded the 14th Army Special Forces in Burma, known, popularly, as the Chindits, used to encapsulate some of his training methods into slogans or aphorisms, some of which have relevance today. One of them in particular was, "The answer to noise is silence". Indeed, it was an instruction for jungle warfare in the dark. But I take it as a rule of life which is applicable at any time. I think that we might bear that in mind in our diplomatic and political relations with other countries, particularly with the United States, and remind them of what my noble friend Lord Trefgarne has described, I think, as the unremitting cacophony of propaganda that comes from the other side of the Iron Curtain. We must remember that the answer to noise is, indeed, silence. And best of all, better even than that, is to be silent before the noise begins.

4.10 p.m.

Lord Mulley

My Lords, I am much indebted to the noble Earl for his kind birthday greetings, and although I deem it a very great privilege to address your Lordships I am bound to say that I could think of other ways of spending my birthday, particularly as today may be one of the few days of summer that the weather authorities seem to have been able to make available this year. I would very warmly endorse the importance that the noble Earl attached to NATO inter-operability. I am hoping that in the next generation of weapons (goodness knows how difficult and long it has been!) we may get more European collaboration and co-operation than we have been able to achieve so far.

I should also like to say—because I recall his great contributions in another place—how much I am looking forward to the maiden speech of the noble Lord, Lord Crawshaw of Aintree, not only because of his contributions in debate but because I know of the devoted and sterling work he did for the territorial forces over very many years—even to the extent, I am bound to say, when there was a very tight Labour majority, voting in the interests of the territorial forces against the Government when I, with the help of the noble and gallant Lord, Lord Carver, was reorganising the Territorial Army some 20 years ago.

It is right, as the noble Viscount the Leader of the House said in winding up the first day's debate, that we should have a two-day debate, but I think perhaps we should think a little more about its form. Certainly I would hope there would not be a week in between. I hope there has been no conspiracy to make the second day my birthday, but the artificial division between certain chapters in the Statement on the Defence Estimates and other chapters makes debating them rather difficult. For example, although I do not intend to talk about the Trident problem, it just happens that Chapter 4 begins with a long section about Trident, which took up a substantial part of the first day's debate. I will only say that I was extremely impressed by the contribution in the debate a week ago of the noble and gallant Lord, Lord Carver, who said much more eloquently, and with more authority than I could command, very much of what I feel about the importance of new technology, conventional weapons and the role of our nuclear forces.

I should like to endorse at the beginning of this debate, as my noble friend Lord Boston did at the beginning of the last debate, our commendation and indebtedness to all members of our armed forces. I believe that our service men and women are the greatest defence assets that we have. I would go so far as to say that I do not think any other army could have done, year in and year out, the job that our boys have done in Northern Ireland. Nor do I think (though I believe it should never have happened, when the Argentines attacked the Falklands we had to respond, and that was inevitable) that any other forces, with all the odds stacked against them, could have achieved the military success that the combined British forces achieved in that context.

I am sure, without any doubt at all, that we can commend the enormous range of services that they render to the community, as set out in Chapter 6. There is very rarely a day that passes without there being some indication of a rescue or some other action in which our forces have taken part. But we should understand, particularly in Northern Ireland, the tremendous strain that this imposes, especially on the infantry regiments but also on the army generally, in terms of separation and the long hours that they work. There is also the fact that it is necessary—I tried to stop it as much as I could—to bring technical and specialist units from Germany to parade the streets of Belfast, leaving their equipment and their training behind.

That is a tremendous additional burden that our armed forces have to cope with; and I was somewhat distressed to see that the Secretary of State has resorted to saying that he is transferring 4,000 soldiers from the tail to make up the necessary numbers in front-line units. Some eight or nine years ago, when, with a rather better ratio between the front line and the tail, I ventured to make some small adjustments, I was hooted at by those now on the Government Benches (then in opposition) who said that it was the old, old story. I am bound to say that I think it is not a very convincing thing for the present Secretary of State to feel that he is saving money in that way, because our supply services were already extremely stretched.

Equally, I am certain that it is right to increase our reserves. Possibly the noble Lord, Lord Crawshaw, may make some comment on that, and quite possibly the noble and gallant Lord, Lord Hill-Norton, may do so, because many of us were extremely impressed with the presentation that he organised on behalf of "Defence Begins at Home"—the possibility of a civilian force, a very cost-effective force, that could be organised under the authority of the Government and Parliament, to be available to relieve the Regular and Territorial Armies proper of some of the essential surveillance and protection which might arise in time of emergency. However, I do not want to anticipate what the noble and gallant Lord may possibly say.

In addition to the demands that Northern Ireland makes, there are now the demands of the Falk lands, and while, as I say, I believe that by means of proper steps the original invasion there could have been averted, as indeed it was on a previous occasion, I think we were all appalled to know that at the present time, out of our all-too-stretched defence budget, £288,000 per head is being spent on the inhabitants of the Falkland Islands. That seems to me something which I would hope could be swiftly and greatly reduced, if not totally eliminated.

I would also venture a word of caution to the Secretary of State, who I know is extremely concerned with management and reorganisation. I think probably it was overdone at an earlier stage. I in fact managed to increase the establishment of the army units, because what is the minimum number needed, for example, to man all the tanks in a tank regiment or all the guns in an artillery unit? You have to allow for people being sick, people going on leave, people going on courses and so on. And unless there is a little bit of leeway we shall not, if the worst happens and we have to move the unit as a fighting unit, in fact have an effective force, apart from the extra strain that this imposes on those who are there.

It is too early to judge the reorganisation of the Ministry of Defence. I think the Secretary of State was right to say in another place that that was the case; but I personally believe that the savings that may accrue will be very marginal—and I am not at all sure that there will be any increase in efficiency at all. In particular, I very greatly regret the abolition of the posts of vice-chiefs of the three services, because, in my experience, not only did they play an essential part in the management of their own services but they were the key liaison officers between their own service and the other two services, as well as being the link between them and the civilian central staff. However, in general, I approve the strengthening of the position of the CDS and of the central section of the Ministry.

The next chapter which we should discuss is the one much devoted to equipment. While I think it is right to stress that 46 per cent. of the current budget is spent on equipment, we should understand that all our services are still needing a vast amount of expenditure in order to bring their equipment up to the required standard of the current generation of weapons, let along making provision to replace them with the next generation, which are bound to be more expensive in every category.

In this context I am extremely disappointed that so little progress has been made in European cooperation. I do not know whether in reply the noble Lord can indicate whether we have gone any further towards an agreement for a European fighter aircraft. I know how difficult it is, because I think that I actually started those talks about eight or nine years ago. But I would equally say that I hope those concerned will go a little easy on the thought that competition will be the answer to all their financial and equipment problems. The savings that were made by the competition for a Royal Air Force Trainer were quoted. But I am not impressed if all, or a good deal of, our equipment is to be foreign equipment off the shelf which we then make only under licence in this country.

The enormous cost of research and development means that one will not get firms to produce prototypes "on spec" so that they may be tested by the services concerned, which will then decide on this or on that. The only people who will enter such a competition are those who already have such equipment in use in their own services. Of course, no one will buy equipment made by British firms in the defence field unless it has been approved and has been bought by us for our own forces. I think that it could mean in national terms that £10 million might be saved here or there, but in the long term it migh mean a loss of hundreds of millions as well as a loss of work and our elimination, just as in the civil long-haul air transport we have been eliminated because it was cheaper to buy abroad. If we are eliminated I think we shall then find that the prices of our competitors will go up quite substantially when we want to have subsequent competition.

To sum up, therefore, I would agree with the excellent report of the Commons Defence Committee when they said: In terms of broad policy, there is little new in this 1985 White Paper", despite the Secretary of State's suggestion last year that, after his preoccupation with the management structure in the Ministry of Defence, this year—namely 1985—he would produce, "a review of policy priorities". I, like the committee, regret that it has not been done.

I recall that in the competent and persuasive manner to which we are accustomed in his speeches, the Parliamentary Under-Secretary, in opening the debate, gave very emphatically a denial—almost an emotional statement—that there was any question either of a defence review going on now, or that there will be one in the near future. I do not think he was wanting to contradict his Secretary of State. We do not need a defence review because it has been done already. It has been done, in a sense, by the Commons Defence Committee; and I suggest that it was probably done in-house in the Ministry of Defence long before that. Indeed, I should be very surprised if it had not been so done by the chiefs and the corresponding civilian advisers.

I think there is a growing consensus that we cannot properly fulfil all our defence tasks to NATO in BAOR, in the Tactical Air Force—both of which are treaty commitments—in Germany, our extensive commitments in the Atlantic, the Channel, and the support which we are committed to provide to reinforce the northern flank of NATO, as well as our own national defence commitments for air defence and minesweeping. Indeed, I would say that the greatest shortages in our defence position at the present are a lack of fighter aircraft and of anti-aircraft missiles, on the one hand; and the very slow way in which we are producing the new and modern MCMVs (the mine counter measure vessels). I am quite convinced that it would be open, if they so wished, for the Soviet Union very quickly to close the approaches and the exits from all our major ports both for our submarines as well as for our surface vessels.

Since these tasks were evolved for us, and we undertook them, we have added for our own forces the responsibilities in Northern Ireland and the Falklands as well as the mounting costs of the nuclear deterrent. I think the only question is whether we are to increase the money and resources if we are to fulfil these objectives—more money, indeed, than we can afford. I do not believe we can, having regard to the continuing, and indeed accelerating, decline in the growth of our GNP compared with most of our NATO allies. I think we should seek to revise the extent of the coverage that we are undertaking to provide. In my view we can, and should, save on Trident; and, as soon as possible, on the Falklands. I know they would be difficult but we should begin talks with our allies about a reassessment of our tasks and priorities in the light of our changed circumstances since the period when they were evolved and undertaken, over 30 years ago.

I believe there is nothing more damaging for morale, on which so much depends, than the constant slippage of equipment deliveries and piecemeal cuts in defence establishment in an attempt to keep within the budget. For example—and this is the worst kind of economy —I understand that the Ministry of Defence is having to find in other ways the difference between the inflation factor allowed by the Treasury and the extra in the very welcome recent award for forces pay. I understand that that is the position. I shall be very glad if it is not and if the Under-Secretary can correct me, because it seems to me that this kind of approach to our defence planning is not one that we would want to endorse.

4.30 p.m.

Lord Crawshaw of Aintree

My Lords, the noble Lord, Lord Mulley, passed some remarks about something that happened 20 years ago. I hope that he passed them in a kindly way. I intend to pass a few remarks about the Territorial Army. I must say that I am very glad to be able to talk about it, because once or twice in my career in the other place I began to wonder whether there was going to be a Territorial Army. I was going to say that I would speak briefly, but I believe that that is a word that is non-U in this House at the present time, so I will say that I shall not exceed the limit which is customary in a maiden speech.

However, before dealing with the subject of the debate, I want your Lordships to know that I consider it a privilege to be in this House. It is a privilege to be able to speak on behalf of the nation, of individuals, of the army or of anything else. May I also express my gratitude to all sides of the House for the kindness and friendship which I have received since I came here? Nor would it be right to leave it at that. I should like to express my gratitude also for the kindness and help received from the officers and servants of the House. I am sure that without their help to so many of us, this place would grind to a halt.

What is it that makes a man give his services to his country over the week-end and perhaps for two weeks in the course of a year? Is it money? No, of course, it is not. Is it to go swanning in the country? Those of us who know how the reserve forces work also know that neither of those two applies. It is something much more than that that makes a man live rough for a week-end, perhaps after he has done a week's work, and then go back to work on Monday morning having got home late on Sunday night. This is the sort of service that people in our voluntary reserve services give.

If I speak primarily about the Territorial Army, it is because I have had more association with them, but by referring to them I certainly do not wish to detract one iota from those who serve in the other two services—the Naval Volunteer Reserve and the Auxiliary Air Force. Each one is playing its part in the defence of this country and, as regards cost-effectiveness, I do not think anybody will dispute that those reserve forces are the most cost-effective of anything we find in our budget.

So what makes people give their service? I think it is for the reason that I have had the opportunity to speak in this debate, because so many of the things that we discuss in this House—freedom of the individual, housing, insurance and pensions—are irrelevant if the defences of our country are brought so low that we are unable to defend the liberties which we cherish. That is why I felt that it would be opportune to say a few words about our reserve forces on this occasion.

The territorial army is a highly efficient and sophisticated force. Many noble Lords here who have not been acquainted with it for many years would be surprised at the efficiency that there is within those units. Most of your Lordships know that many of those units are to take their part alongside the regular forces in NATO in time of emergency. When they are out there training, it is extremely difficult to see the difference between the regular forces and those who are serving in the reserves in the territorial army.

These are dedicated people and they give that dedication because of the things that your Lordships and I cherish in this country. They give it because they believe, despite many things that are said to the contrary, that we are one nation and as long as we remain one nation they will give their services. They do it because they believe that each individual is important, wherever he comes from and whatever his background, and they have done this over years.

We have heard from the noble Lord, Lord Mulley, about the morale of the forces. This is something which we have in our armed forces and which no forces in Eastern Europe can possibly have. When we consider the tremendous forces that are there, we must sometimes ask ourselves: do the people in the Eastern bloc really know on which side those forces would fight, if it came to a showdown with the West?

The morale of our forces is high because they value the things that we have in this country. Despite all the contradictory remarks and the criticisms that are made, they know that the things we have here are worth fighting for. That throws a responsibility on to this House and the other place. That morale can easily be eaten away if we blow hot and cold, as I have seen happen over a period of 20 years—Yes, we want them; no, we don't. You can take people only so far and I am glad to know that at the present time the emphasis is on the increasing of our reserve forces. There is a great part to play in the home service force, which is working in conjunction with our territorial forces.

Over two wars, the Territorial Army and the Royal Naval Reserve have provided the basis upon which our reserve armies were to be built. They fought in every corner of the world and on every battlefield. If one goes overseas and visits those cemeteries, one finds on those memorials what is a gazetteer of the British Isles. Those people have never let us down. Make sure that we never let them down.

4.37 p.m.

Lord Hill-Norton

My Lords, it is a great pleasure to congratulate the noble Lord, Lord Crawshaw, on a really splendid maiden speech. I am sure your Lordships will agree that in content, form and manner it could not have been better. It was also, after our exchanges on procedure, mercifully brief. Your Lordships may not be aware that the noble Lord holds the world non-stop walking record and it is very kind of him today not to have competed for the non-stop talking record.

Turning to our "muttons", a number of other noble Lords and I have been pressing for several years to have two days in which to debate the Defence Estimates, and I have no doubt that they are as pleased as I that the official channels have this year seen the light. I am also in no doubt the the change has been welcome to all of your Lordships and I hope that the noble Viscount, the Leader of the House, may be able to tell us later on that we may count upon this happening every year, though, as the noble Lord. Lord Mulley, and the noble Lord, Lord Cledwyn, said last week, the form of the two debates and the timing obviously need another look.

The White Paper which is under debate is well written and well presented this year and does considerable credit to the civil servants who wrote it. The weaknesses, of which there are a good many—certainly, the important ones—come from a total failure by the Defence Secretary to grapple with any of the important policy decisions which affect the whole credibility of our future defence stance. They arise almost entirely—and many other noble Lords have remarked on this—from the quite evident and wide gap between the resources which this Government are prepared to make available to our armed forces and the tasks which they expect them to continue to meet, to which the noble Lord, Lord Mulley, referred. Nobody knows better than he in your Lordships' House the strains on a Defence Secretary at a time of tight budgets. But the point, if I may repeat it, is that it is no good politicians thinking that they can meet the same commitments with smaller resources. The services are stretched too far and too tightly already. Nor is it any good ducking these difficult choices and concentrating on managerial trivia, even if it happens to be easier. It is astonishing to me that the Opposition in another place, in their debate three weeks ago, did not go harder for this weakness in the whole of the White Paper before us.

No doubt that is why the noble Lord, Lord Trefgarne, in a well-delivered opening speech last week, spoke only in the broadest generalities about this gap. I refer, as has already been mentioned, to the unanimous and unambiguous opinion of the Commons Select Committee that the money available for defence over the next few years will fall short of what is required to meet the items already in the programme. Never mind the new fighter, which is not in the programme; never mind the assault ships, which are not in the programme; never mind the new tank, which is not in the programme: it will still fall short by up to £960 million a year. The Select Committee went on to maintain that this cannot fail to lead to cancellations, slowing down of acquisitions, and the running on of equipment beyond its economic life". The Defence Secretary said in the debate in another place that perhaps £700 million of that shortfall would probably be made good by various measures of increased efficiency. I, for one, will believe that when I see it; it has never happened before. He also said, in the same context, that the resultant gap of £270 million was, marginal in terms of a total defence budget of some £18 billion to £19 billion a year". I shall return to that point in a moment.

Before doing so, I should like to turn briefly to the Merchant Navy and say, as other noble Lords have done, how welcome it is that the promise to include some solid words about the Merchant Navy in this year's White Paper has been kept. But that really is all that one can welcome about the dreadful state of one of our truly vital national assets. A great deal has been said about this subject—notably by the noble Lords, Lord Kennet and Lord Cledwyn, and by other noble Lords this very afternoon—and by Sir Edward du Cann, chairman of the Parliamentary Maritime Group, in another place three weeks ago. I do not intend to repeat their comments or to go into any of the detail, but I cannot fail to repeat just three vital statistics. In just the past five years our merchant fleet has halved in number, has halved in tonnage and—much, much worse—has halved in the number of sea-going officers and men. One cannot replace them nearly as quickly as one can build ships.

This Government really do seem to suffer from what no less a person than the First Sea Lord has described as "sea-blindness". It simply will not do for Ministers to prate about market forces, and letting the maritime enterprise find its proper economic level, when they are wilfully neglecting what is probably our most critical industry in both peace and war. Have they forgotten that we came nearest to defeat in both world wars at sea? Do they still not realise that the integrity of the Atlantic bridge is the one and only prerequisite for any successful outcome of both deterrence and defence in Europe? Have they still not hoisted in that 95 per cent. of all our imports and exports go by sea, and always will?

Thirdly and lastly, I wish to deal with the defence of the United Kingdom base. I must tell the House that the threat to the orderly operation of the United Kingdom base cannot properly be met, either today or in five years' time, with the home defence forces available today, or planned. The troops of all three services currently left at home after reinforcing Rhine Army and RAF Germany are claimed by Ministers to number just 100,000. To put that figure in perspective, they used to number more than one million. In the light of recent statements in, this year's White Paper, I take leave to doubt the figure of 100,000 despite a personal reassurance given to me by the Minister last week. Even if it were true, nothing like that number would actually be available to defend the United Kingdom base, for most of them are already committed to technical and logistic roles, such as running headquarters, air defences, naval bases, communications, supply depots and the like. Many of your Lordships will know what I mean.

Indeed, only about a third of the troops in question are available for static guard duties, and only a much smaller fraction are available, equipped or trained for the type of mobile operation involved in running down hard and ruthless men such as the Soviet special forces. Those troops who do remain will find very grave difficulty in defending the several hundred key points scattered throughout these islands and along our coastline, which is a very long one by any standards, let alone the tens of thousands of lesser key points up and down the country.

Your Lordships may wonder who are the Soviet special forces. Are they real? How do they operate? What is their support? For some time, hard evidence has been available of a Soviet intention to attack deep strategic targets such as ours with special forces, using detachments similar to those which seized Prague Airport and, not very long ago, murdered Ministers in Kabul.

Knowledge of their development and role was secret until fairly recently. The defection of a high-ranking Russian officer—Viktor Suzorov, to use his cover name—has changed that position. His books, articles and recent television interview have made public the existence of the Forces of Special Designation—Spetsnaz is the Russian abreviation for them—and what it is they are to do at a time of our mobilisation or similar emergency. They are to murder individuals in important positions of responsibility, nationally or regionally; to destroy or otherwise sabotage nuclear capabilities; to neutralise national, political and military command and control systems by sabotaging communications; to destroy or neutralise vital military facilities such as air defences, dockyards and ordnance depots; and to disrupt industrial and personal life by the sabotage of power, fuel, food and water facilities.

Your Lordships will be able to judge for yourselves what that would do to the orderly running of this country. It is said that only some hundreds of those men are likely to come to this country—and, indeed, to all European NATO countries—and that they operate in small teams of only four or five. But Spetsnaz units are among the elite of the Soviet armed forces. Their standing is as high, as feared and as admired as that of our own SAS and SBS. They are not a very different sort of men, either. They are selected, in Russia—not here—while they are still at school. They are skilled in weapons and demolitions. They are trained as parachutists or frogmen. They are taught to live rough. They are taught the language of their target country. Many of them go to their target country in peacetime as members of sports or cultural groups, airline crews, merchant seamen—about which we had an exchange in your Lordships' House last week—fishermen, lorry drivers, and tourists. Every opportunity is taken to improve their knowledge of the language and customs of the target people. They are hard, ruthless men and dangerous.

I have been encouraged by the steps taken by the Government to expand the Territorial Army and introduce a small home service force for the static defence of key points. Last year's Defence White Paper remarked that, protection of our own country and its people must lie at the heart of our defence policy", and, in recent years the Warsaw Pact has steadily increased its capacity to strike hard and deep behind NATO's front lines", and, although we regard the air defence of the United Kingdom as our highest priority we have not ignored ground defence". The White Paper went on to acknowledge, for the first time, the Spetsnaz threat.

The same White Paper also talked of providing mobile, quick reaction forces, and this is reassuring. However, even with the new arrangements in train I believe that our available forces would be quite incapable, numerically, of providing the blanket surveillance in urban, rural and coastal areas that would be essential if we are to combat the disruptive activities I have outlined. Possibly well before the outbreak of overt hostilities many thousands more men will be needed for local field intelligence in support, of course, of our professional soldiers. A large reservoir of trained men may very well be required to take over the guarding of lesser key points to release those required for mobile operations. Yet more of them would almost certainly be needed to assist in the marshalling of, your Lordships must admit, very heavy transport requirements through Ministry of Transport approved routes at a time of mobilisation and reinforcement. I may add that gaps such as I have described in the defensive arrangements for our own country would be geatly exacerbated in actual hostilities as compared with rising tension.

No one knows better than I do the difficulties, indeed, the virtual impossibility, of releasing any substantial resources for either our regular or our reserve forces. The proposal put forward by the Defence Begins at Home campaign, to which the noble Lord, Lord Mulley, referred, surmounts this problem because the home defence force it envisages would be unpaid. We rely on the spirit to which the noble Lord, Lord Crawshaw, referred so eloquently and I am absolutely certain we would not be let down.

Utilising existing resources, we have calculated that the running expenses would be £10 million per year for every 100,000 men. The capital cost would be as low as £17 million per 100,000 men, spread over a period of about five or six years. May I, in conclusion, underline those figures? They are trivial in the context of a defence budget of £18 billion, your Lordships may agree. The Secretary of State for Defence certainly agrees, for, as I said a short while ago, he thinks that £270 million a year is marginal in the context of a budget of that size, and I am talking about £10 million. Surely this is such a glittering prize, not only from our own point of view, but from that of our NATO allies, that we should grab it and do it, and do it now.

4.54 p.m.

The Earl of Kimberley

My Lords, I should also like to join with the noble and gallant Lord, Lord Hill-Norton, in congratulating the noble Lord, Lord Crawshaw of Aintree, on his maiden speech. May we hear him many times in this House, particularly on defence matters. I also congratulate the noble Viscount the Leader of the House and the Chief Whip, together with the usual channels, on allowing us to have for the first time a two-day debate on defence estimates. Finally, I congratulate the noble Lord, Lord Mulley, on his birthday.

I have a vested interest in what I am going to speak about. It is a subject I have broached in your Lordships' House on previous occasions and it is about the military applications of the airship. In February 1983 the then Minister of State for Defence Procurement, Mr. Pattie, was asked what steps he was taking to evaluate the possible uses of airships for defence purposes. He said that a study contract would shortly be placed to investigate potential defence roles for airships.

In your Lordships' House in December 1983, over a year-and-a-half ago, I asked my noble friend the Minister who is to wind up the debate whether there were any plans to use airships for defence purposes. He said that studies were being conducted to assess airship capabilities and possible roles. My question today, is, in essence, the same, but this time with perhaps a slight sting in the tail. Has the Ministry of Defence yet made any commitment to an airship programme, and if not, why not? I ask that especially in view of the current United States Navy programme, and those of the French Navy and the United States Coastguard.

I shall try to explain how it is that the airship is overcoming the inbuilt prejudice against its procurement for the military role, why it is being increasingly accepted as an affordable multi-role solution by many military and paramilitary forces, and why it is that the Ministry of Defence should adopt a more enlightened attitude and join with the others in trialling an airship at its current state of development so that operator and contractor together can jointly address areas of concern which still exist in some doubting minds.

Airship Industries Limited is the world's largest manufacturer of airships. It is a British company and it is based in London. It is also the manufacturer of the world's largest and only high-technology airships. It supports the training, maintenance, operational and logistical aspects of airship operations on three continents. It has the unique experience of working with the United Kingdom Ministry of Defence, the French Navy and the United States Coastguard in airship operations. Its vehicles are in production and they are operationally proven. They embody the latest advances in materials and technology. Airships are agile and have a greater payload than others. The company manufactures the only high-technology airship in the world with civil passenger transport approval. It also manufactures the only purpose-built maritime surveillance airship.

It is the experience of that company from the technical and operational evaluations conducted to date that, initially, the project officers tasked to conduct the trials arrive with a quite natural inbuilt preference for the operational capabilities of the platforms on which they normally go about their business. For instance, the helicopter pilot has a high regard for the precision hover capabilities of his helicopter which ensures his safe landing; a fixed-wing pilot is very happy with and has a high regard for, the 20,000 lbs of thrust which ensures his rapid transit; and a ship's commander has a high regard for his ship's gross tonnage which ensures he can carry the many systems which guarantee his mission competence.

All these platforms rely on very expensive, highly advanced, high output propulsion systems, and there is an immediate quantum leap in the understanding of the airship concept when the demonstrating airship pilot cuts his engines to idle and continues his airborne surveillance task at a fuel flow no higher than that which my motor-car will use when I drive home tonight. This little demonstration exemplifies the degree of understanding required by new recruits to the airship field because the airship is for them an entirely new medium, and it is only through extended "hands on" experience that the true operational capabilities become apparent. It is naive to believe that sufficient comprehension and operational efficiency can be gleaned from a paper study subsequently to allow preparation of a considered and well balanced analysis of the future role of the airship.

And what of those roles? There is a need to find a suitable maritime patrol system for the surveillance of our coastal waters. There is a need to find a system to assist or replace the ageing Shackletons, tasked with limited range airborne early warning. There is a need to find cost effective means by which we may provide airborne early warning cover for ships at sea, whether they are routine naval task forces going about their lawful business in areas of influence, or re-provisioning convoys in time of war. There is a need to find cost-effective means by which we may fulfil our NATO obligations for submarine detection and the tracking of those submarine targets once detected. There is a need to expand our mine counter measures capability, which, if history is anything to go by, is rather sadly and dangerously depleted, as of this moment.

Individual needs are of course being addressed, at least in part. Witness the splendid airborne early warning Searchwater radar conversion of the Westland Sea King helicopter, and the recent commitment to the new Type 23 frigates which are to be equipped with towed array sonar systems. But it should be understood that all these important military tasks can be undertaken by a single new multi-role platform—namely, the airship—in each case suitably equipped with the specialist role equipment required to undertake each appointed mission. It is a mission-dependent vehicle suitable for specific uses, under well defined conditions and according to a specific set of requirements. It is not a replacement for existing systems, but an economic and flexible supplement to our total inventory. As my noble friend Lord Cork said when quoting the remarks of the noble Lord, Lord Carrington, "The airship is not big league money".

Why do I believe that the airship can address these serious needs? If you will accept the airship's basic airworthiness as endorsed by the United Kingdom Civil Aviation Authority, and assume mission-competence is professionally validated during evaluation studies, then the case for the airship will be based on those military applications which can most benefit from the two unique advantages which are inherent in the product; namely, endurance and size.

As for endurance, many of your Lordships may not know that the longest non-stop flight recorded for any aircraft took place in March 1957 when a United States Navy airship made a double crossing of the Atlantic, without refuelling. Starting from New England, it crossed the Atlantic, patrolled the coasts of Portugal and West Africa, then returned to Key West via the West Indies. It covered 9,448 miles in just over 264 hours, in other words, 11 days. When you consider that figure, you realise that the airship is aptly named, it is literally a ship of the air. I daresay that nowadays the human factors boffins down at Farnborough will have a few things to say about the crew environment for such an extended flight, but they will find that the low noise and vibration levels, and high payload volume together make it easy to provide the necessary in-flight environment to support such extensive missions.

The second unique advantage is one of size. Obviously, size is an important factor of the endurance capability. But the other truly significant advantage is that in the modern non-rigid airship, the hull itself acts as the perfect radome, the hull being the giant envelope which gives the airship its familiar shape.

The envelope fabric is totally radar transparent, the antenna is situated in a weather protected, near zero-stress environment, and there are no aerodynamic constraints which would limit the sizing of the antenna. This last factor is the most crucial because with any large radar system increased range and definition can be achieved only by enlarging the antenna. This solution is impracticable on conventional fixed wing aircraft without recourse to the enormously expensive rotating radome conversion that looks like a mushroom on top of the Boeing E3 Sentry and the Grumman E2 Hawkeye.

Bearing in mind those facets of endurance and size, let us look very briefly at four role requirements. First, there is the exclusive economic zone or Offshore Tapestry. Typical tasks involve fishery protection, navigation monitoring, pollution control and the detection of illegal transit. All are essentially tasks which require or would at least benefit from a prolonged endurance platform equipped with a high definition surveillance radar. In this role the airship has the speed to overhaul surface targets and near instant transition into precision hover for photographic or sampling work, or even to deploy and recover a boarding dinghy as the French Navy has done. It therefore offers an interesting combination of capabilities—passive airborne surveillance and highly active surface intervention.

Secondly, there is the airborne early warning. Recently in the South Atlantic the need for effective radar cover for ships at sea has been admitted by everybody. Those operations will be especially important if they are anticipated beyond the range of land-based aircraft. It is fair to say that it is almost impossible to contemplate the deployment of naval units in any hostile environment without adequate airborne early warning cover, and yet it is no great secret that the patrol aircraft cover of all the NATO nations is stretched to its existing limit. It seems to me that the picket duty airship is an ideal solution for first barrier defence at sea. In this role the enhanced air defence capability that the airship would confer on a fleet would work to its advantage, in that it would operate under the expanded air defence umbrella of the fleet and benefit accordingly. With its prolonged endurance, reduced vulnerability to stand-off missile attack, due to its low radar and infra-red signatures, and relatively low acquisition cost, the airship is a serious option to this most important aspect of strategic defence.

It is this application which is the subject of the current United States Navy interest. With team partner and leading radar manufacturer Westinghouse as prime contractor, I believe that through the initial study phase of a competitive programme a prototype will be built and eventually a fleet supplied of large surveillance airships with primary radar and mission fit, capable of remaining on station for 24 hours a day for extended periods of weeks rather than days. I think it is very encouraging that the United States Navy is so keen about this form of vehicle because they are—let us face it—the most recent fleet operator of airships in the world.

Thirdly, there is submarine detection and prosecution. In this role, as in the others, the airship benefits enormously from its prolonged time on station capability. Its reduced transit speed will require some flexible operations scheduling, but the additional benefits of a high payload for a wide variety of surveillance equipment and weaponry, slow speed flight for deployment of a towed array sonar system and hovering capability for dipping sonar should all combine to offer a highly effective anti-submarine warfare platform.

Fourthly, and lastly, I come to mine countermeasure forces, which the noble Lord, Lord Mulley, mentioned. Here again the airship has a considerable advantage over a ship—for instance, in circumstances such as when we had to clear mines from the approaches to the Suez Canal. A ship may get blown up; but with zero magnetic and acoustic signatures the airship is invulnerable to any chance mine explosion.

One thing we all know. Regardless of cost of and of the extent of our commercial knowledge, industry should never stand still. When that industry is in the forefront of the technology associated with aeronautical endeavour, it is even more important that the place of any development programme is not hindered by political intransigence. I recognise that those tasked with the expenditure of the nation's limited resources have a very special responsibility, but that responsibility must be weighed in the balance against their responsibility to seek value for every pound spent; to seek for new cost-effective solutions for every task; and, I would suggest, to consider the strategic objective of maintaining a strong and virile indigenous defence industry.

In the case of the airship, I sometimes wonder whether the spectre of the millions lost through other Government department's open cheque book policies—for instance, with two American projects in Northern Ireland—may have touched our political masters with a misplaced caution towards more deserving British projects. If it were so it would indeed be a savage indictment of our procurement process. I prefer to think that the lack of any real airship experience within the Ministry of Defence has caused a preconceived scepticism to rather cloud the objective judgment that we might expect.

What of the way ahead? It would seem that the airship might well have a serious future; certainly the United States Navy, the United States Coast Guard and the French Navy appear to think so. How might our own Ministry of Defence make the best use, if at all, of this new equipment option which on the face of it appears to be such an attractive force-multiplier? In view of the quite laudable commercial preference of the Ministry of Defence for home manufactured equipment, especially equipment with export potential, should consideration not be given to some form of funded development programme which would have as its prime objective the definition of any United Kingdom requirement, but possibly an equally important secondary objective of ensuring that the United Kingdom retains the current world lead in this field and does not lose all its design rights to an overseas Government which have already accepted that the modern airship has its place in the defence inventory?

The noble Lord, Lord Hill-Norton, spoke about the Atlantic bridge and how we nearly lost the last two wars because of what was almost our inability to protect our merchant shipping. I believe that there is a very simple, effective and immediate path open to the Ministry of Defence. What is more, the path I propose will not only assist with defining roles and continuing development; it will also train pilots and immerse maintenance and tactical personnel in the technology and disciplines of airship operations; and it will do all of this on the very limited budget which typifies all airship programmes. The path I should like to propose is the formation of a joint services trials unit with sufficient budget to procure a state-of-the-art Skyship 600 as the test vehicle; to enter into a management and training contract with the airship suppliers; to enter into an operational analysis and systems integration contract with a suitably capable systems house such as Ferranti; and, finally, to enlist such intramural support as would be required best to further the objectives of the programme.

It may be that the competitive tendering route is currently not available to the Ministry of Defence, but nor should it be expected that industry should provide the complete private venture capital for the development and demonstration of every new system which may be the subject of Ministry of Defence procurement. The logical progression of such a policy would be to pool the available expertise into fewer and fewer hands, as only the very largest companies would be able to afford to subsidise Ministry of Defence development programmes, and only the very largest companies would have the spread of interests to ensure that there would always be a sufficiency of winners more than to offset the losers.

The small and innovative companies must be encouraged in their endeavours, and when one considers that 13.4 per cent. of the 1985–86 defence budget is dedicated to research and development, it must be possible for our own Ministry of Defence to make some real commitment to an airship programme. It seems peculiarly British that the engineering and entrepreneurial talents so prevalent in this country should successfully combine to rediscover and perfect the efficient concept of buoyant flight, but that the breakthrough to the world market is delayed and the intellectual property rights for the technology potentially lost through crucial Government inaction.

One final thought, my Lords: it may well be that internally the Ministry of Defence is already taking positive steps for an airship programme. If so, my apologies to the enlightened decision-makers for any previously inferred criticism. But I beseech them and I beseech your Lordships to recognise that the vanguard of this reborn technology is vested here, in Britain, and I think we should all be failing in our duty if we did not ensure that a high degree of budget and commitment were allocated, and allocated quickly, to the further development required to produce the truly mission-competent military airship.

5.16 p.m.

Lord Chalfont

My Lords, I begin by joining other noble Lords in congratulating the noble Lord, Lord Crawshaw of Aintree, on an inspiring maiden speech. It is good that we have the expert knowledge of defence in your Lordships' House (which is already quite formidable) so brilliantly reinforced. I trust that we shall hear him often in your Lordships' House and also in the all-party defence study group.

I should also like to join other noble Lords in thanking the Leader of the House and the usual channels for arranging two days of debate on this year's Defence White Paper. I personally have no objection to the week's gap, nor indeed to the arbitrary division of subjects. I do not think that those are insuperable problems, although, as the noble Lord, Lord Hill-Norton said, it may be that the details will need to be looked at.

I should like to take advantage of the division in the subject matter to concentrate on a part of the Defence White Paper which is to do with what was called in the Army the sharp end of defence. I think in our long discussions about strategic defence initiatives, star wars and nuclear strategy—grand strategy—we sometimes tend to forget what is going on at the sharp end of our defence effort; in other words, our conventional forces and our conventional defences. It might be worth remarking here that in the somewhat hysterical reaction to the March 1983 speech of President Reagan on SDI, what is almost universally ignored is that he included in that speech a section almost as long on conventional defence, pointing out that his strategic defence initiative postulated a new strategic concept within which adequate—indeed, enhanced—conventional defence was absolutely necessary for the success and achievement of his new strategic concept.

One of the implications to the strategist of the advance of technology in defence, especially in such concepts as star wars, the cruise missiles and the SS.20 missiles on the Soviet side, is that they begin to remove and reduce the number of nuclear options open to our principal potential enemy. Therefore he is much more likely, in the pursuit of his foreign policies, to resort to other options and therefore, by extension, to the conventional options, to the option of conventional attack upon territory and air forces.

There is therefore a need, which was mentioned many times in your Lordships' House on the first day of this debate, for a very considerable improvement in our conventional defences. It was mentioned by, among others, most eloquently, the noble and gallant Lord, Lord Carver, who perhaps knows more about that particular subject from first hand than any of us. Within that requirement for enhanced conventional defence there are a number of elements. The principal one is the need to fight any battle that should take place—if unhappily it takes place, in the main theatre in Western Europe—on ground of our own choosing and not on ground of the enemy's choosing.

This is a classic military concept, familiar to all strategists and strategic analysts, but it is enormously reinforced now by the need to fight any battle of the kind that would be implied in a conventional war in Northern Europe, not on the territory of our allies and ourselves, but on the territory of the enemy. This has all been summed up in a number of curious strategic acronyms and principles. It is sometimes called FOFA, follow on forces attack. At other times it is called deep strike. At other times it is called echelon interdiction, being an indication of the need to strike at the second and third echelon of the enemy forces instead of simply at his assault troops. Whatever one calls it, it is quite simply the need to fight the battle on ground of our choosing, on the enemy's ground, and not on our own.

In order to achieve that a number of things are necessary. I shall deal only very briefly with them this afternoon, though each in itself is an important element of strategic analysis. The first thing that is needed of course is close political and military integration among the Western Members of the Alliance. This has been mentioned on numerous occasions and we have heard about interoperability and other elements of allied collaboration.

Next, as I think emerged very clearly from what the noble and gallant Lord, Lord Hill-Norton, had to say in his very trenchant speech, one must match resources with commitments. On whatever abstruse or esoteric principle one chooses to fight a battle in Western Europe, whether one calls it flexible response or graduated deterrence, it is no good trying to fight that battle unless one provides the resources with which to fight it successfully.

Next, one needs to apply all the forces of contemporary technology. Nowadays we can find out a good deal more about he enemy with the part of military operations sometimes known as C3I; that is to say, command, control communications and intelligence. All that is now being enormously improved by the application of data processing and information technologly.

Having said all that, there is one profoundly important element which surpasses all those in importance. It is the officers and men on the ground, operating the equipment and fighting the battles. On page 22 of the White Paper there is a very apt quote. It says: deterrence itself depends on the credibility of our forces' capability to provide a robust defence against aggression". This is of course what the forces, especially the forces of the Rhine Army, the first British corps in the British Army of the Rhine, are for. If they are to provide a robust defence against aggression and therefore pose a credible deterrent to attack, they have to be in the first place highly trained, trained to hair-trigger precision and expertise in the job that they have to do. Secondly they must be superbly equipped. They are smaller in number than the enemy, who will try to engulf them, and they will succeed very largely to the extent that their equipment is better and more effective than his. Finally, they must be what is sometimes now called, in the modern jargon, completely motivated. That is to say, their morale must be high, constantly high; they must know not only what they are doing, but also why they are doing it. Unless that morale is high, unless the motivation is complete, all the other factors may not be enough to ensure success.

If one looks now at the first British corps in the British Army of the Rhine, three armoured divisions and one infantry division, with all its supporting troops and its headquarters, one has to ask oneself, is it in fact all those things? Is it highly trained? Is it superbly equipped? Is it highly motivated and of high morale? If it is not, it is not its fault. If we answer the question that it is not all those things, we must then seek to know where the blame lies.

I think it may be too much to say that the British Army of the Rhine is trained today as well as it could be. As I say, this is not the fault of the soldiers or their officers. If it is a fault, if there is blame, it is simply a fault arising from the fact that very often they do not have ammunition with which to train either their gunners or their infantrymen. They do not have the fuel to train their tank crews. In other words, the resources are not matched to the commitments. Although I should not dream of suggesting that this force in the British Army of the Rhine is ill-trained, it could he in its own eyes—and I quote now from the troops and the officers in Germany to whom I have spoken—much better trained if the resources were available for it to be so.

Is it superbly equipped? In the White Paper there is evidence that a great deal of attention has been paid to this. There is a whole list of pieces of equipment and modifications, guns, tanks and other pieces of equipment coming into commission, coming into service. This is very encouraging. However, I think anyone who has been out to the British Army of the Rhine, especially during one of its autumn exercises, is bound to be impressed by the fact that still the resources do not match the commitments. I do not believe that the equipment that the troops have at the moment, as good as it may be and as good as it may be in the future, will be enough if push comes to shove and they finally have to go to war against the advancing Russian armoured divisions.

Remember again, my Lords, that the White Paper says very clearly on the same page: 1(BR) Corps stand astride an area where a massive armoured threat may be expected". It will be a massive armoured threat. There are 22 divisions, most of them armoured, at present in East Germany, just across the River Elbe from where first British corps has its defensive positions. They are in position. They are not in peace-time locations, waiting to go forward at a time of political tension.

As I have said, given even the resources, given the fuel and the ammunition for training, given the superb equipment and everything else, there is still one matter. This is something that I remember Field-Marshal Montgomery saying to me many, many times. The most important single factor is morale. If the morale of the troops is not good, nothing else really matters. Here I come to something which I think is a matter at which the Government should look with some care. Nowadays there is a great deal of talk a bout management in defence, it seems to me that possibly one of the areas in which there is not enough emphasis and concentration on this is in what used to be called man management—actually dealing with the soldiers on the ground.

I could give many examples, but let me give one of something which is causing our soldiers in Germany at the moment great bewilderment, great pain and great distress. That is the decision that was taken to reduce quite drastically what is called their local overseas allowance. It is the allowance which they are paid for serving outside this country in areas where the cost of living is higher. I recognise that there are perfectly logical reasons why this should have been done at this time. However, should one try to explain to a British soldier why he, alone, of all the sectors of the work force in this country, is being asked to take a reduction in his take-home pay, one will find it a very difficult task.

Their officers know why the local overseas allowance was reduced. But the soldiers simply do not understand why it is that year after year, decade after decade, a succession of Governments take advantage of the totally unquestioned and unquestionable loyalty of our armed forces to make demands upon them that they would not make of any other sector of our society. If they made them of any other sector of our society, there would be uproar at once.

I should like to ask the Government to look at this matter. If they do not, there may be some quite distressing consequences. Already, the figure for internal recruiting in the British Army of the Rhine—by "internal recruiting", I mean the number of people who, at the end of a given contract of service, decide to renew their contract and stay on in the army—is going down and down. It is internal recruiting that counts. If you cannot get soldiers to stay on in the Army—this applies also to the Navy and the Air Force—very soon not only the numbers suffer, but also the quality, the effectiveness and the morale.

I conclude by saying this. Trident, cruise missiles, high technology, modern management techniques in the Minstry of Defence, the strategic defence initiative or star wars—all these things may be very important issues. Indeed, they are. But resolving them will be of no avail if our soldiers, our sailors and our airmen are not, as I say, highly trained, superbly equipped and of the highest possible morale. There is a very great danger facing us if our soldiers and their officers start to get fed up with what they are doing, if they do not know, and do not know with a sense of inspiration, when they get up every morning, for what reason they are putting on their uniform and why they are going out in their tanks and on to their training areas and battle ranges.

I would therefore ask the Government for a reassurance—we need this reassurance from time to time—that they will regard the quality of life and the morale of our armed forces as a very unique sector of our society. Let us not forget that while everyone else takes on liabilities at work for a certain degree of efficiency and productivity, the soldier, the sailor and the airman, and now possibly also the policeman—the security forces—are the only people who take on an unlimited liability. They are liable to give not only the best in the form of productivity but, if necessary—and it often is—their lives as well. This is a unique sector of our society. I ask the Government therefore to give us the reassurance that they will place the quality of life and the morale of these men and women and their officers somewhere near the very top of their list of priorities. I fear that if they do not, all their other concerns may in the long run turn out to be fatuous and academic.

Lord Boothby

My Lords, before my noble friend sits down, does he really believe that in the long run, in the modern world, an international committee can sit down at Geneva to make rules for the conduct of modern war in much the same way that the rules committee sits down at St. Andrew's to make rules for the conduct of the game of golf?

Lord Chalfont

My Lords, that is a little far from my original theme. But to answer the noble Lord, I would say that it is difficult to lay down rules for warfare. I suspect that if they are laid down, they will be broken as often as the rules at St. Andrew's are.

5.34 p.m.

Viscount Trenchard

My Lords, perhaps I may endorse all the comments made about the maiden speech of the noble Lord, Lord Crawshaw, and express the hope that we shall hear many more speeches from him. I was certainly one of those who supported the two-day debate thesis. I am pleased now to be speaking on the nuts and bolts day. It seems to me that the nuts and bolts should have slightly more bearing on strategy and policy than they often do. My sympathy for my noble friend Lord Trefgarne, even in answering half the number of speakers that we used to have in a whole day's debate, over the range of subjects already covered, is extreme. Indeed, this debate has underlined once again the many quite different and very important subjects that are encompassed in the defence area. While it has been stressed twice already that we nearly lost the last two wars in the Atlantic, let me remind your Lordships that we only just saved the last war in Fighter Command in 1940.

Today I want to deal mainly with the cost of modern military equipment and to relate it to the cost of strengthening our conventional defence through the full use of emergent technology. This was the theme that the noble and gallant Lord, Lord Carver, recommended. It was endorsed also by the noble Lord, Lord Boston, who drew our attention to the two books by the European Study Group. I want, at the end, to deal with the cost of nuclear weapons and their value, on the one hand, to potential aggressors or attackers and, on the other, to defenders. In order to give an example of the cost of modern technology—it is slightly an aside to my main theme—let me start by saying that the Royal Air Force today pays approximately 12 million for each Tornado aircraft. That is an escalation in real terms, I believe, of more than 10 per cent. per annum per aircraft compared with the original cost of the introduction of the Hunter. Of course, the multirole Tornado is infinitely more powerful. It does not just fly. It can fly night and day and hug the terrain in all weathers. It can be refuelled in the air as necessary. That is marvellous. But the slightly over one crew per aircraft would be too dog-tired to fly after 48 hours if the balloon ever went up. In industry, when one is faced with capital intensiveness, one goes to a shift work work basis. I believe that we really have to look more closely at the need to be able to fly this marvellous new aircraft, with all its weapons, round the clock. We need to look closely at the question of civilian auxiliaries as a means of being able to do that.

In 1981, when I first went there, the Ministry of Defence projected the forward costs on a fixed budget in real terms of main equipment, based on the cost history of the past 25 years. In relation to aircraft and ships, we found that we would be able to afford only one aircraft to replace Tornado in 52 years' time and one ship of frigate size and above in 29 years' time. The ships that were taken were the Leander frigate through to the Frigate 22. Chapter 4 of the 1982 Defence White Paper confirmed this kind of escalation of main equipment between 6 and 10 per cent. a year after inflation.

I believe that there is a failure to comprehend the main reason rather than the usual scapegoats for this fantastic escalation. It is, I believe, that any new capability is today technically possible and that almost any counter to it is also possible. Furthermore, due to the microelectronic shrink there is room for hundreds of new capabilities in the same space or weight of platform or weapon. This anything-is-possible-at-a-cost age presents an almost impossible task for the operational requirement staff. Against the likelihood of capabilities that any future enemy might have, often underlined by intelligence, these operational requirement staff officers would be quite irresponsible if they did not list a large number of perfectly possible new capabilities which they require.

New technology, including its research and development, is many times—even 100 times—more costly than repeat technology. This is why managing directors of defence firms were often telling me that costs were coming down with new technology, while at the same time I was looking at these cost escalation figures. It is indeed true that, due to microelectronic shrink, existing capabilities become cheaper, but that very shrink allows hundreds of new capabilities to be added in the same space.

The story is even more difficult than that, because inevitably uncertain and all too transient human beings in a democracy are almost bound to want to follow different routes to each optimum solution for a new capability. The costs in this all-is-possible microelectronic age, including in particular the research and development, can be astronomical. European collaboration may provide more resources, but it also provides more opinions as to which capabilities we should require and as to which routes we should follow for their optimum solution. Noble Lords have only to see in their papers today the arguments about the new aircraft or the new defence suppression systems—harm and alarm—to realise the truth of what I am saying.

I am on record elsewhere as recommending the kind of people we need to put together from the services, industry and research in order to harness this problem, which will be very difficult, and the kind of people we need to take the unenviable decisions to select only a few affordable possibilities of the infinite number of possibilities which there are to go into a weapon system 10 years or more in the future. Suffice it to say, I believe that the tenure of office of politicians, officers of field rank, managing directors and research heads makes it substantially harder for us than for the Russians and dictatorship countries. In a nutshell, I believe that what has not been fully taken into account is that potential invention has outstripped imagination, or certainly it has outstripped the imagination of the decision takers and of the longterm cost estimators.

The usual scapegoats and cures for this escalation—competition, collaboration and reorganisation—can make matters a little better, and they can be important subjects. But they can also make matters a little worse. And they are not the main reason for the escalation. It is here that I want to turn to the views of the noble and gallant Lord, Lord Carver, which were endorsed by the noble Lord. Lord Boston, and more fully expanded in the reports of the European study group which they both quoted last Wednesday.

In a nutshell, the thesis is that if we use modern technology—the phrase used in those publications is "emergent technology"—we can greatly increase the so-called conventional defensive power of the Alliance at modest cost. My noble friend the Leader of the House, Lord Whitelaw, rightly pointed to the enormous Soviet superiority in quantity that exists today. One must add to that their ability to reinforce through shorter lines of communication, which are internal, while NATO's are external.

Since this is an age not only when anything is possible, but when the counter to it is possible, and since this is also an age when the Russians have in fact been catching up, and in a few cases passing, Western technical capabilities, we must not assume that we can suddenly reverse the trend and increase our technological lead. First, let us try hard to do so and, secondly, see what degree of policy change it permits.

Since last Wednesday's debate I have read again the original European study group report, which I have read many times and studied very closely. I have also borrowed a copy of the second publication from the noble Lord, Lord Boston, which I had not read. I thank the noble Lord for lending it to me. This second publication, which was mentioned by the noble Lords concerned, is in one sense an answer by three distinguished retired officers and one mathematician professor—who were all members of the original group—to the criticisms that their first report produced. Nobody can quarrel with the aim of the ESECS report, which is to use modern technology to the limit to strengthen conventional defence. However, I am afraid that I continue to feel that the enthusiasm of the four up-daters still leads them to conclude that Russian counter-measures to our new high technology weapons would, in the main, be either too expensive for them or not effective. In many cases I think that they underestimate what the Russians have already done, could do and indeed would feel they had to do if NATO develops the strategies along the lines that these four distinguished people recommend.

At one stage they ironically suggest that the Russians would not clear paths through our new artillery-laid minefields, because to use such limited paths would make huge concentrations of Russian armour too vulnerable to NATO nuclear weapons. In this second book, the four authors endorse, much more fully than was done in the first book, the Russian numbers superiority at the present time. Indeed, they quote the 3.6:1 superiority in tanks, the 4.1:1 superiority in artillery and other dramatic figures, I am afraid that they do not convince me that a proper emphasis on straining every nerve to increase Western technological leadership, which has been decreasing in recent years, will do more than restore to what it was a decade ago the kind of limited time period before which nuclear weapons might have to be used. That would be an important enough achievement, so I am not for one second belittling their aim.

I believe that on costs, too, for all the reasons that I have given from my experience of studying the escalation of costs when I was at the Ministry of Defence, they have still underestimated. I would say to them that it is much easier for one managing director or for four single-minded people to agree a particular strategy and particular weapon routes to reach that strategy and go ahead in a single-minded fashion, than it is for the democracies of the West, with all the necessary experts, to be sure that we have chosen the right routes.

I used to collect, as they have done in this publication, cost estimates from excellent firms, such as Martin Marietta in America, on the cost of such things as tank busting clever weapons. Sometimes these estimates suggested only one-seventh of the cost per tank destroyed estimated by Government experts here and in other countries. When I returned and discussed these with the experts concerned, I was, to cut it short, gradually forced to realise that much more R & D was necessary before one could even decide what of the many tank busting routes was really sound, let alone the point where selections and decisions could be made.

Your Lordships may be surprised at my arrogance in challenging such distinguished people. When I went to the ministry almost everybody knew about cost escalation in modern equipment. It was well after the date at which those updating the ESECS report retired. But I have to say that the Ministry of Defence at that date had not fully quantified the escalation of costs per unit of equipment.

The official figure that I was first given was so low that I could not believe it. I discovered that the greater power of a modern aircraft was treated in the official statistics as a volume increase and not a cost increase, so that each new generation of weapon was considered to be the equivalent of more than one of the previous generation. That is no doubt a comforting way of doing things; but as aircraft numbers had fallen from 1,500 in the 1950s to 500 in the late 1970s, and ships from 300 down to 80 over the same period, the dates at which we would reach the one ship, one aircraft—however invincible, but which could only be in one place—point of absurdity on a straight line extrapolation basis grew ever closer.

I hope that I have made it clear that emergent technology is neither a brand new nor a low cost invention available only to the West; that we have to reverse the trend of recent years whereby the Russians have tended to close the technological gap before we can strengthen conventional defence in real terms at all; and that for the reasons I have given it is going to cost more than the study group suggest.

I want briefly in conclusion to turn to nuclear weapons and their cost, and their value to the alliance and to others. Before I do so, I want to make clear that there is nothing in the two excellent publications (which are extremely thought-provoking) of the European study group which in any way recommends that the purpose of these, or that the consequences of these, is that we should give up Trident. Nor indeed, on the quote I mentioned earlier, even give up our tactical nuclear weapons.

In that opinion the noble and gallant Lord, Lord Carver, is the odd man on his own. I am sorry that the noble and gallant Lord, Lord Lewin, has not spoken in either of our two debates; but he is on record in this House and elsewhere as holding quite different views, as is the noble and gallant Lord, Lord Hill-Norton.

This may be a disagreeable thought and a disagreeable thing to say but I am going to say it: nuclear weapons in terms of cost, in terms of low cost per unit of destructive power, are in a ball park all of their own. It is therefore not a folie de grandeur—as I think the noble and gallant Lord, Lord Carver, suggested—for this relatively small country in economic terms, as co-inventor of nuclear weapons, to maintain its own.

Their value to a defender is immense because provided a would-be aggressor believes that they may be used he will not attack regardless of his possession of nuclear weapons himself. This is because their value to an aggressor in actual use rather than in threat of use has limitations. If you are an aggressor you cannot take your prized country, or people, which you covet, and obliterate them at the same time, any more than in this world you can have your cake and eat it.

But the deterrent value of nuclear weapons, including a British independent stategic deterrent (which can only be Trident in the 1990s, at 3 per cent. of our budget) is of greatest value to the democratic defensive NATO alliance, and is the main reason for the past 40 years of peace in Europe. It can keep the peace until the Russian people gain some control over their leaders, even if that takes a hundred years. For the free democracies, my Lords, weakness and not weapons is the most likely cause of war.

5.56 p.m.

Lord Ardwick

My Lords, as I listened to the noble Earl, Lord Kimberley, I could not help regretting that my noble friend Lord Rhodes was not well enough to be here today because he was a pioneer of aerial surveillance nearly 70 years ago, winning a DFC on the Western Front somewhere in the skies above the noble Earl, Lord Stockton.

I am uneasily conscious that my brief remarks today would have fitted more appropriately into the first debate, for which they were intended—indeed if they had fitted anywhere. What I am concerned about is the political cohesion of the alliance, a subject which falls between our debates on defence and our debates on foreign policy. It is a subject which is causing some concern, though as yet no anxiety. A few weeks ago the German Foreign Secretary, Mr. Genscher, attributed the long peace not just to the nuclear bomb to which it is usually attributed, but to the 36 years that the alliance has existed. He said: The basis of this success is the unity of our alliance. Its firm cohesion is a precious value. Each one of us shares the responsibility for its preservation. That indeed is one of the problems; each one of us shares the responsibility. There is no central power structure ordering the members of the alliance what they must do and exercising a propaganda influence on their citizens. Therefore of course all that can be exercised is persuasion and in this the United States, as in other roles in the alliance, plays a considerable part. But the result is that there is a remarkable diversity among neighbours' methods. Up to a point this is NATO's strength. Its members are free members of a defensive alliance. We know exactly the depth of their commitment. The Warsaw Pact members are not. Nobody knows what some of them might do if ever they were ordered to war.

Yet our alliance has been under strain in recent years. It is generally held, however, that the willingness of governments to implement the double track decision and accept the INF was a political victory of some magnitude over the Soviet Union. But it was not by any means a complete one. The peace movement, as it has come to be called, has been enhanced and enlarged. The movement has been further stimulated by some harsh American rhetoric, by the ideology of the American right, which is well to the right of the President, with its scorn of detente and its suspicion of arms control.

Many people outside the peace movement have been worried by its statements which have been felt to be politically necessary in the United States to ensure that the money is forthcoming for the defence budget. The crowning example of this was its description of the MX as the "peace missile".

Another problem of cohesion is developing in the economic state of the European sector with high unemployment, especially among the young. They have not yet been demoralised by despair, yet they could be unless the problems are relieved. That could be politically dangerous and extremely divisive. Some of Europe's economic difficulties arise from the strange role which the dollar is playing: a role which, ironically, is partly based on the high defence expenditure of which we are the benefactors. Now comes the highly expensive and controversial SDI: as controversial in the United States as it is among the European statesmen and that must inevitably put greater strain on our cohesion. The peace movement can boast that it has influenced some of the opposition parties, particularly in Northern Europe, to share some of its aims. The domestic consensus on defence has been strained, perhaps broken.

We have the problems of Greece, whose Prime Minister has made appropriately delphic utterances about his attitude to NATO, and we have the problem in Spain where next year there is to be a plebiscite as to whether or not they are to stay in NATO. People are asking what will happen to NATO if the opposition parties find themselves in government. Obviously, there will have to be an adjustment; but I am quite sure that NATO will continue because there is no acceptable alternative. As the noble Lord, Lord Carrington has said: military strategy … is not enough. Not enough to sustain the determined and consistent support which it needs within our countries. And not enough to convince the Soviet Union that the security on which we insist for ouselves is not security at their expense; and that we can work together to build a better peace, if they too are willing to take that as their point of departure. In short, political strategy is not the icing on the cake". Today's news of the projected Summit meeting in the autumn between Mr. Gorbachev and President Reagan is good news and will help to sustain, one hopes, that determined support that NATO must have of which Lord Carrington spoke.

6.3 p.m.

Viscount Ridley

My Lords, I intend to confine my remarks to the reserve forces which are mentioned briefly in Chapter 4 of the White Paper. I do so as President of the Council of the Territorial Army and Volunteer Reserve Association which covers the whole country and also includes the reserve forces in the Royal Navy, the Royal Marines and the Royal Auxiliary Air Force; but to avoid using that mouthful of a title I intend to refer to the "TA" throughout.

Before I do so I should like to say how delighted I am to have the support of the noble Lord, Lord Crawshaw, whose maiden speech we so much enjoyed. I can assure your Lordships that he is held in the highest possible regard in the Territorial Army for his courageous defence of that army many years ago when he was a Member of another place. I am delighted that his contributions to our defence debates have started so well.

There can be no doubt that the highly satisfactory state of our reserve forces is due to the strong support they have had from this Government for several years. My noble friend the Minister, Lord Trefgarne, must take much personal credit for this state of affairs, as must his predecessor. Nor should there be any disagreement that the decision to increase the size of our reserve forces, which is referred to in the White Paper, is not only correct but most welcome. Indeed, so very cost-effective are such forces that there is a danger that we might try to increase the proportion of reserve forces beyond a prudent level. We need both types of army and the ratio is, or will be, about as correct as can be judged. Further, I am confident that this increase is possible.

The modern equipment now in use and the professional approach to training shows—and especially showed last year in Germany on Exercise Lionheart—how effective is the Territorial Army and how effective it could be in any emergency. I am happy indeed tonight to have a chance to pay a tribute to their skill and enthusiasm.

But to say that a volunteer is just as good as a regular can only be interpreted as a slur on the regular Army. They may be nearly as good, but they cannot be so highly trained. At the same time we must not forget that the TA at the moment provides some 30 per cent. of the Army's mobilised strength, a figure which will rise to 40 per cent. by 1990, at a cost of some 4½ per cent. of the army budget.

Although recruiting to increase the TA to the projected level is going very well, and the Government are giving encouragement including adequate resources, it has been a worry to those responsible that wastage, which can be defined as the loss of soldiers after too short a period, is much too high. At the moment it averages no less than 30 per cent. per annum and units vary from as little as 9 per cent. to as much as 60 per cent. This is like running the bath tap with the plug out and is very wasteful indeed of resources. The recently retired Commander-in-Chief, General Sir Frank Kitson (who through his career has been a very good friend to the TA), has said that all recruiting problems could be solved if only we could reduce this 30 per cent. by 5 per cent. to 25 per cent.

The reasons for this high wastage are numerous and probably very complex. I think that pay is now adequate, and recently it has been considerably increased. Boredom in some units can be a factor, because the young TA soldier wants to be active all the time. Inevitably many young people find the Army rather different from what they expected and they can walk out without being stopped at any time. Changes of job very often mean that volunteers can no longer be released for camp, etc. Indeed, getting a job at all, which as we sadly know can be so difficult, can itself be a cause of wastage.

However, in my view, after a good deal of research and discussions around the country, the most important factor in causing this high wastage is the situation facing the unemployed volunteer The Minister knows very well that this has been under discussion for several years and I pay tribute to his attempts to help; I know he has done a great deal. I am not sure whether or not his previous experience at the DHSS has been useful, but the problem is still there, and it is a real one. At the moment 17½ per cent. of the TA are unemployed. This figure varies from as little as 4½ per cent. in Greater London to 17 per cent. in Scotland, 19½ per cent. in Ulster and more than 25 per cent. in Wales and most of the north of England. One unit in Scotland at the moment confesses to having 43 per cent., of its men on the dole.

The problem is that men on unemployment benefit only (the word "only" is important, and about half the unemployed are in that category, as far as I can make out) can end up out of pocket if they undergo the necessary training. Those on supplementary benefit are better off, thanks to a valuable concession recently agreed. This means that what is known as a disregard for these people was raised so that a volunteer can earn up to £32 a month without affecting his benefit. But the man who is on unemployment benefit only can disregard only what he may earn on a Sunday and if he reports for training on a Saturday, he will have his basic unemployment pay reduced and can actually end up worse off than if he had stayed at home. Furthermore, there is always the temptation not to own up to what he is paid by the Army, and nobody wishes to talk about that.

The Armed Forces Pay Review Board has recently announced that a payment for drill nights and evenings of the week will be introduced. Although this is undoubtedly welcome, it will further widen the difference between the unemployed and the employed soldier, as the new pay structure itself does. It is wrong to weary your Lordships with statistics, but it is worth quoting that the soldier who at the moment earns £15.20 per day, who trains for three Saturdays and two Sundays in a month, should he be in full employment, or should he be on supplementary benefit, will take home £45.20 after tax. But if he is in receipt of unemployment benefit only, this figure is reduced to £30.98. That is the extent of the problem.

Nobody should believe that voluntary service in the TA or another reserve is a substitute for a full-time job, but it can be a real help and perhaps is better than nothing. The point I am making is that unemployed young people should no longer be penalised for volunteering to serve their country in this way. I believe that the opportunity of the current review of the social services structure, which is a labyrinth and a subject into which we should not venture tonight, gives a good opportunity to put this right.

I realise that to make concessions here might open the door to other volunteers who could perhaps use these concessions as a precedent. I would only say to that that, if they serve their country, then let them fight their own battles. I believe that the lifeboat people, to whom we owe a great debt, already have such a concession and I would remind your Lordships that the reserve forces are an integral part of the armed forces and are liable to call-up, and they are the only volunteer organisation in that category.

There will also be a cost in all this, as there is in everything. It is estimated to be approximately £1 million if this concession is granted. Against this, we have to look at the savings in reducing wastage, and thus training costs, and the savings which might come on reducing the need to advertise and so on. We should end up, I believe, with an even better and more effectively-trained reserve army than we have; and that is what we are after.

I know that it is seductive to say that a million pounds is only peanuts in terms of the defence budget. But I would remind your Lordships that at the moment the reserve forces account for only 1 per cent. of the defence budget and I think, too, that the demand I am making is really small peanuts compared to the ideas of the noble Lord, Lord Hill-Norton, which seemed to me to add up to rather more than that. To replace these people, if we cannot recruit them, with regular soldiers would cost a great deal more than £1 million per annum.

Everywhere I go I find that the discrimination against the unemployed is an injustice which prevents many admirable young people from trying to join the reserves. If this disincentive disappeared, it would be the biggest single advance that we could make in this field. I know that any moves in this problem are as difficult and as dangerous as crawling through a minefield. It is, indeed, sometimes difficult to get accurate statistics and figures about what is going on. It could be argued that unemployment benefit is meant for those who have absolutely no other income and that anything earned should either count against such benefit or be taxed. It could be put that no-one should be paid twice by the state for one day or for one week. But what they earn in pay is taxed. Also, we are talking here only of perhaps 10,000 or 20,000 men or women at the most, all of whom are volunteering to serve their country in the best possible way. I believe that it is not only unjust but extremely foolish to penalise these people. I hope that my noble friend will do what he can to redouble his efforts to find a solution to this problem.

Lord Chelwood

My Lords, before the noble Lord sits down, he made a very important point and I am sure that he carried the House with him. Does he not feel that to wait until (as I understood him to say) the whole social security system has been reviewed and revised would mean he would have to wait for a very long time? Ought this not to be dealt with very quickly?

Viscount Ridley

My Lords, my noble friend may well be aware that this has been under discussion with the Ministry of Defence for very nearly four years and we hope that it will not take more than a few months for sense to prevail.

6.13 p.m.

Earl Attlee

My Lords, I should like to start by adding my congratulations to my noble friend Lord Crawshaw of Aintree on his maiden speech, which, it seemed to me, was a model of what a maiden speech should be: short, uncontroversial and very well delivered. I should like to apologise for the fact that I was not in your Lordships' House last Wednesday on the first day of this debate but, unfortunately as President of the National Association of Industries for the Blind and Disabled, I was in Bradford for our annual general meeting. However, I have read the debate with great interest in the Official Report and found it very interesting indeed. As a member of the House of Lords All-party Defence Study Group, noble Lords will not be surprised if I say that I support the Government's defence policies in broad outline.

My reaction on reading Part I of the Defence Estimates was one of alarm. It was very well written and very persuasive but it was too smug and self-satisfied by far. I actually wrote down, "Too smug and self-satisfied by far", in the margin of the report after I had read it. I was re-reading this on Sunday and, having done that, I then sat down and I was reading this book, The Complete "Yes, Minister", which is a follow-on from that very well-known television programme. I came across an absolute gem on page 326, where it said, referring to the Minister: and he would always give the impression that the UK had adequate and credible defences". I have quoted from a work of fiction, my Lords—at least, I do hope that I have!

With so many experts here today, my own contribution will be targeted on the smaller aspects of defence. During this debate, noble Lords have been talking in billions of pounds—£9 billion there and £22 billion somewhere else. It is fine if you say it quickly, but I think that you have to remember that all these billions are raised through taxes. Thus with these large sums being bandied about is all too easy to dismiss as piddling the wasting of, say £10,000 or £20,000 or £100,000.

I served in the Merchant Navy for five years and at the end of the war in the Far East my ship was anchored in the roads in Singapore. My company was the Blue Funnel Line. We waited for about 10 days for a berth. In looking round, I counted, I think, 17 Blue Funnel ships. In Singapore today, you would be lucky if you saw one quarter of that number of ships flying the Red Ensign, let alone flying the flag of one particular British shipping company. There has also been a catastrophic decline in our near-, mid- and far-water fishing fleets. In time of war, I do not think we shall have the ships or the trained men by which to provide this country with fish.

I believe that I am correct in saying that in the Falklands war there were as many merchant ships as Royal Navy ships involved. If there were another Falklands, would we have the merchant ships available? There is no use in saying, as was said in the Command Paper, that they are keeping a register of suitable ships, for the chances are that when these ships are required they will be many thousands of miles away just when they are needed.

The "Ark Royal", the latest warship to carry this proud name, has just been handed over to the Royal Navy. She is, I am sure, packed with all the latest equipment to enable her to do the job for which she was designed and built. But even the very latest of this equipment will have been designed some 12 years ago. This basically means that her radar and sonar equipment was out of date even before it was installed. I think the one exception to this is that she is fitted with three Phalanx, as I think they are called. I certainly saw Phalanx being fired on HMS "Illustrious". It was very impressive indeed, and they are in no way near 12 years old.

But even the Ministry of Defence appears to realise that 12 years is excessive. There is now something called accelerated procurement, certainly the word "accelerated" comes into it. But just how accelerated is "accelerated"? It is 10 years instead of 12. That is some acceleration, is it not? I am certain that the noble Lord the Minister will be able to explain to your Lordships', and to his own, satisfaction that this delay is inevitable. But I do not believe that it is.

The week before last I visited the OSEL Group in Great Yarmouth. They are, I understand, the world leaders in submersibles. One of their customers had a special requirement for a one-off submersible for a special job. From design to delivery took just six months—I repeat, my Lords, six months. Had that been an MoD contract it would have taken at least 20 times as long. With a submersible, especially one which contains a man, you cannot skimp on materials or workmanship; and nothing was skimped on that contract. So it can be done, even when the highest standards are demanded; and it is quite right that our fighting services should have the very best equipment.

Another thing I noticed with this company was that, with all their equipment, any piece of it that might have to be removed for modification, updating, servicing or repair could be simply unplugged, unbolted and removed, and, if necessary, a replace ment unit simply slotted in. Also, everything that is likely to need replacement, or nearly everything, can be reached very simply from the outside.

This company's products are extensively used by oil companies in connection with offshore oil and gas rigs throughout the world. If a rig has to stand idle because a submersible is unavailable through something going wrong, it can cost them hundreds of thousands of dollars a day, every day. It is for this reason that servicing is made so quick and simple. Regrettably, this does not appear to happen in connection with the equipment supplied to the services. In Norway. I saw electronic equipment—part of a Rapier defence system—which was out of use because of the non-availability of a particular replacement part the cost of which is measured in pence.

As we all know, electronic equipment gets smaller, more powerful and cheaper all the time; but if a piece of electronic equipment, designed perhaps 14 years ago, breaks down, it has to be replaced by exactly the same thing, even if that has to be specially built. Why does not the Ministry of Defence simply specify what function a part has to perform and leave it to the manufacturer to supply a replacement part that will do what is needed, even if it is cheaper, better and smaller than the original?

In paragraph 430, the paper rightly acknowledges the importance of NATO's northern flank. I was privileged to be a guest of 3 Commando Brigade, Royal Marines, in Norway earlier this year. In talking to groups of newly-trained marines I found they well understood the importance of the northern flank. They understood why they were there and what job they would have to do in time of war. If they had any worries, there were two of them and neither of them had anything to do with the equipment. They had heard rumours that their winter training in Norway might be reduced from every year to every other year. They explained to me that if that were to happen and there was a break of one year, it would mean that next year they would spend most of that year's training making up for the loss of what they had missed in the previous year. They all felt it was vital that they should go every year for training. I might say that certainly was not because they were having a jolly time, because they train very hard and they train in temperatures of 30 and 40 below.

Their other worry was this. It sounds a bit silly, but they asked: what would happen if the Russians were so unsporting as to launch their attack on the northern flank in the summer? These particular Royal Marines in 3 Brigade have only trained in Norway in winter, when there are masses of snow around, and they would not recognise the terrain in the summer. Going from point A to point B in the winter, they can go in a straight line: in the summer there might be gorges, gullies and so on, and they simply would not recognise the land. I should be very grateful if the noble Lord the Minister could answer these two questions. The first one is whether 3 Brigade will be able to continue their training in Norway every winter; and, secondly, whether there is any possibility of their being allowed to train, in addition, once or possibly twice for a few months in the summer so that they could get to know the terrain on which they might have to fight.

In paragraph 422, the paper refers to the MCV 80. As those noble Lords who read The House magazine regularly will know, I recently drove one at GKN defence operations' testing ground. The paper refers to the fact that "this vehicle is undergoing trials". Let us hope that these are successfully concluded as quickly as possible. I say this because if the balloon goes up before sufficient numbers are in service our reinforcements will be slaughtered on their way to the battle area. Why?—because at present I understand our troops would be driven forward in canvas-topped vehicles. The Russians know this and they have plenty of artillery, as we know and as we have heard again today. Therefore, all they would need to do in fact would be to use a barrage of fragmentation shells, set to explode in the air, and our troops would not stand a chance; they would be torn to ribbons. Therefore, I should be very grateful if the noble Lord the Minister could tell the House when the trials of the MCV 80 are likely to be concluded and what the likelihood is of an order being placed.

I said at the start of my speech that I would return to the subject of pounds and pence. I should like now to give just one example of waste. I know of a heavy recovery vehicle which goes into command workshops after having covered only a very few miles since its last appearance there. Once there, its unit does not see it again for several months, even if the fault is a minor one. This vehicle is old, inefficient and too slow to keep up with the vehicles it might have to recover, and it costs tens of thousands of pounds every year just to keep it occasionally on the road. As I understand it, the cost of repairs to a vehicle comes out of the current, account, whereas if a vehicle is sold off the replacement would be charged to the capital equipment account, or something similar. I am, incidentally, talking about a territorial unit, and obviously it is better for them to spend vast sums of money on maintaining an old and worn-out vehicle rather than get rid of it and buy a new one.

In conclusion, I think that we have the finest sailors, soldiers and airmen in the world. Should we not so organise matters that the very latest equipment is just that, and not 10 or 12 years old? And should we not find the money so that they can fire their guns and their rockets, drive their tanks and fly their planes? That was a point mentioned by the noble Lord, Lord Chalfont. Where would the money come from? That is simple, my Lords: a very small percentage of the money saved by cancelling Trident and its massive over-kill potential would be more than enough to provide all the funds that are required.

6.28 p.m.

Lord Ashbourne

My Lords, as a large number of noble Lords decided to speak in this debate, I shall be as brief as possible and am minded to touch on only three points. First, I am concerned about the support arrangements for Northern Europe, mentioned just now by the noble Earl, Lord Attlee, and specifically about the replacement of our two ageing assault ships, HMS "Fearless" and HMS "Intrepid". This is particularly critical, as HMS "Hermes" (flagship of the Falklands campaign) is now in reserve without replacement, certainly so far as her capability to transport a Royal Marine Commando is concerned.

Perhaps I may quote from Chapter 2 of the White Paper—and I am aware that Chapter 2 was covered in last week's debate. Nevertheless, a number of topics are covered in both Chapters 2 and 4 and as I lurched, rather uncertainly, from one to the other I was rather wondering whether I should be speaking last week or this. However, my mind was speedily made up by circumstances and as I was ill-prepared to speak last week I decided to focus on Chapter 4 so as to gain valuable breathing time. Nevertheless, perhaps I may quote from Chapter 2. The White Paper says: The Northern Region: of importance to the integrity of the Alliance and critical for the containment of the Soviet Northern and Baltic fleets, flexible and mobile amphibious and airbourne forces are committed to its defence". Turning now to the report of House of Commons Defence Select Committee published on 23rd May, under the heading "Amphibious Capability" the report states: We have taken a particular interest in the future of the UK's Amphibious Capability, particularly in terms of replacements for the Assault Ships Intrepid and Fearless reprieved after the Falklands Campaign, and the resulting implications there may be for the Royal Marines and their specialist roles. We do not doubt that the Secretary of State attaches a high priority to the effective reinforcement of the Northern Flank. Nevertheless, in our view the postulated replacement date of 1995 is as late as it could be and later than it ought to be. Your Lordships will of course judge for yourselves, but observing that both HMS "Fearless" and HMS "Intrepid" were laid down in 1962 and will be over 30 years' old before they are phased out in the mid 1990s, is it sensible to rely on two extremely antiquated vessels for support of the Northern Region which, in the words of the White Paper is critical for the containment of the Soviet Northern and Baltic fleets"? I should like to move on and touch briefly on the serious worries posed by the decline of our merchant fleet. I believe that this shortcoming in our defence armoury has been perceived by your Lordships. I say this as as number of questions have been asked in your Lordships' House during the past month or so. Indeed, a question was asked today by the noble Lord, Lord Hatch of Lusby. Admiral Sir John Fieldhouse, who was in overall command of the Falklands operation as Commander-in-Chief Fleet observed: I cannot say too often or too clearly how important has been the Merchant Navy's contribution to our efforts. Without the ships taken up from trade, the operation could not have been undertaken, and I hope this message is clearly understood by the British Nation". The White Paper tells us that a major study into the future trends of availability in those parts of the merchant fleet for which there is a defence need was started in December 1984 and is due to report in mid-1985. This is to be welcomed and I trust that the Government will take firm and decisive action to reverse the present relentless, deteriorating trend when this report has been published and digested.

Thirdly, I want to say a word or two about manpower. The Defence Select Committee in another place had this to say on the White Paper: There is surprisingly little about recruiting, retention, pay and allowances, maintaining skills, morale and career prospects at a time when these issues are causing increasing concern to servicemen and their families". The restrained language of the Select Committee has to be commended, because in truth their comments represent a masterpiece of understatement. One can only presume that these weighty matters of recruiting, retention of highly trained personnel, maintaining skills, morale and career prospects, are not mentioned because Her Majesty's Government have either not recognised that these problems exist, or are doing nothing about them.

The old adage, "All work and no play makes Jack a dull boy" is still true, and I am reliably informed that in many cases ships are doing as much sea-time today as they were in World War II. In the Defence White Paper of 1984, we were told that more training would be done at sea. I recall the noble and gallant Lord, Lord Hill-Norton, saying that he hoped this would work—this was last year—while I stated that I also hoped it would work but that I had severe doubts whether it would. Perhaps the noble Lord the Minister might care to comment on this aspect of training when he winds up the debate. It is, however, beyond doubt that the very high proportion of time spent at sea is having an adverse effect on morale and job satisfaction in the Navy; and this is bound to lead to skilled personnel who can command highly paid jobs in industry deciding to leave the service earlier than would otherwise be the case.

Turning now to the Army and Air Force, your Lordships are aware that local overseas allowance in Germany has been cut, and this of course affects personnel serving in BAOR and the 2nd Allied Tactical Air Force. This point was mentioned by the noble Lord, Lord Chalfont, who, if I may say so, perceptively put his finger on just the spot to which I would draw your Lordships' attention. In many cases the soldiers and airmen have had their real take-home pay cut and the effect of the recent pay rise has been nullified. The "fun" element of a tour in Germany has been severely restricted with obvious consequences.

Servicemen these days are skilled and highly trained and if they decide to go earlier than would otherwise be the case, this is bound to prove very expensive in training their replacements. As many servicemen are highly skilled in technical fields the temptation to try one's luck in "civvy street" is obvious. As the Select Committee in another place clearly perceives, the consequencies of this "brain drain" from the armed forces is likely to prove inefficient and costly. I should like to end by asking the noble Lord the Minister whether it is intended to allow this state of affairs to continue; or, if not, what action is proposed to rectify this outflow of skilled personnel?

6.37 p.m.

Lord Ironside

My Lords, when I spoke in last year's debate, I did not imagine that today defence procurement would feature so strongly in my interests; in fact, so strongly that I would have to declare them. My interest is a direct one as the defence market coordinator for a British-owned engineering group of companies in the £10–£25 million per year contractor club. Just to put things into perspective, for the first division contractors in the £100 million-plus club a single contract could qualify them for the £10–£25 million club, and it is therefore welcome news that one of them has just received a contract worth £27 million for 1,000 air data computers for the United States Air Force.

I mention this for two reasons. First, because it must show that firms competing for MoD business are better placed to compete for the overseas business; and, secondly, that the two-way traffic in defence sales, at present running two to one in favour of the Tnited States, has received another tilt in our favour. I should also like to congratulate the noble Lord, Lord Crawshaw of Aintree, on his excellent, short and uncontroversial maiden speech discussing a subject in which we are all interested; namely, the reserves and their dedication to their duty and the planned increases that we shall now expect in the Territorial Army and in the Royal Naval Reserve. In the Royal Naval Reserve that is from 5,200 to 7,800 people: a 40 per cent. increase, in order to man and operate the most important type of small vessel that we shall see in the future—the mine counter-measure vessels.

The Government now face much more exposure in defence procurement with open consultation, accountability, and newspaper coverage. There is more parliamentary involvement with Select Committees, all-party studies and debates. I think that here in this House we are very well informed, and we now see £9.1 billion, or 46 per cent., of the budget going on equipment procurement. This is a large sum of money by any standards and in Peter Levine's own words defence procurement is now a commercial matter and will be treated as such.

I support the Secretary of State wholeheartedly in his determination to get value for money in his spending; but I think that the dilemma which is facing the MoD now is how to get value with competitive price. If you pay good money for things, you should get the goodies; but of course if you pay peanuts, you are likely to end up with monkeys. So the big question is how to implement competition policy to the best advantage of the country without forcing cut-throat bidding onto industry.

Today I want to talk about this and to touch on contractorisation—that new word which means contracting-out—which affects our dockyards. Here I might say also that by "dockyards" I mean—and I think everybody now means—warship repair yards. In the past, there has always been a rather hazy distinction between naval bases which are operational support bases for the fleet, and the dockyards, because they have been synonymous, and Devonport, Portsmouth and Chatham have in the past been both of these.

Someone with the skills and experiences of Peter Levine must realise that, if the United Kingdom defence industrial base is to remain strong, he must in some way sugar the competition pill that industry is now being asked to swallow. Competition must taste of reward and not of penalty, and if he is to win over industry to his side he must show them that competition policy can be developed and implemented fairly. If he is able to do this, then he will have done a good job for us.

He has said that in the relationships that firms have with the MoD the status quo has gone for ever. Firms cannot take anything for granted any longer and so there are a lot of uncertainties being voiced throughout the industry. But, as I see it, what he is really saying is that the old, rather limited, designer-maker relationship has disappeared and has been replaced by the much more normal customer-contractor relationship, where industry is able to play a much fuller part in the whole business of research, design, manufacture and supply; and now this includes other things such as maintenance and repair with contracting-out.

The Heseltine principles in procurement, then, are really only a reassertion of the Rothschild principles of customer-contractor relationship in research and development, perhaps made tighter and tauter by competition policy. However, it takes two to make a customer-contractor relationship work and the customer needs to adapt as well. It is worth mentioning here that the Haldane principles, the precursors of the Rothschild ones, greatly benefited the armed forces departments and allowed their decision-making to be based on scientific fact.

My noble friend Lord Trefgarne made the point last week that the shortfalls between resources and commitments—and the fears about this were again expressed today by the noble and gallant Lord, Lord Hill-Norton—can be precluded by rooting out slack practices in contracting which have grown up in the past, and I think this point is a valid one. Not only contracting practices need adaptation, but apparently accounting practices do as well.

I have read with great interest the defence open government document No. 2, which is the Coopers and Lybrand efficiency audit on the Director General of Defence Accounts Department. It seems to be very critical of all parts of the system from civil payroll, billing and cost accounting to financial services and data processing, but it makes constructive proposals about change. It is said that productivity is very low by comparison with industrial practice and that in automatic data processing programs are, at best, over eight years old and were written for tape technology. They have been amended so much that few lines of the original code exist and the logic is now very difficult to follow. It is also said that ICL have refused to maintain the 1900 series computers, which are being used in Bath and Liverpool, after next year.

All this sounds very alarming, but it illustrates my noble friend's point about the product of slack practices and I hope he can give assurances that Coopers and Lybrand's proposals will be implemented to overhaul the Ministry of Defence accounts department. The noble and gallant Lord, Lord Carver, made the point that our armed forces are slow to adapt themselves to technical revolution, but I hope that the defence machines standing behind them will be able to set an example, particularly in the area of accounts.

The noble Lord, Lord Boston of Faversham, speaking for the Opposition, said that there was nothing new in the estimates, and of course he was quite wrong. He has only to look at chapters 3, 4 and 5 to see all the new ideas which are proposed. There is a whole list of them—competitive tendering by six companies for the design, building and equipping of the first two AOR vessels, which are the one-stop replenishment vessels; co-operative grant schemes; collaboration in the provision and operation of MoD facilities; the setting up of a British National Space Centre at Farnborough, and so on. These are all new ventures of considerable importance which I think point towards further partnership with industry and which I welcome.

Industry is ready to compete, but it must be on a fair customer-contractor basis. For example, the position of public sector firms which are virtually Government subsidised must be discounted in some way to allow private sector firms to compete with them on an equal footing. This is obviously an important point in the AOR case, where Harland and Wolff may well be competing. It is very costly to tender, and sometimes the costs run into millions so if you win a main contract you want an expectation that you can carry through your investment as if you were facing the open market.

As there are no preferred positions with MoD contractors any longer, the attractions of competing are diminished if it means competition in mid-stream between development and manufacture and repeat manufacture, if it is likely to put an investment programme at risk. There is a strong case for a prime contractor to stay with a project throughout its working life, as in the Trident case in America, and mid-term competition may not generate the expected benefits. In any case, there are cost premiums in doing this to be reckoned with on both sides.

So that newcomers and competitors can tender, perhaps without having all the resources and without appreciating the extent of the customer requirement, possibly foreign-owned as well, they will have access to drawings in order to allow them to do it, which may also allow them to gain access to proprietary information, design philosophies and commercial strengths, and this is a genuine fear with main contractors, particularly where they have built up a worldwide reputation for excellence. They do not wish to lose their grip on their market hold through having to give competitors, or potential competitors, the basic information on which they can tender for MoD business.

The industrial briefings to allow firms to home-in on the technical requirements and help towards finding solutions are valuable, and I have attended some of them. Their value is shown by the Oracle and Seafacts series for the army and navy. I wonder why it is that the air force, who have the biggest equipment requirement, do not, so far as I know, hold a general industrial briefing session. Maybe it is not necessary but I should be grateful if my noble friend on the Front Bench will say what the position is. It would seem to me that an industrial briefing is perhaps necessary in this case. As we have seen, the new RAF trainer is to be produced by a firm under licence from a foreign company.

There are many procurement issues, and if they are not at the weapons end then they are at the logistics end—involving such matters as support for BAOR, construction of the Clyde naval bases, the organisation of defence research establishments, and the future of the dockyards. There is only a line or two about the future of the dockyards in the estimates but then this matter is fully discussed in the defence open government document No. 1. The proposition to commercialise the dockyards highlights the whole question of contractorisation and how it can best serve the national interest. The interest which the engineering industry has in contractorisation is in the way it can expand its activities and profit by adding to the industry's skills and capabilities. Therefore, to attract industry there must be an opportunity to do more than just hire and manage the workforce. There must be involvement with the functions and performance of the organisation or establishment so as to make full use of a firm's resources, and make the proposition attractive.

The experience of contractorisation gained in the United States under the GOCO—Government-owned contractor operated schemes—concept comes from the Oakridge National Laboratory, where the single contractor manager is Martin Marietta, who took over from Union Carbide. The GOCO contract is a management and operating contract, which is defined as an agreement whereby the Federal Government contracts for operation, maintenance or support of Government-owned or controlled research and development, special production or test facilities devoted to one of the major national programmes—usually in defence.

GOCO has many of the features which are preferred by the Government here for operating the commercial management option in the dockyards. In effect, the customer is buying management competence; the criteria for considering a GOCO option, the tender evaluation, the working arrangements and the tender prequalification have been established in the United States.

The contractor owns the staff, whose terms and conditions are integrated into the company structure. For financial control purposes, the operation has to be run as a separate business unit. Minimum contract periods in well-defined cases—such as the air force plant at Fort Worth producing aircraft to proven designs—run for five years and are renewable without retendering; but where there is uncertainty, the time-span needs lengthening or qualifying in some other way. Under the GOCO arrangements in the United States, contract administration is complicated. I understand that there are something like 500 Government staff involved at Oakridge and another 400 at Fort Worth.

Looking at the future of our own dockyards, I ask my noble friend whether he can give an assurance to the House that the Government will be able to make the statement as promised before the Recess about their preferred course of action, having publicly invited comment from industry and other interested parties. However, I hope that my noble friend will persuade his right honourable friend to heed the advice of industry, which I can assure him is very ready to collaborate.

On United States evidence, the GOCO operation is complicated to operate, and in the case of the dockyard here it must not be made more complicated by applying unnecessary conditions. The arrangements must be simple and evolutionary. We can then establish the best method of working. If it is simple and implemented effectively over a contractual period of more than five years—and, advisedly, eight years or more—so that the operating company can exercise all its skills and succeed in making a profit, then we shall have a very positive outcome.

The growing partnership with industry in procurement opens up new ways of meeting defence commitments, and I believe it will lead to greater fighting efficiency and cost effectiveness.

6.56 p.m.

Lord Westbury

My Lords, like my noble friend Lord Attlee—and I know that I should not have used the word "friend", but he is one—I had the honour and privilege of being a guest of the Royal Marines in Norway earlier this year. I should like to say how very impressed I was at the efficiency, determination and esprit de corps that was made blatantly clear to me by all ranks. It gave one great confidence knowing that by their presence in that country the defence of NATO was greatly enhanced.

I admired the spirit of all ranks in very ad verse conditions. I became familiar with those conditions, having slept in a tent at 25 degrees below freezing. Admittedly, the Royal Marines had their own sleeping bags, whereas we had to use the ordinary type, which were not very good. I admired also their stoic attitude towards being away from their families for so long. I gather that a great many of them will probably have completed a tour in Northern Ireland prior to going to Norway, thereby seeing very little of their families for at least six months of the year. But I understand that the Royal Marines are never short of volunteers to do service in Ireland before going to Norway.

The major worry from the top level of command seemed to be a glaring omission of a dedicated-area air defence capability. I should like to ask my noble friend the Minister what active steps are being taken to provide the much needed enhancements to this unique force to enable it to meet its task. In particular, what is the position on the early dedication of a Rapier air defence battery and the updating of the Blowpipe point air defence weapon with both increased numbers and improved systems such as Javelin?

I shall now turn to a more mundane but, to me, equally important subject; that is, military bands. Last week I attended a band concert in Yorkshire, given by the King's Division. I was very impressed, as was the whole audience, by their performance, particularly that of the pipes and drums of the 6th Battalion Ulster Defence Regiment. It reminded one wholeheartedly of the trauma of that regiment's service in Ulster and how they go about their civilian work and at the same time serve with great heroism our Queen and country.

It seems to me quite ridiculous that the cutting down of regimental bands is, not the least of it, counterproductive. There is no doubt that with the summer and tourist season in full swing; the bands of the British Army are probably the biggest tourist attraction in the United Kingdom. By their constant appearance they bring in well-earned money to regimental funds which, as we know, help so much to bring relief and benefit to old and sick soldiers and their families. We must not forget either that all bandsmen are trained in first aid, which was so well illustrated in the Falklands.

Such small but niggardly cuts very much lower the morale of the armed forces. I heard the other day that the Secretary of State himself had sanctioned the disbandment of all barbers' shops in the Army.

7 p.m.

Baroness Airey of Abingdon

My Lords, in speaking this evening to the White Paper on defence estimates, I should like particularly to draw your Lordships' attention to the demise of the distant-water fishing fleet. This has been touched on by several noble Lords this evening, but I wish to emphasise how bad is the situation. It can be said that comparisons are odious, but in 1939 1,500 such vessels were requisitioned and used as minesweepers. Today this particular class has only one—it is called "The Pict"—although I understand that there are, of course, 12, or so, middle-water trawlers and a considerable number of smaller off-shore supply vessels and further fishing vessels. But the reason that this alarms me so much is that all these vessels are suitable for conversion to minesweepers. I consider, and I am sure many noble Lords will agree with me, that it is important that we should have the services of minesweepers.

I know that with new and modern sonar techniques it is possible for a smaller number of minesweepers to carry out the same duties that would have needed more ships in 1939; but it is extremely important that we should have the services of these nearly extinct ships that we had in the past. We have our important submarine bases and it is essential that they should be protected. Our submarine bases in Scotland, and those of our NATO allies, are very vulnerable to attack by mines. I remind your Lordships that there is also the question of economic shipping which would be our life's blood if we were again in a time of tension or actual war. We would be very short of suitable ships for conversion to minesweeping.

I understand that the consultant's study mentioned in the White Paper is examining future trends of availability of the merchant fleet, but what about the fishing vessels? We still have the small yards in this country where modification and repair could take place, but they are in danger of falling into disuse and their experienced fitters will then be disbanded. I urge my noble friend the Minister to press the Government on this matter. I hope that he will do everything possible to express very strongly the dangers in which we might find ourselves in the future.

There is then the question of manpower, which has also been touched upon this evening. It was particularly well put forward in a splendid maiden speech, which we all enjoyed so much, by the noble Lord, Lord Crawshaw. He spoke about our reserves and our territorials and here I should like to mention the Royal Naval Reserve, in looking to the future, which we must do. I speak from personal experience and with great affection for an old MTB which did wonderful service at Dunkirk and, after that, in rescuing some of our agents from the rocky and dangerous coast of Brittany. It has been converted at no expense to the Government for use as a training ship for very enthusiastic Sea Scouts. They could be the future Royal Naval Reserve. The whole subject on which I have spoken is, I consider, a very serious matter of defence. It is, overall, a matter for NATO, but Britain should take the lead because, historically, we are a maritime nation and we know how to do it.

7.4 p.m.

Lord Mottistone

My Lords, I should like to add my congratulations to the noble Lord, Lord Crawshaw, on his splendid maiden speech. Indeed, as is sometimes not the case with maiden speakers, he has sat here almost uninterruptedly to listen to the rest of the debate. It is a wonderful start and I hope he will often illuminate our discussions with his contributions.

I also welcome the two-day debate. I hope that my noble friend the Minister does, too, and will encourage the usual channels to do this again. I think the two days should be closer together and that perhaps the dividing line should not be too rigid. But on the whole I think it is a very good arrangement, and it is to be hoped that we shall be able to repeat it in the future.

I shall concentrate on the problem of whether the Government have really got their heart in ensuring that we shall continue to maintain a Navy of the size and shape necessary to provide the maritime element of NATO's deterrent forces and to provide the means of meeting our commitments to our remaining colonies and the other countries with which we have treaty arrangements outside the NATO area. I am fearful that this Government, like many before, have a lot of fine words but do not have their heart in carrying them out. The noble and gallant Lord, Lord Hill-Norton, and the noble Lord, Lord Chalfont, said that the resources are too small for the commitments. The noble and gallant Lord, Lord Hill-Norton, went on to say that the money is inadequate to provide the planned resources. I fear that the noble and gallant Lord is right, though I hope that my noble friend will be able to show me that I am wrong.

Like the noble Earl, Lord Attlee, I also felt that the defence review was too silent in too many places. I shall refer to that later. I shall endeavour to produce just a few examples to illustrate where I am concerned. The intentions on pages 25, 26, 27 and 30 of Cmnd. 9430 are admirable. The recognition in the opening sentence of Paragraph 433 that, In a battle for sea control a balanced fleet is essential, and each component has its particular function", is absolutely correct. Indeed, I suggest it should appear in every defence review from now onwards; but, of course, it must be honoured.

The statement, also in Paragraph 433, that a new class of diesel-electric submarine is on order is most welcome, as is the statement in Paragraph 435 that we now have 53 front-line destroyers and frigates and, in the longer term, intend to maintain a level of 50 such ships. I do not think that that is enough but, bearing in mind what my noble friend Lord Trenchard said earlier, we are lucky to have more than one.

However, taking note of the 53 front-line destroyers and frigates now and the 50 in the future, I find it strange that in Annex C, Table 1, serials 5 and 6, there is mention of only 49 destroyers and frigates. On page 6 of Part II of the White Paper only 46 are given for 1985. That seems to be rather strange, bearing in mind that it positively states in Paragraph 435 that currently we have 53. That is the sort of discrepancy that looks suspicious.

In examining the detail one sees that to achieve the required numbers of destroyers and frigates they need to be ordered at the rate of not less than three per year if out-dated ships are not to be run well beyond their useful life. None was ordered in 1983 and only one in 1984. Two were announced in January 1985, but contracts for three Type 23s will probably not be placed until next year. Thus the shortfall is at least six now and is liable to rise. In limited-over cricket parlance the run rate per over is drastically under that required for victory. I hope most fervently that my noble friend will be able to produce convincing reassurance that he has a Botham up his sleeve to produce a substantial increase in orders during the next 10 years.

Turning now to diesel-electric submarines, 14 are over 20 years old, the new type 2400 takes four years to build, and the first of its class is not due to enter service until the end of 1987. A sharp contraction of numbers in service therefore seems inevitable unless, once again, old ships are run on long after their time. Again, I hope that my noble friend will be able to produce convincing reassurance on this point.

To consider one other type of ship, a major lesson from the Falklands campaign was that assault ships were essential. My noble friend Lord Ashbourne made a point of this. As he said, the "Fearless" is now 20 years old and the "Intrepid" will be a similar age in 1987. Both require replacement, but the White Paper is totally silent on this point. Once again I trust that my noble friend will be able to reassure us in this matter.

Turing now to equipment, another of the major lessons from the Falklands campaign, if not the most important, was the need for airborne early warning operating from ships' aircraft. I was therefore much heartened to read last year in paragraph 437 of Cmnd. 9227 that the Government were introducing interim organic helicopter-borne AEW and that they were working on a longer term solution, based on a development of that system, so as to deploy a flight of AEW helicopters in each of the two operational carriers.

However, in this year's White Paper there is no mention of either the interim or the longer term solution to the AEW problem. Fearing that the Government might have dropped this vital addition to our ship-borne capability, I pointed this out to my noble friend in a letter. I thank my noble friend for his reply, in which he said that the plans had not changed. Indeed, in November 1984 849 Squadron was formed to operate the AEW helicopters, which will all be in service by the end of this year. Though there is no mention of this fact in Chapter 4 of the White Paper, 849 Squadron is mentioned in table 4 on page 62. What I now have to ask my noble friend is whether these helicopters are fitted with the interim solution equipment mentioned in paragraph 437 of last year's defence review or whether they have the longer term solution also referred to in that paragraph. If it is not the longer term solution, when can that be expected?

Finally, I turn to manpower, as indeed did my noble friend Lord Ashbourne. I am much concerned at the steady decrease in numbers of trained naval manpower over the last five years, particularly when that is compared with the maintenance of and slight rise in numbers for the other services shown in table 4.3 in Part II of the White Paper. From all sides—and my noble friend Lord Ashbourne gave us details—one hears of inadequate numbers to man promised ships, aircraft and submarines, serious limitations or shore training for highly skilled jobs and, as has also been mentioned, not enough people re-engaging. There was an interesting discussion yesterday in another place at Question Time, which is recorded in cols. 167 and 168 of Hansard of the other place, regarding the manning of the Fleet Air Arm. I shall not bother your Lordships with the detail at this stage, but it is worth looking at.

Thus I conclude that I fear greatly that this year's defence review is more window-dressing than hard fact with regard to the navy, and I suspect that this applies also to the other services. I trust most fervently that my noble friend can convincingly set my fears at rest.

7.15 p.m.

Viscount Hanworth

My Lords, first I must apologise and ask the indulgence of the House and the Government for now making a speech which clearly should have been made on the first day of the debate. I wrote the speech and then found that other engagements prevented me from delivering it when I should have done.

There have been many attempts to define the Russian outlook. I am sure that it is not the enigma that Churchill said it was. I wish to emphasise three points. First, that Russia is not so very different from what it was in the past under the Czars. It had the same denial of free speech and the secret police; hut its expansionist policies have been emphasised by the communist ethic of converting the world to its views. Secondly, any sudden change—I underline the word "sudden"—to a more permissive society, even supposing that the Russians thought it desirable, would take the lid off the pot and the head of steam would consequently result in chaos and possibly revolution. To persuade their population that there is a military threat from the West and that the "guns for butter" outlook is necessary is a good way of diverting people's attention from the hardships at home, and it preserves the status quo. Thirdly, Russia feels it has a right to convert other nations to the communist way of thinking in the same way as the West promotes democracy. This point was made quite clear when the noble Lord, Lord Shinwell, at last managed to get a speaker from the Soviet Embassy to address our Defence Study Group.

In essence, the Russians do not see why they should be prevented from propagating communism, because until recently they have been inferior in world-wide military terms. If they can become superior, and not simply equal, without an arms race, it will make life that much easier for them. I am sure this is the Russian point of view. Basically I support more or less the conventional view of NATO's and our own defence policy. Nevertheless, I think it right at least to question on moral grounds some of the things we do.

The Russians have been prepared to use arms to achieve their aims in Afghanistan, and their puppet Cuba has done the same in Africa. Initially there has been a subversion policy and the supply of arms, before military intervention has taken place. To counter this we have inevitably used some of the same tactics, but we must question the ethics of carrying them too far. For example, are we justified in making possible the continuance of civil war by supplying arms to insurgents when a quick resolution of the problem is not in sight? The Russians may do so, but should we do the same? As your Lordships may be aware, research in this field shows that there are plenty of examples, where the West has interfered in the internal affairs of a country, sometimes for purely commercial reasons. In one case it promoted a revolution to achieve its ends. I pose the question simply to bring to people the dilemma in which we stand and, I hope, to prevent purely emotional judgments being paramount.

In a debate like this it is not possible for a speaker to deal with more than a few subjects. I therefore propose to discuss only two further matters which concern one aspect of our nuclear deterrent and the proliferation of nuclear capacity. Because of NATO's requirements, I agree with the stationing of cruise missiles in the United Kingdom, but it means that we become a first-strike target. That risk can be lessened by keeping an independent submarine deterrent so that retaliation for a first-strike on the cruise missiles becomes a strong disincentive. Because of the increasing vulnerability of submarines, there is much to be said for the long-range Trident fleet, as that means that the submarine has most of the oceans of the world in which to hide and remain in range of its target.

Nuclear proliferation is to my mind a potential threat far exceeding any likelihood of a deliberate attack by Russia. It seems that Pandora's box has been opened and that however much we now try to prevent it, nuclear proliferation into the smaller countries will continue, although it is still possible to slow down the process. I ask your Lordships to consider what might have happened if Idi Amin had had the atom bomb; and I am sure that sooner or later if Gaddafi survives he will have it. Already about 10 countries have nuclear capability, including Pakistan.

If we do not retain that capacity, we shall have no answer to nuclear blackmail. I believe that that point was made in a previous debate. Even then there is the frightening possibility of a "fizzle" or a more effective nuclear bomb being planted in, say, the heart of London and the country being held to ransom. I have made those points several times over the years in your Lordships' House, and it now seems from the newspapers that the danger is at last being recognised. With the practical difficulties of constructing an atom bomb, I do not think that the threat is from the terrorist groups unless they are backed by a much larger organisation or possibly even a nation. Nor do I think that plutonium separation for fast reactors will markedly increase the risk, in spite of what the antinuclear lobby may say.

What is the answer to that threat? I am afraid that we shall have to realise that in peacetime we may have to accept the same risks to human life as we were ready to accept in wartime. While I appreciate the importance of preserving human life, I sometimes wonder whether doing so has not become an ethic as a substitute for conventional religion. I would go a little further and say that, with the terrible things that go on in the rest of the world, we may have lost our sense of proportion. To me and to some others what matters is the quality of life and not its continuance.

7.24 p.m.

Baroness Vickers

My Lords, I should like to say how delighted I am to see the noble Lord, Lord Crawshaw, here. He was obviously well trained in the other place to sit it out to this time of night. I congratulate him on his speech, which was very interesting.

I should like to speak on one subject and that is the document. In Cmnd. 9430-I, at page 38, paragraph 518, is the only mention of the Royal Dockyards. It says: We have been considering the arrangements under which the Royal Dockyards at Devonport and Rosyth should be managed in the future to enable them to meet the Royal Navy's needs in the most cost-effective manner. No decisions involving major change will be taken until a period of consultation has been completed". What I should like to know is this. Will the Government leave the consultation for a longer period, anyhow until September or October?

My reason for asking that is that Devonport has always been the home and life of many Plymouthians and others from Cornwall, South Hams, West Devon, Caradon and the county councils of Devon and Cornwall. It has been a major source of jobs for people for many, many years; in fact for centuries. Devonport was opened in 1690 and was well established by 1692. By 1694 it had built 240 ships. Many famous ships have been built there—HMS "Lyon", the Battle of Jutland flagship, HMS "Exeter" of the River Plate, the "Royal Oak" and later the "Eagle", the "Ark Royal" and "Hermes". The "Intrepid" came into the docks recently and was refitted in 15 months, despite the fact that at the last moment a 50 per cent. increase in the work was demanded. At the present time there are 15 ships there having major repairs, and 25 other ships and five frigates, one being converted.

During the last war Devonport was severely bombed and the city centre wiped out. The workers in the dockyard carried on just the same. Those who worked by day used to have to go on to Dartmoor to sleep in their cars when their houses were bombed. They did a splendid job in preparing the ships, and also recently they prepared ships at record speed to go to the Falklands.

It should be remembered that for many generations great-grandfathers, grandfathers and sons went into the yard. The training of apprentices (boys and girls) is outstanding. At one time, if the yard could not employ them all, they were able to go to other jobs because they had been so adequately trained.

I think that it is very unfortunate that during the so-called period of consultation there were so many leaks, which was very disturbing not only for the people at the dockyard but for the city itself. The most disturbing was the Levene episode. That has unsettled the workforce. I should like to congratulate them on the steady performance of the trade unions during that period; especially as it was suggested in another document, The Defence Open Government Document 85/01 on The Future of the Royal Dockyards, that over two years to March 1987 there would be a reduction of 2,000 union members working in the yard.

I understand that the Secretary of State for Defence is to visit Plymouth on 9th July. I hope that he will have a real understanding of the problems of making a change too quickly. I agree that there must be changes but I do not believe that they should be made too quickly.

The first comparator refit has started. It is a most extraordinary word; it means that ships in the yard and ships in private yards will be refitted and a comparison made of how it is done. HMS "Arethusa" was started on 29th May. She is one of the two ships in Devonport which are going into the—shall I say?—competition. These ships will be compared with matching ships being dealt with in private yards. I gather that the planned time is about 38 weeks, including one week's machinery and sea trials. Whatever arrangement is made for the future management of the dockyard, the success of this refit will be very important both to the management and to the workforce.

It was agreed by the city council that management consultants should be engaged. It was also agreed by the Government that they could go anywhere they liked in the yard to make their report. A firm called Peat, Marwick, Mitchell was employed to undertake the task. It has just completed its first document. I have only just received it—on 1st July. It has 79 pages. I suggest that until it can be thoroughly studied no action should be taken.6 The report ended with paragraph: We suggest that the needs of future dockyard management require further analysis and examination. Further study needs to be carried out before it would be reasonable to contemplate any firm commitment to any particular option". It should be remembered that Chatham, Portsmouth and Gibraltar have been closed, and we no longer have Singapore, where we could very often have ships repaired while they were at sea. I have visited all these yards and so have quite a good knowledge of the work undertaken there. Not always were the ships refitted to the liking of the Royal Navy, so the contracts had to be changed. I should like to know what position the Royal Navy will have in private yards, whether it is going to be able to make changes in these yards because it has the use of them, having done the supervising as it has in the Royal Dockyards. I should like to suggest that we wait until these trials I have just mentioned are finished. After all, 38 weeks is not a very long time. Perhaps the Secretary of State can wait until this experiment has finished before taking future action.

There is one other point. It is the question of the evidence of the Select Committee on Defence, which met very recently to hear the views of the dockyard. It was only last week and it has not had time to make its report. I understand that the committee also wishes to interview further people from the dockyard and the City.

Why am I interested in this? I am interested because I was there for 20 years and at the end they were kind enough to give me the freedom of the City. I feel that when one is lucky enough to be appreciated like that, one should keep up one's interest and do everything one can to help the people concerned. The only option that they really like at all, though they are not very keen on it, is what is called the trading fund. All the other options that have been put forward by the Government have been turned down by the people concerned. I should like also to mention that the United States of America have not been satisfied with their privatised dockyards and they have built more and more dockyards which will be worked under the Government.

I feel we owe, and so does the Secretary of State, a great deal to the people of the West Countr, The Secretary of State was MP for Tavistock, which was at that time part of Plymouth, and I should like to finish with the last paragraph of the report: Whilst this further analysis is proceeding, we think it is important to press ahead with work which will be required whichever option for future management is eventually decided upon"— The phrase "is eventually decided upon" is very important. We want anyhow a few more weeks and not an announcement tonight that a decision has been made— This work includes examination of the restructuring of Dockyard organisation, the development of financial systems to provide adequate cost information for operating in a commercial and competitive environment, and the examination of opportunities to increase the utilisation of Dockyard resources through diversification and land release". The noble Lord the Minister is unlikely to be able to give me any answer tonight. However, I hope that he will give full consideration to these points and discuss them with the Secretary of State. I think the Secretary of State has heard the noble Lord, Lord Chalfont, speak about the morale of the soldiers and the morale of the troops. The morale of the citizens of Plymouth, not just the dockyard, is pretty low at the moment. I hope we shall consider this and consult the people in the future as to what action it is necessary to take and what action will be most satisfactory to all concerned.

7.38 p.m.

Viscount Slim

My Lords, I am most grateful that, though my name is not on the list of speakers, I have been allowed to address your Lordships. I am particularly worried in this debate by a political problem and some practical problems. If I may refer to the noble Lord, Lord Boston, I should say that his gander round the daily press, the weekly periodicals and the monthly reports that are made was to me a sadness. I feel that Her Majesty's Opposition should have some clear-cut strategy, should have some initiative and should have some criticisms of Her Majesty's Government's defence policy. In the noble Lord's remarks I found very little criticism. There were some side swipes at organisation, or points about Trident and matters such as that, but I found that there was nothing real. If there is an opposition party, I look for clear directives from it, I look for clear strategy, and I look for clear criticism of Her Majesty's Government. I did not find this.

I wish to refer to a small point on munitions and ammunition which the noble Lord, Lord Chalfont, mentioned in his speech. In this regard I found the noble Lord, Lord Boston's review most fascinating, but, with the greatest of respect to him, I feel that a hard look at bullets would have been of some use instead of trying to work out the difference between the American and the British exchange rates, which really does not help defence a great deal.

I think that the trouble with Her Majesty's Opposition at the moment is that there is no clear line in defence, there is no clear strategy and there is no clear voice. To me that is a great sadness. Perhaps I may take this point a little further. When the noble Lord, Lord Kennet, was speaking for the Alliance, or for the Liberals, or for the SDP—I am never quite sure who they speak for from those Benches—I found that again to hit this problem with the merchant marine was rather old-fashioned. Nobody in this House has worked harder than the noble and gallant Lord, Lord Hill-Norton, to bring to your Lordships' attention the scene of the merchant marine, the scene of what state it may or may not be in. I would have said to the noble Lord, Lord Kennet, had he been here this evening, that I thought he had made a wonderful point but, with the greatest of respect to him, I think he missed the real point.

What I should say to the Government today is this. I should hit them, as with bullets and munitions, with questions such as, "How long can you fight for? Have you the materials with which to fight?" I would say, "Never mind the strength of the merchant marine today". I would ask the noble Lord whether the Government have a proper strategy to protect the merchant marine in a way that enables it to operate in a time of war or a time of build-up to war.

In this respect I was doubly worried by what the noble Lord, Lord Kennet, said—that he actually allied himself to everything that the noble Lord, Lord Boston, said. I have read Hansard to double check my facts. He said that he was in complete agreement with what Her Majesty's Opposition said. I am worried about that because I was told in the early days of the Alliance and the SDP that they would have an independent line on defence. Various noble Lords in your Lordships' House and Members in another place were kind enough to come to me. I was so honoured and so amazed that I had been noticed. They asked me whether I would care to join the Alliance Benches. I asked very definitely whether the SDP had an independent defence strategy and policy. I have never expected the Liberals to have one. I asked whether there was one. I was told that there was. I was told last Thursday, or whenever it was that our first debate took place, that the SDP entirely agreed with Her Majesty's Opposition. I was saddened. That is my political worry about defence. I commend to noble Lords that they come to our all-party defence study group, because we discuss these things. We talk about them. Your Lordships can give us your views. We never hear them. That, too, is sad.

I now come to a practical point. I am for Trident. I always have been. If your Lordships care to look at a speech or two that I have made in this House in the past, it will be seen that I believe that we sometimes misunderstand the need for the nuclear deterrent, whether it is strategic or tactical. The Russians wish your Lordships' House, those in another place, those in Whitehall and those in Westminster, to be singularly sucked into the NATO and the European scene. The danger is outside the NATO scene. The danger is that while we are pulled in by the NATO argument and by the European argument, this is exactly what the Russians wish. It is necessary to see what they are doing on the periphery. I live for quite a large part of the year in South-East Asia. If your Lordships were to see the build-up of Russians out of Vietnam, within the Pacific basin and within South-East Asia today, you should be worried, you should be very worried. Because this is happening outside NATO, you feel perhaps that it is not a matter to be discussed here. But the presence, the strength and the power of the Russian influence right down to trade union level in various islands of the Pacific and other places is very real.

I have one final thing that I wish to say to your Lordships. I have come from 8,000 miles away. I asked whether I could speak to your Lordships for eight minutes. The noble Lord, Lord Chalfont, mentioned the servicemen in Her Majesty's armed forces. I believe that your Lordships should reflect most sensibly on the pacifist argument, the CND argument and the Left-wing argument. I am very sad that Her Majesty's Opposition did not stand up and say that they would remove the missiles or lots of Americans from this country if they got back into power. It is a good Labour gimmick, maybe. But your Lordships in this House, we, in this House, are going to send soldiers into battle, sailors into battle and airmen into battle—our people—without the ultimate threat, without the ultimate deterrent.

We are going to say to them, "You fight. We are telling you it will be a conventional war. You are all right. It is just guns, butter, ammunition and that sort of thing. Do not worry. There is no nuclear involvement here". Every soldier, sailor and airman that I have met knows that no Russian will cross a frontier unless the mind has already been made up that when he wishes to, or when he feels it is right, in his view, the Russian will loose chemical warfare and the nuclear weapon, whether it be strategic or tactical, and he will do it. Otherwise, he will not cross the border.

We have all these arguments about this and that, and about conventional war and what have you. I say to your Lordships very seriously tonight that if you believe in your armed forces, if you believe in the men and the women in the three services and if you, some of you, come to power in this politically democratic life that we live and intend sending Her Majesty's armed forces into battle without the ultimate weapon that could save them, without the knowledge that they have a back-up of something that is strong and which might win, I think that it is shameful. It is also not good politics. It is, I believe, very poor strategy. I wonder sometimes whether we are really doing our best for our country. I thank you, my Lords, for allowing me to speak for a few moments. I hope that my words strike home.

Lord Boston of Faversham

My Lords, before the noble Viscount sits down, I would ask him, in view of the extraordinary and astonishing attack that he has made upon the noble and gallant Lord, Lord Carver, upon the noble Lord, Lord Kennet, and upon myself, to reflect on this. If he heard the three speeches that were made by those members of your Lordships' House last week, he certainly did not listen to them. And if he read those three speeches, he certainly did not take in what he was reading. The view that he has given of those three speeches could hardly be further from reality.

Viscount Slim

My Lords, I am grateful to the noble Lord for raising that point. I rather hoped that he would. I so disagree with the noble Lord that it is very difficult in some ways to answer. I have had many discussions with the noble and gallant Lord, Lord Carver, whom I very much admire and whose integrity and experience is without question in your Lordships' House. However, I disagree with him over the whole business of nuclear strategic and tactical deployment and operational use. I have to say that to the noble Lord, Lord Boston. I have not only read the three speeches; I was in the Chamber when the noble Lords that he named made those speeches. I am perfectly happy to argue with the noble Lord, Lord Kennet, on any matter concerning the strategic nuclear deterrent. I state my case quite clearly. And if the noble Lord should like to have a glass of whisky with me afterwards, I would put him straight, too.

7.48 p.m.

Lord Mackie of Benshie

My Lords, it is difficult to rise to speak after such a self-evident guru, but I shall do my best to be fairly practical without perhaps assuming the mantle of greatness that has so obviously fallen upon the noble Viscount who has just spoken. The fact is that this has been a very interesting debate in which a great number of practical points have been made. The debate has also revealed a large degree of agreement on all sides of the House, together with a large number of doubts about the conduct of particular things, two especially.

The first of those two major points is the decline in our Merchant Navy and the resultant lack of back-up for the Royal Navy and for amphibious operations in time of war or emergency. It is an extremely serious point that has been made all over the House many times. It is one that the Government must take extremely seriously.

The other point is that a large number of people are very doubtful as to whether our conventional defence, our conventional forces in the field, can be kept up properly, in view of the declared intention to stabilise expenditure and the rising costs that are evident all round.

The noble and gallant Lord, Lord Hill-Norton, devoted his speech to his doubts as to whether the good intentions expressed in the White Paper could be realised. This is perhaps a major point on which the debate has concentrated. It is very interesting that right now in NATO a great debate is taking place on this very subject. In the latest NATO Review it is the leading article. It quite clearly quotes General Rogers' warning that: if war broke out today, it would only be a matter of days before I would have to turn to our political authorities and request the initial release of nuclear weapons". The one thing on which we are all agreed is that the day that that situation arrives, all our defence policy has been in vain.

We on these Benches accept the fact that conventional defence without nuclear back-up cannot be viable because you are always subject to the blackmail of nuclear attack. This is a major factor, and one which we accept. But the vital point which the Government and the House must look at today is: can we afford our particular form of expenditure on nuclear weapons and at the same time maintain the vital first line of defence? I think that it can be done. We accept the need for nuclear stalemate, or call it what you will, for this we must have. However, we must look at whether we can afford Trident. Our view has been quite clearly that we cannot afford it. The noble Lord, Lord Mulley, suggested that, in view of our changed position, we should renegotiate the spread of expense over Europe. Perhaps we should do so. But the plain fact is that we will not be able to supply and properly maintain our conventional forces, which we are all agreed are the first line of defence. If they fail, then we shall have failed.

A great deal of what is said in the White Paper illustrates this. The Government have agreed a reasonable rate of increase in pay for the forces, which is very important. However, they have said that that will be achieved within the compass of increased efficiency; that increased efficiency in competition and in other ways will pay for it. People who know about this do not think that it can be done. They have said that they have heard this story before and that it will not happen. Last week my noble friend said that we all know how to do it. Anyone who has been a Minister—or, for that matter, anyone who has not—knows perfectly well that you delay the supply of new equipment and you delay programmes. You cut out this and you cut out that. This is a degree of fudging which does enormous harm.

Last week the noble and gallant Lord, Lord Carver, said that it was most important to maintain our conventional forces, and the noble Viscount the Leader of the House made a very interesting reply to that suggestion. He said: Would I not be right in thinking that the more we did that the more certainly the Soviet Union would seek to preserve what I understand is about a two-to-one superiority?". The noble Viscount went on to say: and seeking to maintain conventional forces of the necessary size would be every bit as much as the cost of the 1 rodent programme".—[Ofcial Report, 26/6/85; col. 800.] That was an extraordinary admission from the noble Viscount. He is suggesting that we should unilaterally appease Russia in the form of not equipping our conventional forces properly. I do not think that the noble Viscount meant to say that, and perhaps the Minister might refute it when he replies, but that is what he is reported as having said in Hansard. I can only say that it does not appear to me to be very logical.

Without any doubt the logic lies in maintaining our conventional forces, and, as they are two-to-one in defence, their quality in equipment, morale and experience needs to be much higher than that of the opposing forces—and at the present time it is. That is what we must maintain as our first line of defence. In order to do that we need to maintain pay and equipment and to avoid the sort of niggardly gesture we had when the German overseas allowances were cut. I know that they were good allowances, but they were originally given so that our people in Germany would not live at a lower standard than those alongside whom they were serving. That appears to me to be entirely logical, and to reduce them is not the sort of thing that helps morale. Morale is one of the major factors which we must maintain, and one way of doing so is to ensure that the troops trust the Government's long-term intentions.

Much has been said about the navy, and very little has been said about the Royal Air Force. I am not being rude when I say that it is high time that we had an Air Marshal in this House. We have many of the very best types of admirals and generals, but we should have an active Air Marshal as a Member of this House to keep up the end of the Air Force. I know that the sons of very distinguished Air Marshals of the Royal Air Force do their best, but when the noble Viscount, Lord Trenchard, and I try to do our best it is not the same as having a real expert here.

I should like to make several points about this great service. It is a service in which a long time ago I was very proud to serve, and it is a service of which I am very proud today. In the spring I visited the base in Cyprus and was delighted with the quality of the officers and the men I met. They were of the very best of the types we had in wartime—and we had a fair mixture then, but the best were very good. All the officers and men I met appeared to be at the level of the best of my wartime comrades. If we are to maintain the Royal Air Force at its proper standard, a number of matters need the attention of Her Majesty's Government in a way which they have not had it in the past.

In the White Paper the Government quite complacently say that: The new structure has come into effect, as planned, on 2nd January 1985 and has been operating successfully for several months". They say: It is designed to provide, on the one hand, for stronger central control of defence policy, operations and resources … and, on the other, for decentralisation to the Services and the Procurement Executive (PE) of day-to-day management". It is extraordinary that the Chiefs of Staff of the various services who are responsible for the whole operation of their particular service can have no say in the procurement of essential equipment. That must be wrong.

I know that it will work if the Chief of Staff and the Chief of Procurement are friends and are in accord, but what will happen when they are not in accord? There must be times when there are strong disagreements. It is all very well saying that there will be consultation, but what is consultation if, as the Chief of Staff of a great service, you can be overridden? It must be wrong, and to say at this time that it is operating successfully is, with great respect, nonsense.

The great tradition among military men in this country is that they are the servants of the Sovereign's Government, of the King, and their country. We have never had the sort of dangerous political generals, admirals, and air marshals that there have been in other countries. Of course they will try to make it work, and at this stage they are trying to make it work, and probably there is agreement, but to say after five months that it is working sucessfully is a little optimistic. The whole policy of separating responsibility from procurement is, to coin a phrase, slightly bonkers.

The next point I should like to raise concerns the European fighter bomber. I know that the noble and gallant Lord, Lord Carver, thought that it might be shelved. But I think we must disagree on this point with the noble and gallant Lord. It is true that ground-to-ground missiles take a great deal of risk out of attack, and you can use them on permanent bases, but there is no real substitute for man in an aeroplane. It is true that a computer can do away with human mistakes, but it cannot equal human ingenuity and human determination. It would be entirely wrong at this stage to accept the suggestion that the day of the manned fighter might well be over, and that we should make do with what we have.

The point I am trying to make is that the decision to build the fighter should not be based on political expediency. Certainly to accept the French position would be entirely wrong, because anything they have falls way behind the standards required. I seek an assurance from the Government that in this matter what will be paramount will be the quality, the design, and the specifications of the aircraft, not any political or money-saving conditions.

The third point with regard to the RAF is one to which I beg the Minister to give me a proper reply. This year there is to be a 15 per cent. cut back in fuel allocation to the RAF. This can only mean a cut back in flying. Nobody is going to tell me_ that a cut back of 15 per cent. is not significant. The great thing about training is that you have to fly. If you fly, you have to fly intensively and fly for the number of hours and in the sort of conditions that you will meet in operations. Otherwise when there is a war and an emergency and people have to fly hard and up to the limits of human endurance, they will not be able to do it.

Intensity of flying in the RAF has produced excellent results. In all the NATO and bilateral competitions the RAF have come out very high and won a large number of prizes for their competence. I hope that the Minister will be able to tell me that he will rescind this order and restore the allocation of fuel. It is vital to training. It is cheeseparing of the worst sort to cut the number of training hours that the RAF does.

I cannot finish without saying something which really belongs to last week's debate. When the noble Viscount the Leader of the House comes to consider it I think he must reflect whether the debate has worked well, because I find it difficult to stick to a technical point. I have already said that what we should be looking at is whether the cost of Trident is worth what all sides of the House have said will be a depreciation in the quality of our conventional forces.

I also make a point which has been made a number of times. It is that what we are doing here—and I think that the noble Earl, Lord Cork and Orrery, brought this out—is not defending our country, or defending peace, or defending a principle; we are defending the survival of the human race. That is what we are doing at the present ime.

Of course it is difficult. It presents us with terrible dilemmas, but the fact is that in the Soviet bloc they have the same appreciation of the dangers being faced. They have the same appreciation of the expense, and of the difficulties they have with their own population. Of course they know this. The White Paper says that they are paranoid, or something to that effect, about their own security. Of course this is true. It says that we have to have great perseverance and keep up our forces, and wait and wait—and people have quoted various times—until common sense returns.

I do not think that common sense is all that far away. What we need is the sort of policy and the sort of action that we have had from the Foreign Secretary, who did a great deal of good with his East European tour. We have to keep talking. The Russians can see perfectly well from our defence estimates how determined we are to oppose them, and we have to keep assuring them that we do not want to destroy them. We do not want to complicate our assurances on that by the sort of speeches sometimes made—and backed up by our Prime Minister—by American leaders.

It is important for us to realise that we have to live with this bloc. We are all agreed that we have to oppose their aggression, but for goodness sake let us set about convincing them that there is no danger to them if they do not attack us. If we do that, we might see the sort of common sense that we all require, which is a balanced reduction in the forces of terror, keeping them even, if that is what has kept the peace.

8.7 p.m.

Lord Graham of Edmonton

My Lords, the House has heard warm tributes paid not only to his maiden speech—an impressive beginning to a long and distinguished period in your Lordships' House—but to the qualities of the man called Lord Crawshaw of Aintree. From these Benches I give him a warm welcome. He knows that he comes among many friends from the other place. Friendships made then, despite regrettable shifts in political allegiances, will serve not only him but the whole House. Our personal friendship remains unimpaired. I wish him well in your Lordships' House.

Last week my noble friends Lord Boston and Lord Cledwyn took time and great care to recognise—with great clarity—the awesome task facing all those with front-line responsibility in defence matters in this day and age. Between them, as the record will show, they expressed the views of the Labour Party across a wide range of defence issues: the nuclear arguments; Trident; NATO; the strategic defence initiative; the SALT talks; staff reorganisation; public expenditure; conventional versus nuclear weapons; the brain drain; and world diplomacy. They spoke, and speak, with the authority of the Labour Party. They have the respect of the House. They both have my thanks for their effective and valuable contributions.

Your Lordships did a good job last week in restricting the debate to Chapters 1, 2 and 3 of the White Paper. Today we have striven, fairly successfully, to limit our debate to Chapters 4, 5 and 6. I would remind your Lordships what they are: Forces and Equipment; The Management of Defence; and The Services and the Community. Because of the deep interest and the experience gained and garnered over many years, your Lordships have created a form of debate which may have much to commend it, but speaking now more than seven days after it was opened by the noble Lord, Lord Trefgarne, I find that there is an air of weariness, perhaps battle weariness, about our proceedings at this hour.

A seven-day half time, as it were, takes some of the immediacy away from such tension. Yet, listening as I have today to most of the speeches made from all parts of the House, I have to confess that your Lordships have displayed a great facility for hanging in there and punching hard for your individual stances. Not only as always does your Lordships' House benefit from the words that have been spoken in the other place, where their two days of debate were consecutive, but we can reflect on what your Lordships said last week.

I want to begin by saying a word about the morale of the personnel who form the fighting forces and those who sustain them in a variey of ways. Within the changing role for our fighting forces the Government have a simple solution to keep them happy: pa), them above the going rate. Having budgeted for 3 per cent. we find that the Armed Forces Pay Review Board awarded 7.3 per cent. a net over-requirement of some £133 million. There was no hesitation in accepting this recommendation, only where it was to be found "within economies elsewhere in the defence programme", the Prime Minister told the other place.

The noble Lord, Lord Chalfont, reminded us (in one of those speeches to which I always listen with great interest and respect) of the importance of morale, and he raised the matter of the LOA. I am reminded of a Question that was asked by my noble friend Lord Mulley only last week when the details were given. We have to consider the figures here: for a single corporal there is a difference of £1.27 per day over seven days a week. That is a net reduction of £9 a week. The Minister must reply not only to the points made by the noble Lord, Lord Chalfont, but by a number of other noble Lords on the net impact on the forces of decisions of that kind.

No one will deny that the front line fighting forces are sustained by a host of backroom support. How do the Government treat them? We have had a number of references to the naval dockyards—a once vital part of our maritime defences and our defence strategy—which now, if they are not sunk without trace, are a sad and sorry reminder of our once proud naval heritage. They are to be partially privatised. And, ultimately, who knows‡ Do the Government know? Will the Minister take this opportunity to put the future of the Royal Naval Dockyards in the setting of our future strategy? Our ordnance factories are going through one of the unhappiest times in their 300-year history. The Minister knows that we from these Benches have conveyed that unhappiness on behalf of thousands of ordnance factory employees. A swift programme of privatisation faces them. The Minister is on record as desiring ultimately 100 per cent. of our weapons procurement to come from the private sector. He presides over an unhappy, unsure and anxious workforce.

There is a need to tell the Government that not only was there wholly inadequate consultation with or care for the welfare of those civilians employed in our defence establishments, such as the ordnance factories and the naval dockyards, but also their actions against trade unions and trade unionists at GCHQ, the heart of our security service and at the heart of our national defence caused anger and dismay. We shall come hack time after time to remind not only trade unionists but all fair-minded people. Whatever are the imperatives of the Government they have a wholly misconceived concept of dealing with public servants in a trusting, caring and responsible way. Those chickens which have severely damaged the morale of public servants will come home to roost, and I venture to suggest before very long.

Page 40 in the review deals with civilian manpower and boasts that the Ministry of Defence has since 1979 shed 73,000 of what it calls "locally-engaged civilians". We are told that civilian manpower reductions are on course, even ahead of targets, down to 169,000 by 1986 rather than by 174,000. There has been a reduction of 79,000 since 1979. How is this to be done? How will it be done? By dropping, curtailing, contracting-out and privatising. Thus we can see how this works in the case of the ordnance factories. On page 36 we read that in 1980 there were 21,800 non-industrial and industrial workers sliding to 19,000 in 1985. Then by a stroke of the pen or by changing status from a Ministry of Defence establishment to an independent Companies Act company 19,000 civil servants are wiped out: they disappear from the record. But of course they remain: they continue to perform vital national work but in their case they are disgruntled, apprehensive ex-civil servants. Why? Because they now know that even our national defence and security is up for grabs—"Small arms factory. Good working order. Good workforce"—it is up for sale eventually by being floated to the highest bidder.

The British Maritime League is in little doubt that the partial privatisation of the dockyards is a good thing. It said so in its memorandum of 31st May; but it goes on to say that there is great concern about the announcement by the Secretary of State that there would be an inescapable need for adjustments in the workforce in the short term to improve dockyard efficiency. The League tells us that that is not necessarily true or even realistic. It may not even be prudent. The League tells me that the recent closure of Chatham, Gibraltar and most of Portsmouth has already caused chaos and there is now serious doubt about the capacity of the two remaining dockyards to meet the fleet requirements in peace, let alone the far greater work load and variety in war. Will the Minister comment on those statements by the British Maritime League? Does he take those views seriously? The House is entitled to know.

Hard boiled or soft centred, the Secretary of State for Defence clearly has a sweet tooth. The Daily Telegraph gives us a new confection: "Heseltine fudge"; a kind of palliative, a bromide, designed to be swallowed easily but alas‡ leaving a nasty taste in the mouth; already retailed. Nevertheless the opening sentence of that quotation is well worth repeating: If the statement on the Defence Estimates were the accounts of a public company they would at best have sent the share price sliding and at worst been qualified by the auditors". The noble Lord, Lord Mottistone, described the reviews as, in part, window dressing. If the affairs of the nation are not the most public of all companies, what are they? If the management, the presentation and the guardianship of the national interest in terms of billions of pounds is inferior to those of a public company we are merely living in cloud cuckoo-land. We are not. The Daily Telegraph is fully justified in applying both the analogy and the strictures.

Let me draw for the Minister an aspect of defence provision which causes such strictures: the gap between promise and performance. The replacement rate of orders for frigates has not begun to reach the minimum of three to four a year. None was ordered in 1983; only one in 1984; two were announced in January 1985, but contracts for three Type-23 frigates we were told will probably not be placed until next year. The shortfall now is therefore at least six and that is liable to rise. Will the Minister comment on that aspect?

Nothing said by any parliamentarians in either House can remotely approach the devastating critique of the state of the Merchant Navy that we heard from the noble and gallant Lord, Lord Hill-Norton. It was based on his experience and expertise. We are all deeply in his debt. His observations on security must be appreciated by the Secretary of State. To ignore them would be to do so at our peril. The enhanced role of the Merchant Navy with our nation's defence strategy is recognised by the nation. Its signal part in assisting in the Falklands war is a matter for record and for pride.

I take nothing from either the Government or the Minister in their rightful gratitude to our Mechant Navy for their sterling work. But what, in fact, do we find within the "blue pages"? Paragraph 458 on page 30 begins well: The United Kingdom's Merchant Navy is a vital defence resource and as such plays an important role in our planning". So far, so good. We all know what world trends are in shipping tonnage, and the table on page 30 makes sober and sombre reflection. I agree completely with the statement on page 31 when it says: It is of concern that, if the decline continues for several more years at the present rate"— and I repeat, "at the present rate"— … it could become increasingly difficult for us to discharge at least some of our NATO obligations". More than one speaker in your Lordships' House or in another place has stressed the crucial importance of the news on page 31 that a report on the future trend of availability in those parts of the merchant fleet for which there is a defence need should be produced at the earliest moment. We are told that it can be expected by the middle of the year. My noble friends Lord Cledwyn and Lord Boston asked last week when—and we are now in the middle of the year and reaching the second half of the year. When, indeed, can we have that report?

I wish briefly to refer to a helpful development in the sphere of civil defence, a not-wholly-unrelated field from that of defence and covered, in my view, by paragraph 623 on page 46, which relates to defence and public relations. It says: The activities of the Services and their interaction with the wider community are an important way of keeping defence matters in the public eye". The noble Lord, Lord Renton—and I am sorry to see that he is not in his place tonight—has done this House and, I believe, many outside a signal service by exploring ways of increasing not only the awareness but also the effectiveness of civil defence. He has recognised that while there are deeply held differences on the use of public money to make preparations for a nuclear war, there is a powerful case for what is called the all-hazards approach—an attempt to depoliticise the civil defence issue, so that the believers in deterrence and disarmament alike can agree upon civil defence measures without prejudice to their different standpoints on military policy.

The National Council for Civil Defence now has 230 parliamentarians, sponsors in both Houses and representing all the main political parties. Surely this can only benefit the country as a whole, and I welcome those initiatives. I take nothing away from the crucial importance to our national interest of the defence of the realm when we recall the grotesquely swollen size of the defence budget—£ 18 billion—and we are right to see this segment of the government of our country as deserving of all our attention. Yet that is not how the people of this country see it. I do not mean that they are not interested or affected by defence considerations. They know, and we know, that they are. What I mean is that when it comes to getting it right, policy, cost-effectiveness and satisfaction, the people have other priorities.

The latest confirmation of the low priority given by the public to defence matters comes from the Brecon and Radnor by-election—a place in which we have all taken an interest with varying degrees of enthusiasm and to which we will listen even more avidly on Friday morning, again with varying degrees of interest and appreciation. The Times yesterday carried the results of a MORI poll taken in Brecon and Radnor. It shows that the first priority, the first worry of the people, is not defence; it is unemployment. The second worry is inflation, and not defence; the third is law and order, and not defence; the fourth is the state of the health service, and not defence; the fifth is defence, followed by education and, lastly, trade union strikes.

The noble Lord, Lord Trefgarne, when opening the debate, reminded your Lordships that £18 billion is a lot of money, and that spending money on defence meant forgoing expenditure on something else to which, in an ideal world, we should all like to give priority. The people of Brecon and Radnor and, indeed, the people of the country, I think, have their priorities for expenditure on these matters absolutely right.

I wish to express approval from these Benches for the Government's stance in the field of chemical warfare. We note on page 53 the growing stockpile of chemical agents built up by the USSR, and I noted the interesting exchanges on these matters in another place at Question Time yesterday. We from these Benches approved years ago, and support now, the resolve of Britain to renounce the making of such appalling weapons and acknowledge that even now the Government are right in persisting in taking part in discussions to seek agreement for the ultimate elimination of these inhuman weapons. We shall continue to give support, not for the matching of other stockpiles but for the elimination of all stockpiles.

Finally, it is a privilege and an honour to conclude my remarks made on behalf of the Labour Party with a warm tribute, unstinted and unqualified, to the fighting forces of the nation. They have fulfilled their task to the satisfaction of the nation. Their standards, their professionalism, are the highest in the world. They bring both pride and comfort to us all. They accept the role of doing the dirty jobs while facing great danger. They secure our peace of mind in the same way as do our police forces—and, indeed, as do our prison officers—performing tasks that society creates and then hopes will be fulfilled cleanly and efficiently. We shall continue to agree to disagree on policy and priorities with the Government; but we can agree with the Government and the nation that we have the finest fighting forces in the world. Long may it remain so‡

8.27 p.m.

The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne)

My Lords, the second day of this year's debate on the Defence Estimates has encompassed as wide and deep a range of subjects as did our debate last week. Today, we have had the particular benefit of the maiden speech of the noble Lord, Lord Crawshaw of Aintree, which, with my particular responsibility for reserve matters with in the Ministry of Defence, I, as the noble Lord will understand, specially appreciated. I congratulate the noble Lord upon the style and content of his speech and I hope that we shall have the opportunity of hearing him again soon and often thereafter.

We have discussed many aspects of the Government's defence policies and a good deal of our military hardware. I would now like to concentrate for a few moments on the most valuable and sophisticated items in our inventory. They are precision-guided, accurate, versatile, capable of operating in a wide variety of conditions, and reliable. I am referring, of course, to the men and women of the armed forces. They are the most important assets we have. Without them, all our ingenious and valuable military equipment is just so much expensive scrap metal. I believe that this sentiment will be very much appreciated by my noble friend Lord Cork and Orrery, the noble Lord, Lord Mulley, the noble Lord, Lord Chalfont, and, indeed, every other noble Lord who has spoken.

When this Government came into office in 1979, service pay had been allowed to fall well behind that of comparable outside occupations. We made a firm commitment to restore and thereafter maintain pay comparability for the armed forces. We have kept that commitment by accepting the recommendations of each and every report of the Armed Forces Pay Review Board. Last year, there was a need to show particular restraint in public sector expenditure, and the 1984 award was therefore staged. Nevertheless, we kept our pledge to maintain comparability by introducing the full rates by 1st November 1984. This year the recommended rates have been implemented in full from 1st April.

Pay, of course, is not the whole story. Conditions of service—the armed forces' quality of life—arc of considerable importance and very much in the mind of the noble Lord, Lord Chalfont. We try to ensure that, within the limits of justifiable public expenditure, we give our servicemen and women the best possible package of conditions of service. The Government have made a number of improvements in recent months. For example, we have introduced a 30 percent, discount scheme for the sale of surplus married quarters; we have introduced Falkland Islands pay for certain repeat tours in the South Atlantic; and we have made a number of improvements for those serving in Northern Ireland. We will consider further improvements as the need arises.

There is one aspect of service allowances that has been the subject of considerable and often misleading publicity—some of it, I fear, echoed by the noble Lord, Lord Mackie of Benshie, tonight—and I should like to spend a few moments talking about that. I am referring to the reduction in Local Overseas Allowance for our forces in Germany. The noble Lord, Lord Graham, mentioned that too. Perhaps I may remind your Lordships that Local Overseas Allowance is a supplement to service pay in locations where expenditure on day-to-day living is higher than it would be in the United Kingdom. It is not an inducement or reward for service overseas, nor for the long hours or potential dangers of service life, which are all taken into account in assessing the correct level of service pay. It is a tax-free cost-of-living allowance.

The differences between the cost of living in this country and in overseas countries can narrow as well as widen. It is inevitable, therefore, that there will sometimes be LOA reductions as well as increases. The recent review of LOA concluded that the level in Germany should be reduced, while LOA in other theatres has been increased—although we did defer the reductions by two months longer than would normally apply. I can understand there being some unhappiness at the reduction among servicemen and women in Germany, but I also believe that there is general understanding of the reasons for it.

The pay and conditions of service in the armed forces, as well as the opportunities for alternative employment that exist in the country as a whole, all play their part in determining levels of recruitment and retention in the services. At present, manning levels are generally being maintained and recruitment is satisfactory. We do not, of course, simply rely on glossy brochures to attract young men and women of the right calibre to join the services. We rely to a great extent on the organisations that are available for young people to join and through which they can receive training, education and motivation to build up and maintain their interest in the services.

Among such organisations are the university air squadrons, and I should like to take this opportunity of announcing a small but significant change to their practices. Since their foundation 60 years ago, the university air squadrons have provided a marvellous opportunity for interested undergraduates to train and work with the Royal Air Force. In particular, of course, they have been a splendid and valuable training ground for future RAF pilots. With the emphasis on recruitment of pilots, we have, however—not unnaturally perhaps—had to restrict flying opportunities for other UAS members. We have now decided that we should be less restrictive and that all other members of the UASs, such as engineering cadets, should be able to carry out flying training with their squadrons. I am delighted to say that this will also allow us, for the first time, to provide flying training for our female UAS members. These changes will be achieved within existing resources. I think that this is a most worthwhile step. It will strengthen the UASs, encourage individual students and benefit the service as a whole.

Turning to the Royal Auxiliary Air Force, mentioned by several noble Lords, prior to 1979 it had a strength of only 250 at three maritime headquarters. Since then the force has undergone a major expansion. It is planned to build up the Royal Auxiliary Air Force to a strength of 1,700 personnel: almost a seven-fold increase. At the same time, the roles undertaken by auxiliaries have been widened to include ground defence, movements and aeromedical evacuation. Six auxiliary field squadrons have now formed. Both the movements and aeromedical evacuation squadrons took part in Exercise Lionheart last year. Earlier this year, an auxiliary air defence squadron, equipped with the Skyguard anti-aircraft system (captured, incidentally, from the Argentinians) was formed at RAF Waddington.

The noble and gallant Lord, Lord Hill-Norton, takes a particular interest in matters of home defence, and he referred again to them today. I believe he will be interested in what I now have to say. I am pleased to announce that a further expansion of the Royal Auxiliary Air Force is now planned. A trial will be held over the next two years into the formation of an auxiliary support force along the lines of the Army's Home Service Force. This force would undertake a variety of support and defence roles at RAF units in the United Kingdom, releasing fully-trained regulars to the more specialised duties.

A trial will also be held at two university air squadrons to assess the feasibility of filling instructor posts with members of the Royal Air Force Volunteer Reserve Training Branch. If successful, this would then release qualified flying instructors to the front line. Finally, a further RAFVR flight will be formed at RAF High Wycombe to provide intelligence support at headquarters and front-line units: a total of 75 personnel will be recruited. This is a clear indication of our support for the reserves and I hope it will allay the fears of certain of your Lordships and particularly those of the noble and gallant Lord, Lord Hill-Norton, who is concerned about the number of men available for home defence.

Perhaps I may now turn to some of the other points that have been raised during the course of the debate. I have a quantity of material in front of me and I hope your Lordships will forgive me if I go at a fair pace. My noble friend Lord Cork, in his opening remarks, urged us to look carefully at the provision of training for overseas students. I can tell him that we are currently reviewing the provision for foreign and Commonwealth training and I can assure him that his comments will be taken into account—not least by me, since I am involved in the conduct of this study.

The noble Lord, Lord Mulley, and also my noble friend Lord Cork mentioned the problems of NATO interoperability. I can assure both noble Lords that this is a topic to which we give high priority. We work through NATO to co-operate on equipment matters so as to avoid the wasteful use of research and development resources and to enhance interoperability, leading to more operationally effective forces on the ground. My right honourable friend the Secretary of State for Defence participated in a useful meeting of the REPG at Lancaster House the week before last, when it was possible to report significant progress with European efforts in this area.

The noble Lord, Lord Mulley, also asked about mine counter-measures vessels The White Paper gives details of the measures in our drive to modernise our mine counter-measures capability to meet a threat which is growing in size and sophistication. Since its publication, we have announced the orders for a further two Hunter class MCMVs, which will be the 12th and 13th ships of the class and will replace existing 'TON class vessels at the end of the decade. We recognise the vital importance of this aspect of warfare and believe that the programme we have demonstrates our resolve to keep up the modernisation of our MCM capability.

As your Lordships know, we have a number of new equipments in service or in development: the Hunt and River classes, the single-role mine-hunter and Sonar 2093. We believe that the Royal Navy is a leader in this field both in operational effectiveness, as Operation Harling demonstrated in the Gulf of Suez last year, and in new technology such as the single-role mine hunter and its variable-depth Sonar. I shall shortly have something further to say to my noble friend Lady Airey about another aspect of mine counter-measures activity.

The noble Lord, Lord Mulley, asked about the AFPRB award and how it was to be funded. The net cost of the award is approximately £216 million. Provision for an increase of 3 per cent. has been made in the defence cash limit for 1985–86. The additional cost of the award will be contained within the defence cash limit for the year. It is too early to say what adjustments may have to be made to the defence programme in order to meet this extra cost but, to judge from most of the remarks made by your Lordships during the debate, the pay increases will be very welcome not only to those who will receive them but also to your Lordships.

I turn again to the admirable maiden speech of the noble Lord, Lord Crawshaw, who referred particularly to the Territorial Army and the current expansion of that force. The success of our plans to expand the TA to a strength of 86,000 by 1990 will dpend on our ability to recruit and retain men and women of the right calibre. Recruitment is going well and TA strength at the end of April was over 73,500, compared with around 71,000 towards the end of last year. I am confident that the target of 86,000 is achievable with sustained efforts on recruiting and retention and, above all, with the support of employers.

I turn now to a matter which is much in the minds of many of your Lordships: that is the concern which has been expressed about our merchant fleet. The noble and gallant Lord, Lord Hill-Norton, my noble friend Lady Airey, the noble Earl, Lord Attlee, my noble friend Lord Ashbourne and several other noble Lords referred to this matter. As your Lordships know, our merchant fleet plays a significant role in our defence planning. Consequently, as the Defence White Paper makes clear, the recent decline in the merchant fleet has caused us concern. I repeat that at the present the overall size of the merchant fleet is adequate to meet our foreseeable defence needs, with the exception of deep-sea trawlers for the minesweeping role, a matter particularly on the mind of my noble friend Lady Airey. In the latter case, we have studies urgently in hand to find alternative ways of meeting the require- ment. My noble friend referred to one or two possibilities.

Because of our concern at the possible prospects for the future the Department of Transport commissioned its study of future availablility of merchant vessels to meet our requirements. This study has just been received by the Department of Transport. Its results will now be carefully examined by both that Department and my own, the Ministry of Defence. I cannot predict in advance what will be the outcome of that examination, but I can say that close monitoring of all aspects and implications of changes in the merchant fleet will continue, as has indeed been the case in the past. We have recognised the problem, we have begun our detailed study of the problem, and we shall in due course have to decide how to proceed.

The noble and gallant Lord, Lord Hill-Norton, speaking in particular about his concern regarding the shortage of forces for home defence pointed to what he thought was a discrepancy in the numbers of forces available. But I believe there is no discrepancy between the statement in SDE 84—that there would be some 100,000 ground forces available on mobilisation for home defence—and statements in SDE 85 which suggest that about 100,000 men would reinforce BAOR on mobilisation. Volume II of this year's White Paper shows that at the beginning of this year the number of trained men in the Regular Army was about 140,000 and the numbers of men in the Territorial Army and Regular Army Reserves were about 66,000 and 148,000 respectively. In addition, significant numbers of ground forces for home defence on mobilisation would be provided by the Royal Navy, the Royal Marines, the Royal Air Force and their respective reserves. I therefore believe that I can look the noble and gallant Lord in the eye and say that we do indeed have about 100,000 personnel available for this role should the need arise.

My noble friend Lord Kimberley referred to his particular interest in airships. He raised the interesting possibility of a military application for these machines. As he already knows, it is a subject in which I have taken a particular interest. We have looked carefully at a number of areas of military activity where airships may have potential applications and our investigations are continuing. Although airships have shown themselves likely to have certain advantages in particular tasks, for military roles these are expected to be outweighed by the disadvantages. We have not yet been persuaded to include airships in our plans in preference to the platforms currently envisaged. We are, however, continuing to examine the potential of airships. We shall be proceeding with a two-week trial on the Airship Industry's 600 airship, and we shall of course follow closely all evaluation work which is carried out on airships elsewhere. I can assure my noble friend that we do not have a closed mind on this matter, but we have to take into account the realities of the situation.

My noble friend Lord Trenchard, in a characteristically well-informed and trenchant speech—that is not a pun on my noble friend's name—spoke at some length about the views of the noble and gallant Lord, Lord Carver, and others, about the possibility of using enhanced conventional technology in our defence activities. I have a lot of material here in reply to the noble Lord which very much shares some of his views. Perhaps, if he will forgive me, I shall write to him with some of that information.

The noble Earl, Lord Attlee, asked me also about the Royal Marines' winter training in Norway. As he will already be aware, following his visit to Norway earlier this year, we feel that it is crucial for the Royal Marines to receive training in the worst conditions likely to be met in this important theatre, and with the agreement of our Norwegian allies we intend to continue to train there on an annual basis. We have no plans for summer deployments. We believe that the important thing is to train in the worst conditions that are likely to be met.

The noble Earl asked me also about the MCV80. As my right honourable friend the Secretary of State for Defence announced in another place on 12th June, we have placed an order for 1,048 MCV80s with GKN following the completion of trials on the main variant.

My noble friend Lord Ashbourne asked me about the problems of premature voluntary release—PVR as it is called—particularly I think referring to the Royal Navy. Manning levels are generally being maintained and, as I said earlier, recruitment is satisfactory. There is, however, a rising trend of applications to leave the forces prematurely, and the figures are therefore kept under close scrutiny. This rise must, however, be measured against the exceptionally low levels of PVR which followed the restoration of pay comparability by this Government in 1979.

My noble friend asked me also about the success of our policy of carrying out more training at sea. It is true that the numbers leaving the Navy, as I have just said, appear to be rising marginally over those that were occurring a year or two ago. But we do not believe that the extra time spent at sea as a result of the transfer of some training to sea is a major factor in this.

My noble friends Lord Ironside and Lady Vickers and others asked me about the dockyards. I think they are particularly anxious to know when a decision will be taken. We are at present engaged, as my noble friend knows, in a thorough and wide-ranging process of consultation. Our intention following completion of that process is to take decisions in time for them to be announced before Parliament rises for the Summer Recess. I hope that my noble friend will forgive me therefore if I do not say more about that at this time. Clearly tonight is not the occasion for an announcement.

My noble friend Lord Ironside referred to the examination of accounting practices being conducted by Coopers and Lybrand. I am sure my noble friend will be pleased to hear that we have accepted the main recommendations of their report and are going ahead with implementing the detailed studies which arise out of it.

My noble friend Lord Westbury asked me about area air defence for the Royal Marines in Norway. I think he must have been on the same visit as the noble Earl, Lord Attlee. We are well aware of the importance of this and, as he saw on his visit there, the Royal Marines were trialling a Rapier battery in the harsh conditions of the Norwegian winter. When the results of this trial are to hand we shall be considering them most carefully.

My noble friend Lord Mottistone asked me about destroyer and frigate numbers. We have said on many occasions, and it is repeated in this year's White Paper, that in the longer term we intend to maintain a force level of about 50 destroyers and frigates. To sustain the quality and effectiveness of this force, as my right honourable friend the Secretary of State for Defence said recently in the other place, we intend to maintain an ordering rate of broadly three Type 23 frigates a year from the first follow-on vessels. My honourable friend the Under-Secretary of State for Defence Procurement, speaking on 8th May last, announced our intention to invite tenders in the late summer for the next three vessels of the class. The Government remain committed to this force level. The construction programme involving Type 42 destroyers and Type 22 frigates, in addition to Type 23s, will ensure that the force remains composed of modern and highly capable warships.

My noble friends Lord Mottistone and Lord Ashbourne asked me about future amphibious capability for the Royal Navy. We well understand the vital part amphibious forces can play in reinforcement and intervention operations both in and out of area. Our present forces will continue to fulfil this role until the end of the useful lives of the current specialised ships in the mid-1990s. We have referred frequently to the wide-ranging studies we have in hand on the options for our capability beyond that date. These are proceeding satisfactorily. Ministers expect to take decisions on this in the middle of next year. Detailed design work involving industry would, on present plans, need to start shortly thereafter to allow us to replace the present ships, if we decide to do so, by the mid-1990s. To suggest, as I think the Select Committee in another place did, that our decisions will depend primarily on whether the solutions are financially opportune is quite incorrect, as my right honourable friend the Secretary of State for Defence said recently in the defence debate in the House of Commons. The purpose of our study is to determine the military requirements and to assess their relative priorities in the overall balance of our defence needs. It is in this context that we examine the implications of resource allocation.

My noble friend Lord Mottistone was concerned about future submarine numbers. Today the fleet has 28 attack submarines in service, of which 13 are nuclear powered and 15 are diesel electric. Four further Trafalgar class SSNs are under construction and so is HMS "Upholder", which is the first of the Type 2400s. In addition, Vickers Shipbuilding and Engineering Limited have responded to our invitation to tender for another nuclear submarine, SSN.19. In the future, overall numbers of attack submarines are likely to remain generally constant, although the fleet will contain a higher proportion of nuclear-powered vessels.

I can tell my noble friend Lord Mottistone that AEW Sea Kings, with their search water radar, can direct Sea Harrier fighters to intercept any incoming hostile aircraft. The longer-term question of a replacement for the hastily conceived Sea King AEW is still being considered. So I think I have to tell my noble friend, in answer to the specific question that he put to me, that the current squadron of those aircraft is fitted with the interim arrangements which we established for Operation Corporate.

My noble friend Lady Vickers asked me a number of questions about the dockyard consultation process that we are currently going through. I wonder whether I may, in the interest of containing the length of my remarks, write to my noble friend with some of the details. The noble Lord, Lord Mackie of Benshie, asked me about the EFA—the European Fighter Aircraft. Again, I have a great deal of material which I could give him, but perhaps I may write to him on that matter as well.

The noble Lord also asked me about the flying activity level, and perhaps I may answer him on that. It was, in fact, at around 10 per cent. of the planned levels of general flying activity that had been accepted for 1985–86, in order to release some £25 million of funding for allocation elsewhere. The measure was necessary to help continue the expansion and modernisation of the front line. But I am now pleased to be able to say that a significant relaxation of the constraints on flying has been agreed. The revised aviation fuel allocations are being assessed and will be issued shortly to the RAF stations and squadrons affected. Incidentally, flying training was not affected, even at the time of the reductions.

Before I conclude my remarks, I should mention that I am due to follow the debate by moving for approval the draft Army, Air Force and Naval Discipline Acts (Continuation) Order 1985, which was laid before the House on 11th June. As your Lordships will be aware, the purpose of the order is to continue in force for a further year the Army and Air Force Acts 1955 and the Naval Discipline Act 1957, which together provide the statutory basis for discipline in the three services. Your Lordships will be aware that the current Armed Forces Act expires at the end of 1986 and that, in accordance with the normal practice for quinquennial review, your Lordships can expect a fairly early opportunity for detailed examination of the service disciplinary systems.

For the moment, however, the annual continuation order simply ensures the continuation of these systems and, against the background of the detailed and expert attention which has been paid by your Lordships today to the services generally, I hope that your Lordships will be able to approve the order without too much further debate. I am aware that the noble Lord, Lord Boston, has some points to raise and I shall be happy to answer them when the time comes.

Managing the nation's defences has been likened to running a large industrial concern. Looked at in that way, "MOD Limited" could be described as the biggest multinational in the country, with over half-a-million employees and an annual budget of some £18 billion. But there is more to it than that. First, defence is a concern in which we all have a stake, not simply in the sense that, as taxpayers, we are all, as it were, shareholders in defence, but in the sense that, without a realistic and credible defence policy, there can be no guarantee of the security and freedom that we are accustomed to enjoy. Secondly, the abilities, skills and dedication of our service men and women—and the civilians who support them—have earned, and retain, the admiration and gratitude of us all.

The Government's plans for procuring equipment are geared to maximising value for money and cost-effectiveness. We have kept our promise to restore and maintain levels of pay for the services that are fully comparable with outside employment. Our defence policies are realistic, credible, affordable and prudent; and we believe that none of the alternatives that has been put forward, in Parliament or outside it, by political parties or any others, would be as successful in ensuring the continuation of the peace and freedom that we are privileged to enjoy in this country.

On Question, Motion agreed to.