HL Deb 12 July 1988 vol 499 cc713-81

3.12 p.m.

Lord Trefgarne rose to move, That this House takes note of the Statement on the Defence Estimates (Cmnd. 344).

The noble Lord said: My Lords, certain features of the Statement on the Defence Estimates remain constant from year to year: their examination of the international background to our security policies; their description of the strengths, roles, activities and equipment programmes of our armed forces; and their explanation of the Government's plans for the management of the Ministry of Defence and the defence budget. In addition, in recent years the Government have attempted to provide both Parliament and the public with a greater insight into the thinking behind our security policies and those of the alliance of which we are a part. This year's statement continues this process.

The theme of the 1988 paper is the continuing need to maintain security in a changing world. The past 12 months have indeed seen momentous changes, both in the atmosphere of East-West relations and in the new thinking which appears to be on the brink of transforming the internal structure of the Soviet Union. President Reagan and Mr. Gorbachev have brought to a conclusion the first treaty—the INF treaty—to eliminate an entire class of nuclear missiles world-wide; progress has been made towards a START agreement; and a withdrawal of Soviet forces from Afghanistan is under way.

All of those developments have been wholeheartedly welcomed by the Government and represent a triumph for our resolute adherence. in the face of much ill-informed criticism, to the twin elements of our balanced security policy—strength in defence and readiness for dialogue, in the pursuit of realistic, balanced and verifiable measures of arms control. None of that could have been achieved, nor would such prospects have been opened up had the alliance followed the policies of unilateral surrender in which some continue to find solace.

Only two weeks ago, Mr. Gorbachev outlined comprehensive plans for the internal reorganisation of the Soviet Union, including moves towards a greater degree of democracy and individual freedom. which all in the West will welcome. But these, like many recent Soviet proposals, arc at present still only words. The task confronting Mr. Gorbachev is a vast one, and it will not be concluded overnight. The Soviet Union may well one day be a more comfortable neighbour—with a policy which does not depend for its own security on the insecurity of others—but we have to face the world as we find it. not as we would wish it to be.

The light of hope for the future should not blind us to the realities of the world we inhabit now. As Chapter Six of the White Paper makes clear, there has been no let-up in the Soviet Union's military modernisation programmes. Soviet expenditure on defence has grown in real terms by some 50 per cent. since 1970, and the share of national economic output allocated to defence. at 15 per cent. of gross national product, far exceeds that of any NATO country. By the mid-1990s virtually the entire Soviet strategic nuclear force in place in the mid-1980s will have been replaced by new or modernised systems. Modernisation of theatre nuclear forces also continues, as does that of the Soviet Union's conventional forces, where technological strides in the key areas of aircraft and tanks are reinforcing its substantial numerical advantages. Its capability to conduct chemical warfare remains far beyond that of the West. And all of those Soviet forces are deployed and structured in such a way as to give them a capability for offence and surprise. It is the case that under Mr. Gorbachev the Soviet defence budget has declined by not so much as a single rouble.

While there is no reason to believe that Soviet leaders want a war in Europe, the fact remains that they retain (and are modernising) the capability to launch one. It was against that background that the NATO summit in March reaffirmed the essential elements of alliance policy: the vital link between the European and North American allies, the crucial role of nuclear deterrence, and willingness to seek dialogue and further arms control agreements with the Warsaw Pact. In particular, NATO leaders agreed that there was no alternative to deterrence based on an appropriate mix of adequate and effective nuclear and conventional forces, kept up to date where necessary. But we are under no illusions that the political changes taking place in the Soviet Union will make more difficult—and even more necessary—the task of explaining to the public why we need to maintain our commitment to defence.

We have recently witnessed the end of an era for NATO, with the departure of the noble Lord. Lord Carrington, from the post of secretary general. Under his admirable stewardship NATO maintained its resolve to negotiate from a position of strength, and that solidarity made possible the achievement of the historic INF treaty. We now warmly welcome Dr. Manfred Woerner as the new secretary general. In spite of the apparently changing face of the Warsaw Pact, his task will not be easy, so it is good to know that the alliance is in such capable hands.

Deterrence of aggression, and the strategy of flexible response and forward defence which maintains it, remain at the heart of NATO's philosophy. The credibility of that deterrent continues to rely on a strong and stable partnership between the two sides of the Atlantic. We aim to improve the use made of the resources devoted to the alliance by more effective co-operation in defence and security matters. In particular, a more cohesive European effort can make a greater contribution to the alliance than the sum total of our individual national efforts. In that context, the revitalised Western European Union, the Eurogroup and the Independent European Programme Group have all continued to play their part over the past 12 months. The United Kingdom assumed the presidency of the Western European Union for a year on 1st July. We shall continue to use it to strengthen the European pillar of the alliance, and hence the alliance as a whole.

The White Paper outlines the extent to which the British Government remain committed to NATO. We believe that the only way that we can ensure our security is through the collective strength of the alliance. NATO's policy of deterrence based on a mix of nuclear and conventional weapons was endorsed by the British electorate last year, as was the maintenance of Britain's independent strategic deterrent. The Trident programme, designed to provide the necessary updating of that capability from the mid-1990s, remains on course. More than 95 per cent, of our defence budget continues to go directly or indirectly towards carrying out our main defence roles in NATO: the provision of nuclear forces, the defence of the United Kingdom, the defence of the European mainland and the provision of maritime forces in the eastern Atlantic and channel.

We also have important defence commitments outside the NATO area, including the protection of our merchant shipping in the Gulf, military assistance to foreign and Commonwealth governments, and contributions to international peace-keeping, all of which help to promote stability in areas where we have important economic interests. And since our interests coincide closely with those of our allies, these efforts make an important contribution to preserving broader Western interests outside the NATO area.

To meet these commitments, the defence budget for 1988–89 is £19,215 million. This is among the highest in NATO and represents an increase of almost one-fifth in real terms since 1978–79. On current inflation forecasts, the defence budget will benefit from broadly level funding between 1988–89 and the end of the present public expenditure planning period in 1990–91. This will not eliminate the need for difficult decisions to be made of the type taken every year in the course of the usual planning cycle, but the Government remain committed to maintaining our defence roles. Eight years ago this Government's first Defence White Paper undertook, within the constraints of our national economic capability, to restore our defence effort to the level needed to give the best possible guarantee of safety using the most economical means available",

The 1988 White Paper agains shows that this pledge is being amply fulfilled.

The substantial real increase in our defence expenditure since 1978–79 has largely been devoted to our conventional forces. We have spent in real terms some £21½ billion more on defence than if spending had continued at 1978–79 levels. Only about £2½ billion of this sum has gone on nuclear strategic forces. The extra spending on conventional defence has resulted in orders of more than 60 vessels for the Navy, seven Challenger tank regiments and 23 battalions of armoured personnel carriers for the Army, and over 500 aircraft for the Royal Air Force. Much of this equipment is yet to be brought into service, illustrating that many of the benefits of this investment are yet to come.

For the fleet, the 10 frigates now on order, including the three new Type-23 vessels announced by my honourable friend the Under-Secretary of State for Defence Procurement in another place yesterday and the three nuclear powered fleet and four diesel-powered electric submarines still to enter service, should give the lie to the charge that the Government have neglected the needs of the Royal Navy.

The Army's contribution to forward defence in Germany is being strengthened by the introduction of an air-mobile capability, an additional Challenger equipped armoured regiment, the introduction of Saxon and Warrior and of a range of new infantry equipment. including the new SA-80 infantry weapons. Taken together. this programme represents a major improvement in the Army's mobility and firepower.

The RAF's major modernisation programme continues with the introduction of the first two squadrons of the air defence variant of the Tornado, the delivery of the first Harrier GR5 and Tucano aircraft and the order for the seventh of the Boeing AWACS aircraft. In addition, an MOU for full development of the European fighter aircraft was signed in May. This aircraft will fulfil a vital defence role in the best and most cost-effective way, and it will continue the trend of successful European collaboration in aerospace projects.

All of this demonstrates the importance which the Government attach to conventional defence, but it would be foolish to imagine that equipment alone is all that we need. Without manpower of the right quality, and in the right quantity, expensive and sophisticated equipment is worthless. We recognise the debt that we owe to the professionalism and sense of service of the men and women of the Armed Forces— and especially so in the peculiarly difficult circumstances of Northern Ireland. This Government have continued to devote attention and resources to the task of ensuring that our defence is in safe hands. Since 1979 pay has been increased in line with the recommendations of the Independent Armed Forces Pay Review Body, and we believe that servicemen and servicewomen generally regard their pay as both fair and reasonable.

But we are not in any way complacent. Figures for premature voluntary release in 1987–88 are slightly worse than those for 1986–87 and the demographic trough will ensure that the services will face increasing competition from the private sector as fewer young people become available for employment. These are developments which we are studying carefully. However, all these things are relative. Premature release applications for officers stood at 5 per cent. in 1978–79, compared with only 3.7 per cent now, and for other ranks the rate then was 6.8 per cent. compared with a current rate of 3.5 per cent. And all three services have made good progress in improving the efficiency with which the vital human resource of manpower is deployed. For example, 70 per cent. of Royal Naval personnel are now deployed in the front line, and the next generation of frigate, the Type-23, will require only two-thirds of the crew at present needed to man a Type-22.

The last nine years have also seen an expansion of our reserve forces—regular reserves up from 188,500 to 226,500 and volunteer and auxiliary forces up from 73,500 to 93,100. The Territorial Army is 25 per cent. larger than in 1979, and 43 out of the 47 companies planned for the new home service force have been formed. The Royal Auxiliary Air Force and RAF Volunteer Reserve have expanded five-fold, the Royal Marine Reserve has increased by 60 per cent. and the Royal Naval Reserve is some 10 per cent. larger than when plans for its expansion were announced in 1984.

It has been said in recent weeks that the Government cannot afford to maintain their defence commitments. By devoting sufficient resources and working tirelessly to improve the efficiency with which we deploy them—both material and human—we believe that we can maintain them. And for the reasons outlined in the White Paper we believe that we must maintain them if we are to continue to enjoy for the next 40 years the benefits of peace that NATO has secured over the past 40.

A changing world offers the United Kingdom and its allies a challenge. I believe that we shall meet that challenge. But we shall not meet it by walking blindly, naked and alone, into the future, trusting in the good will of our potential adversaries. We shall meet it by going forward in our common determination to defend our common values. We shall never fear to negotiate, but we shall never negotiate out of fear. I beg to move.

Moved, That this House takes note of the Statement on the Defence Estimates (Cmnd. 344).—(Lord Trefgarne.)

3.28 p.m.

Lord Irving of Dartford

My Lords, in a debate on the White Paper just before the general election I drew attention to the increasing number of defence experts who were critical of the Government's defence policy. The document was described by Bradford University as, a bland document with all the harsh decisions delayed till after the General Election". We pointed out then the Government's obsessive concern for nuclear weapons, small, medium and large, which we believed could only be provided at the expense of our conventional force contribution. We drew attention to the reining back of defence expenditure while commitments were being increased and to the Government's failure to meet their conventional commitment to NATO, especially the undertaking to provide 50 surface vessels.

Lord Trefgarne

It is about 50.

Lord Irving of Dartford

The noble Lord makes the reservation, about 50. I shall come to that later. I only wish that it were about 50 instead of about half that. Few of us could have predicted this year the increasing wave of criticism, not just from academics and military analysts, but from much nearer home: from Conservative Members of Parliament and newspapers normally sympathetic to the Government.

This time it was the Daily Telegraph leader that said that the White Paper was as: bland and as self-congratulatory as ever". Anyone who has just listened to the noble Lord's speech will know exactly what the Daily Telegraph meant. The Economist on 27th May this year said: This time when government commitment to NATO grew at 3% a year is officially over. For the time being the Armed Forces will have to get along with no real increase in the budget. Defence will take a smaller proportion of GNP". Its further comments were among the harshest yet: The White Paper glosses over how such austerity can be reconciled with Britain's overstretched defence commitments. The Army is seriously underequipped. Most of its tanks should have been replaced tomorrow. Its artillery is already out of date, and its helicopters fleet is much too small. It needed yesterday a new anti-tank missile with a tandem warhead to defeat the war-time reactive armour that the Russians already have. If Mr. Younger cannot squeeze cash out of the Treasury he will have to cut something else in order properly to equip the Army—his reluctance to face the choice suggests that the best way would be a thorough defence review". Mr. Younger's reply has always been: The defensive posture we have at the moment will he continued. As to the review, he has said: I do not see any sign that that is necessary". But this is not the view of some of the Government's supporters. Mr. Leon Brittan in his pamphlet Defence and Arms Control in a Changing Society says: The Government should not put off a wide ranging review of defence policy". Regarding the Secretary of State's decision not to have a review he says: The real reason must surely be that a review would lead either to a call for more money to be spent; or to calls for sonic commitments to be dropped". However, I believe that Mr. Younger's blandness and lack of decisiveness covers a serious anxiety about the future. At heart he knows that the commitments he has to accept and is still being given cannot be achieved under present budgeting or by any of the devices which have been deployed in the past of delaying programmes without doing damage to our armed forces. He is worried, despite his public posture, as he is reported in the Independent as having demanded (in confidential talks with Mr. John Major, Chief Secretary to the Treasury) a substantial increase to avoid a fundamental review of Britain's defence commitments.

Mr. Brittan also calculated that there will be a shortfall in our defence budget of at least £4 billion. Some noble Lords will recall that last Thursday when the Eurofighter programme was announced I asked where it would be in the budget and there was no answer for us.

The consequences of the Government's failure either to have a review of our defence commitments or effectively to fund our defence programme is already causing severe damage to our armed forces. In addition, the whole question of the Government's competence in handling defence contracts has been called into question. The service to suffer most severely is the Royal Navy.

Despite what the noble Lord has said in his speech, only 31 of Britain's 50 ships were fully operational last month. For long our surface fleet of frigates and destroyers was kept. as the noble Lord said, at about 50. One can hardly believe that that discloses a bigger shortfall than the odd one under 50. To retain this figure orders must be placed for three new surface ships a year. Despite the expected orders for new frigates —we were glad to hear that three will he ordered—the annual rate of replacement for the last decade is only 1.6. The Ministry of Defence counter is that a lower construction standard is acceptable because the working life of a ship is being extended. By carrying out an additional refit on older vessels the working life of warships can be stretched from 16 to 22 years. If the present rate of building is not improved upon the lifetime of a frigate or destroyer would have to be 31 years to guarantee that we fulfilled our commitment to NATO of about 50 ships.

Mr. Ian Stewart, the Under-Secretary, disclosed four months ago—

Lord Trefgarne

The Minister of State, my Lords.

Lord Irving of Dartford

The Minister of State disclosed that 11 frigates and destroyers are already more than 20 years old. In fact, the total number of Royal Naval vessels which had, so to speak. reached their majority was 50. Moreover, the useful sea life of a warship is determined not just by its age but to a large extent by its weapons. By no means all naval vessels are well enough armed. Naval strength has gone down by 10 per cent. in the last five years compared with a fall of 0.4 per cent. in the Army and an increase of 4 per cent. in the RAF.

The Times leader says: The Government has returned to the 1981 objectives (of Sir John Nott) while rejecting the option of a further defence review. The Government is trying to achieve the same effect by stealth". Captain Richard Sharpe, the editor of Jane's Fighting Ships, recently attacked the Government for cutting the fleet under the table. A senior civil servant told the Select Committee on Defence in another place that even if the Navy had 60 frigates and destroyers it would be overstretched to perform all the tasks expected of it. In addition, to maintain the crucial Armilla patrol in the Gulf, for example, requires six ships—an important task that we cannot neglect.

But the biggest loser from any permanent cutback in the Royal Navy's strength is NATO, as more than 70 per cent. of allied strength in the eastern Atlantic is provided by Britain.

The problems of the Secretary of State have been made worse by the sudden appearance of two vast new programmes that have to be fitted into the long-term costings for the first time. One is a nuclear missile which Mrs. Thatcher particularly wants, and the other a tank which the British Army thought it did not want. The sums involved run to billions of pounds, with plenty of scope for financial risk attached to their development.

According to the report of the Select Committee on Defence, only 31 of Britain's about-50 ships were operational in June. The White Paper is increasingly using unrealistic statistics to justify that about-50 commitment. Two frigates listed as operational by the White Paper are unmanned, ready to be sold as scrap. I understand that one has been officially offered to Plymouth council as a floating museum for £1 per annum. The Ministry of Defence says that seven destroyers will be temporarily unavailable to the fleet because of refits. In addition to the 31. eight others will be ready in a week to 10 days.

While denying publicly that they are reducing our surface ships, the Government have cut the naval budget and manpower. The effect has been that there are not enough men to crew all the ships we have. "Illustrious", a light aircraft carrier which is less than 10 years old. will next year be mothballed for three years because there are not enough men to crew her. Sir John Nott —whom noble Lords will recall tried to cut the Navy in 1981—has said publicly that if his 1981 proposals had been accepted 12 to 15 ships would have been ordered. Nothing like as many have been ordered. It is clear that with the Government's neglect of the Royal Navy and the merchant marine, a Falklands-style task force could not be mounted again.

However, the Select Committee has raised the whole question of the Government's lack of competence in handling their procurement programme. The Ministry of Defence commissioned Jordan. Lee and Causey to produce an efficiency scrutiny. The cancellation of the £1 billion Nimrod project and the Marconi fraud investigation are only two of the best-known dramas in this field. It is fairly obvious that after a whole range of projects there has been serious fraud in some instances and in most cases a lack of competence and good housekeeping.

Mr. Winston Churchill, a member of the Select Committee, has commented: It all seems so sloppy, so amateurish, one gets the impression that these negotiations are undertaken by people who do not have experience of having been in or having worked in industry, and so it appears time and time again that the manufacturers are able to pull the wool over their eyes". Of course the defence industry takes rather a different view, not surprisingly. It worries about the lack of national objectives and long-term planning on the French and West German lines. Army contractors see the Government as panic buyers, inconsistent, unsure of long-term needs, changing their demands late in the day. Mr. Alan Goodwin, chairman of the British Computing Association's Defence Group, has said: The fundamental difference between the UK and our allies is simply that we do not have a strategy for associating major defence procurement with the technologies that are vital to the UK's national interest". He further argues that the fear of wasting money in the early stages of projects, spurred by the spectre of the National Audit Office, is now actually costing the taxpayers money. In complex projects, front loading or early spending and testing ideas can save huge waste later. It is unpopular because by definition it will have to be written off. Beyond the individual fiascos there are two charges: first, lack of competence and, secondly, timidity and lack of planning and direction. We welcome the work of Mr. Peter Devine, but unless these and other matters are put right his tough negotiating policies and procedures will not produce as much benefit as they should.

One of the most encouraging aspects of the recent Moscow summit was the announcement by President Reagan that he no longer looked upon Russia as the evil empire. That was a long overdue recognition that what was being done by using new techniques for on-site supervision and verification could lead to agreements upon which both sides could rely. It is accepted that these procedures must be worked out with patience and care. It is a recognition that what is happening is not merely a series of cat and mouse moves from which one side or another can obtain an advantage. What has happened in Russia during the past few years is so extraordinary as to have been unthinkable only 12 months ago. To have had the most reverend Primate the Archbishop of Canterbury standing in Moscow as part of the 1,000th anniversary of the Church and the discussion in the Communist Party at its Praesidium in Moscow last month give hope of the normalisation of relations and a lessening of tension between East and West which until recently was unthinkable.

In many ways, and particularly in arms control, the Russians have been more forthcoming to a degree previously thought impossible. A number of issues which I listed in an earlier debate which Mr. Gorbachev had promised have already been done. In agreeing to the ratification of the INF agreement the Soviets accepted a Western proposal in its entirety. They have undertaken to withdraw four times as many nuclear warheads as the West. Many Soviet proposals go well beyond anything the West has proposed.

We might well ask why nothing of this is reflected in the White Paper. As Mr. Yacovlev, the former director of the Institute of World Studies in Economics and Politics, has said, it has nothing to do with any Western policy of negotiating from strength. That is not why Russia is withdrawing from Afghanistan. It has come about because a more liberal-minded and intelligent elite has risen to a position of influence in Soviet politics. There is no glimpse of that either in the White Paper or in Mrs. Thatcher's remarks at the recent NATO summit.

As Frank Burnaby said in an article in the Independent: NATO's reaction is curmudgeonly and remarkably negative. The INF agreement with an exchange ratio of four to one in NATO's favour is treated as some kind of defeat which requires the discussion of new nuclear weapon systems, studies of the use of Pershing 2 warheads and a new missile to replace the lance". We are told that nothing more can be done in Europe until progress is made on conventional disarmament. It is the Western side in Vienna which is dragging its feet about setting up a new forum for that purpose. Western politicians such as President Reagan and Mrs. Thatcher declare their support for what Mr. Gorbachev is trying to do. At the same time they give valuable ammunition to his conservative opponents by making his foreign policy appear a failure. Mr. Gorbachev has given himself a superhuman task and it is in all our interests that he should succeed and should not be allowed to fail because of our lack of encouragement.

The position in Europe is stable despite the immense concentration of troops and arms. Last year General Rogers told the House of Lords Defence Group that he did not believe that a surprise attack in Europe was likely. No NATO or Warsaw Pact country believes that it is likely to be attacked. Our security would not be at risk if NATO took a more positive attitude towards arms control and showed some initiative.

Several proposals of that kind have been put forward. In his article in the Independent Frank Burnaby put forward proposals: first, to establish a zone on each side of the central border, free of tanks, heavy artillery and nuclear weapons but yet allowing full defensive preparation in the zone; secondly, to limit the total number of heavy battle tanks in Europe from the Urals to 10,000—that is 5,000 on each side; and, thirdly, to withdraw from European soil all tactical nuclear systems—that is, those with a range below 500 kilometres. The sole function of the nuclear weapon should be to deter and for this not many warheads are needed. They should not be in forward positions where they are vulnerable.

The proposals would give NATO the reduction in tank numbers which it wants; they would give the Soviet Union the wide zone free of offensive weapons which it has favoured and the elimination of tactical nuclear weapons.

Coming nearer home, on 8th June 1988, Mr. Leon Brittan said: The Government should not put off a wide-ranging review of defence policy". He proposed a tank-free central Europe in return for the West giving up short-range nuclear weapons—the proposals he claims should be offered in return for star wars to be abandoned. That could be part of what Mr. Dukakis wants in his conventional defence initiative.

However, the Foreign Ministers meeting in NATO stuck to the cold war rhetoric, as did the noble Lord today. NATO must not be lulled into a false sense of complacency by Mr. Gorbachev's charm and persuasiveness". And again: Western security can only be assured and effective … if negotiated from a position of strength". From the other side of the Atlantic Mr. Brezinski thundered: The issues that precipitated the First World War have not changed". I believe that those are speeches of men and women who believe that the leopard can never change its spots.

Security we must have and we shall obtain it only through verification and on-site inspection. However, I believe that these doubters stand in the way of the greatest opportunity for real peace that we have had this century. I think that in lecturing—one paper called it bullying—the Germans to modernise their tactical nuclear weapons this country is making a grave mistake which could cost us dearly. The Germans know that if the weapons on the German frontier were used masses of Germans would die. Each weapon would have at least the effect of a Chernobyl.

British military procedures are too cumbersome and complicated to obtain an early response in negotiations to stop them, and the escalation that would follow if they were used would be unstoppable. We heard about that during our visit to General Rogers. Not only would there be a difficult choice to make in using them—and it is NATO's belief that they should be used at an early stage—but the pressure to use them or lose them would be enormous. By pressurising the West Germans into agreeing to the replacement of these weapons they will start a debate which will be less likely to be won than when the weapons were first installed. The result could be exactly the opposite of what the Prime Minister wants to achieve. Far from holding NATO together, it could become a powerful issue in the next West German general election and could mean that, with a relaxation of tension in the East, the West Germans could be more and more attracted to the East and leave NATO destabilised and weak.

What has happened in any case to the comprehensive concept of arms control which is being drawn up by NATO officials to establish priorities for future arms control negotiations? In its latest issue the Institute of Strategic Studies stated: There is a burning need for NATO to renew the West's present options". We believe that the White Paper is a complacent document which does not face up to the need for a review to deal with our overstretched commitments. It covers an incompetence in the handling of our procurement programme which has already cost the taxpayer dearly. It contains an obsession and a concentration on nuclear weapons at the expense of our conventional force contribution. It fails to understand what is happening in Russia and it fails to take the appropriate initiatives to consolidate the chances of peace and a lessening of tension.

3.49 p.m.

Lord Mayhew

My Lords, a large number of the points made by the noble Lord, Lord Irving, will be welcomed by my noble friends and myself. The inadequate provision for the Royal Navy and the total impossibility of fitting all the Government's proposals into the defence budget is something to which every independent expert bears witness. His references are less sceptical, and therefore more realistic, about the changes in the Soviet Union. Scepticism is not necessarily realism. Sometimes it is realistic to take a positive view of the kind of changes which are occurring in the Soviet Union today.

I also welcome the emphasis which the noble Lord placed on conventional disarmament. My attention may have wandered but I do not recall the noble Lord, Lord Trefgarne, dealing with the subject at all, which as far as we are concerned should now take the maximum priority in the strivings of the West and the NATO countries. The noble Lord described the White Paper as "bland", whereas the noble Lord, Lord Trefgarne, said that it gives greater insight into the thinking of the Government. Those two descriptions are not necessarily irreconcilable. Indeed, in my view, the thinking revealed by the White Paper is not only bland but, as I shall try to show, also dangerously shallow.

Perhaps the reason that I felt so sympathetically towards the noble Lord, Lord Irving of Dartford, was that he never mentioned Britain's nuclear weapons. Here of course there is disagreement between our parties. To us it is obvious that while the Soviet Union has nuclear weapons NATO has to have a deterrent. As a member of NATO Britain has to contribute, as it has done for 20 years under successive governments, by assigning submarines to the NATO deterrent and by providing appropriate support to the American deterrent.

Further, while the Russians have nuclear weapons and while there is any uncertainty about the American commitment to Europe, in our view some second strike capacity should remain in European hands. We thus differ from Labour's unilateralist policy, as was set out at length recently by Mr. Neil Kinnock in the pages of the Independent. We welcomed the robust attack on that policy made by Mr. Neil Kinnock a few days before in a television broadcast. For one glorious moment it looked as though the nuclear weapons policy of the Labour Party would for the first time bear some correspondence with the nuclear policy advocated by the Labour Front Bench in this House. For a few days there seemed to be a connection between the two. However, those glorious days—and they were only days—have now gone.

The differences we have with the Government on nuclear weapons are, first, on the scale of British capacity, to which I shall come, and, secondly, on the policy of flexible response which the noble Lord expounded to us once again this afternoon. We reject the Government's view that we should be willing to use nuclear weapons first against a conventional attack. In our view to start nuclear exchanges in Europe would he suicide and nuclear weapons are quite useless except as a means of deterring an opponent from using theirs. Therefore, as our objective we set the achievement of a conventional balance which can deter and, if necessary, defeat a Soviet conventional attack by non-nuclear means.

We are greatly strengthened in that belief by recent developments in the Soviet Union and Eastern Europe. Those changes are given strangely grudging welcome by American and British leaders. The White Paper states: We are now at last beginning to see signs of change in the Soviet Union reflected elsewhere in Eastern Europe". I suppose that we should be grateful to Ministers for at last beginning to see what has been quite obvious for some time to the rest of us. The US Secretary of State Mr. Carlucci went further. He said that these changes were no cause for rejoicing. A fortnight ago he said: The fact that change takes place does not tell us whether it is for the better or the worse". Yet commonsense says that these changes are very much for the better. The only snag, which was hinted at by the noble Lord, Lord Trefgarne, this afternoon, is that these changes make it difficult for Ministers to get large defence appropriations through their parliaments.

The Prime Minister is equally negative. After the last NATO summit she declared: The NATO alliance is as vital now for protecting our freedom as it was in 1949". In 1949, after crushing Czechoslovakia, Stalin sent the Red Army to close the rail and road exits and entries into West Berlin, in order to starve the West Berliners into submission. In that year Berya's power was at its height, as was the strength of international communism. Of course, commonsense says that the threat to our freedom was much more serious and immediate then than it is now. To argue otherwise is to diminish the achievements of NATO and to underrate the resounding victory of democratic ideas over Stalinism and Marxism all over the world. Perhaps most seriously, it blinds the sceptics to the great new possibilities which are now emerging on the world scene.

The noble Lord, Lord Trefgarne, made play with the fact that there has been no reduction in the defence expenditure of the Soviet Union under Gorbachev and that the Russians are modernising their weapons. The assumption behind his remarks is that that is evidence of unfriendly intentions, that it is a reason for maintaining and modernising our weapons and a reason for maintaining a high level of defence expenditure; that is the only interpretation which we can put on it.

However, there are other possible explanations. Mr. Gorbachev could be forgiven if he felt that this was not the moment for imposing perestroika on the Soviet military establishment; or, like the NATO countries, he may be wishing to strengthen his position in disarmament negotiations. It is plainly in the interests of Gorbachev to reduce defence expenditure and to increase detente, and his actions strongly suggest that those are his genuine aims. In those circumstances it is so disappointing to have found from the White Paper and the noble Lord today that the British Government have such a totally negative attitude to the proposals he has made, especially in the field of conventional disarmament.

Everyone agrees that glasnost and perestroika may fail. If the Government's position was that our defence policy has to be based on the assumption that they do fail, that would be possible to defend. However, Ministers go much further than that. They are saying that as East-West relations improve, as the Russians withdraw from Afghanistan, as they implement the INF treaty and as they relax their objections on verification, it is appropriate to respond with a vast increase in Britain's nuclear capacity. That is ridiculous. Ministers celebrate the improvement in East-West relations by treating themselves to a large extra helping of nuclear warheads, stronger and longer-range nuclear artillery, and it may well be—at vast cost—stand-off nuclear missiles for the Tornadoes.

That is a gross misjudgment of our real security needs. Those needs are to improve the conventional balance in Europe, to strengthen the European pillar and to acknowledge and encourage the forces of sanity emerging in the Soviet Union. There is no sign that Ministers are taking that last aim seriously. There is nothing in the White Paper or the speech of the noble Lord, Lord Trefgarne, which suggests that.

They might at least start planning, on a contingency basis, for the changes in defence policy which will be called for if glasnost and perestroika succeed. In that event many of our fundamental assumptions about defence will be invalidated. It is arguable that if after the war the West had been faced with Gorbachev, glasnost and perestroika instead of Stalin, Molotov and the Iron Curtain, the Atlantic Alliance could never have been brought together and might not even have been necessary.

Earlier this week the Hungarian Government announced that the Hungarian leader, Karoli Grósz, had been discussing with Gobachev Soviet proposals for withdrawing all foreign troops from Europe by the year 2000. Commenting on this the US State Department, referring to intelligence sources, reported that there were indications that the Soviet Union was preparing to make an early decision on pulling its forces out of Hungary. That would mean the entire Soviet southern army, 65,000 strong.

Of course it may not happen, but one thing is certain. If it does happen Britain and her NATO allies will have done nothing to encourage it and will have been taken completely by surprise. There is nothing reflected in the White Paper or in the speech of the noble Lord, Lord Trefgarne, of the possibilities.

Thirty years ago the Soviet Union formally offered to withdraw all its troops from Europe if NATO countries did the same. On that occasion, for better reasons than can be put forward now, NATO rejected the offer. However, it is not inconceivable that the offer may shortly be repeated by Gorbachev. Will the West be ready with its answer? Has it studied the possibilities? No doubt the military establishment on both sides would oppose the idea, but there are powerful arguments in its favour. The idea deserves serious study, which ought to be undertaken by the Government and by NATO but which is not being done.

To conclude, as things stand at the moment we still need the Atlantic alliance. We still need a formidable defence capacity. We should make no unilateral concessions on defence to the Soviet Union. But surely it is incongruous that the Government should greet the remarkable changes in the Soviet Union and the remarkable improvement in East-West relations with a White Paper which largely repeats old ideas and in which the main provision is a huge increase in Britain's nuclear capacity

4.2 p.m

Lord Bramall

My Lords, each year for the past few years the Defence White Paper setting out the estimates and giving the Ministry of Defence commentary on them has been produced in even glossier form, calling on the latest marketing techniques. There is nothing intrinsically wrong in that. It makes what could be rather turgid stuff a great deal easier to read and gives to the armed forces of the Crown a modern businesslike and up-to-date image which they thoroughly deserve.

Our defence effort is, after all, a very marketable commodity, with Armed Forces which have seldom, if ever, been better, as the Falklands campaign so clearly demonstrated, and with some home built military equipment which is among the best in the world. If we can get our prices right or our customers arc rich enough. it is often much coveted abroad, as we have seen recently, by those who, if and when they buy it, bring much financial benefit and employment to this country as well as, it is to be hoped, greater stability in the area.

The Government can be proud that as a result of seven years of sustained growth between 1979 and 1986. induced both by the Falklands campaign and by the Government's adherence to the NATO 3 per cent. growth target (an intention, I have to say, which was first announced, as the noble Lord, Lord Mulley, will know, by the last Labour Government), there is in the pipeline a formidable re-equipment programme for our forces which for the moment at any rate is both necessary and urgent. as the Minister reminded us. It is necessary and urgent because of the technical and numerical threat which potentially still faces us both in Europe and in the Middle East, the need for continued stability in East-West relations and the very varied nature of our current commitments, from the north of Norway to the Falklands and from Central America to Hong Kong. There is much to savour and be proud of in the White Paper, and its format and presentation bring all that to life.

Unfortunately, that is not the end of the story. What the glossiness and salesmanship cannot do, as was implied by earlier speakers, and despite the Minister's rather generous interpretation, is disguise the fact that from the point of view of real term resources and percentage of the gross domestic product we are back to the syndrome which existed in the 1970s and which was so soundly criticised by this Administration when they came to power. That was when the resources which successive governments were prepared to justify to Parliament were never quite sufficient to meet the commitments and capabilities which equally those governments thought necessary to maintain.

Today there are some additional complications. For example, whereas in the 1970s commitments were being pruned, they have now been kept at roughly the same level for the past six years and even in certain cases increased. Moreover, this Government have inevitably introduced and encouraged much higher expectations than existed in the 1970s. We are at the same time in, or edging into, a particularly expensive part of the programme such as the completion of the Tornado programme, the arrival of Trident, the rationale for which has been debated many times in this House and elsewhere, the replacement of the ageing Chieftains, the maintainance of some sort of amphibious capability to give us valuable mobility on the flanks, which we are particularly good at, and the development of the European fighter aircraft. Taken all together they will stretch the elastic to breaking point and beyond.

This Government would always want to see themselves as strong on defence. Indeed, they have done much, first. to get forces' pay on a proper basis—and here again I give credit to the noble Lord, Lord Mulley, who started the process when he was Secretary of State. Secondly, though much remains to be done. they modernised and re-equipped the forces, particularly during and in the aftermath of the Falklands campaign. Finally, they have generally made the Armed Forces. unlike the Civil Service, feel wanted and appreciated.

Despite all that. the financial squeeze in real terms is now, if anything. greater than ever. That is hound to have a harmful effect on training, activity and professional standards, governed as they are by such things as petrol, spare parts, leading to track mileage. and ammunition—the only areas in which money can be saved in the short term. In consequence, there is an effect on morale and retention rates, which are already worsening quite significantly as the Minister recognises. That is the natural consequence of overstretch and curtailment of activity.

It is not so much the not inconsiderable sum of £19 billion plus which is allocated on paper that is the problem, though it scarcely keeps pace with inflation, if it does at all. It is much more the contrivancies which the Treasury, with no longer any government or NATO discipline of 3 per cent. growth to restrain it, can use to keep down public expenditure, such as a straight cut in estimates in conjunction with Star Chamber vetting. That occurred in 1979 just after the election; early in 1982, hard as the noble Lord. Lord Pym, tried to prevent it; again in 1983 just after the election, and since then quite a number of times.

Perhaps the Minister will be able to tell the House how confident he is of resisting such further inroads. If he cannot do that, it will invariably have the effect not only of squeezing the short-term cash flow—difficult as that sometimes is to accommodate—but also depressing the annual out-turn figure on which all subsequent promised growth (or, more likely, negative growth) is measured. Therefore, what in the early and mid-1980s was a steadily rising graph of expenditure has now become a convex and downward curve, without in the immediate future any significant change in requirements and commitments which the Government will admit to.

There is also one other Treasury device which is perhaps the most damaging of all to the availability of the cash which Parliament thinks it has allotted for general defence needs. That is the question of funding the pay award for the Armed Forces for personnel up to the rank of brigadier or its equivalent. In a civilian business one can say to the workforce that times are hard or profits are down so one cannot afford to pay more than so and so. With the Armed Forces it is a little different. As noble Lords will know, pay rates are judged and recommended by an independent review body on the basis of comparability with earnings for similar responsibilities outside. The Government are more or less committed to accepting the findings of the review body. That is clearly understood on all sides.

To recommend an award of X per cent., have it accepted by the Government, and then not pay it on the ground that there is a problem with the cash flow of the Ministry of Defence, would be a travesty of justice and virtually a breach of contract. Yet when it is awarded as mirroring the general national trend of wages and salaries, the Ministry of Defence is only compensated by the amount which reflects whatever the Treasury deems to be the going rate for public service pay, which is invariably well below the award figure.

Judging by past experience, this may mean that at least 3 per cent. to 4 per cent. of the total award has to be carried by an already restricted budget. Put another way, around £150 million or more per annum which Parliament may be under the impression is available for general defence, particularly in the high-spending equipment field, is effectively being removed from any other use than meeting the existing pay bill. So cash absorbed by personnel costs (even when manpower has been cut to the bone, as I believe it has) goes ever upwards and money available for activity, material and equipment gets more and more squeezed, thus effectively reducing the defence budget annually by that amount.

When I was Chief of the Defence Staff we appreciated that the Government would not wish or he able to sustain indefinitely the 3 per cent. growth, however much it would be in NATO's interests to do so and would wish, in view of other priorities, to level off. Therefore, with some difficulty, we made certain adjustments which generally allowed the programme to be accommodated within a zero growth level in real terms resources. But this further erosion which has taken place, exacerbated by the now apparent—unless the Minister reassures me—annual short-funding of pay awards, has produced a new and disturbing situation. This will lead either to a defence review of capabilities and commitments which the Government, with some justification, are most reluctant to undertake, or to an even more damaging salami-slicing, slipping and fudging until the moment comes when defence is so manifestly over-extended or under-funded that it loses credibility with those it has to deter, with its allies and, just as importantly, with those who stand guard on the frontiers of freedom and elsewhere and who have to sustain and implement it.

I know that some would shelter behind the facile theory that if only the Ministry of Defence conducted its weapons procurement business more efficiently, and the defence industries were not allowed to rip off the Ministry of Defence on some of its contracts, there would be more than enough money to go round. It is a good excuse, but when one bears in mind the efforts that have been made by hyperactive Secretaries of State over the last four or five years to get the best value for money, and the almost obsessional preoccupation with profit-cutting competition, this view does not stand up to close scrutiny—at least not for the major sums we are talking about; namely, shortfalls of hundreds of millions of pounds over the three-year accounting period.

Moreover, excessive competition, when combined with inherent uncertainty about future orders and defence spending in general and cautious and delayed decisions, does not always produce the most economical answer. The only sure way of getting prices down to within or below normal inflation is to have continuity, stability in programmes, early decisions, long lead times and long production lines. The best example of that is the production of nuclear submarines which are planned well ahead and where I believe prices have been reduced in real terms. It is rather like buying a colour television set today, which costs so much less than it used to.

I hope that the Secretary of State and the Minister will do all that they can to restore defence resources to at least zero growth in real terms. One of the simplest ways of achieving that would be by reaching an agreement fully to compensate the Defence Vote for any pay review body award, as I believe was done for the nurses this year and it may well be done for the police and the fire services. Under the previous government, as the noble Lord, Lord Mulley, will know, it was done for the Armed Forces in his time. That will make a substantial difference.

I hope that I am pushing at an open door because with such funding I believe that with a little ingenuity the Ministry of Defence could implement the defence policy as advertised (I use that word advisedly) in the White Paper and of which I heartily approve. We shall continue to need a defence policy at least until glasnost proves to be on surer foundations, and while we negotiate mutual arms reductions from a position of strength. We shall need a defence policy until the Middle East becomes less volatile and dangerous with its implications for Europe. All that will take a long time to achieve.

4.16 p.m

Lord Kennet

My Lords, I know very little about it, but what we have just heard sounded to me to be absolutely right. There is much to agree with in the defence White Paper and also in the speech of the noble Lord, Lord Trefgarne. We in our party naturally welcome the firm order made at last for three frigates. There was one part of the noble Lord's speech where I was a little bored. That was where he said that the Soviet Union had not stopped having a large defence budget and it had not stopped building up its military forces. Of course, neither have we. It is hardly surprising in either case because we have not yet succeeded in stopping the arms race. A moment later the noble Lord was taking credit for having raised our own defence expenditure by 25 per cent. over approximately the past 10 years. As regards glasnost, perestroika and the virtues of Mr. Gorbachev, I believe that NATO should be careful that in its turn it does not adopt the knee-jerk "Niet" as its trade mark.

When the USS "Vincennes" shot down an Iranian airliner, killing the hundreds of people on board, the Prime Minister declared that US warships had the right to defend themselves. It may be that she did not then know much about what had happened.

But yesterday, Mrs. Thatcher took part in a radio phone-in programme from the Soviet Union. She is to he praised for having taken part in this programme. During the phone-in she repeated her original defence of the captain of the USS "Vincennes" and continued by saying: Speaking as Prime Minister, you cannot put your armed forces in the waters of the World without them having the right to defend themselves". This extends to the Royal Navy the application of what she said originally and we must examine its implications. First, put your armed forces in the waters of the world". Iran and Iraq are two countries with which we in the Western democracies do not have anything in common hut our shared humanity. We obtain oil from both. In the waters of the Gulf and in the Straits of Hormuz, these two countries were harassing one another's merchant shipping, including oil tankers. Iran depends upon tankers to get its oil to the outer world: Iraq depends much less on tankers because it has pipelines. The attacks upon merchant shipping were roughly equal as between the two countries.

They then began harassing ships flying neutral flags, and the Western navies went in to protect their own shipping in, we hoped, a non-provocative way. Subsequently, a United States warship was attacked with loss of life and it has since been written off. It was attacked by Iraq, the country whose oil exports to the outer world depend less on tankers. However, in response the United States virtually entered the war on the side of Iraq against Iran, which had not attacked the US ship, and whose oil comes to us in a greater degree in tankers.

The Government have been quite right to keep the Royal Navy completely separate from the United States action in the Gulf and in the Straits, and they are to be congratulated on the recent and little-reported achievement of bring the British, Dutch and Belgian forces there under a united command. All in all, nobody could call this a clear-cut case of united Western action for an agreed end.

We come now to the "Vincennes". The aircraft was flying over the Strait of Hormuz when it was shot down; and though we have not been told where the "Vincennes" was—perhaps the Government can tell us—it seems reasonable to assume that she was in the strait too. That is an international strait, and international straits are subject to a special regime in law. Warships are allowed to go through them, but not in a warlike manner. They are supposed to keep moving. It has been said that the surface firing which preceeded the destruction of the civil airliner had begun because of the flight of one or more United States helicopters. If that flying had taken place in the international strait or in territorial waters, even in untroubled peacetime, even from a warship with no known hostility to either riparian state, that would probably have been unlawful. In the circumstances there and then, it would have been not only probably unlawful but certainly provocative. The Government may be able to tell us where the helicopters flew off their ships.

As to the shooting down itself, the Pentagon said first that it was an F-14 that had been destroyed; then that though it was a civil airliner it had taken off two hours late, was descending at high speed from 9,000 ft. to 7,000 ft., was outside the civilian corridor from Bandar Abbas to Dubai, and that its transponder answered with a signal used only by the military. Much of this the President also asserted. We now know that it had taken off three minutes late, was level or climbing at 12,000 ft., was within the corridor, and that its transponder answered with the civilian signal, though it may for some reason have responded with a military one as well.

The noble Lord, Lord Hill-Norton, wrote an extraordinary letter to the Independent last Saturday in which he said that we should accept as truth only the second thing the Pentagon said; namely, that it was not an F-14. As to all the untrue statements it has continued to make since, we should await the inquiry—to be carried out by the United States of course. He also said that the captain had been absolutely right in his action and that he might have been court martialled for cowardice in the face of the enemy if he had not fired, a thought which the Prime Minister echoed in her Russian broadcast. We must mark well all these statements and all their implications.

The ship was defending itself, according to the noble Lord, Lord Hill-Norton, and the Prime Minister. It had thus been attacked and the attacker was an enemy. It was thus a series of lawful, just and courageous actions. That is the implication of what was said. However, the reality is that the ship was not defending itself, because it was not being attacked. It could not have been attacked because that was a harmless airbus. And harmless airbuses are not enemies in whose presence one must show courage. So what we hear from the Prime Minister can only sound like new orders to our own navy: if in doubt fire; if it is an airliner, no matter.

There is discussion now about the role of high-tech gear in this connection, particularly the radar and fire-control system called Aegis, which I have told the Government more than once in the past two years is an absolute menace. Well, it is, isn't it? Perhaps it does work in the open sea; perhaps it does work in major battles, not little skirmishes. Perhaps there was so much going on that the captain was confused, and so on and so on. This discussion is of course important in settling the question what the United States navy ought to do next, but it has nothing to do with how we judge what it just did. The system did not work, and the United States navy is endangering peace and besmirching its name by sending ships to the wrong place with the wrong systems on board, or perhaps with the wrong combinations of men and systems. And the Prime Minister is besmirching our name by her repeated defence of this terrible action.

Consider now what this means for collaboration between the two largest NATO navies, both in peacetime and in a possible war. The United States navy has over the past couple of years persuaded or compelled us to become part of its new "Forward Defence" at sea. "Forward Defence" is a familiar phrase on land but is not so familiar at sea. It means sending the British fleet—tactfully described as a carrier task force—into northern waters during a time of tension in order to bottle up the Soviet navy in its own home waters. This we would do without the Americans until they had time to arrive. We would also do it at the expense of all other ways of protecting our shipping during the first 30 days when there must be 1,000 extra railings from the United States to Europe carrying in an extra 1.3 million tonnes of equipment. There must be that conventional build-up because without it we would he condemned to using nuclear weapons almost immediately.

Embedded within the new United States strategy of Forward Defence is that other new American idea, the New Maritime Strategy. This means getting everything set up in advance for a first strike to sink the Soviet strategic missile-carrying submarines immediately conventional war breaks out. Though that is not necessarily a nuclear strike it is a preemptive strike against the enemy's strategic nuclear forces and is thus just about the most de-stabilizing thing one could possibly announce. Recent evidence from the Ministry of Defence to the House of Commons Select Committee on Defence, which equated "forward defence" at sea with "forward defence" on land, should, I think, have made everybody's hair stand on end. Are the Government satisfied that the new Joint Staff structure is good enough to bring the realities of sea war home to Ministers, especially when none of them has naval experience? That is a question to which I do not expect an answer in this debate, because I know that that could be only a hasty and defensive one.

All this is part of a long saga of how two countries linked by a political system, history, language and alliance in war came to see their relationship distorted by illusion on one side and false loyalty on the other. The United States under President Reagan, and especially the Pentagon, is plagued by corruption, by systematic mendacity, by a dependence on high technology as self-deluding as that of the drug addict, and by the lawlessness which is so attractive to the strong. We were lied to about Grenada. The whole world was lied to about Nicaragua, and the law was flouted. The whole world was lied to when the President sold arms to Iran. We were forced to submit to our airfields being used for an attack on Libya which, like the "Vincennes" action, killed some children. We were dragged into the Lebanon against our better judgment. It looks as though we shall have to put up with a large increase in the number of nuclear armed F-111s in the country. Mr. Younger keeps saying that they are not coming, but American military sources keep saying that they arc. Meanwhile, on our side, the Prime Minister keeps nodding in sage agreement as each new short-sighted folly is committed.

Over this unworthy scene looms—whether an ignoble bargain or some awful infatuation, I do not know—the Trident missile purchase. I must be clear at this point. The SDP will not seek to prevent or undo this purchase, whether our future influence in the country is small or large. It is already too late for that. We shall give our support as needed in votes or whatever it may be because things have now gone too far to change it. But I for one condemn the Government for their original decision and for pressing forward with the project between 1981 and, say, 1986. We should have been separating ourselves from Regan's United States and not binding ourselves ever tighter to his coat tails. We should have been turning for international co-operation to the European pillar of NATO, especially to France in nuclear matters, but to all of the members in others. Even now we should be turning to France for co-operation in whatever system may be adopted to replace our old, free-fall bombs, so long as that does not replace anything that was "tactical" with something which is "strategic".

Our future lies with the European Community, and every time we miss an opportunity of doing something about it we drive ourselves further into a blind alley. Dc Gaulle vetoed our entry into the European Community for years because he thought that we were immovably ensconced in the American pocket. We should remember what President Johnson said about the British Prime Minister during his war in Vietnam: I've got his pecker in my pocket". For us to play our proper part in the new Europe after 1992 we must regain our autonomy and our freedom of action. Let us begin by condemning attrocities—whoever commits them. Our first political loyalty is to humanity; our next is to our sovereign institutions and then to our alliances and treaties in order. "My country right or wrong" hurts humanity; "someone else's country right or wrong" hurts not only humanity, but reason and sovereignty as well.

Lord Hill-Norton

My Lords, before the noble Lord sits down, perhaps I may just intervene because he referred to me by name during his speech—of which he kindly gave me notice. May I say that in what he described as my "extraordinary letter" to the Independent last week noble Lords who care to read it will find none of the sentiments which he attributed to me this afternoon.

Lord Kennet

My Lords, is the noble Lord saying that he did not say that the captain of the USS "Vincennes" might have been court-martialled for cowardice in the face of the enemy if he had not fired?

Lord Hill-Norton

My Lords, I do not know whether it is proper to continue with this exchange, but I must say that those are about the only four words which the noble Lord has quoted correctly.

4.32 p.m.

Lord Thomas of Swynnerton

My Lords, perhaps I may return to the subject of the debate. Many noble Lords in this House will have been seeking a phrase or a bench-mark by which to judge the seriousness or the lasting quality of the remarkable changes within the Soviet Union which are foreshadowed and discussed in paragraphs 104 to 108 of the defence White Paper which we are discusing today. Many noble Lords on this side of the House will he wondering whether it is ever possible for the Soviet people to grasp exactly what is needed if a free enterprise economic system is possible. Noble Lords on the other side of the House will be wondering whether Mr. Gorbachev's reforms foreshadow at one remove the possibility of a real version of democratic socialism at last.

The Bishops will no doubt also be wondering about the future of religion. Masters of the parliamentary craft, of whom there are so many in this House, must be wondering whether the words about elections which Mr. Gorbachev has so eloquently used are likely to be followed by practical considerations of how people work together in a democratic chamber such as our own.

As an historian, I was particularly struck earlier this summer by the announcement in the Soviet Union that history exams had been abolished this year. Why? lzvestia gave the explanation. It was because of the fact that in the past the history taught had been false. It declared: Huge, immeasurable is the guilt of those who deluded generation after generation. poisoning their minds and souls with lies. Cancelling the exams was the only possible sober and honourable decision". Many of us from this side of the House have used phrases, although not quite as strong as that, in relation to Soviet behaviour in the past. When we have done so we have been condemned by the other side of the House as being cold warriors.

I do not think that it is appropriate to crow; indeed, I am sure that that would be disorderly procedure in this place. Nevertheless, those of us on this side of the House cannot help noticing that relatively recently the American actress Jane Fonda, has apologised for the fact that during the course of the Vietnam war she sat on the top of a North Vietnamese tank in Saigon at the time when her country was fighting North Vietnam and gave encouragement to the North Vietnamese forces. Many of us who have taken the view that the Soviet Union has been exactly what Mr. Gorbachev said it was in the past are anticipating some degree of prudent concession by those who criticised us in the past. Surely that would be the very least one might expect in a free, democratic assembly.

The Minister is correct in saying that not everything has yet changed for the good on a permanent basis. We observe throughout the world the Soviet military power extended far beyond what is necessary for the preservation of the Soviet Union itself. We still see Soviet propaganda very active in disinformation and other activities in the rest of the world. We also observe, in so far as we can, that the KGB abroad is also still active. Those are important matters and those of us who are hoping for a real change in the Soviet Union must pay special attention to the last matter.

As many of us will remember either from an experience of the time or from having studied the matter, the good relations which we had at the end of the war with the Soviet Union—to which attention was drawn from the other Benches during Question Time this afternoon—were destroyed in particular by the revelations following the Gouzenko case that the Soviet Union, even during the high period of AngloSoviet and United States-Soviet relations during the course of the war, had organised an elaborate system of espionage and subversion within the free countries. That is the kind of thing which needs to be dismantled if we are to take perestroika internationally, as opposed to glasnost, as seriously as it deserves.

Nevertheless, it must be said, and I think any fair-minded person would say this, that what is happening in the Soviet Union is a remarkable beginning: there is a qualitative change. One should also say that if anyone is to start to reform the Soviet Union the odds must be that that person would start somewhat in the way that Mr. Gorbachev has done. Therefore, I feel that every encouragement should be given.

I have four further points to make in this respect. First, I think it is quite wrong to suppose that such changes would have happened if the West had not taken up the position of strength that it has over the years. Can anyone imagine that if the West had given way over all kinds of matters in the past that Brezhnevism would now be as out of fashion as it obviously is? Of course not. If we had accepted the Soviet position on arms control in the early 1980s; if we had accepted the Soviet position—even in central America, to which the noble Lord, Lord Kennet, has drawn our attention—without any form of criticism, does anyone really suppose that the policies pursued by Mr. Brezhnev, Mr. Chernenko and Mr. Andropov would have been so severly criticised? Of course they would not have been. A reformer in the Soviet Union would not have had a leg to stand on.

The second matter to be mentioned is that of course we do not know what will happen. Glasnost has undoubtedly broken out, but perestroika—restructuring—has not gone very far. We have had some discussion of this today already. The trouble is that, if one starts to let the air into an intra-national or multinational empire such as the Soviet Union, there is no knowing what will happen. We have seen some indication of what might happen already in Azerbaijan, but there are innumerable Azerbaijans in the Soviet Union, that is to say, instances where there are people of one race in another republic of the empire. That leaves aside the whole national question in the empire itself—what we are seeing in Transylvania at present in relation to Hungary and Romania. The problems are still very considerable.

There is also the point to be considered of what our reaction would be if perestroika worked. After all, Mr. Gorbachev has said that the aim of his policies is to make the Soviet Union richer and more powerful. That seems to pose the certainty that, for as long as we can see, we shall have to be dealing with the Soviet Union, which is a powerful nation and one which we shall probably get as wrong, when it has dismantled its ideology and its present political system, as we have in the past. When that strength and prosperity are achieved, if they are and are combined with Mr. Gorbachev's concept of the Soviet Union sharing in a common European house with ourselves—I think I am right in saying that the concept of the common European house is one of the most striking innovations in this philosopy—it seems to me that we need to do a great deal of thinking.

That brings me to my final point in this section of my speech. It is not too soon to begin to wonder what kind of world we should like to see achieved if indeed in the future the Soviet Union is to play a positive, creative and helpful part. In the course of the First World War and in the course of the Second World War there was a great deal of thinking as to what the future world would be in terms of international security. The League of Nations—the United Nations—was thought out as a result of these discussions. In the second part of the Second World War there was a great flowering of ideas. If we are to have, as it might he put, a third chance of restructuring the world, it is surely not too soon to begin to think. A weapons system takes a very long time to construct. as we all know; and I suspect that a peace system does too.

I have three final points to make. First, my right honourable friend the Prime Minister has been criticised a good deal in the course of the debate. I think it is worth while saying, without any suggestion of sycophancy, that she was the first Western statesman to recognise the positive qualities of Mr. Gorbachev when she said during his visit to this country in 1985 that he was someone with whom she could do business. Many of us—particularly on this side of the House, I think—were a little sceptical of that forthright encouragement. She has turned out to be right, and we were wrong. As a historian of Cuba, I cannot but be particularly pleased to notice that she, the Prime Minister of capitalist Britain, appears to be on better terms with Mr. Gorbachev than is Fidel Castro, the Prime Minister of Communist Cuba during these years.

Secondly, the White Paper is a little unhelpful about the concept of European defence. This is probably not the moment to dwell overmuch on that, but I believe that this is a positive idea. I am sure that our European partners in the next 10, or five, years will be expecting a more forthright position than we have been able to adopt in the White Paper.

My third and final point is this. I noticed in the Independent last week an appeal by a journalist for a British glasnost in relation to the issue of Katyn. Many of us will remember that about 10 years ago a monument was erected in Gunnersbury cemetery to those Poles who were murdered by Stalin in 1940. The British Government of the day felt that it was not possible for there to he a British representation at the unveiling of the monument. It now seems likely that the Soviet Government themselves will admit that those Poles were indeed killed by Soviet officials. If that is the case, it would be appropriate at some time in the next few months for some token recognition to be made at the monument recalling that indeed the Poles at the time of the crime were our allies and that Poland did a great deal for us in the course of the Second World War.

Lord Hatch of Lusby

My Lords, perhaps I may put one point to the noble Lord as a historian. Would he not agree that in the earlier part of his speech he was somewhat unfair to many of us on this side of the House (of which in his earlier incarnation he was once a member) who made a clear distinction between the value of Marxism and the disgrace of Stalinism, but when we attacked Stalinism this did not necessarily mean that we were supporting the pursuit of the cold war?

Lord Thomas of Swynnerton

My Lords, the noble Lord will be aware that I never had the privilege of stitting on the other side of this House. Nevertheless, if he felt that I was unfair to him. I naturally withdraw my remarks.

4.47 p.m.

Lord Jenkins of Putney

My Lords, I am rather inclined to pursue the noble Lord, Lord Thomas of Swynnerton, in his looks into the past. My problem in this matter is excessive political constituency. or rather consistency—I was thinking for a moment that I was back in the other place. 1 am indeed so consistent that when I rise to speak people think, "We've heard it all before so we needn't stay", and I do not really blame them for that.?

It is the case that people sometimes change their minds, and I sometimes wish that I had changed mine more often. The other day I came across an article in The Times headed "Force de Frappe—or French Farce?" The writer said that it was, reasonably safe to assume that the British Defence White Paper of 1955 announcing the decision to manufacture a hydrogen bomb and confirming the intention to develop a nuclear striking force had caused French policy to be set on its present course. Since then events have followed a logical and depressingly foreseeable pattern". The writer of this thoughtful, even profound, piece goes on to show how inevitable it is that the adoption of nuclear weaponry creates its climate of perception with the result that, the dreadful inexorable logic of the nuclear arms race begins to take the place of rational decision making". The article then demonstrates how this dreadful nuclear arms race logic leads military planners—the writer describes them as "programmed daleks"—to the inevitable conclusion that, having aquired nuclear weapons, they must now be a prime target for Soviet nuclear weapons and that they must seek to maintain their own effectiveness by proceeding to a second more powerful, more accurate and secure generation, and so on to a third and fourth generation. The message of the article is that each new development forces the other side to seek to match it and nullifies in practice the efforts of the politicians in their search for arms limitation.

This "Gadarene progress" which the writer foresaw in 1973 has continued. Today more and more people are realising, with Mr. Gorbachev, that we are on a road to financial ruin, leading in turn to an ultimate holocaust. Hence the desperate endeavours of the Soviet leader to get off the nuclear bandwagon—endeavours which have not been matched in the West, least of all by the Prime Minister who clearly has no understanding of the peril which overhangs us all. We have heard about words and actions before; the Prime Minister does not match her kind words about and to Mr. Gorbachev with any effective action, giving concrete evidence that she really means those kind words.

President Reagan has at last grasped the point but is being undermined by his own administration, as I shall show in a moment. Before that I want to say without delay that this Statement has an unprecedented glimpse of reality when it says on page 2, to which the noble Lord referred in his remarks introducing the document: There is no reason to believe that Soviet leaders want war in Europe". Alas, everything that follows in the document shows that, reason or not, this is exactly what our military planners are programmed to believe. They not only believe it; noble Lords have only to read on to know that the planners are preparing to fight that war. They have persuaded the Government to devote precious brains and vast sums of money to repel an attack which in their saner minds they know and they say is not coming.

On the one hand, it is admitted that there is neither need nor sense in the huge accumulation of nuclear and other arms. But on the other hand, as was foreseen in the article which appeared in The Times of 26th July 1973. nuclear weaponry has created its own climate of perception and those who are tunnel-visioned into it can no longer even see the wider world they are there to serve.

The information on page 68 about Soviet military expenditure is a typical example of the effort which is made in the Statement to frighten us all into spending or agreeing to spend more money. It has been very successful in the United States where they have practically broken themselves in the effort to spend more and more on military expenditure. However on page 68 it says, and I think I had better get it right so that I do not mislead the House in any way: The substantial improvement in Soviet military capabilities over recent years has been made possible by the high priority given to the defence sector in the allocation of resources". This is the important sentence: Expenditure on defence has grown in real terms by about 50 per cent. since 1970". That was repeated by the noble and gallant Lord, Lord Bramall. It is quite true. Then it goes on: The share of the national economic output allocated to defence, at 15 per cent. of gross national product, far exceeds that of any NATO country". That is true. But what we are not told and what is concealed from us is that the gross national product of the Soviet Union is so low that 15 per cent. of their national product is very much less than 5 per cent. of the American national product. What we are entitled to know here is what is the actual expenditure. Let us have it in dollars. I have been looking for this; it is very difficult to find it. As far as I can see, the International Society for Strategic Studies is the best source. I was astounded to discover that, according them, the total American expenditure on so-called defence—it is so-called, whichever side it is, because everybody is defending themselves against everybody else; nobody is going to do any attacking, of course—is not merely a percentage larger than the Soviet expenditure; it is several times the Soviet expenditure. That is a fact which is concealed.

I believe that it may he as much as five times larger than the Soviet expenditure. This is something which I think we ought to know for sure. I hope that when my noble friend comes to speak he will shed some light on the subject. Perhaps the Minister, in reply, will tell us. Is it true that we are spending so much more on defence than they arc in the East? If it is, we are spending not a little bit more or a percentage more but several times as much. What are we doing with it all? Do we need to spend it? Can it be true that our expenditure is so enormous and at the same time we are getting so little for it that we are in a pathetically weak position all over the place and must spend more and more? It seems to me that the more we spend, if we believe what they say on the other side, the weaker we get. We keep on hearing these moans about our relatively poor position in relation to the Soviet Union and at the same time we spend more and more on making ourselves apparently weaker and weaker. It is nonsense; that is what it is. We need to know the truth.

Since the signature of the INF treaty the United States has decided to deploy twice as many new cruise missiles in Europe as the 429 cruises and Pershing Its to be removed. Twice as many arc now to replace them. That is where some of the money is going. According to the very reliable Dan Plesch writing in the Nation on 25th June, the Reagan administration has embarked on a new phase in the nuclear arms race. In addition to the cruises which will be mainly seaborne but include the new "stealth" air-launched cruises, there are more powerful and versatile nuclear battlefield missiles and artillery. Several new horrors are under development. Plesch also points out that NATO has 750 bombers available to carry these new missiles. These aircraft are at present devoted to cruise or free-fall nuclear bombs and there are 1,000 bombers in the United States allocated to Europe as well.

No wonder the START talks have problems to face. One hundred and fifty American Tomahawk sea-launched cruise missiles are already deployed aboard destroyers, battleships and submarines in the European area. Perhaps we should count ourselves lucky that the American captain in the Gulf was not telling us that he would have to live with the responsibility of unleashing a nuclear missile—by mistake of course. When that happens, he may not have time to tell anybody anything about it any more.

Meanwhile, Mr. Plesch says that the American navy is also being deployed just outside Northern Soviet waters. In Scandinavia and perhaps elsewhere this is regarded as a visible military rejection of Mr. Gorbachev's proposals.

New weapons are also on order for the American army, perhaps in the hope that Congress will at last be satisfied that several times over means that superiority has at last been established and war can be risked in any part of the world. The thinking, if any, must be that if the worst comes to the worst the last to die will he the Americans at—least those who have failed to leave for the southern hemisphere in time.

Fortunately, these plans are encountering resistance. The Germans are unenthusiastic about their role of the first to die and the policy of' pretending that the 1983 Montebello decisions to modernise, as they were called, did not take place at all—as we were told by the Front Bench opposite—has come unstuck. That policy of pretending that Montebello meant nothing has come unstuck because the Americans have blown the gaff.

The American Defence Secretary, Frank Carlucci, argued that the decisions which we and other Parliaments were told did not exist—that at Montebello all that took place was a chat—not only did and do exist but are in fact irreversible. The noble Lord, Lord Trefgarne, who I am sorry to say, is not here—his alter ego is with us—was simply carrying out an agreement to conceal the decisions. This Government are getting so economical with the truth that veracity is becoming the exception rather than the rule.

Public opinion in Europe, particularly in Germany, is moving strongly against nuclear weapons and perhaps would have moved quicker if my party had not seemed to wish to avoid the issue at the general election. We must not repeat that mistake and we shall not repeat it. Many Europeans, notably the Germans, are beginning to see that, far from keeping the peace, as The Times article which has been the text for these observations makes clear, rational decision-making cannot take place under the nuclear imperative. The luck cannot last much longer.

Although the issue is assuming its proper all-party importance in the world and especially in Europe, in this country the lead towards real disarmament must be taken by Labour, as my noble friend Lord Irving of Dartford has indicated.

Finally, I wish to add two things. Mr. Plesch, whom I have quoted, is director of the British American Security Information Council which has offices in London and Washington. The brilliant article in The Times, which should be read in full, was written by the noble Lord, Lord Chalfont. I am sorry not to see him in his place, but I told him that I should be referring to his past views on the subject. The article is of course available in the House of Lords' Library for your Lordships to read.

5.2 p.m.

Lord Pym

My Lords, East-West relations remain the dominant feature of the world scene and provide the basis for this defence debate. Those relations are going through a period of remarkable turbulence, the long-term significance of which cannot yet be foreseen. Of course we all hope that the outcome will be an altogether different relationship resulting in less tension, fewer weapons and more security. That is what we all want and that is exactly what our Government are working for. But it certainly has not happened yet. There are immense obstacles to overcome and it will take time. Glasnost and perestroika can only develop over a period of years and even decades.

During the next few years, which I see as an extraordinary opportunity to establish a better relationship, it is vital that we keep the facts of the situation clearly in our minds as they are at any one time and not as we would wish them to be, and read the changing situation with hard-headedness, a sense of reality and certainly honesty. Already the new image of the Soviet Union which Mr. Gorbachev is presenting and his attractive style have led people to think that the threat is over and that peace in our time has arrived. Indeed it seems that some noble Lords take this view. But it is not, and it has not.

When I last met General Galvin a few months ago he told me what has already been said in this House, including by my noble friend the Minister of State, that in the Soviet Union there has been no reduction whatsoever in the output of armaments, modernisation continues unabated and their advantage in conventional weapons is as big as ever and growing. Those are the facts which the media is so reluctant to put over to people but which we and our allies have to face up to.

The big question is: are those facts going to change? We do not know. That remains to be seen, but I am certain that we must do all we can to encourage and further that change in the Soviet Union because it is the one way to solve the most basic problem of all—the great political divide between East and West. I do not subscribe to the opinions which have been expressed in your Lordships' House this afternoon, that the Government are being negative about this. That has been suggested, but Members of the Government from the Prime Minister downwards have not responded in a negative way. We must encourage those changes in the Soviet Union. That is not an easy thing to do and, incidentally, it could be counter productive. But until we see the evidence of a new attitude on human rights and of a reduction in their armaments programme and in the conventional imbalance, until we see them stop making trouble in Southern Africa, Central America, the Far East and elsewhere, we and our allies must still ensure that our combined forces are always fully capable of fulfilling their purposes, which is to prevent war, as they have for over 40 years.

We must enable them now to go on doing that for the next 40 years and beyond. To do that five conditions must be satisfied. The first is that the balance of strength must be kept within manageable bounds—an aspect to which I thought the noble Lord, Lord Mayhew, paid insufficient attention. Secondly, the quality of our forces must be commensurate with their tasks. Thirdly, the resources must be adequate for the task. Fourthly, the 16 national contributions must be merged into a unified whole in a changing situation; and, fifthly, the support of public opinion must always be maintained.

I shall not dwell today on the balance of strength, even though it is of fundamental importance. Chapter six of the White Paper deals with it very well. I shall not dwell either on the quality of our forces, which is of the highest order, except to stress the importance of reserve forces and to say how glad I was to hear from the Minister of State that these are now on the increase. It is very important to enlarge them if we can, because the proportion of our population which has had any military training is very small—probably smaller than it has ever been—and should be larger. We also have to prepare for the rather dramatic demographic changes which will put great pressure on recruitment. I know that the Chiefs of Staff are giving much attention to that.

The provision of adequate resources and equipment is always difficult and controversial, as the noble Lord, Lord Bramall, illustrated so vividly in his speech this afternoon. That is so because the needs of defence conflict with the desire to spend less money. There is always a good case for more defence. However, not only are resources limited, but there is also a limit to the amount of money the public are prepared to see spent for this purpose. That is the balance that has to be struck. On the one hand, our defence must be fully adequate, but on the other hand it must also be obtained at an affordable price.

In recent years the strain of achieving that balance has been very great. the main reasons for that being the growing imbalance of military capabilities between East and West and the ever-rising cost and sophistication of weapons of all kinds. For five or six years after 1979 there was a very real increase in defence spending in this country, but there was a much greater increase too on the part of the Warsaw Pact. So the gap widened. That is why the pressure on the defence budget is so great and why the Secretary of State for Defence and the Chancellor of the Exchequer have such a difficult problem to solve. Just as in my view it would be quite wrong for defence to have absolute priority in public expenditure, so would it be quite wrong for the Treasury to stick rigidly to some figure for defence expenditure that was convenient for the economy but unrelated to defence needs.

This conflict of interest is genuine and, in my view. its importance is such that it needs to be settled by Ministers without recourse to the so-called Star Chamber where the expertise on defence is, to say the least, limited and where other considerations will tend to intervene. Apart from the ceaseless drive for greater efficiency and better value for money, which is a permanent feature of MoD life. there is one other way to relieve the budget pressure while the present threat exists, and that is by much closer collaboration and integration of procurement alliance-wide. Progress is being made. However, it is slow. Rivalries between nations and services and their inevitable prejudices hold up and hinder the procurement at lower prices of the weapons and ammunition which we need. I know that my noble friend and the Secretary of State understand that very well and do their best. However, I should like to see an alliance-wide initiative led from the top to give collaboration a greater impetus. By that means, we shall get more defence for the same money or, if events go favourably, the same defence for less money. Either of those alternatives is highly desirable.

The fourth condition for the continuing success of NATO is the merging and cohesion of the forces of the 16 nations. That is a task which was most admirably achieved by my noble friend Lord Carrington and by SACEUR General Galvin and his predecessor, General Rogers. The British contribution is a comprehensive one. There is virtually no activity in NATO with which we are not involved, from the northern flank to the southern, and with a capability that encompasses all types of warfare up to our strategic nuclear weapons, which all our European allies see as their ultimate deterrent just as it is our own.

All our capabilities are important. I wish to single out two in particular. The first of those is the Royal Navy. The role of the navy is irreplaceable by any other ally. That is in contrast to our land forces, some of whose responsibilities could, at any rate in theory. be taken over by someone else. I am concerned that any doubt at all should have arisen about the size and effectiveness of the navy, especially in view of the escalating size and power of the Soviet Navy. Annex A of the White Paper is clear enough and I accept 50 frigates and destroyers as the appropriate size of our front line force.

However, doubt has arisen as to how many ships need to be ordered and how many the defence budget can allow us to afford. That sense of uncertainty undermines confidence at home and no doubt increases it to some extent in the Kremlin. In a way, my point is underlined by the ordering of three new frigates from Yarrows yesterday. There ought to be no question about ordering whatever ships the navy requires to maintain its strength and efficiency. That should be a matter of routine.

On top of that comes the dwindling size of our merchant fleet. That is beginning to become a strategic weakness. The Government say that they regret that decline. However, they do not seem to do anything about it. I wish to see all those doubts dispelled altogether. The choices facing the Secretary of State are formidable. However, in my view there is no scope for any reduction in the Royal Navy and I hope that my noble friend will give the assurance that it will he fully maintained and equipped at at least its present level.

The other capability which I wish to single out is that which enables our forces to operate outside the NATO area, where we already have some responsibilities of our own. The threat that exists outside the NATO area, although different in character. is no less real than the threat on the eastern front. It is not sensible for NATO to take an introverted view of its role and leave everything else to the Americans. The United States is of course the only nation able to sustain a world-wide role. But even the United States is becoming overstretched. It needs all the help and support we and others can give.

The only European countries that can make a significant contribution outside NATO are France and ourselves. We are both making a contribution now in the Gulf, in our own self-interest as much as anyone else's. The fact that French forces are not integrated into NATO forces and our forces are makes no difference in this context. I believe it is necessary for NATO to make a fresh strategic assessment of the present situation and its possible developments. That has been suggested for some time. 1 very much hope that it happens. My belief is that the logical outcome would be to ease the United Kingdom from some of its responsibilities inside the NATO area and enable us to play a larger role if and when that becomes necessary outside the NATO area.

I know how difficult it is to change anything in a wide alliance like ours. It is much easier to leave everything alone. However, if the threat we face changes and if circumstances change—and they do—then our response needs to change also. I believe that the time has arrived when that must he undertaken. Whether or not that happens, our role outside NATO is at times vital. Again, the Royal Navy is the critical factor in our capacity.

The final condition for continuing the peace is the support of public opinion and the support which the electorate gives to our defence policy. Without that. we have no security. Happily that support is strong and solid. However, it must never be taken for granted. That is especially true when, as now, the Opposition and the other parties have no credible. worked-out or thought-out defence policy—or even any policy at all. I believe that that is a disgraceful position and an appalling state of affairs that speaks for itself. Against that background, some of the remarks made by the noble Lord, Lord Irving of Dartford, did not come well from him.

I believe that the Government and the Conservative Party must present and re-present constantly and dispassionately the facts of the situation, the reality of the threat, the balance of forces and the alliance response to all those circumstances which are, in any case, changing. Constant explanation, calmly and coolly given, is what is required. Then people understand.

There is a real chance that during the next decade a new chapter of East-West relations will be opened, that more arms control agreements will be made and that the political chasm between East and West can he reduced. But none of that will happen if we allow our forces to become under strength or underresourced and thus call into question the credibility of our deterrent. In the atmosphere of glasnost in Russia it will be all too easy for people to believe that the threat has disappeared and that all is peace and quiet. To fall into that temptation would be to fly in the face of all the evidence and of all the experience of our own lifetime. We must judge the Soviet Union by its deeds.

The quotation from Churchill on page 1 of the White Paper is totally apt. The unequivocal meaning and implication of it and the truth of it is this: if the reality of the situation requires the Government to spend more on defence than at present planned—however much we hope that is not so—then that is what they must do until we achieve a more peaceful world. That will flow from actions which we can only hope will take place following the rhetoric of Mr. Gorbachev.

5.17 p.m.

Lord Moore of Wolvercote

My Lords, today NATO and the West face what is probably their most difficult challenge since the Berlin blockade. The Soviet Union has at last produced a highly intelligent leader. Mr. Gorbachev has given the West the INF agreement and has heralded important changes in the Soviet constitution. There is an enormous temptation to conclude that the Soviet Union has decided to abandon its dedication to the spreading of communism and wishes to live in peaceful cooperation with the rest of the world.

Against that background—and we may be sure that Mr. Gorbachev has only just started—it will be increasingly difficult for those responsible for the defence of the West to persuade governments, parliaments and peoples to persist with what Churchill is quoted in the White Paper as calling: the harassing expense of fleets and armies". However, we must persist.

There is an interesting passage in the White Paper on Soviet military doctrine. I am no expert on that subject. However, we must not forget that after the end of the war in Europe in 1945, the Russians intended to take the rest of Europe. We were only saved by Hiroshima and Nagasaki. I am not suggesting that that is what the Russians plan today, but we need very much more evidence of a genuine change of heart in Moscow. The situation on the ground remains the same. Without the nuclear deterrent it would not he possible to prevent the Soviet tanks from streaming through Europe. While we welcome any evidence that the Soviet Union of today wishes to live at peace with the world we must never forget their preponderance in conventional forces, an advantage which I do not believe they will ever forgo.

I welcome the determination expressed in the White Paper and by the Minister to maintain our defences at a level which will always deter an aggressor. But it will not be easy. The temptation to disarm will he very strong as the Soviet Union, under new and skilful direction, presents a different face to the world.

I should like to turn now to the predicament over defence policy which has faced British governments over many years. That is that in practice our armed forces are much more likely to be in action in other parts of the world than in Europe. We rightly have to commit most of our forces to NATO. However, because of the nuclear deterrent, it is highly unlikey that a shot will ever be fired in Europe. That is not so elsewhere in the World, as the Falklands and the Gulf have shown.

It is always difficult for the British Government, with our limited resources, to make our contribution to NATO and keep troops in Northern Ireland while at the same time meeting world-wide commitments. Yet we have to be prepared to do both. In addition to the all-important air mobility, as several of your Lordships have pointed out, we must remember that the Royal Navy has a vital part to play. We must keep up the number of frigates and above all maintain the naval air support. The folly of getting rid of our original carrier fleet was demonstrated in the Falklands where only superb flying by a handful of Sea Harriers saw us through. No navy is viable today without its own air cover and I hope that that will never again be forgotten.

There are two great advantages in maintaining our out of area commitment—I use the rather unattractive phrase of the White Paper. First, there is the value of the training and, secondly, the enhancement of Britain's standing in the eyes of the world. It is good that we are helping with the Community allies to protect shipping in the Gulf, and I was delighted to see that British forces are to take part in major exercises this year with our allies in the Far East. That is greatly welcomed by our friends in the area who still regret the unwise decision to withdraw our small force from Singapore where it did so much good at so little cost. Let us remember that our armed forces are magnificent ambassadors for Britain and are genuinely welcomed wherever they go. After the Falklands conflict their professionalism is recognised as second to none.

I think that this is a good White Paper, recognising our role both in and outside NATO. I hope that we shall never be tempted to reduce our commitment in either field.

5.24 p.m.

Earl Fortescue

My Lords, I too should like to congratulate the Government on this year's White Paper. which is comprehensive and clearly set out. I should like to speak on two aspects only: first, chemical warfare, and, secondly, NATO's relationship with the United States.

I thoroughly endorse the Government's aim of trying to negotiate a verifiable treaty on conventional arms. There is already a large imbalance in favour of the Warsaw Pact. If one takes into account the inhibiting factor of being forced to wear NBC equipment, the imbalance becomes intolerable and the nuclear threshold is immediately lowered.

Although there has been little change, the Defence Estimates this year give more frequent mention to chemicals, and the boxed passage on page 69 is essential reading. I entirely agree with what is written on page 69, although I question the conclusion which is drawn. It is suggested that the renewed production of binary chemicals in the United States—to be held in the United States—will provide a sufficient deterrent and will help to bring about a treaty banning the production, stocking and use of chemicals. I believe that to be wishful thinking and that the only real deterrent, as in the last war, is for both sides to know that the other has a chemical capability which can be quickly and effectively used if necessary.

I see little hope of a satisfactory treaty to ban chemicals as I believe that verification will prove to be impossible. While it may be an exaggeration to say that modern chemicals can be made in any bathroom, they can certainly be made in any modern but simple chemical factory. Indeed, many chemicals presently manufactured for agriculture and other civil uses are akin to military chemicals. How can those premises, many of them small, be policed? Furthermore, those chemical weapons—unlike most other major weapons—could be produced by small and third world countries with little or no major manufacturing industry. For those reasons I suggest that all NATO countries, and certainly Britain, should carry chemical stocks and have the ability to deliver them.

Successive governments have wrongly kept very quiet about chemical warfare. A public outcry on the lines of CND is possible. However, I suggest that history and common sense favour the action which I have put forward, and the sooner the electorate are given the facts and prepared to accept the deployment of chemical weapons the better.

As to the United States, it is vitally important that we should encourage it to continue its support of NATO and this country. Whichever graph on page 53 is used, the American expenditure on defence can clearly be seen far to exceed that of its allies. The American contribution to NATO is huge. It also has military commitments world-wide, including in Central America on its doorstep.

I ask whether it is right or sensible to expect the United States to accept a disproportionate part of the cost of NATO or whether the European allies should not contribute more. We do not know what the reaction of next year's American Government will be, or indeed which party will be in government, or who will be President.

In particular, the British Government depend on America for the supply of the Trident missile, its servicing and I believe for its guidance. Surely we have a special interest in keeping the United States involvement in NATO at the present level and also to encourage our European allies to contribute more of their resources as well as doing so ourselves.

While on the subject, I cannot resist one final comment. Financially, the United States is running an enormous deficit, largely because of its contribution towards the protection of the free world. Japan is now one of the world's richest countries, with a huge trade surplus. It benefits from the protection of its markets by the Western world and by America in particular, and yet Japan's expenditure on defence is minimal. Has any attempt been made to obtain at least a financial contribution from the Japanese?

5.30 p.m.

Lord Monkswell

My Lords, one of the interesting things about the debate is that following the INF agreement, the changes in the Soviet political scene and the détente that is being generated between the United States of America and the USSR, one noted the cries of anguish from the cold war warriors who feel the ground moving under their feet. However, I do not want to enter into that debate.

I should like to touch upon a few practical points that have been brought out by the Statement on the Defence Estimates. I wish to start by thanking the Government for stating that they will not deny the public the facilities of the military search and rescue capability. I hope that the Government will abandon their plans for the privatisation of those services. On the other side, I must add my voice to the concerns that have been expressed by a number of noble Lords about the size of the British merchant fleet. We must recognise that our defence capability faces a continuing and increasing vulnerability because of the decline in the British merchant fleet and the Government's inability, or unpreparedness, to do anything practical about that decline. Many speakers have spoken at length on that subject. I shall not prolong that side of the debate.

I should like to touch next on an aspect of British defence capability which is sometimes neglected; that is, the contribution that the military makes when it comes to the aid of the civil power. The most dramatic example of that is the actions of British soldiers in Northern Ireland. In the majority of cases, the actions in which the British armed forces are engaged in Northern Ireland probably produce the objectives that we all seek—the diminution of violence associated with the Irish question. But there are occasions when the actions of the military, when it comes to the aid of the civil power, are counterproductive. I shall mention three examples and go a little further into the third. The first was Bloody Sunday; the second, the so-called shoot to kill affair linked with the name of John Stalker; and the third was when three unarmed people were shot dead in the streets of Gibraltar.

Whatever people's views about the rights or wrongs of what those Irish people were doing in Gibraltar, to gun down unarmed people was counterproductive to the efforts of sensible people to try to bring peace to the Irish question. I should like to make two personal points on that subject. The first is that a short while ago I met a young person who visited Gibraltar the day before the shooting. That person was a young lady, completely unconnected with the affairs of Ireland, who happened to have an Irish-sounding name. She was terrified by the idea that if she had been in Gibraltar the following day she too might have been shot dead. If there is a death-squad policy, are people like myself vulnerable and likely to be shot down because we happen to disagree with the Government's philosophy and attitude? I hope that we are not, but we must speak out plainly and strongly and say that that type of activity is unacceptable to the British people. It is counterproductive to the objectives. What effect did their actions have on the young men involved? What psychological traumas do they face as a result of killing those people'? It is unfortunate that the British establishment forces young men to carry out, or causes them to volunteer for, that type of activity.

Misinformation is one of the problems of the Gibraltar incident. The whole thing may have been a terribly unfortunate accident based on misinformation or bad information supplied to the soldiers involved. We are entitled to ask how it came about that the British media learnt on Sunday afternoon and evening that armed terrorists, having laid a gigantic car bomb, were shot in the course of that activity in Gibraltar, and yet by the next day we learnt that not only were they not armed but that there was no car bomb. We must ask about the calibre of information that not only we, the British public, receive but the members of our armed forces and the police are provided with. How can we expect them to do their job satisfactorily? How can we, as politicians, expect to come to the right decisions if we are not provided with the correct information?

I shall leave that subject and turn to my next, which relates to nuclear weapons. Again, I suspect that we are faced with the problem of misinformation. 1 hope that the answer to the problem is to provide accurate information. My support for the Labour Party's policy of getting rid of nuclear weapons is not based on a pacifist belief or an abhorrence of weapons of mass destruction—I recognise that the support of many people for the Labour Party is based on those factors—but is based on an analysis of the political and military realities.

The mass bombing of civilian populations, which effectively is what nuclear warfare is about, has never in the history of warfare achieved a military victory. In a number of cases, it has been demonstrated to be counter-productive to that victory. Our current knowledge of the effects of nuclear weapons, from Hiroshima to the recent example of Chernobyl, tells us that we could not use them without damage to our side of the conflict and the environment generally.

We are further faced with the risk of accident. We have only recently seen the shooting down of an Airbus over the Straits of Hormuz. We suspect that that incident was based on misinformation available to the captain of the US vessel. Unfortunately if someone who is in charge of military weapons is provided with the same kind of misinformation, what risk does the world community face as a result?

The problem that we face is not whether or not we get rid of nuclear weapons, but how. I suggest that we need to join with the leadership of the United States and of the Soviet Union and dedicate ourselves to working out how, by the year 2000, we can rid the world of nuclear weapons. We. as the British nation, need to make the point to other nations that do not have nuclear weapons that they would be foolish to acquire them. We can demonstrate that nuclear weapons can be abolished without that leading to instability.

The other aspect of Labour Party policy is our commitment to NATO. One could argue that our commitment to NATO is the same as that of the Tory Party. However, we approach it from a different angle. The objective of being committed to NATO is different. The Tory Party commitment to NATO is a conservative one, hoping to maintain the current status quo in the face of a changing world, with the maintenance of nuclear weapons come what may. The clear statement on the defence estimates is that there is no conceivable alternative to the maintaining of nuclear weapons by Britain. My understanding of the Labour Party's commitment to NATO is that we should use NATO as a mechanism to communicate with other countries, to communicate across the divide of the Iron Curtain, to enhance détente, and to enhance the peaceful co-existence of nations in this world of ours. For those reasons I support the Labour Party policy.

5.42 p.m.

The Earl of Cork and Orrery

My Lords, that was different, was it not? Before now I have described, I think without contradiction, this annual debate as a sort of ritual dance. Copies of the White Paper are set up on music stands and the dancers, some of them possibly making their first terpsichorean appearance of the year, step forth to join the courtly saraband. Year by year the orchestration evolves a little. The picture on the cover of the music is replaced. But on the whole an experienced Member of your Lordships' House would recognise, without being told, that he had strayed into the midst of yet another defence debate. (Perhaps I may state at once that my one criticism of the White Paper as a publication is that there is no mention of the name of the master photographer who took the picture on the cover.)

This year I do not feel quite so much that we are taking part in a ritual dance. On the contrary—and to vary the metaphor somewhat—I sense the cold light of reality breaking in. It is the INF treaty, to which reference has already been made, that is producing this effect, the significance of which I believe to be crucially important. It is not the effect, which—since both the strategic and the so-called theatre missiles remain—is limited, but the significance that is vast. It is hardly necessary for me to emphasise the point. But there is one particular truth that deserves, and 1 believe ought, to be hammered home in connection with this treaty. I do not know whether or not the unilateral nuclear disarmers—whether they belong to the Labour Party or to CND—have the crust to claim the impending removal of cruise missiles from England is a victory for their cause. I believe that it is important for us, and all their compatriots, to grasp this truth.

Those people, whether or not they belong to any of these forces or organisations, have fought to frustrate the negotiators of this treaty. If they had had their way, the operation of American ground-launched cruise missiles at Greenham Common and Molesworth would now be scheduled for removal and destruction while the USSR retained some 1,700 muclear warheads that threaten all of Western Europe including Great Britain. As it is, and thanks to the resolution of the United States, the NATO allies in general, and the British Government in particular, all the so-called intermediate range weapons on both sides are to go. We may fairly applaud the tenacity of the women of Greenham Common while heaving a sigh of relief at their defeat.

I said that I thought it would be unwise to set too much store by the effect of the treaty. But I also think that it might be possible to attach too much importance even to its significance. It would certainly be unwise to throw our hats in the air and to cry that Gorbachev means glasnost, and glasnost means perestroika, and perestroika means that peace and harmony are just around the corner. I am content to go along with the somewhat muted optimism of my noble friend Lord Carrington, as expressed last October in an address to the Royal United Services Institute, when he said: We must not close our minds to the possibility that the Soviet leadership is genuinely interested in a better relationship with the West, albeit for reasons of making their own system work better rather than some democratic revolution". It is a point of view which I believe has some support from my noble friend Lord Pym. True, there have been signs in the past few weeks—days even—of the germination of the first democratically revolutionary seeds since 1917; but that I feel is a matter for the Foreign Office rather than for the Ministry of Defence. Some red lights still glow among the branches in the olive grove.

For example, let us consider chemical warfare. In this connection, the White Paper has this to say in paragraph 217 on page 12: The negotiations"— those are the negotiations on the conference on disarmament in Geneva— have been dominated by Western initiatives and proposals. But over the past two years there have been welcome signs of Soviet willingness to respond more positively to Western attempts to secure a comprehensive and global convention that is truly verifiable". That undoubtedly is true. However, if one analyses what I have been able to find in these documents as a report of what the Russians are in fact up to, one discovers that they are concentrating on the verifiable aspect of the problem. Verification is absolutely necessary to the carrying out of a treaty. But it is no good if there is no treaty. Perhaps when my noble friend Lord Glenarthur winds up he will indicate —I do not detect this anywhere in the White Paper—whether or not any progress has been made with the advance towards an agreement to do away with chemical weapons or their use, quite apart from verification.

The objective behind the thinking of the White Paper is safety. The ultimate objective behind even that is peace. It is important not to forget one basic natural law. It is this. One can have safety without peace, but not for long; and one cannot for long have peace unless one removes the cause or causes of non-peace. The cause of non-peace between the USA and the USSR, or between East and West, can be stated all too simply. Any of us can do it. It is mutual distrust. No useful purpose is served by pointing an accusing finger at Marx or Lenin and saying, "They started it!" The ineluctable fact is that the mutual distrust continues, and will continue, to stoke the furnaces in the arsenals of' the world until both sides decide in concert that it shall stop.

There are compelling reasons why neither side finds it possible to trust the other. If some or all of these reasons are to be removed, it must be done as a matter of overriding priority before even arms control or anything else. A useful first step might be to find out what makes it impossible for the USSR to trust the USA. That should not be too difficult, but it would hardly be appropriate for me to attempt it now. The next step is for the United States—I am personalising the argument for the sake of simplicity—to consider how it can allay the suspicions of the USSR. (When I suggest that it is impossible for nation A to trust nation B, I do not imply that nation B is itself untrustworthy. One can find it difficult to trust people who are perfectly trustworthy if one did but know. I am keen not to be misunderstood about that.)

The Soviet Union might begin by demolishing the Berlin Wall. No one who has seen that disgusting wall, and few who have not, would question its significance as a symbol of distrust. That may be followed by a total adherence to the 1925 Geneva Protocol on Chemical Warfare. I do not know that I entirely agree with the conclusion of my noble friend Lord Fortescue that it is absolutely necessary to have a chemical capacity of our own in order to solve this problem. But I believe he is right in implying that one cannot negotiate if one has nothing to negotiate with. How then are we to negotiate with the Soviet Union if we have no chemical armaments at all?

The one criticism I have of the White Paper is in connection with chemical warfare. One gains the impression that the chief concern which appears strongly in the White Paper is the trouble that is caused to all our services but especially the Army by the chemical warfare capability of the other side. As a result of that all our soldiers and airmen will be required to wear what is known without any affection at all as a Noddy suit, the NBC suit, in which it is almost impossible to do anything efficiently at all. The White Paper suggests that wearing these suits might reduce the fighting capacity of troops by as much as 50 per cent. Anybody who has ever worn these suits or anything like them will find that a most optimistic statement. The constant wearing of protective clothing reduces the capacity of any fighting force including its tail to almost nothing. Therefore I detect a certain lack of seriousness on the part of the White Paper in that approach.

That is the only point I wish to make and it is much more to the point that I should suspend the poppings of a cork and to give way to the heavy guns of the noble and gallant Lord opposite.

5.54 p.m.

Lord Hill-Norton

My Lords, as we have come to expect, the White Paper is well written, well produced and readable. I found the several essays—I believe there are more this year on various subjects—particularly valuable. I should like to make one suggestion for presentation to the Minister of State and that is that the annexes which show the strengths of the three services would be more valuable if they included manpower figures as well. I have never quite understood why they do not.

I found that the brochure, glossy though it is, is more remarkable for what it does not say than for what it does say. Among the most startling omissions is the absence of any convincing rationale for defence policy as such, to which I have referred in your Lordships' House on more than one occasion in the past. I am in no doubt that Sir Frank Cooper, that distinguished former PUS at the Ministry of Defence, was absolutely right when he claimed in public last year: the Government has remarkably little in the way of defence policy, and it is the politics of expediency rather than a properly worked out policy which runs the Ministry of Defence". Indeed, as I have often said before in your Lordships' House, the hard questions have once again been ducked. These hard questions arise almost exclusively because of budgetary attrition and not through any difficulty on the part of the chiefs of staff in recommending what needs to be done to achieve satisfactory deterrence or, should that fail, proper defence.

Our commitments are plainly too great and too diffuse for the money which the Government see fit to make available. Several other noble Lords who have already spoken this afternoon have made the same point. I do not know one single informed military person who would not wholeheartedly agree with the assertion I have just made. I have never understood why Ministers in this Government seem to be so terrified of having another thorough defence review. They go out of their way again and again to say, "Never mind all that. We are not going to have a defence review".

I suspect, particularly after the grisly failure of their one ill-starred attempt to do that in 1981, that the Government simply funk the awkward choices that have to be made. For example, how shall we cope with the manpower shortages which are demographically certain to occur in the 1990s? How are we to make adequate preparedness when the public are hypnotised by the smiling face of Mr. Gorbachev? How are we to respond to the now inevitable US manpower withdrawals on the Continent of Europe which are bound to happen in the next five to 10 years? When can we expect true collaborative production on a large scale of defence equipment? Are we even buying the right kit? What practical steps are we taking to implement the NATO-wide initiative on conventional defence improvements?

If Ministers are working on any of these problems there is no sign of it in the White Paper. What is certain is that these awkward questions—and nobody knows better than I how awkward they are—and above all the matching of commitments to resources can only be properly tackled by going back to basics to decide. I believe it was the noble Lord, Lord Pym, who asked so eloquently: what is the threat today all over the world? What do we need with our allies to deter it, or defeat it if deterrence fails, and structure our forces in accordance with what the Government believe the public are prepared to pay?

Within my experience, which going back somewhere near the top of the defence tree is now about 20 years, the public have never actually been asked. When they are asked in public opinion polls there is an enormous vote, always over 70 per cent., sometimes as much as 80 per cent., for adequate preparedness. I know very well the competing claims of the social services, health, education and science, and all the other matters that the Government have to spend money on. I believe it was Mr. Healey who said that none of those things will exist if you let your defence run down too low.

I make the point this afternoon—I shall not elaborate on it any further except in one or two particular instances—that we have jolly nearly reached that point now. The defence committee in another place has recently rehearsed precisely the same arguments and come to precisely the same conclusion, as those of your Lordships who have read its excellent report will know. In his opening speech the noble Lord, Lord Irving of Dartford, spent some time making a similar point.

I have on more than one occasion expressed to your Lordships my unwavering support for an independent strategic nuclear deterrent. This afternoon I do not intend to say why, except that my support for the Trident programme—which is the only sensible weapons system to use, if that is one's policy—is unwavering. Nothing that has happened in the welcome successful negotiations over the INF treaty has caused me to waver in that view.

Certainly it is NATO's cohesion in the face of high political odds and a well-orchestrated campaign by the so-called peace movements which enabled that to be successfully completed. As an instrument for ensuring peace in Europe the nuclear deterrent demonstrably works. However, a balance based upon conventional forces alone simply does not, in history, have the kind of track record on which it would be safe to rely. That view is shared by no less a person than Marshal Kulikov. He recently said in public: Strategic parity between the USSR and the USA is the central factor of peace and international security". Nevertheless, I believe that some caution is now necessary in future negotiations about nuclear weapons. I warmly agree with what was said by the Canadian Minister of National Defence a month or two ago. He said: It must be no part of our policy to make the world safe for conventional war". I was pleased to hear the noble Lord, Lord Trefgarne, use the same words during Question Time last month.

As regards conventional forces, there was a welcome declaration in the gracious Speech last year that it is the Government's determination to increase the effectiveness of the nation's conventional forces. However, as my noble and gallant friend Lord Bramall said at the time: If the Government makes no further provision for defence funds than they have at the moment, this is in real danger of becoming a contradiction in terms". And so it is.

On the question of further negotiation about conventional forces, it is extremely important that they should be NATO-wide with the Warsaw Pact, if necessary, for cosmetic reasons; otherwise with the Soviet Union. That is quite different from the START and INF negotiations which are, quite properly, bilateral US-USSR affairs. High on the list of conventional forces to which I have referred—and, in my view, dominant—must come our maritime forces. They have been accurately described as being the most reliable because they are the most survivable. Plainly they are now inadequate to discharge our NATO role, much less to continue to meet the out-of-area commitments laid upon them by Ministers.

The White Paper is considerably less than honest about these forces. I should like to deal briefly with the merchant fleet, dismissed in the paper in two short paragraphs (319 and 320). I suppose it is just possible that there may be people, apart from Ministers, who believe that there are sufficient merchant ships and crews under national control to meet the needs of defence and economic supply in war. If there are any such people I have not met any of them. I have no hesitation in telling your Lordships that we could no longer mount such a relatively small operation as that in the Falklands, much less meet our NATO requirements, with the merchant fleet at our disposal today. That grave situation is becoming rapidly worse, rather than better, for both merchant ships and their crews; perhaps worse still for the crews than for the ships. That is because the Government foolishly suppose that the priceless national asset of our merchant marine can be left entirely to the play of market forces. Of course it cannot.

Noble Lords have no doubt read the view of the transport committee of another place. It reported last month that it was, dangerously naive and extraordinarily complacent of the Government to suppose that there would be adequate ships and crews for defence and economic purposes". I could not have put it better myself.

I turn to the Royal Navy, as noble Lords might suppose. Today I shall confine my remarks to the surface fleet and in particular to the destroyer and frigate force. Noble Lords have no doubt already read the excellent report of the defence committee to which I have referred. The appendices show how the committee found an enormous consensus—which I do not find at all remarkable on the facts—among academics, the military, shipbuilders and owners, learned institutes and even some politicians, that we could not meet our commitments even if we had about 50 destroyers and frigates, as Ministers constantly repeat.

SACLANT, the Supreme Allied Commander Atlantic, and our own Commander in Chief Fleet have both said, for example, that we need rather more than 60 for our NATO task alone. Going further, SACLANT said that he is now 45 per cent. short of the escorts that he needs to meet his commitments. The defence committee underlines that by stating: The Commander in Chief Fleet simply does not have the assets to meet all the operational requirements presented to him". I have quoted several times, which I have never before done in your Lordships' House. I have done so because I want noble Lords to understand that the views which I am expressing are widely shared by a powerful committee of all parties in the other place.

Our out-of-area commitments, already referred to by other noble Lords, take up no less than 11 of the ships, however many they are. Prudent ship husbandry and the way of running our fleet in peacetime, which provide acceptable conditions for our sailors, take about one-third of the total force at any time to be at extended operational notice. Despite running the fleet harder than it has ever before been run in peacetime, these demands alone have resulted in a sharp diminution in the other activities which the Royal Navy ought to be carrying out, particularly NATO exercises.

The noble Lord, Lord Pym, with his great experience of defence and with all the authority of a former Secretary of State, told your Lordships this afternoon most forcefully that the question of whether we have our priorities right demands a further look. I agree with him.

The arithmetic is very easy to do. Ministers either have not done it or, if they have, they choose to conceal the results. We do not have about 50 such ships unless that can be taken to mean 45 or some smaller number. That has been accepted and reported in forceful terms by the defence committee, to which I have referred. The reason is not difficult to find. Simply, it is because not enough orders have been placed for new construction.

I shall put the figures in a slightly different way than did the noble Lord, Lord Irving of Dartford, who quoted similar examples of what is wrong. On the basis that three new ships are required to maintain a running fleet of 50, the total number which should have been ordered since this Government came to power in 1979 is 27. In fact, 21 have been ordered. Since 1982 only 10 have been ordered; 13 if one counts those which were so conveniently ordered yesterday. That figure includes four replacements for ships sunk in the Falklands.

One can see that the arithmetic really is easy to do. To keep the numbers up to the target of 50, which the Government have claimed, 15 must be ordered over the next five years. On their track record I know perfectly well that Ministers have absolutely no intention of doing so. I challenge the Government to refute these figures which I and the defence committee have given.

In conclusion, perhaps I may remind the House that the Royal Navy fulfils a vital defence of the United Kingdom role as well as its NATO role. In the eastern Atlantic and in the north Norwegian seas, the Royal Navy has the dominant position in NATO, which is clearly recognised by our potential enemies there. It is only our control of those seas which makes possible successful deterrence and defence in Germany. If we were to lose that control then such success in Germany would become impossible. That is what is at stake.

6.11 p.m.

Viscount Mersey

My Lords, with the leave of the House, my noble friend Lord Ridley and I have agreed to change places through the usual channels.

Traditionally, NATO has planned a defensive battle in Europe and the Warsaw Pact an offensive one: the conquest of the West, no less. It is therefore remarkable to learn now that the Russians are looking at defensive defence; that is, of creating an area 50 miles in depth heavily mined and bristling with anti-tank guns.

Such were the ideas floated at the Moscow Consultation on Common Security on 22nd and 23rd April last. Eugene Silin hosted these talks. He is First Deputy Chairman of the Soviet Committee for European Security and Co-operation. We sent delegates from the Foundation for International Security, and the Americans likewise from their committee for US Soviet relations. I find it fairly surprising to find Russians examining strategies that run against the traditional Marxist-Leninist doctrine of expansion, but I can assure noble Lords that such views were expressed this April.

The Russians at this meeting were academics. These academics advanced the idea of defensive defence and their arguments were based on a re- examination of Clausewitz, who did preach that defence was the stronger form of warfare. The Russians dismissed static defence, such as the Maginot Line, as useless; quite rightly with hindsight. But they saw merit in mobile defence in depth. They cited the battle of Kursk in 1943 as a good example of how to defeat German armour by staying put in very great depth, using tank traps, mines and armour-piercing shells. They contrasted this defensive battle with the disastrous Soviet offensives earlier in the war. That is the good news.

The bad news is that the generals are still thinking in terms of a European blitzkrieg. Their thinking is rigid. They are still building 3,500 tanks a year and the admirals are launching a new submarine every six weeks. Many of my noble friends and other noble Lords have made that point.

The big question is: where does Gorbachev fit in? Perhaps I might suggest that he is sincere in his glasnost and perestroika and that he could be using the academics to persuade the generals to change from inflexible tram lines to a more flexible, steerable trolleybus approach. What is beyond dispute is that this meeting has taken place and that its findings have been published. Such a publication would have been inconceivable four or five years ago.

I should like to read out one short paragraph from the Moscow Consultation under the heading "Conventional Reductions". It states: A general willingness to consider asymmetrical cuts in conventional land forces was reflected by several speakers. One Soviet participant drew attention to Defence Minister Yasov's recently published admission of a 20,000 superiority of Pact over NATO tanks". Further, I understand that the Russian military now also admit a superiority in aircraft, artillery and helicopters, and that they are willing to break down the quantities of weapons held to whatever level NATO wishes—right down to company or squadron if need by—for verification purposes. I understand that the MBFR talks which have never made any real progress have been replaced by conventional stability talks in Vienna which are doing somewhat better. So there is evidence at least that the Russian military machine is becoming less secretive.

I speak only of words, not deeds, a point already made very eloquently by the noble Lord, Lord Pym. I speak of noise not action. Dr. Edward de Bono in a thoughtful letter to The Times last week pointed out: Russian Internal Politics have made it necessary for noise to precede action with glasnost and perestroika. The more effective strategy of action preceding noise would have been too dangerous because the reformers would have been quietly removed". I assume he includes Gorbachev in that category. But he continues: The considerable noise may lead to unrealistic expectations and disappointments". We have had one magnificent piece of action; that is the INF treaty, mentioned by many noble Lords including my noble friends Lord Trefgarne and Lord Cork. We have too rather alarming pieces of action in Armenia, Lithuania and Bylorussia, mentioned by my noble friend Lord Thomas. These types of unrest often arise as a result of liberalising a dictatorial regime.

Gorbachev is certainly treading a delicate path, and I would not mind betting that the military hardliners are saying to him right now, "We told you so". Certainly so far the concept of defensive defence has been all noise and no action. The Warsaw pact exercises still take the same form as they have always done: a rehearsal for a massed advance of armour into the West.

However, should those exercises ever change into defensive defence, and should the Russians cut back on their tank building, and their ship launching, then I believe we in NATO might say with all due caution, "The cold war is over, and we can sleep easy in our beds".

6.18 p.m.

Lord Hatch of Lusby

My Lords, my first action in the political field was when I was a schoolboy collecting petitions for the League of Nations across the Yorkshire Moors. I found as a young boy what I now find as at least a mature adult—that disarmament is an issue which is felt by every citizen in this country. We find that at election time; we find regularly, constantly that it is a central issue for the British people and indeed for the human race.

Yet so far in this debate very few have spoken of disarmament. To hear the opening speech of the noble Lord, Lord Trefgarne, it would seem that the Government's policy is still based on the Montebello Treaty of 1983, with its preparations for the modernisation of nuclear weapons, its context of the cold war, of the Soviet Union and Eastern Europe as the enemy, and with the figure of the Prime Minister as the Iron Maiden in the background and often in the foreground. That is a misreading of history and of public opinion in this country. Montebello was held before the era of glasnost. It was held before the appearance of Mr. Gorbachev. It was held long before the INF treaty.

Perhaps I may take up a point raised by the noble Lord, Lord Thomas of Swynnerton. There seems to be, particularly on the Government Benches, a complete ignorance of the background of the Communist movement, and therefore surprise that the reforms which Mr. Gorbachev has introduced should come out of a Communist system. Those of us who have lived all our lives with the Communist community—and I can claim to have known them from the days when the heart of Communism in this country was in West Fife, when Willie Gallacher was the last Communist Member of Parliament and I spent nine years fighting him not as an anti-Marxist but as an anti-Stalinist—know that it is only that understanding of Marxist philosophy that explains what is now happening in the Soviet Union and Eastern Europe.

There is a crucial difference between Marxism and Stalinism, and that difference is now being seen in the struggle which is taking place in the Soviet Union. The relevance of that struggle to our defence policy is that, if it continues to be based on Montebello, Mr. Gorbachev's chances of survival, of producing the liberalisation and democratisation which Marx himself forecast could take place in certain circumstances, will be destroyed. It is clear that the British and American Governments and members of NATO are continuing the policy of Montebello. At the North Atlantic Council meeting in Brussels in March this year the NATO communiqué on conventional arms control stated: Although conventional parity would bring important benefits for stability, only the nuclear element can confront a potential aggressor with an unacceptable risk": Those were the sentiments expressed by the noble Lord, Lord Glenarthur, when he wound up a debate on defence in this House in December of last year. Apparently the concept of nuclear deterrence is still rooted in the Government's policy.

I do not ask the Government to take my view or the view of my noble friend Lord Jenkins, about the folly, irrelevance and stupidity of the concept of nuclear deterrence. I quote from George Kennan, who, referring to nuclear deterrence wrote this year: all these millions of occasions when the term has been used, it has carried with it the implication that there were fearful things the Russians wanted to do—attacks on Western Europe, first nuclear strikes, or what you will—and would assuredly have gone ahead and done, had they not been 'deterred' by the threat of our nuclear retaliation … I, as one who has been involved in the observation of Soviet-American relations longer, I believe, than anyone now in public life on either side, have never seen any evidence of any desire, intention or incentive on the Soviet side to do any of these things". Therefore, Her Majesty's Government cannot simply assume that their concept of defence, as based on nuclear deterrence, is one which has universal respectable support. It does not. It is contrary to public understanding that NATO has been carrying out since Montebello an extensive nuclear modernisation programme throughout the 1980s. The programme includes free-fall bombs, artillery shells and the lance missile.

My noble friend Lord Jenkins of Putney quoted from Dan Plesch. I suggest, because I do not have the time to go into detail, that noble Lords who are interested, particularly noble Lords on the Front Bench opposite, should read the British-American Security Information Council paper Basic Fact Sheets: NATO's New Nuclear Weapons published in April of this year. I also suggest that Members of the Front Bench opposite could learn a considerable amount about the background of the whole nuclear issue if they refer to the updated Guide to Nuclear Weapons published by Bradford University, also this year, written by Paul Rogers. I quote only one paragraph from it because it leads me into the point that I want to stress.

It states: Prospects for arms control at the intermediate level may look good"— this is before the INF Treaty— but it is already apparent that a variety of devices is available to be employed to bypass any treaty. Thus a removal of cruise, Pershing 2 and SS-20 missiles would leave a perceived targeting gap which could readily he filled by sea-and air-launched cruise missiles and depressed trajectory SLBMs". That is what is happening.

I refer here to the points that I put to the noble Lord, Lord Glenarthur, during our last defence debate in December. I asked certain specific questions of which I had given notice. My questions and the noble Lord's answers are reported in Hansard for 9th December 1987, cols. 259 and 273. I asked: First, is it true that the new short range air launched cruise missiles are being developed and that a nuclear warhead is being developed to be added to them? Secondly, is it true that there is now development of a so-called fire-and-forget nuclear missile known as a stand-off missile? Is it the case that the Royal Air Force would like—and intends—to buy it to place on its Tornado bombers? Thirdly, is it the case that the United States is being asked to assign sea-launched cruise missiles to NATO? The noble Lord dodged every one of those questions. His answer to them was, first: I cannot comment on the United States defence plans". Secondly, he said, referring to the fire-and-forget missile: of course the nuclear capability of Tornado and other aircraft is kept under constant review"— I did not ask him that— and no decisions have been taken on any modernisation of the free-fall bomb". Have they not'? Have they still not been taken? In answer to my third question referring to the United States assigning some of its sea-launched cruise missiles to NATO, he said: Any adjustments to NATO's nuclear capacity are a matter for NATO as a whole and no decision has been taken". Has that decision yet been taken? My fourth question was dodged even more blatantly. The question was, why is it that a neutron capable artillery shell funded by Congress was deployed in Germany two years ago without any information being given to European parliaments? His answer was: The noble Lord claimed that no information had been given to European parliaments. I cannot speak for other European parliaments, but this Parliament will he fully informed, as has always been the case, of any change in the destructive nature of nuclear weapons assigned to Her Majesty's forces. This applies both to the United Kingdom and US-owned warheads". The question I asked was: how did it come about that this artillery was being used two years ago and that Parliament has never been informed about it? The answer, "will be informed", can hardly be an answer to the question that I asked.

My central point is that pursuing the policy decided at Montebello on the modernisation of nuclear weapons despite the INF treaty is an obstacle to the whole spirit and the possibility and opportunity for negotiations in Europe. It is sabotaging both the INF treaty and the spirit in which that treaty was signed. That policy is also undermining the opportunity which we now have to end the cold war. Only the ending of the cold war can lead to disarmament and provide the opportunity for co-operation in Europe to attack the problems that go way beyond the European Continent; namely, the global problems which are now menacing the future of the human race.

The consequences of the INF treaty itself could result in more deadly nuclear power and a greater threat to human survival as the British Government and other members of NATO, besides the Soviet Union, try to replace what is being destroyed in the INF treaty by making more sophisticated weapons and the modernisation of the whole nuclear armoury. That will happen unless the whole mentality which produced the cold war is ended and genuine disarmament is pursued. We now have the opportunity to look at the issue of disarmament in co-operation with Eastern Europeans. When we have the opportunity for constructive co-operation between NATO and the Warsaw Pact, the British Government should be taking a lead in pursuing this opportunity. I have no doubt whatever that the British people will be behind the Government in pursuing this aim of genuine nuclear disarmament followed by disarmament in conventional weapons.

The two aspects are connected, because one cannot have disarmament in conventional weapons so long as one has a nuclear strategy. As noble Lords opposite know very well, it is now the case that conventional weapons can be used to carry nuclear weapons. Only by the opening up of information and a genuine public democratic debate based on revealed genuine facts can this new spirit be developed with the assistance, support and leadership of the British people. It will also require an end to secret decisions which have undermined the disarmament programme. The attitude of Her Majesty's Government shows that they are opposed to taking the opportunity for disarmament. They appear to be fanatical in their adherence to the destructiveness of nuclear weapons. Her Majesty's Government appear to be set on the path of using all their power and weight to prevent the total. removal of nuclear weapons which could begin now. I have no doubt that they would secure the entire support of the British nation in pursuing this objective.

6.35 p.m.

Lord Colnbrook

My Lords, at this stage of the debate I believe that I should confine myself to two points only. I hope that my noble friends on the Front Bench will find the first congratulatory; the second I fear they may not. I begin with the first point, that of congratulation. I commend my right honourable friend the Secretary of State and my noble friend the Minister of State, on having arrested the decline in the defence budget. We all remember very well nine years ago the adoption by the present Administration of an increase in the European NATO target of 3 per cent. per annum over a period of time and how they struggled to meet that target. They did not quite meet it but they made a real effort and our defence budget increased.

I recollect that it was in 1985–86 we were told that this would come to an end and that there would be a levelling off in the defence budget. It so happened that at the time I was the chairman of the Select Committee on Defence in another place. We made some fairly detailed inquiries into precisely what was meant. We were dismayed to find that it did not mean levelling off at all; it meant a reduction. After delving into the matter we forecast that the reduction that was to come about over the next three years would be of the order of 6½ per cent. if one included expenditure for the Falklands, or 4 per cent. if one did not.

I regret to say that we were very nearly right. It turned out to be a reduction of 6 per cent. including the Falklands, and 4 per cent. without it. We are now told by my noble friend and by the White Paper that expenditure is really to level off. The figures I have seen indicate that to be the case. That is a matter for congratulation. How it was done and what the arguments were between my right honourable friends the Secretary of State and the Chancellor of the Exchequer, I dare not think, but they must have been fairly intense and they must have happened fairly recently because I do not recollect any indication of this last year. It is only this year that we have had an indication that for the next three years defence expenditure will be very nearly level.

The noble and gallant Lord, Lord Bramall, indicated that he thought that there were continuing reductions. I believe he attributed that to the fact that nowadays increases in pay over and above the rate of inflation have to come from the budget. That has been the case for some while. I hope that when my noble friend winds up the debate he will confirm that for the next three years expenditure on defence matters will in real terms be at the same level as it is now.

My second point is one that has already been touched upon by a number of noble Lords, namely, my noble friend Lord Pym, the noble Lord, Lord Monkswell, and the noble and gallant Lord, Lord Hill-Norton. I wish to go into the matter in a little more detail for a few moments. It concerns that absolutely essential element in the defence of our country, the Merchant Navy. I am sure it does not need me to rehearse all the reasons for making that statement. Everyone knows that no military operations in Europe or anywhere else can be conducted for more than a day or two without reinforcements of material and men, virtually all of which have to come by sea. As regards operations further afield, your Lordships will remember that the Falklands campaign involved the Government taking over 49 merchant ships. I cannot think what number would be needed if we were ever to find ourselves engaged in conflict in Europe.

Numbers have been assessed by NATO and I understand that they are being re-assessed. I refer to the numbers required for reinforcing Europe from Britain, for reinforcing Europe from across the Atlantic, for the service of the Royal Navy and for what is called economic shipping—to bring in the things that we ordinarily eat and drink. This will involve large numbers of ships. All of us hope that there will never be a major conventional conflict in Europe, and I do not think that there will.

However, if the renunciation of nuclear weapons by East and West proceeds, the chances that any conflict in Europe would be conventional must increase rather than decrease. If one puts it at its very lowest, nothing has occurrred to reduce the requirement for merchant ships in assisting the defence of this country. If we are in the business of deterrence, which we are, the availability of adequate merchant shipping represents a significant element in the make-up of that deterrence. What is therefore of concern to us all is whether the right kind of ships and enough of them are readily available.

This point has exercised the minds of many of us for a number of years and the Government have been pressed time and again to address the problem. To the credit of my noble friend, the merchant fleet is now recognised as a defence resource. Mention is made in the Statement on the Defence Estimates and there is a table of figures in Part 2. The trouble is that it is quite impossible to discover what really is readily available.

The noble and gallant Lord, Lord Hill-Norton, mentioned the Select Committee on Defence of another place. It took evidence on this subject, as did the Select Committee on Transport, though from a different angle. No fewer than three different figures were given by government departments in evidence to the committees. The Ministry of Defence said in May of this year that 906 ships were available. The Department of Transport said that there were 410 available. The people from the Ministry of Defence went away, scratched their heads and came back and said that there were 646. The Ministry says that that is enough. I do not know which of those figures is correct and I do not think anybody else does. Furthermore, we do not know what those ships are.

When the Ministry of Defence originally accepted the desirability of including the Merchant Navy fleet in the Defence White Paper it worked on the basis of ships of 1,000 gross registered tonnes or more. I think it is now working on figures of 300 gross registered tonnes or more. The Department of Transport uses the figure of 500 gross registered tonnes. We do not know where we are. For the benefit of those who do not go to sea all the time, perhaps I may point out that 500 gross registered tonnes is not very much. The Isle of Wight ferries are 900 tonnes, so we are not talking about large ships. Some of them may be, but many of them are small. Whatever may be the correct figure of ships available to be pressed into the service of the country if need be, what is quite clear is that the numbers have fallen rapidly.

In the past 12 years the number of ships in the Merchant Navy has fallen by 40 per cent. The tonnage of the Merchant Navy has fallen by 78 per cent., which indicates to me that the larger ships have been going and that we are left with smaller ones. These are frightening figures and the problem is continuing. The Department of Transport takes the view that the decline has stopped. I do not think it has because 11 ships went off the register in the first three months of this year. I have no reason to suppose—nor does anybody else—that the decline is going to stop. If the number continues to fall, I do not know how we will manage any kind of military operation.

The problem is not just the number of ships available but, perhaps more serious, the number of people trained to man them. The number has been rapidly falling. In the past six years the number of officers has fallen from 25,000 to 10,000. That is bad enough, but worst of all is the decline in the number of cadets entering the Merchant Navy. In 1982 4,000 cadets were learning their trade as officers. Today there are 500. One cannot altogether blame these young men because if the Merchant Navy is very small, what is the point of training to be an officer and finding that one cannot get a job? What is crucial is that there should be men trained to man and officer what ships we have or what ships we can lay our hands on. If we can lay our hands on ships registered in Bermuda or wherever it may be—and I think we can—the chances are that those ships will not have British crews. They will have a crew of Poles or Yugoslavs or even a crew from Communist China. They will not want to come and help us fight a war. The lack of men is just as serious, if not more so, as the lack of ships themselves.

This problem has exercised the minds of some of us for a long time. However, when exploring it we have always found that it is "somebody else's job" to deal with the matter. The Ministry of Defence says that the Merchant Navy has nothing to do with it and that it is a Department of Transport responsibility. The Department of Transport says that how the country is defended has nothing to do with it and that it is the responsibility of the Ministry of Defence. The result is that very little, if anything, gets done. 1 have pressed before in another place—and I do so again tonight—for the Government to seek to get their act together. Perhaps I may make one final quotation from the report of the Select Committee on Defence. With reference to the future of the Merchant Navy, it said: It is essential that policy on this subject should be directed by the Prime Minister as the only Minister in a position to take a broad overview, and, where necessary, to cut across departments". I have to say that I agree with it.

Lord Hatch of Lusby

My Lords, is the noble Lord aware that three years ago noble Lords on this side of the House, with the support of noble Lords opposite and indeed noble Lords from all parts of the House, for months pressed the Government to appoint a Select Committee to investigate the decline of the Merchant Navy and the decline in the number of seafarers? The Government have never responded to that request.

Lord Colnbrook

My Lords, in answer to that question, I can only tell the noble Lord that three years ago I did not have the honour to be here.

6.47 p.m.

Baroness Strange

My Lords, I shall try to follow the example of Sir Winston Churchill and not speak mush, slush and gush, but instead shall try for immense common sense on defence. That is what we all want. We need our defence in order to maintain our equilibrium of peace in the world. It is rather like treading water when one is out of one's depth. If one keeps treading water, one stays afloat. It one stops, one sinks. That is basically our principle of defence.

We have all read the excellent document the Statement of the Defence Estimates 1988. Some of us have been lucky enough to visit sections of Her Majesty's Armed Forces at Aldershot, Hawley or Porton Down, to go over the Royal Air Force base at Leuchars, to sail in a frigate in the North Sea or down the Clyde or to visit the Grenadiers in Germany. We are therefore very aware of the excellent state of our British armed forces, of their equipment and of their morale.

In the past few years there has been an immense change in the general attitude of the Soviet Union. Things which would have been unthinkable even a few years ago are now being taken for granted. Glasnost is like watching a glacier breaking up in the sun. So many treaties and negotiations have taken place. I am sure that they would not have done so if we had not had a complete and adequate system of defence.

There are just two points which I should like to make. First, although we have gone far along the way in reducing nuclear armaments, in the field of conventional armaments we still have far to go. In Europe the Warsaw Pact countries have 170,000 more soldiers than NATO; 8,900 more tanks; 5,700 more anti-tank guided weapons; 6,900 more artillery and 1,300 more fixed-wing tactical aircraft. By any account we are heavily outnumbered and it must make sense to try to achieve a closer balance.

I realise that to convert many of the factories in the Western Soviets, where a large part of the Russian workforce is employed in making weapons, would be a costly and time-consuming enterprise. It is not easy, or cheap, to convert swords into ploughshares. But, there is also a considerable export market of Soviet weapons to Egypt, Finland and India—where many of the military planes are Russian. However, difficulties exist to be overcome. With Mr. Gorbachev's new call for a European summit there is indeed hope.

The second point I should like to make is in the area of chemical weapons, where I disagree profoundly with my noble friend Lord Fortescue. We in Britain have had no chemical weapons since the late 1950s and are committed to a complete global ban of them. The Soviet Union is known to have very considerable stocks, though even here there are signs of the glacier melting a little with a projected visit from Porton Down to Shikhany. Here, too, it must make sense to continue to work for the eradication of all chemical weapons.

The world is opening up and becoming a surer and safer place in which to live. We are all experiencing glasnost and perestroika. We must remain vigilant and alert and not—I repeat, not—relax our defences. Having started my speech by quoting Sir Winston Churchill, perhaps I may finish by quoting my right honourable friend the Prime Minister. She said on 9th June: Our defence policies effectively safeguard the defence of this country, and ensure that we are staunch allies of NATO".

6.53 p.m.

Viscount Allenby of Megiddo

My Lords, along with other noble Lords, I welcome the Statement on the Defence Estimates about which we have heard so much this afternoon. To my mind the Estimates, though somewhat glossy, as has already been pointed out, give a thorough review of our defence forces of which the Government are justly proud.

At paragraph 512 of the Estimates, under the heading of "Personnel" it states: The manning position in the armed forces is broadly satisfactory, although there are shortfalls in certain areas". The Statement goes on to say: Recruitment has reached 99 per cent.". But, as has already been indicated by the Minister, and without wishing in any way to be alarmist, the present trends are disturbing for all three services in the recruiting world. The Navy is currently 18 per cent. short of its officer strenth; the Army and the RAF are also short of officers. This is despite a very high profile recruiting campaign in the weekly colour supplements which I am reliably informed is most effective.

The worst problem lies in the technical trades in all of the three services. The Navy is 20 per cent. down on technical apprenticeships. The Army is also facing problems during the current recruiting period until September of this year. There are currently 800 adult vacancies and 300 junior vacancies and on present predictions that will mean between 1,500 and 2,000 men short next year. That is a far cry from the additional 6,000 men that the Army would like to have in its ranks.

The situation is very serious and there is no simple cure. But, first and foremost, we need to retain those trained soldiers, sailors and airmen that we already have. Mr. Freeman stated in another place on 22nd March (at col. 191 of Hansard):

"PV R"—

that means premature voluntary retirement— rates—for all three services have been broadly stable for the last 18 months. They are still too high". I agree with him. But I believe that the package of allowances which was recently announced has been well received and will meet the aims as laid out in paragraph 515 of the Estimates. However, I urge the Government to continue to keep under review all pay and allowances for the services because I think that that is one of the major factors for a high wastage rate in the regular forces. We hope that the wastage rate that we currently have will improve and we shall make good steps towards retaining the personnel that we have at present.

However, there are areas which need to be tackled, but as they have already been touched upon by other noble Lords this afternoon I shall be brief. Job satisfaction and having the resources to do the job are aspects that one continually hears about when visiting the Armed Forces today: the ability to do the job properly. Here perhaps I may quote one example. Our tank crews in Germany have 40 field-training days a year; in comparison, their American counterparts have 100 days. When they go on the ranges, tank crews have somewhere between 65 and 70 rounds to fire over a period of a fortnight. Anyone who knows anything about tank gunnery will know that that is very few rounds indeed. Not having the resources to do the job properly on the ground causes a considerable amount of frustration.

I know that money is extremely short. But I urge the Government not to reduce further the resources for our Armed Forces to train and to do the job properly. One of the most recent things that have happened has been the increase of 102 posts in the Army's individual training organisation. That is a most welcome move and will enable the Army to train its recruits properly. I know that this may be a reaction to some adverse publicity which I shall mention later, but it is a step in the right direction.

A great deal of building has been taking place under the present Government and a great deal has been put into the TA building programme, which is most welcome. For example, new drill halls and cadet huts have been built and that too is a welcome move. I believe the problem now lies in the maintenance of existing buildings, especially married quarters. Wives are no longer content to put up with sub-standard quarters at reduced rents; they want well-maintained quarters in good condition and readily maintained. Recently I had the pleasure of visiting Aldershot where new quarters have been erected in place of the disastrous ones which were put up some 15 years ago and which were virtually falling down. They are of a very high standard and those who are occupying them welcome them immensely.

However, I am concerned about the economies referred to in paragraph 505 of the Estimates. With more uniformed men at the front and less in the support services, the services will become more dependent upon civilians. Because of rising employment figures, those civilian posts may not be filled. There is an indication that some civilianised posts may have to revert to the uniformed servicemen because they cannot be filled by civilians. I put it to the Government that there may possibly be a case for extending in service some of our servicemen today. It already happens in certain officer posts and it also happens in what are known as long-service list posts. This could be looked at and some of our well trained, well motivated and excellent soldiers could be extended in post beyond the 22-year point.

While welcoming the statement on bullying, ill-treatment and initiation in the Army at paragraphs 516 and 517, I consider that there is a real need to heighten further the service image in the way that the Territorial Army is undertaking this autumn through the national employment liaison committee, possibly aimed at 16 to 19 year-olds. I wonder whether there would be any mileage in reintroducing the Army youth teams that we used to have about five years ago and putting them into the inner cities where there is a lot of frustration and unemployment among the young. If those teams were well trained and we had good school of recruiting, they could do a great deal for the inner cities and enhance the present recruiting situation in the Armed Forces.

Closely involved as I am with recruiters from all three services, I believe that servicemen and servicewomen involved in recruiting do an excellent job. However, there are far too many agencies and far too many staff levels involved in recruiting. All too often these are unco-ordinated. I Shall not delay your Lordships further by quoting examples, but I see the need to get our lines of communication sorted out for public relations and recruiting. There is an urgent need to look towards the future manpower needs of our services. For the Army this is already happening with the MARILYN study, manning and recruitment in the lean years of the nineties. The report is to be presented later this year and it is hoped that it will receive urgent attention. It is well under way, but it will need a lot of work done on it yet. Our service personnel do an excellent job wherever they serve and they deserve our unremitting support. I for one recognise and applaud the tremendous support that all three services get from Ministers both in this House and in another place.

7.2 p.m.

Viscount Ridley

My Lords, it will probably be no surprise to your Lordships if I refer to the reserve forces yet again, as I have in the past. However, I hope to be brief tonight partly because in April we had a debate on this subject alone, and, secondly, because I volunteered to be tail end Charlie in the debate and I understand from the Royal Air Force that tail end Charlie did not last very long.

The reserves are mentioned in the Statement on several occasions. No one should be left in any doubt as to the importance that the Government attach to them. They have done so much and have so much to be proud of in this respect that it was with some sense of dismay that I and many others concerned in the matter a few weeks ago read the document on the British defence policy, 1988–89, explaining what goes on in the defence world. It is a first-class document in every way and accompanied the annual White Paper. In it there is only one mention of the reserve forces in a short paragraph on page 24. I believe that the document is meant to be widely circulated; indeed, it has been circulated throughout industry. It seems to be that this miserable almost dismissive mention of the reserve forces could not have been more harmful at the present time, nor could it have come at a worse time.

We have already discussed—my noble friend Lord Allenby of Megiddo mentioned it—the fact that the retention of recruits in the reserve forces is not going as well as we should like and there is doubt whether we can reach the targets, whatever the Minister of State may think. Secondly, the national employers' liaison committee is referred to in paragraph 332 on page 34, and I shall not describe it. The Government have wisely and sensibly allotted £10 million to carrying our the recommendations of the committee. The purpose is to convince industy of the need to support the reserve forces. What will industry think when it reads the White Paper?

Last but not least, in a fortnight the triannual congress of reserve officers will meet in London for the first time for some years, at which the Secretary of State for Defence will preside. What will it think when it sees our view of the reserves? I hope that in some future year the Government may try to do something to put the matter right. I have written to the Minister on the subject, and await an answer with the greatest of interest. I think that a public affirmation of confidence at this time is badly needed. The reserve forces have done so much so well, as the noble Lord, Lord Trefgarne, said, and they have so much support that it is a pity and a great surprise to me that they have not used this opportunity to blow their own trumpet on the subject.

I turn to one other matter that is quite unrelated—the announcement yesterday of the order for three frigates. We cannot question the decisions taken on the matter of costs with regard to these tenders. Inevitably this will bring joy in one shipyard and sorrow in many others. It is a terrible fact that literally hundreds of jobs may depend on this decision. I cannot believe that this is the right way to run a shipbuilding industry. I should very much like my noble friend to consider—here I make a special plea—whether some orders might put to Swan Hunter of Tyneside in the future. The despair felt there today I think will he well known to him already. I shall fully support any theory that sentiment is no way to run defence matters and defence orders. I must remind the House how very hard and successfully all the men in the Tyneside yard of Swan Hunter worked to complete HMS "Illustrious" during the Falklands war not only weeks but months ahead of time. I know for a fact how very grateful the Royal Navy was at that time. I hope that the fact will not be forgotten.

7.6 p.m.

Lord Graham of Edmonton

My Lords, it is with my normal pleasure and satisfaction that I speak at the end of a defence debate not least because the noble Lord, Lord Trefgarne, got us off to a very good start with a lucid explanation, making the best of a bad job in putting to us what my noble friend Lord Irving of Dartford said was a very bland statement—and it is right and proper that the bland should be leading the bland. But that is not the right posture for a Minister of Defence.

We have enjoyed—I say this sincerely—for the past four hours, as we always do in defence debates, listening to Members of your Lordships' House who, from political, ministerial or service experience, bring to the House an infinitely better informed debate than one experiences in another place. At times there is passion, but I think that the defence debates in this House are slightly more detached and less partisan than those in another place. I pay tribute not only to the Minister but to my noble friend Lord Irving of Dartford and the noble Lord, Lord Mayhew. Although he and I disagree on some aspects of defence, the noble Lord in my view is always well worth listening to because of the lucid way that he puts his often sensible arguments.

I want to go immediately to what I think is the kernel of differences in the debate. The noble Lord, Lord Pym, who has my greatest respect in a wide range of matters, castigated my noble friend Lord Irving of Dartford for his inability to put forward a coherent Labour policy for defence. I know that the noble Lord listened with great attention when the noble and gallant Lord, Lord Hill-Norton, who has some experience in these matters, pointed out that the report—it is a well written, well produced and readable report—contained many things but also left out a number. One, he said, was defence policy. He pleaded in aid that, not only in his view but also in that of the former permanent secretary, there was remarkably little defence policy.

We can score debating points as to imperfections in the cogency of the defence policy of any party. The Minister is experienced in trying to defend that policy. I want to say sincerely that I recognise that any government of this or any other country in a swiftly changing political environment have a very difficult job to do in producing the right policy at the right time with value for money and the satisfaction of defending the country.

The Minister made a fair job of packaging the contents of his war chest. As I think many of his noble friends behind him were better able to point out to him than I, even though they support him in the Division Lobbies and support his policy, he suffered because nevertheless they were irritated by the unwillingness of the Government at the right time to recognise when things go wrong and flexibility is called for. They will almost die in a ditch before they acknowledge that something needs to be done.

I know that the Minister will say to that, "Well, if I am criticised from the right and from the left I think I have it about right". That is a refuge, a cop-out. The Minister must not attack somebody else's policy but defend his own policy. Tonight many noble Lords sitting behind the Minister and some behind myself and my noble friend Lord Irving have pointed out deficiencies and criticisms. Many references have been made to the excellence, the glossiness and the improved presentability of the Defence Estimates. That is absolutely right. No one has cavilled at the fact that the reports are more readable and more understandable even to a layman like myself who, I confess, can listen to colleagues in other places and in this House with great respect. Nevertheless, we have to try to assimilate some of the arguments. Glossiness can do a great deal about that.

There is a dilemma for the Government at the moment. They are torn over whether they are pleased to have contained expenditure. As the report points out, they have presided over cuts in defence spending. For instance, on page 8 of the Statement on the Defence Estimates by the Defence Committee, we have the precise figures. Defence spending in real terms has continued to decline from £18.5 billion in 1986–87 to £17.5 billion in 1988–89. There are other figures. I applaud any reductions in expenditure on armaments and defence. If the Government were honest they would say, "We hope one day not to have to spend as much, or anything, on defence. If we are honest we are working towards a world in which there is no need for arms". As an earlier Question on the Order Paper mentioned today, there would then be no need for enemies. But we are in the real world. The dilemma for the Government, as has been pointed out by more than one of the Minister's colleagues, is that faced with constraints of expenditure and demands from the Treasury, the Government know that there are commitments.

We have had a sorry tale of the inability of the Government to match the moneys which have been made available to them with the responsibilities which they have taken over in the defence field. I listened very carefully to the noble and gallant Lord, Lord Bramall, who spoke from a position of great authority which has our respect. He concentrated very fairly, I believe, on the effect of the last two or three years in defence policy on men and women, the human resources on which we have to rely.

If the Government feel that all is well, which was the general impression that the Minister opening the debate tried to give, we have also had the voices of the men and women in the forces uniquely through the noble and gallant Lord, Lord Bramall. He has been telling us not that they are screaming blue murder that they have had a bad deal but that there are ways in which they could have a better deal.

Perhaps the Minister could help me to understand the Government's philosophy on another aspect of the report. On page 47 the statement talks about money and management. Paragraph 504 is about value for money. The Minister and his colleagues take some credit for having reduced the number of civil servants, having closed many factories and transferred the operation, for instance, of the Royal Ordnance Factories and the dockyards. I am glad that the Minister who will reply has his noble friend Lord Trefgarne beside him. He will remember the pain caused in this Chamber when we tried to get from him some undertaking of responsibility for the men and women who worked in the Royal Small Arms Factory at Enfield or in the dockyards at Plymouth. We asked the Minister what he would do when the transfers were made over either continuity of employment or some aspects of pensions, retirement etc.

The Minister is well aware that the people who buy the factories from the Government smile at anything the Government might say is likely to happen. They will say anything. The Minister stands up in this House and in other places and tells us what will happen. I wonder whether he could tell us whether the Government monitor what people say to them once they have washed their hands of the responsibilities which they have hitherto enjoyed not only over the lives of the men and women but very often over communities. To what extent do the Government care or follow up what they have accepted, swallowed, rested upon and told the House?

Another illustration of this is the shambles of the AWACS episode. Not only was more than £600 million wasted in research before the scheme was abandoned, but when we had the AWACS, what were we told? That buying the system would bring 40,000 new jobs to Britain. The Minister will say, "We did not accept that". He never said that in the House at the time. That was just in the first five years. What did GEC say?—that they would create 1,500 British jobs within six months and a further 3,000 new British jobs in five years. What did the Minister say? I correct myself, it was not GEC but Boeing. The Minister said that Boeing's proposals for the E-3A included a contractual commitment on its part to an extremely high level of offset, amounting to £130 million to be spent on work for British companies for every £100 we spend on the E-3A. This commitment has been welcomed by British firms which will be participating in the E-3A project.

Lord Trefgarne

My Lords, I apologise for interrupting the noble Lord. I know he would wish to quote the figures correctly. It was 130 per cent. of the contract value, not £130 million, as he said.

Lord Graham of Edmonton

My Lords, I was quoting from Hansard of 18th December 1986 when Mr. Younger announced the decision to the House of Commons: amounting to £130 to be spent on work for British companies for every £100".—[Official Report, Commons, 18/12/86, col. 1351.] It is the same thing.

Lord Trefgarne

My Lords, I think the noble Lord said "£130 million" when he spoke originally. I know that he wants to get it right; the correct figure is 130 per cent. of the contract value. That means £130 for every £100 spent.

Lord Graham of Edmonton

My Lords, it is more important that the Minister and his colleagues should get it right than that I should get it right. I accept what the Minister said and stand corrected. The question I wish to ask is to what extent the Minister and his colleagues monitor statements, not the promises which they accept because, as the noble Lord, Lord Trefgarne, realises, this one was the subject of correspondence which appeared in the Independent in the last few days. There was a challenge and a counter-challenge. We want to know to what extent the Government are bothered about the reliance which is placed on such statements.

Running through the theme of this debate has been an unease which the Government should capitalise on. Now is the time, if never before, in the light of the change in political circumstances and the change of the defence imperatives to do what the noble Lord, Lord Pym, urged upon his colleagues. His was a powerful voice for a fundamental review of strategy.

I have jotted down two words—under-strength and under-resourced. The noble Lord made particular reference to the situation of the navy. In words which I could perhaps put together better given more time, I should say that the House is asking the Minister what he is afraid of in undertaking a fundamental review of strategy which, as the noble Lord, Lord Pym, said, could very well include a look at our responsibilities inside and outside NATO in which the Royal Navy would have a major part to play. I should like the Minister to help us to understand that because that is one of the keys, I believe, of this debate.

This House has been very well served by the debates that have taken place. I do not cavil for a moment at the fact that what we have sought to do is to challenge the Government, to probe, to question and to argue. The Minister and his colleagues have an enormous responsibility which we on these Benches do not shirk. We know that there are, if not hair-raising tales very serious concerns which have been expressed by our colleagues in another place. In their reports they have raised very serious concerns. The document Learning from Experience states that about £3 billion to £4 billion of each year's equipment budget may be associated with costs which were not foreseen when projects started. About £1 billion to £2 billion may be associated with costs not foreseen when projects were entered for development.

That report was submitted to the Minister. I know that many of those charges were rebutted later, but nevertheless they were made by serious and well-informed people. This House, as well as another place, is entitled to an explanation from the Minister.

Tonight we are debating the policies and the performances of Her Majesty's Government and the men and women who serve in our armed forces under Her Majesty's Government's direction. We have been examining both value for money as well as policy and philosophy. We have done so in a world where change happens more swiftly, more deeply, and is more wide-reaching than ever before.

I do not cavil at the dilemmas facing the Government or at their creation or difficulty of solution. But nor do I gloss over the yawning gaps in Her Majesty's Government's management of the defence of our nation. To question, to probe, to doubt and to challenge may be construed as but carping criticism, but if it helps to make the defence of our nation more sound, more secure, and to fashion that defence ultimately into a weapon not for war but for peace and to create a world without arms or enemies, I for one do not care who gets the credit. The victors will be the common people of this land and of the world.

7.24 p.m.

Lord Glenarthur

My Lords, the contributions which we have heard today from all sides of your Lordships' House demonstrate that the zest with which your Lordships customarily address defence issues remains undiminished. Long may that be so.

The debate has, as usual, ranged very wide. I shall respond in a few moments to some specific points. I and my noble friend Lord Trefgarne will study closely tomorrow all that has been said. But let me preface my remarks by elaborating on the themes of East-West relations and security which were touched on by my noble friend Lord Trefgarne when he opened the debate, and to which others, notably my noble friends Lord Thomas of Swynnerton and Lord Pym, have referred.

The keynote of the 1988 Statement on the Defence Estimates is maintaining security in a changing world. The noble Lord, Lord Irving of Dartford, described his view of that changing world. I am sure he will agree that the management of change can be very challenging. Change opens up horizons; it generates options; and it diversifies opinion far more than a steady state of affairs can. The advent of Mr. Gorbachev and his reforms, combined with the recent initiatives in East-West relations—the qualitative change to which my noble friend Lord Thomas referred—have stimulated much thought on where we should go from here. My noble friend Lord Mersey referred to it as the change from a tramline to a trolleybus approach, if I have got him right.

One thing I am certain of is that maintaining our essential security needs is vital if we are to make real progress. Encouraging as some of the reforms may be, we cannot simply—the noble Lord, Lord Moore of Wolvercote, brought this point home—ride a wave of euphoria that might sweep us towards unjustifiable risks and an uncertain future. Some of the hazards that too euphoric a view might lead us to were pointed out by my noble friend Lord Thomas.

The INF treaty was a major achievement. It was a triumph for alliance solidarity and the strategy of negotiating from strength. I very much agree with my noble friend Lord Cork and Orrery in the points that he made. It was the first agreement ever to result in a reduction of nuclear weapons. We are hoping for similar progress in the negotiations between the United States and the Soviet Union aimed at a treaty significantly reducing the number of their strategic nuclear weapons.

But I agree with the noble Lord, Lord Mayhew, that we must not stop there. We must try to move forward in other areas of arms control, to create a more secure world with fewer armaments on both sides. But the question surely is: what should our arms control priorities be? As my noble friend Lady Strange said, we must face up to the hard reality that NATO's conventional forces in Europe are outnumbered by those of the Warsaw Pact. For instance, in the area from the Atlantic to the Urals, the Warsaw Pact outnumbers NATO by over three to one in tanks and well over three to one in artillery. In addition, the Soviet Union has the largest, most comprehensive and advanced capability in the world for chemical warfare. That is a theme to which I shall return.

Warsaw Pact leaders assure us that they have no aggressive intentions. But so long as the capability for offensive action is there the West must, in all prudence, guard against it. Such large imbalances in key equipments which, as my noble friend Lord Pym suggested, are being modernised are a serious potential threat to our security as, combined with the Warsaw Pact's existing force structures, they represent a capability for surprise attack and large-scale offensive action. I noted the comments of the noble Lord, Lord Mayhew, about possible Soviet withdrawal from Hungary. We have seen those reports and of course we would welcome any genuine reduction of the Soviet military presence in Eastern Europe.

Our strategy is to deter aggression. We would never be the first to use our weapons, but if an attack were mounted against us we would be prepared to take whatever actions we thought necessary to defend ourselves. This of course could include the use of nuclear weapons.

The priorities in arms control which the noble Lord, Lord Irving. asked about, in addition to limitations on US and Soviet strategic nuclear arms, must be agreement on the global elimination of chemical weapons and the establishment of a stable and secure level of conventional forces in Europe. There should be no negotiations about further reduction of nuclear weapons in Europe until these issues have been tackled. But NATO has agreed that with the elimination of the conventional balance in Europe and a global ban on chemical warfare, it is ready to contemplate reductions in US and Soviet land-based missiles of shorter range leading to equal ceilings.

Even then we could not safely eliminate all nuclear weapons from Europe. Conventional parity would bring important benefits. However, it would not do away with the need for a nuclear element in our security arrangements. Although the noble Lord, Lord Monkswell, disagrees, and the noble Lord, Lord Hatch, indulges in what I believe to be wishful thinking, nuclear weapons make a unique contribution to preserving the peace.

The noble Lord, Lord Hatch, referred to a number of points which were raised earlier. He alluded to what was, in his eyes, a circumvention of the INF agreement, and to proposals to modernise in the light of Montebello. So far as concerns circumvention, the allegations are untrue. The alliance warmly supports the INF agreement. In order to maintain deterrence at a minimum level, we must continuously ensure that our forces are effective, responsive and survivable. It is not least because of the resolution shown by the NATO alliance at Montebello that it has become possible to reach the INF treaty.

Lord Jenkins of Putney

My Lords, perhaps the noble Lord will give way. I seek clarification. Is the noble Lord saying that if the Soviet Union and the Warsaw Pact countries decided to give up nuclear weapons, we would advise NATO that that should not be carried out?

Lord Glenarthur

My Lords, the noble Lord has misunderstood me; if he studies what I have said, he will see that that is so. However, I have a great deal of material to cover and I must continue. As regards the threat (and bearing in mind the elements which the noble Lord, Lord Hatch, and others, disregard) Soviet modernisation of nuclear forces continues at full speed with the more accurate SS-21 replacing Frog with no dimunition in numbers despite a massive surfeit; and a 14 to 1 superiority in SNF missile launchers; and a continuing build-up of Backfire and Fencer aircraft. There are other factors as well. However, I am sure that they will be well known to the noble Lord.

Two world wars have taught us that conventional forces cannot prevent conflict. Today, aggression in the face of the risk of nuclear retaliation is no longer a rational option. If we eliminate nuclear weapons altogether, we shall not be making Europe safe. We shall be left with the possibility of a conventional war which will be a war involving modern weapons many times more horrific and destructive than those used previously.

However, it is not impossible to ensure the security of both East and West at lower levels of nuclear weapons. The INF treaty is an example of what can be achieved. We must face up to the realities of the modern world. We shall not achieve a more secure Europe by anticipating an ideal world that is at present beyond our reach. Before we can dispense with the security that nuclear deterrence provides, we shall have to demonstrate that there is available to us some other and better means of preserving the peace. That alternative has yet to be found.

The noble Lord, Lord Irving, followed by my noble friend Lord Pym, the noble Lord, Lord Moore, and the noble and gallant Lord, Lord Hill-Norton, made several comments (basically drawn from the recently published report of the defence committee of another place) concerning the Royal Navy surface fleet. I hope that the noble and gallant Lord, Lord Hill-Norton, will understand if I say that I cannot anticipate the full reply that the Government will give to that report.

Perhaps I can set the record straight on one or two other important aspects of that matter. First, I must remind the House that the Government announced yesterday their intention to order three new Type-23 frigates bringing the number of new frigates now on order to 10. The ordering pattern for such frigates is geared towards meeting the stated aim of maintaining a force level of about 50 destroyers and frigates. The latest order is in excess of the number assessed by the defence committee of another place as required to be ordered this year for that purpose. I am therefore able to give my noble friend Lord Pym the assurance for which he asked.

Secondly, there are currently 48 destroyers and frigates in the fleet. Of those, 41 could be made available for operational deployment immediately or within a short period. The other seven are in refit, which happens to all ships from time to time. Thirdly, the noble Lord, Lord Irving, said that ships were being withdrawn from service, and he referred particularly to HMS "Plymouth". He did not bring out the important fact that new ships are being brought into service as a result of the Government's substantial ship ordering programme. Most recently, a Type-22 vessel, HMS "Coventry", was brought into service as the third such vessel to be accepted this year.

Turning to the important matter of merchant shipping and picking up the important points made by the noble and gallant Lord, Lord Hill-Norton, and my noble friends Lord Colnbrook and Lord Pym, I am sure that the House will be aware that the defence committee's report on merchant shipping for defence needs was debated in another place last week. The Government will be responding in writing to the detailed criticism in the report. However, I must emphasise that we continue to monitor the position carefully. We have already introduced a number of measures designed to ensure that we have the merchant vessels and crews that we shall need in an emergency. We shall continue to do whatever is necessary to safeguard the national interest. I hope that that will reassure noble Lords, in advance of the Government's response, that that matter receives serious consideration.

Turning to the nuclear side of this matter, and in particular to the United Kingdom nuclear deterrent, the noble Lord, Lord Mayhew, and the noble and gallant Lord, Lord Hill-Norton, hold differing views on the point. However, I hope that the noble Lord, Lord Mayhew, accepts that our deterrent is at a minimum level. The warheads currently deployed represent approximately 3 per cent. of the warheads of the superpower strategic arsenals. I also hope that the noble Lord will note what Mr. Gorbachev said publicly in Reykjavik in 1986. He stated: We decided today to withdraw completely the question of the French and British missiles". He went on to say: Let them remain as an independent force. Let them increase and he further improved". That was confirmed when my right honourable and learned friend the Secretary of State for Foreign Affairs visited Moscow in February 1988. We have never said that we would never associate the United Kingdom deterrent with arms control processes. Nevertheless, the noble Lord is well aware of the two important conditions concerning cuts in the strategic defensive arsenals of the superpowers and the fact that even after 50 per cent. cuts in arsenals the United Kingdom Trident programme will represent a lower percentage of the Soviet arsenal than Polaris did in 1970.

As for the matter of "no first use"—an aspect which was deplored by the noble Lord, Lord Mayhew—I believe he is familiar with the argument that flexible response relies fundamentally on keeping a potential aggressor in a state of uncertainty as to NATO's response. NATO must have the potential to respond with nuclear weapons in view of the massive conventional superiority of the Warsaw Pact forces. To relinquish the option of first use of nuclear weapons in any circumstances would undermine NATO's ability to maintain an effective deterrent strategy.

Lord Hatch of Lusby

My Lords, will the noble Lord give way? I believe that he is contradicting himself. I believe that if he reads Hansard tomorrow, he will see that he said earlier that we would never use those weapons first.

Lord Glenarthur

My Lords, I referred to any weapons and not to nuclear weapons. Therefore, the noble Lord has the wrong end of the stick. Turning to the Gulf, the noble Lord, Lord Kennet, made a number of remarks. I wholly disagree with him on every one of those remarks. They were made in what I thought was a most ungracious way and they concerned our association with our major ally, the United States. I hope that the noble Lord will read carefully what he said because I think that he might regret it.

I have no information to give him about the tragic loss of life that occurred on the Iranian Airbus. We have no direct information of the kind that the noble Lord seeks and he would not expect me to get involved in a discussion about comparative rules of engagement.

Perhaps I can now turn to the question of two aspects of defence which I think are important and which were touched on by my noble friends Lord Thomas and Lord Fortescue; namely, European defence and the question of burden-sharing. The United Kingdom does not neglect European defence. I hope that my noble friend will realise that. We believe that that is clear to our allies.

Indeed, as he may be aware, on 1st July the United Kingdom took over the presidency of the Western European Union, and we intend to continue the successful process of revitalisation. We do not have unrealistic expectations but we believe that the WEU can make a practical contribution to strengthening the European pillar of the Atlantic Alliance. There are a number of objectives and I am sure that the noble Lord will be aware of them.

So far as concerns burden-sharing, the Europeans already do a great deal. But as my noble friend Lord Fortescue pointed out, the inputs cannot be ignored. United Kingdom defence spending, which is up some 20 per cent. in real terms since 1979 and is at present about 4.7 per cent. of GNP, compares with, for example, Italy at 2.1 per cent. of GNP and Luxembourg at 1.3 per cent. There are differences to be gleaned from studying the figures and I think that it is important to bear them in mind.

A substantive consideration of the burden-sharing issue is taking place in NATO on a collective basis. That is a fact, but we should not let it lead to the kind of discussion which might grow from it and lead to a vindictive US-Europe row. That, as my noble friend acknowledges, would be unhelpful.

My noble friend Lord Fortescue went on to talk about chemical warfare in two ways. First, perhaps I can welcome his emphasis on the importance of verification in the field of chemical weapon control. It is notable that the United States produced no chemical weapons for 18 years between 1969 and 1987. That unilateral moratorium was not matched by the Soviet Union. The Government have no plans to change the policy which led to the destruction of our chemical warfare capability in the late 1950s, but in the absence of a worldwide comprehensive and verifiable ban on chemical weapons our policy is to provide effective means of protection for our Armed Forces against chemical weapons.

I note the remarks of my noble friend Lord Cork and Orrery about the difficulties of conducting any kind of fighting while wearing some of the equipment which is used for such protection. All that I can say is that that equipment has improved immeasurably over the past few years. We hope that the United States moves to modernise their limited retaliatory chemical warfare capability will underline to the Soviet Union the benefits of a negotiated and verifiable ban.

So far as concerns progress towards a treaty on chemical weapons, leaving aside the matter of verification, I think that my noble friend Lord Cork and Orrery perhaps missed one important point: that in the absence of any verification arrangements a treaty will be meaningless. I am sure that if the noble Lord looks at page 13 of the White Paper, he will note the wise remarks of my right honourable and learned friend the Foreign Secretary.

The role that Japan might play is an interesting facet. Japan's self-defence forces are constitutionally forbidden to operate outside her borders or her immediate territorial waters, as I understand it. They accept their responsibilities in that area in close alliance with the United States. In areas where Japan shares other Western interests, such as the Gulf, she makes some provision in the form of a financial contribution, although we would welcome it if Japan felt able to do more in that area.

The question of search and rescue was raised by the noble Lord, Lord Monkswell. We have seen a number of ways in which those extremely competent and brave people deal with emergencies such as the Piper Alpha disaster. One of the studies was to examine proposals from Bristow Helicopters that the Royal Naval and Royal Air Force search and rescue services should be replaced by a civilian contract. On 11th February my honourable friend the Minister for the Armed Forces announced in another place that wherever there is a military requirement for SAR helicopters, that will continue to be provided by naval and Royal Air Force aircraft whose services will continue to be made available to the wider civil community. At the same time the Ministry of Defence has been reviewing the deployment of military helicopters but no decision has yet been reached.

The matter of the Boeing offset was raised by the noble Lord, Lord Graham of Edmonton. As he. noted, the Government's announcement was of a financial commitment—the 130 per cent. of the contract value discussed just now. That is a contractual obligation on Boeing, as I understand it, to be fulfilled over eight years. We have every confidence that the commitment will be met. I can assure the noble Lord that Boeing's performance is being very closely scrutinised by my noble friend Lord Trefgarne.

Lord Graham of Edmonton

My Lords, will the Minister allow me to intervene? I do not dispute for a moment what has been said. If those matters are wholly financial and the consequences of the contractual arrangements which the Minister makes result in human terms in desolation and distress, that may give some people the idea that they have been deceived. Surely the Minister has some responsibility to avoid that impression being given.

Lord Glenarthur

My Lords, of course there is a responsibility to bear' in mind the human consequences of such decisions. I think that that has been made clear both by my noble friend and myself on more than one occasion when dealing not just with this important topic but also others relating to the defence industries. So I hope that the noble Lord will not think that that aspect is ignored.

I greatly welcomed the very informed, as one would expect, and distinguished contribution from the noble and gallant Lord, Lord Bramall. The cry that the resources are insufficient to meet the task is, I fear, a fairly familiar one to Ministers in every department, -certainly in all those in which I have served. The noble and gallant Lord paid tribute to the Government's record of providing for the defence budget and meeting the recommendations of the Armed Forces Pay Review Body. The noble Lord, Lord Pym, also referred to that subject. Certainly pay is one of the many pressures on the defence budget. So, for example, is inflation in the equipment programme, although in some years equipment inflation is less than GDP inflation.

Like everyone else, the Ministry of Defence is determined to improve efficiency and value for money. However, I note the particular concern which the noble and gallant Lord expressed in relation to the funding of the pay awards. Of course the MOD is not entirely alone in this. I have no doubt that my right honourable friend the Secretary of State for Defence and my right honourable friend the Chancellor of the Exchequer will note the noble and gallant Lord's comments.

It was suggested in this debate that the Government cannot afford to maintain our defence commitments. As my noble friend Lord Trefgarne said, since 1979 we have ensured a very substantial real growth in defence funding. All the services have benefited from it. As my noble friend Lord Colnbrook thought was the case, on present plans funding will remain broadly level in real terms until 1990–91. I can give him that assurance.

Since the 1986 White Paper we have made clear that the ending of the period of real growth in the defence budget would mean that some difficult decisions over relative priorities would have to be taken. There will continue to be circumstances in which it would he necessary as part of the normal planning process to make changes at the margins of the defence programme both to provide savings and also to make room for some essential enhancements.

Examples of such decisions recently taken are those concerned with the radar for Lynx and the fact that we can only at present afford seven AWACs aircraft rather than eight. However, let me assure your Lordships that we have not undertaken a so-called defence review by stealth. With continuing emphasis on value for money and efficiency we can and will continue to provide capable forces in all of our main defence roles.

On the point of capable forces, I noted the remarks of the noble and gallant Lord, Lord Hill-Norton, about the demographic trough and the difficulties which that produces. I also noted the points made by the noble Viscount, Lord Allenby of Megiddo, about manpower, premature voluntary release, training and image. I shall read carefully what he said.

I wish to dwell for a moment on the roles we follow and the strength of the NATO alliance. I have already touched on the fundamental rationale of our nuclear forces. The defence of the United Kingdom is a self-evident national priority, but also our pivotal role, geographically and politically, within NATO means that the United Kingdom would automatically be a target in a general European war. We must make adequate provision for the air, ground and naval defence of our territory, our own bases, vital NATO installations and the lines of communication from North America and onwards to the Continent.

Is it a choice between BAOR and a naval presence in the eastern Atlantic? Absolutely not. There is no political or financial alternative which so binds and strengthens the alliance as the commitment of many countries to the forward defence of one of their number, by stationing their armed forces in its front line. BAOR is so important because it is an irreplaceable contribution to alliance solidarity on the central front.

The provision of capable and balanced naval forces in the eastern Atlantic is similarly a crucial contribution to the security of the northern-flank nations and to maritime operations in the Atlantic. Without it, the United States would find itself meeting the full burden of containing the Soviet maritime threat in northern waters without the benefit of a major European naval contribution.

All of our major defence roles are crucial to the cohesion of NATO. The Government will not sacrifice them. We are determined to maintain this country's defences and will not flinch from taking the measures necessary to do so.

On Question, Motion agreed to.