HL Deb 14 July 1994 vol 556 cc1975-94

3.52 p.m.

The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne)

My Lords, with the leave of the House I shall now repeat a Statement being made in another place this afternoon by my right honourable friend the Secretary of State for Defence. The Statement is as follows: "The end of the cold war saw major changes in the international situation. In response, along with all NATO countries, we have reduced the size and adjusted the balance of our Armed Forces. We believe that our plans for the Armed Forces reflect the challenges that we are likely to face. We are determined to maintain that position and not to drop our guard. Accordingly, I have no proposals to announce that would reduce the fighting strength of our Armed Forces.

"Defence is expensive. This year we are spending £23 billion, a higher proportion of our gross domestic product than most NATO countries. That amount is being reduced, as announced last autumn. There is a continuing need to ensure that the administration and support of our Armed Forces is subjected to the most rigorous analysis. Only by doing that can we make sure that the money available for defence is being spent properly and in a way which contributes to our fighting capability.

"That is why we set up Front Line First, not to look at fighting strength, but to look at headquarters, stores, infrastructure, manning and all other aspects of defence administration and support.

"It has also been determined that we should benefit from the experience and ideas that are to be found within all parts of the Armed Forces and in the Civil Service. Accordingly, we invited service and civilian personnel to contribute their ideas, and they did so to a splendid and unprecedented degree. Over 3,000 proposals were received. All those proposals were considered and many endorsed.

"We recognised from the start that strong and efficient support is of course a necessity not a luxury. Unless the Armed Forces are recruited, trained, clothed, fed and supplied in a professional and successful manner their operational capability will suffer. Accordingly, every recommendation for change was examined against one major criterion. Would it directly or indirectly affect the operational capability of the Armed Forces? We relied heavily on the professional advice of the Chiefs of Staff. If it was concluded that a proposal would damage the fighting capabilities of the Armed Forces it was rejected.

"The proposals which have now emerged are set out in detail in the report published today. I have placed copies in the Library of the House. I do not have time in this Statement to go through every proposal, but I would like to set out the most important of our decisions.

"A number of themes have emerged from the work that has been done. First the Ministry of Defence and other headquarters at all levels are too large, too top heavy and too bureaucratic. Secondly, there is scope for far more delegation of responsibility down the management chain. We can simplify working practices and increase personal responsibility and accountability. We should try to bring to our peacetime working practices the reliance on personal responsibility which the Armed Forces show so effectively in operations. Thirdly, recent experience shows that military operations are increasingly conducted on a joint service basis. Our structure should reflect that.

"We intend to reduce the Ministry of Defence in central London still further from over 5,000 to a central core of 3,750, a reduction of over 25 per cent. on previous plans. They will be housed in the main building and in the old War Office instead of four separate buildings as presently planned.

"We have decided to form a permanent joint headquarters at Northwood to replace the current approach where headquarters staff are drawn together ad hoc in response to developing crises.

"The Procurement Executive headquarters will have 500 fewer staff. We will go ahead with the planned relocation of the executive at a single site at Abbey Wood near Bristol but it will now be collocated with another headquarters which will allow significant capital savings.

"We have looked in depth at our arrangements for holding and distributing stores for the Armed Forces, such as clothing, food and fuel. We have found that modern supply techniques mean that we can reduce inessential holdings enabling us to rationalise storage facilities while improving our ability to get stocks to the front line. This will allow the closure of 17 depots in the United Kingdom of varying sizes. They are identified in the report published today which I have placed in the Library and details have been sent to those Members of Parliament in whose constituencies they lie. All together the changes in our logistic arrangements set out in the report will save the defence budget over £200 million a year and will improve operational capability by providing a more efficient supply chain better able to deliver essential stores to the front line.

"A number of the studies took a fundamental look at the arrangements for recruiting servicemen and women and our procedures for managing and training personnel. The total cost of our recruiting activities amounts to £100 million each year and is unacceptably expensive, especially when recruiting needs are low. At present it is costing between £5,000 and £15,000 for every recruit.

"It has become clear that there is scope for closer co-operation with the Employment Services Agency. Subject to the successful completion of a pilot trial, we intend to use the facilities of the 1,300 jobcentres as the first point of contact for those wishing to join the Armed Forces. This means that we can replace the existing network of over 200 careers information offices with a much smaller specialist regional organisation. We expect the proposal to save us £25 million a year.

"Given the joint service nature of military operations, we believe that it is right to combine command and staff training at the senior level and create a joint services staff college. Further work is in hand to examine whether this should be located at Camberley or Greenwich and whether junior command and staff training should take place on the same site.

"Front Line First identified a number of ways in which we could reduce the cost of flying training. We intend to establish a single defence helicopter flying training school for all three services at Middle Wallop, near Andover, or at Shawbury, near Shrewsbury; increase the involvement of civilian instructors and contractors in much of our flying training activity; and rationalise training. This means that RAF Finningley and RAF Scampton will no longer be necessary and they will be closed.

"Skilled medical support is essential for the Armed Forces, but at present service hospitals have substantial over-capacity and there is considerable scope for closer links with the National Health Service. We intend therefore to reduce the number of service hospitals in the United Kingdom from three to one which will be situated at Haslar in Gosport, and at the same time to establish regional military district hospital units in National Health Service hospitals at Derriford and at two new sites and to retain a presence at Catterick.

"We have also looked at military music. This is part of the fabric of our Armed Forces and makes an irreplaceable contribution to morale and fighting spirit. We have therefore decided that the numbers of musicians and bands which I announced last year should remain. But there is a need to rationalise and reduce the costs of training. The Royal Marines believe that training their musicians at Deal has become prohibitively expensive. The maintenance demands of the buildings, and other running costs, have resulted in costs per musician trained of up to £300,000. We therefore intend to transfer Royal Marine music training to a new location by April 1996.

"I now turn to naval infrastructure. In 1993 it was decided that the Portland naval base would close by 1996, which would leave four bases at Portsmouth, Plymouth, Faslane, and Rosyth. Over the last three years the number of ships in the Royal Navy has reduced further and over-capacity has increased. We should not be spending large amounts of money on bases unless there is an operational requirement to do so. The money spent on excess base capacity could and should be spent on enhancing the Navy's fighting capability. The Royal Navy therefore has examined whether the number of bases could be safely reduced.

"The conclusions were that Faslane on the Clyde should remain in view of the operational need for a strategic submarine base. It is also necessary to retain at least two surface ship bases, given the substantial size of the Royal Navy. Of the three surface ship bases, Rosyth is the smallest and is designated as the base for two of the three squadrons of minehunters and the fishery protection squadron.

"The Royal Navy has concluded that there is no strategic need to keep these ships permanently at Rosyth. We have therefore decided to move one squadron of minehunters to Faslane on the Clyde, which is closest to its normal area of operations. The second squadron and the fishery protection vessels will move to Portsmouth. That is sensible as the fishery protection squadron operates almost entirely off the coast of England and Wales. The Scottish Office provides a fishery' protection service around the Scottish coastline.

"Rosyth will not, however, close. There is a continuing need for other Royal Navy related activities at the Rosyth naval base site. These include necessary support for Rosyth Dockyard, storage, accommodation, defence research agency activities, and the defence land agent. Rosyth base will therefore become a Royal Naval support establish-ment continuing alongside the Rosyth Royal Dockyard. We will also retain the option of using Rosyth as a forward operating base should it become necessary to establish such a base on the east coast of Scotland. All in all, these proposals will mean that over 900 civilian and service jobs will remain at the Rosyth base. Seventy new jobs will be created on the Clyde. Around 700 civilian jobs will go; around 600 civilian jobs will remain.

"We expect these proposals to save about £22 million a year with no operational disadvantage. A consultation document on our proposals for Rosyth is being issued today. The Royal Dockyard at Rosyth is not affected by these proposals and, as announced last year, can look forward to a substantial programme of surface ship refits.

"We have also looked at arrangements for the shore basing of naval aircraft. We have concluded that the naval air stations at Culdrose and Yeovilton should continue and that the Lynx squadrons now accommodated at Portland could be moved to Yeovilton without any detriment to operational effectiveness. This will save about £12 million a year. The air station at Portland will close by 1st April 1999. This will involve the loss of 400 jobs at Portland, though some of these and about two-thirds of the service personnel based there will transfer to Yeovilton.

"In the aftermath of the cold war there is no longer a requirement for the Maritime Headquarters at Pitreavie. We therefore intend to close it in 1996. We intend to transfer some staff, together with Flag Officer Scotland, Northern England and Northern Ireland, to Faslane. The rescue co-ordination centre for the whole of the United Kingdom which we had planned to move to Pitreavie will now be set up at RAF Leuchars in Fife.

"The Special Boat Service Headquarters will be transferred from Poole to Portsmouth where the facilities will meet our requirements. This will enable the closure of Royal Marines Poole. We are also rationalising Royal Marine Barracks at Plymouth, and subject to the outcome of current studies we hope to transfer certain units to Chivenor, which is no longer required by the RAF.

"We have also looked at our requirement for ranges. We have concluded that we can provide the Armed Forces with all the range capacity required and at the same time make savings of £7.5 million a year. This will involve the closure of the ranges at Kircudbright, Pendine and Hum. There will, however, still be a need for the ranges at Aberporth and at Benbecula in the Hebrides.

"Finally, so far as RAF Germany is concerned we have also decided that we only require one air station. The Harriers and helicopters currently based at RAF Laarbruch will accordingly be redeployed to existing operational air stations in the United Kingdom. This will have operational benefits because the aircraft now based at Laarbruch often have to train over the United Kingdom.

"Change on the scale envisaged in Front Line First is bound to have painful consequences. The overall impact of the package will mean net job reductions of about 18,700 over three years. Compared with previous plans the number of civil servants in the Ministry of Defence will fall by almost 7 per cent. or 7,100; and the total of uniformed personnel will fall by 5 per cent. of which the Royal Navy will reduce by 1,900, the Army by 2,200 and the RAF by 7,500. These cuts will fall on all levels of service and civilian personnel. We anticipate that more than 20 senior military and civilian posts—that is, major-general level and above —will disappear. This will bring the total reduction in senior posts since 1990 to about one-third.

"A proportion of these reductions will require redundancies in the Armed Forces and the Civil Service. We will wish to deal sensitively and fairly with those who have served the nation well. The terms on offer will be the same as have applied to other recent redundancies.

"It will be seen that manpower reductions are higher for the RAF. This reflects in particular the conclusions of work set in hand by the Air Force Board some two years ago. The work addressed the scope for reducing costs by civilianising or contractoring out uniformed jobs. It also looked at savings to be derived from introducing new engineering work practices and from reducing the number of expensive aircrew occupying ground posts. The Air Force Board endorsed the outcome of this work, which is reflected in the measures I have announced today. Like all the other proposals I am announcing, these manpower reductions will not adversely affect our front line fighting capability.

"I should now like to outline our plans for the future of the Territorial Army. The Government remain committed to making greater use of the reserves. There has been a detailed study of the structure and manning of the TA. One option was to make a major reduction in the size of the TA to reflect the reduced home defence role.

"We have decided, however, to reject that option. In future, the role of the Territorial Army should be to act as a general reserve to the Army. It will remain an integral component of our defence forces on mobilisation and we intend to make greater use of it in peacetime. Our previous plans were for a TA with formed units of 59,000, plus a recruits pool of 4,500. The latter is no longer necessary, but we intend to retain at its current level of 59,000 the formed units of the TA.

"We shall consult widely within the TA about whether there should be some re-roling of units or other changes within the 59,000 total and will announce the outcome later in the year.

"We do not under-estimate the challenge the proposals I have announced represent for all those involved. They will have a significant impact on the lives and prospects of many who serve in the Armed Forces as well as the civilians in the Ministry of Defence. The changes are, however, essential if we are to focus our resources on sustaining and enhancing our operational capability and fighting strength. Front Line First has enabled us to do this. In particular, Front Line First has allowed us to make a number of highly significant enhancements to our front line capability which I would now like to outline to the House.

"For the Royal Navy I am able today to announce key equipment improvements across a range of capabilities that will enhance the Royal Navy's ability to sustain operations as well as being of value to Britain's warship building industry.

"We will complete the modernisation of our amphibious capability. Last year we ordered a helicopter carrier and today we are announcing that we shall shortly issue an invitation to tender for two new assault ships to replace HMS "Fearless" and HMS "Intrepid".

"We will also extend the Royal Navy's capability for anti-ship and anti- submarine warfare well into the next century with the invitation to tender for the design and build of a new class of nuclear powered submarine—the Batch 2 Trafalgar class—which will replace the Swiftsure class.

"We are able to carry forward our programme to build a force of 25 modern and highly capable mine counter measures vessels. Accordingly, we are today placing an order with Vosper Thornycroft for a further batch of seven Sandown single role minehunters.

"Four Type 23 frigates are currently on order. We plan to issue invitations to tender for a further batch during the coming year. The Government will assess the case thereafter on the basis of price and operational need.

"For the Army, we can now confirm the order of a further 259 Challenger 2 tanks from Vickers Defence Systems. This will enable us to field an all Challenger 2 fleet of tanks, improve the quality of the United Kingdom's contribution to NATO's rapid reaction corps and ensure that we have a continuing capability to make a significant contribution to the type of coalition operation we saw in the Gulf. This order will be very good news for Vickers and its workforce of nearly 2,000 at both Leeds and Newcastle and to the company's sub-contractors throughout the country. An order is also being placed with Royal Ordnance at Glascoed, Gwent, for 400,000 rounds of 51 m.m. mortar ammunition. Finally, we will use some of the additional 3,000 personnel made available last year for the field army to allow the Royal Armoured Corps Training Regiment, currently the 9/12 Lancers, to be roled as a third and additional armoured reconnaissance regiment and to take its place in the front line.

"For the RAF, we are placing a production order for the mid-life update of 142 Tornado GR1 aircraft. This will provide improvements to the aircraft's avionics, navigation and armaments systems. It will maintain the operational effectiveness of the RAF's long range attack capability well into the second decade of the next century and help to preserve British Aerospace's manufacturing base at Warton, Lancashire, in the run-up to production of Eurofighter 2000.

"Turning to weapons programmes, the Gulf conflict demonstrated the value of precision stand-off weapons to allow targets to be attacked accurately while reducing aircraft vulnerability. We are therefore placing an order for advanced laser-guided bombs with the associated thermal imaging and laser designation pods. The bulk of the work will be done in Edinburgh and elsewhere in Scotland, in the West Country, and on the south coast. In addition, the Government believe there is a good case in principle for a new long-range air to ground missile— CASOM. They will continue to examine the case for CASOM carefully and, subject to the outcome of that examination, intend to open discussions with industry later in the year.

"This is a substantial programme of investment in new equipment. The orders I have announced today and orders resulting from the invitations to tender should together be worth in the region of £5,000 million and are expected to sustain directly over 10,000 jobs. These decisions represent a major boost to British industry as well as providing vital enhancements for all three services.

"The success of Front Line First has also identified resources which can now be used to deal with other pressing priorities. I have decided that the most important priorities are to reverse the hollowing out measures of recent years and to increase levels of operational training.

"To this end I can announce that the success of Front Line First has enabled me to increase RAF operational force levels by moving 12 Harrier GR7 aircraft from the reserve fleet to the front line. In addition, I can also inform the House that the frigate and the submarine previously planned to go into mothballs within the next few years will remain in service as part of the operational fleet. These proposals will, I know, be particularly welcome within the Armed Forces.

"Equipment levels are themselves of little consequence unless they are backed up by intensive and highly developed training arrangements. Here, too, I am able to announce proposals for all three services. For the Army we shall be improving our training areas in the United Kingdom and in Germany. This will enable there to be an increase in such training of between 50 per cent. and 100 per cent. particularly at the battle group level. And we shall be acquiring additional training aids to allow more complete simulation training.

"For the RAF it is important that pilots should have sufficient regular flying to preserve and enhance: their skills. As part of our shift of resources to the front line, I have decided that the current level of aircrew flying training hours will be increased progressively over the next three years. When completed, the increase will bring the level of flying training for each aircrew member up to 20 hours a month, a total increase of 8,000 hours a year for the fast jet force.

"For the Royal Navy we shall be purchasing additional anti-submarine and gunnery targets to allow more realistic training for ships and naval aircraft deployed away from usual target facilities.

"One of the most important achievements of Front Line First will be progress in tri-service operational capability. I have already referred to proposals for a joint headquarters, a joint staff college and a joint helicopter school.

"I am pleased to be able to indicate our intention to develop a joint rapid deployment force. We have already the fighting elements of rapidly deployable forces such as the Royal Marines, the Parachute Brigade, and 24 Air Mobile Brigade. We shall be looking at how best we can develop the capabilities of these forces to enable them to intervene even more effectively and speedily together. We shall be providing additional communications infrastructure to improve their effectiveness and many of the equipment enhancements outlined earlier will contribute directly to improving this important area of capability. The concept of the joint rapid deployment force is one that can be built on, and the overall ability of our forces to operate at speed and effectively in the kind of situation described above will be a high priority for the future.

"In the changed strategic environment, there is a wider range of operations in which our forces may be deployed. In this context, for the Navy, we are therefore also examining the case for acquiring and committing to NATO conventionally-armed Tomahawk land-attack missiles and will be seeking information from the US Government and from industry.

"I am conscious that the changes that the Armed Forces have undergone since the end of the cold war have been painful and demanding for them as well as for civilian staff. The nation already owes them a great debt and successful implementation of the proposals I have announced today can only increase that indebtedness. This process of change needs to be managed with sensitivity and care for our people, and that we will do.

"These changes are necessary and justified. They will enable us to preserve the front line and proceed with a programme of investment necessary to maintain its operational effectiveness. Today we have demonstrated the determination of the Government to preserve and enhance our fighting strength and to ensure that our Armed Forces, soldier for soldier, pilot for pilot, and ship for ship, remain the best in the world."

My Lords, that concludes the Statement.

4.21 p.m.

Lord Williams of Elvel

My Lords, the House will be grateful to the noble Viscount for repeating the Statement made in another place. It is long and complex. Indeed, it has taken 29 minutes for the noble Viscount to repeat it. I do not complain about that. If we ask for Statements, we must expect what we get.

My response to the Statement will, I hope, be brief. It will be brief, first, because in two weeks' time there will be a debate in this House on the Defence Estimates when a considered response will be made from these Benches, and, secondly, because, despite extensive leaks—either from Ministers or departmental officials, I know not who—giving some idea of what the Statement was to contain, there is still a lack of information, as the Statement admits.

As regards the consultation document on Rosyth—a report, or possibly two reports, published today, which may or may not be in your Lordships' Library—I was told that if I wanted a copy I had to apply to the office of the noble Viscount, Lord Cranborne. Therefore, I find myself at some disadvantage in responding fully to the Statement.

One has to recognise the genesis of the whole exercise. Front Line First is a nice jingle: no doubt someone in the PR department of the Ministry of Defence invented it. But the fact of the matter is that the Treasury said to the Ministry of Defence, indeed, said to the Secretary of State —it was announced by the Chancellor in a Budget Statement, not by the Secretary of State for Defence—that the defence budget needed to be cut. Various figures were bandied about but the central figure seems to have been around £1.3 billion. I am led to believe that at the same time studies were being undertaken in the Ministry of Defence on all sorts of matters concerned with the issues that the noble Viscount put to us today.

So the two things came together. It was not a case of the Secretary of State saying, as the Statement says: That is why we set up Front Line First". That is all for the birds, if I may so put it. It was the Treasury who said, "This is what we want and this is what we are going to get". It coincided with a number of studies going on inside the MoD.

What is odd is that the studies in the MoD came up with savings of a figure much greater than the Treasury asked for. They discovered, in the words of the Statement: 'The Ministry of Defence and other headquarters at all levels are too large, too top heavy and too bureaucratic"— possibly with too many Ministers. I understand that they also discovered that 70 per cent. of all spare parts right across the range of the Armed Forces have never been used and are sitting in depots up and down the country.

Therefore, the first question I have to ask the noble Viscount is this: as the Government have been in power for 15 years, why has it taken them so long to find out that the Ministry of Defence and other headquarters are, too large, too top heavy and too bureaucratic"? Why has it taken them so long to find out that 70 per cent. of spare parts are not even used and that depots are redundant? What have they been doing all this time? Should not we have an answer?

We find that there will be unemployment resulting from the changes proposed. I ask myself and the noble Viscount: is not this just a case of a direct transfer from employment in the Ministry of Defence and its related activities to unemployment payment from the Department of Social Security? Where in that does the Treasury save?

The noble Viscount made great play of the surpluses over the savings required by the Treasury which, we are now told, will be used for extra procurement which will enhance our activity. I must say to the noble Viscount that I am rather suspicious about some of the announcements that he made. For instance, there is the replacement for HMS "Fearless" and HMS "Intrepid". The project was announced in 1992. It was repeated in 1993 and confirmed in the Defence Estimates in 1994. There is the plan to issue invitations to tender during the coming year for a further batch of Type 23 frigates. That was announced for the second time in April 1994. With regard to the Army, the noble Viscount said: We can now confirm the order of a further 259 Challenger 2 tanks". That has already been announced three times. The Statement says that: For the RAF, we are placing a production order for the mid-life update of 142 Tornado GR1 aircraft". That was announced in May this year.

I shall not go on in this vein. It seems to me that the noble Viscount is trying to cover up a rather serious difficulty that he has in not being able to announce genuinely new projects and is simply repeating announcements that have been made not necessarily once, not necessarily twice, but three times.

I ask the noble Viscount: what, in this Statement, is truly new? How much money will be spent on the truly new projects that the noble Viscount has in mind? How much employment will thereby be generated on the new projects that have not been announced before?

I turn very briefly to Rosyth. As I said, I have not had the opportunity to read the consultation document because I have not yet applied to the noble Viscount's office for a copy. I challenge the idea that the fishery protection squadron should be removed from Rosyth. After all, Rosyth is close to the principal operational areas within the UK 200-mile fishing limits which will become our exclusive economic zone when the Law of the Sea Convention comes into force on 16th November 1994. That being the case, will the noble Viscount explain why those vessels—which are not just being moved to Faslane; I understand that they will be moved to the south coast of England—should be moved when the steaming distance to the North Sea grounds where their major operational activity occurs will cost enormous sums of money—much more than will be saved at Rosyth? However, I leave Rosyth because we shall no doubt have plenty of time to debate that in the future.

Two major questions arise. First, what is the "front line"? I am told that in the Army 94 per cent. of resources are devoted to logistical support of the front line. What do the Government mean by "front line"? Do they mean NATO out-of-area operations? What are we talking about? Until we understand what they mean by "front line", we cannot understand why the Government are producing a defence cost study in terms of defence cuts. Why are they producing it as a front line operation?

Secondly—and I ask the noble Viscount to think seriously about his answer—is this the last of the cuts? I have been privileged to be defence spokesman in this House for nearly five years. I have stood at this Dispatch Box and been assured by Ministers that Options for Change and subsequent proposals notwithstanding, this was it; this was the end of the story. Now we are faced with another one.

I want the noble Viscount to say that this really is the end of the cuts. If he says, "Oh well, the Treasury may walk in tomorrow or next year with the Budget and say it wants to knock another £1 billion or £2 billion off the defence budget", then he must say that outright. It is easy to blame the Treasury. But the Treasury is government and these cuts were accepted and endorsed by Cabinet. It is not just the Treasury as an extra-terrestrial body saying that this is what is required; it is the Government themselves saying, "This is what we propose to do".

I conclude simply by saying that the noble Viscount repeats the Statement on Bastille Day, the French national holiday. I remind your Lordships, although your Lordships' historical knowledge is outstanding, of what happened when the mob successfully stormed the Bastille on 14th July in those days of the French Revolution. They expected to find a well-armed fortress. They expected to find guns in proper operation, properly supported logistically. When they got through the gates they found nobody there. There were no guns; nothing worked. I only hope that what the Government are doing does not land our country in the same situation.

Lord Mayhew

My Lords, in thanking the noble Viscount for repeating the Statement I must say that his package of cuts has been most carefully gift-wrapped. Fortunately, neither the noble Lord, Lord Williams, nor I were born yesterday. We remember and assert that the primary purpose of Front Line First was not to improve the forces, but to save money. And those savings will not go to the forces; they will go to the Treasury.

I can say to the noble Lord, Lord Williams, that the Statement contained two or three new positive proposals; for example, the joint rapid deployment force, which is a good idea; the new Batch 2 Trafalgar class submarines—I believe that to be new also. But as the noble Lord showed so convincingly, almost all the rest of the positive proposals are simply confirmation of old pledges that have been repeated more than once in the past, whereas the cuts are new and very formidable. There are far too many of them for me to comment upon. I have not had time to read them all or to consult the documents now available. But perhaps we can return to some of them in the forthcoming debate.

In relation to Rosyth the blow is less heavy than had been feared at one time, but we register our admiration and sympathy for the workforce and the community Perhaps I can ask one question of the noble Viscount. How long will it take in an emergency to reconstitute Rosyth as a base? He envisaged the idea, but how long will it take? If it takes a long time that certainly weakens the front line capability of the Navy.

The heaviest proportional cuts seem to be for the top posts in the services and in the Ministry of Defence. Top brass has always been an easy political target. No doubt some reduction is called for. But I cannot help remembering the extraordinary speed and efficiency with which our expeditionary forces to the Falklands were assembled and provisioned. Much credit for that goes to the holders of the posts which the Government are now abolishing.

We still have the Falklands commitment and I ask myself whether we still have the supply back-up and the front line forces to honour that commitment. I shall return to that in our coming debate. I feel extremely worried that the answer is no and that there is a growing gap between some of our commitments—-notably the Falklands—and the capability of our forces to honour them.

I agreed with the noble Lord, Lord Williams, when he asked whether this was the end of the cuts. I have been a spokesman for a much longer time than the noble Lord, Lord Williams, and I have had to answer more often in regard to piecemeal cuts by the Government in our defence forces. There are worries about that in all parts of the House and in the debate we shall look for a convincing defence from the noble Viscount.

Viscount Cranborne

My Lords, I am grateful to both Front Bench spokesmen for much of what they said, though I was highly diverted at the picture of the noble Lord, Lord Williams of Elvel, as the last defender of the ancien régime in your Lordships' House. If I may, I shall be reasonably brief in answering the many points raised by both noble Lords. As they observed, we shall have another opportunity to debate these matters in greater detail fairly shortly. However, I want to try to address some of the questions which both noble Lords raised.

In relation to the lack of information, I am sorry that the noble Lord, Lord Williams, did not find the necessary papers in the Library and I will ensure immediately that he will be able to do so. Being able to apply to my office, particularly in view of how busy it has been during the past few days, is not perhaps the best way to enter into the noble Lord's esteem.

The noble Lord, Lord Williams, asked why it has taken so long to come to the conclusion that the Ministry of Defence and much of its administration was too bureaucratic and so forth. There are a number of reasons for that. First, as he rightly observed, those characteristics have been characteristics of which the management of the Ministry of Defence has been conscious for some years. The noble Lord observed that a number of studies had been in train for some time to try and address those deficiencies. I need only refer him, by way of example, to the prospect study of 1991. It made our job, particularly for me who is the ministerial sponsor for the studies addressing the question of management and financial control within the Ministry of Defence, very much easier in that there was so much fine work, solidly based, looking at reforms on what seem to me to be entirely the right lines on which we could base the analysis under Front Line First. We were able to accelerate and deepen those reforms and bring them to fruition in what is a highly complex organisation. At the same time as making those reforms we must be able to maintain the defence capability to which both noble Lords rightly paid tribute this afternoon.

I also draw to the attention of the noble Lord, Lord Williams, a point to which the Statement made reference. The end of the cold war has meant a reduction in the size of our Armed Forces and it has also meant that we have had to look fairly radically at what we want our Armed Forces to be capable of doing and to assess where the threat is. Therefore, to change in the light of the end of the cold war was an imperative: not an imperative going back to 1979 and the first time that we had to begin to forget the effects of a socialist government but something that came as a result of the end of the cold war. I would ask the noble Lord to bear that in mind, particularly when he comes to considering the remarks that he will make during our defence debate in a few days' time.

The noble Lord also asked where the Treasury is saving. I remind him that, quite properly, the duty of the Ministry of Defence is to provide this country with defence capability. I am sure he would be the last to advocate that the Ministry of Defence should spend defence pounds on support capability which is surplus to its requirements. He would not advocate such a thing and I certainly would not do so. Therefore, it is only right that the support element, to which the noble Lord rightly drew attention as being an essential part of our defence capability, should only be great enough and should be taut enough to be able to supply the front line cutting edge.

The noble Lord also asked—and the noble Lord, Lord Mayhew, made reference to this—what is new in the equipment announcements. The noble Lord is perfectly correct to say that we have planned to provide a number of the pieces of equipment to which the Statement refers. We have planned to provide them for some time. He was also right to say that not the Treasury but the Government as a whole made a judgment on public expenditure in the last PES round. It was a judgment to which the entire Government subscribed. If they had not subscribed to it there would no doubt have been resignations. So far as I know, there were none. One of the beneficial effects of the Front Line First exercise and the savings, as a result of the greater efficiency, that we think we will be able to make is that we are able to confirm those orders and not cancel them in spite of the reduced amount of government expenditure devoted to defence in the PES round. We ought to be proud of that rather than suggest, as the noble Lord does, that this is a source of criticism. It is also fair to say, as the noble Lord, Lord Mayhew, pointed out quite correctly, that the Statement referred to a number of innovations and new equipment announcements.

On top of that, I hope that the noble Lord, Lord Williams, will not underestimate the effect of the reversal of what is known in the trade as "hollowing out". It is something which I know has been worrying the Armed Forces for a number of years. We have taken a significant step towards making sure that the ships, regiments and aeroplanes available to the Armed Forces of the Crown are not merely there for show but can actually deliver what we say they can. That is where the reversal of hollowing out has been so important.

The noble Lord, Lord Mayhew, referred to what he called the top brass. Of course he is right. Without their extraordinary professionalism it would have been impossible to have mounted either the Falklands campaign or the Gulf campaign. The fact that we are reducing the number of senior officers in the Armed Forces in no way undermines the validity of what the noble Lord said, but it is only fair to say that with smaller Armed Forces it is right that we should not become too top heavy in the matter of the number of generals we employ. It has been pointed out by a number of Opposition politicians, and indeed by newspapers, that the number of very senior officers nominally in the British Armed Forces is higher in ratio than for a number of other armed forces. I am sure that the noble Lord, Lord Williams, would not wish us to be overburdened in that direction in spite of their own manifest competence.

Is this the last of the cuts? I must say to both noble Lords that this exercise will enable us to preserve the front line and to proceed with the programme of investment necessary to maintain its operational effectiveness. I cannot anticipate, as the noble Lord well knows, the outcome of any future PES round. But I can say to the noble Lord—and I hope that this will be of some comfort to him—that the programme of new equipment and operational improvements which we announced today is a clear indication of the direction in which the Government intend to head.

4.45 p.m.

Lord Bramall

My Lords, I thank the noble Viscount very much for his frank if rather curate's egg-like Statement on the Front Line First exercise which now requires very careful study, a stripping away of the gift-wrapping and a full debate, which I am glad we are going to have.

At this stage I merely make two observations. First, whatever the merits and demerits of the proposals—and I am sure they involve both—they must be viewed and considered against the background of all the draconian cuts in front line manpower, support services and pressure on budget holders which have been imposed since the beginning of the decade. By 1997 those cuts will have reduced defence expenditure by 25 per cent. in real terms to bring it down to below 3 per cent. of the gross national product: all in a world where we have replaced the comparative stability of the East-West balance with the far greater uncertainty and instability of a volatile and kaleidoscopic world. It is therefore very important that we get an assurance from the Government that at least in their lifetime there will be no more cuts to sap further the confidence and professionalism of our uniquely expert and reliable Armed Forces and indeed distract them from the real problems of the future.

Secondly, I am sure the House will wish to analyse and to question the Minister most carefully not only on whether these cuts in manpower and civilianisation are sensible in the real world in which we live and can be made without detriment to our front line—whatever that may be, as the noble Lord, Lord Williams of Elvel, said —and the capability and quality of our Armed Forces, but on whether the so-called good news which the noble Viscount mentioned really does represent enhancement in areas which are so in need of it rather than being largely cosmetic or, as has already been said, tardy announcements of equipment items already in the programme. I am sure that we will be looking for reassurance from the noble Viscount on that and he may like to quote an add-back figure to reassure us.

It is excellent that we are having a debate before the Recess but I wish to register my disappointment that yet again it is being held on the last day of the Session. I am sure that the noble Viscount of all people will agree that something as important as the whole future of our national security and the support to our foreign policy should never under any circumstances be marginalised.

Viscount Cranborne

My Lords, I am grateful that the noble and gallant Lord welcomes at least some of what the Statement announced today. I must refer him to what I said to the noble Lord, Lord Williams, when he asked for an assurance about whether there would be any more depredations to the defence budget. I hope that the spirit of what I said a little earlier is one which we will be able to maintain and one into which the noble and gallant Lord will be able to read something positive.

Are these enhancements cosmetic? Perhaps the best way I can attempt at least to reassure the noble and gallant Lord is by saying that, when it became apparent that there was additional money over and above the reduction in the defence budget that we had been asked to find in the current PES round, Ministers immediately consulted the Chiefs of Staff. We have taken the very clear advice of the Chiefs of Staff about how that money should be spent. I am content to rest on their judgment

As regards the date of the defence debate, like the noble and gallant Lord, I am grateful that we are at least holding it before the Recess, unlike another place. If he is still worried about the debate being held on the last day, that is a matter for him to take up with the usual channels rather than with me.

Baroness Strange

My Lords, can my noble friend the Minister tell the House whether the Government have changed their plans about Rosyth as a result of the campaign?

Viscount Cranborne

My Lords, the short answer to that is no. The proposals are exactly as they first emerged from the study groups about what the proper balance of capability should be at Rosyth. I am grateful to my noble friend for enabling me to make that clear

Lord Ewing of Kirkford

My Lords, as regards the decision to move the Royal Marine band training school from Deal in Kent to some other place, if there is not already in place a lasting memorial to the members of the band who lost their lives in the horrific bomb attack there about four years ago, before the band and the school of music is moved, will the Government ensure that there will be a lasting memorial put in place in Deal to the memory of those young men who lost their lives in that horrific event?

I turn now to Rosyth. I have not read the consultation document. Does the noble Viscount appreciate that the feeling in Rosyth, which the Government should take on board, is that Rosyth is being asked to accept a much heavier share of the cuts, as; a result of what is. loosely described as the "peace dividend", than any other part of the United Kingdom? Rosyth in particular, and Fife in general, see history repeating itself because in 1921, after the First World War, it was the Rosyth naval base which was closed down and moved to Portsmouth. Here we are, 73 years on, with the same kind of announcement. Whatever the noble Viscount says, at the end of the day there will be between 700 and 800 fewer jobs in the Royal Naval base at Rosyth and possibly 1,000 fewer jobs in the county of Fife because of the proposals for Pitreavie which is only up the road from Rosyth. Fife and its economy simply cannot stand that kind of measure of job loss, having made a major contribution to the two world wars in 1914–1918 and 1939–45. It is really time to put a stop to asking Rosyth in particular and Fife in general to bear more than their share of the cuts in this regard.

Viscount Cranborne

My Lords, as regards the noble Lord's suggestion for a memorial at Deal, I am very conscious of the tragedy which occurred there. I shall at once remit his suggestion to the proper authorities. I am most grateful to him for making it.

As regards Rosyth, I challenge the noble Lord's assertion that it has suffered more than any other part of the United Kingdom as a result of Front Line First. My own constituency of South Dorset included the naval base at Portland. As a result of Options for Change and now Front Line First, not only will they have lost the Flag Officer Sea Training and the main activity of the naval base, but also HMS "Osprey". That will have a terrible effect on employment in my old constituency.

I have to accept the overwhelming reasons why it was necessary to do so. But I certainly challenge—in the same way, as I believe the people who work at Eaglescliffe would—that particular assertion by the noble Lord, particularly when one considers that for the first time for many years now the average rate of unemployment in Scotland is lower than the average for the whole of the United Kingdom. I also point out to the noble Lord that there will remain 630 civilians and 335 servicemen and women working in Rosyth. A number of the 700 civilian posts lost will be redeployed. I am always sorry when people lose their jobs and I know that the noble Lord is, too. I hope that he will not yield to the temptation, despite his understandable links and loyalty to his own hearth, by exaggerating too much the effect of what he describes.

Lord Avebury

My Lords, I wish to ask the Minister the question of which my noble friend Lord Russell gave him notice. Have the Government made any attempt to estimate the cost to the social security budget of the cuts which they have just announced and is the estimate of savings from this review gross or net of such cost? Perhaps I may also repeat to the Minister the question which I asked the other day. Has any decision been made on replacement of the elderly Lockheed Hercules aircraft? If not, how are our troops to get to the front line?

Viscount Cranborne

My Lords, I am most grateful to the noble Earl for giving me advance notice of that question. I point out to the noble Lord that it is not possible to estimate the effect of staff redundancies on the social security budget. However, the effect is likely to be small in the light of compensation payments made on termination of employment. For those over the age of 55 any occupational pension payable is likely to affect entitlement to unemployment benefit.

As regards replacement of the C-130, we plan either to replace or to refurbish the first half of the RAF's Hercules fleet by the end of the century. We are assessing the price and performance data which we have received for the new buying and refurbishment options for both halves of the replacement need in order to determine the most cost-effective option. We hope to take a decision before the end of this calendar year.

Lord Craig of Radley

My Lords, perhaps I may add my voice to those who have been stressing the importance of stability following a period of four years of unparalleled turbulence, reduction, redundancy and so on. The more that can be said the better to stress that this process is now over, even allowing for the fact that for the next five or six years there will be reorganisation and redundancy to be faced in all three Services. I welcome the emphasis which has been placed on "jointery". I hope that we can be reassured that joint staff training will first ensure that single-service knowledge is well established in the mind of each and every officer. Such an officer cannot bring to a joint operation or staff project proper advice unless he is well informed himself.

The importance of rapid redeployment seems to underline the importance of the last point which the noble Viscount touched on regarding the refurbishment or replacement of the C-130 Hercules. I hope that we can have an early announcement about that.

Viscount Cranborne

My Lords, I am most grateful to the noble and gallant Lord. As far as the joint staff college is concerned, he will not be surprised to hear that that point has been made repeatedly by members of all three Services. I am sure that I can give him the reassurance that he seeks. I can only refer once again to the answer which I gave to the noble Lord, Lord Williams of Elvel, and to the noble and gallant Lord, Lord Bramall, on the subject of stability. It is a point which I know all members of the Armed Forces would echo. We must look at the circumstances at the time. I can only reiterate what I said a little earlier.

I am grateful to the noble and gallant Lord for what he said about the C-130 replacement. I am sure that his remarks will receive keen attention from the people in my department.

Lord Howell

My Lords, we are grateful for the detail that the Minister gave, but I am sure that he will understand that it will take quite a bit of time for us to appreciate the criteria and rationale behind parts of the Statement. At the beginning of the Statement, the noble Viscount said something to the effect that this was not an exercise in looking at the size of our Front Line forces. Indeed, if we take the Front Line forces and the Reserves together, we can see that the Statement does not produce any additional Front Line servicemen.

As my noble friend Lord Williams and other noble Lords have said, many of us find great difficulty—I am certain that this is true of people throughout the country—in reconciling the various Statements that we have heard, starting with Options for Change, and many other Statements and defence White Papers since then, leading to this Front Line exercise and what the Government are doing in terms of the size of our Armed Forces, with the political commitments which the Government have undertaken and which those Armed Forces have to meet. That point is absolutely fundamental, so I plead with the Minister to ensure that when we debate these matters in two weeks' time the Government will try to reassure us on that point.

We have to remember the situation in Northern Ireland, the dangers of the situation in eastern Europe, the Gulf, the middle east, the far east and Africa as well as the demands made upon us by NATO and the United Nations. I hope that the Government will be able to reconcile what they are doing now in terms of the future size of our Armed Forces with all those commitments. So, the short question that I want to ask the Minister is whether he can assure the House that under all circumstances, in any theatre of the world, the size of our Armed Forces (which he has just announced) will be adequate to meet any demands that are made of us.

Viscount Cranborne

My Lords, the concern raised by the noble Lord, Lord Howell, has been articulated by many Members of your Lordships' House—certainly since I became a Member. I am grateful to the noble Lord for acknowledging the complexity of the Statement. I certainly acknowledge how difficult it is to make a thorough analysis of the situation based purely on listening to my reading a Statement, and I also acknowledge how much we are asking in expecting your Lordships to do that.

I draw the noble Lord's attention to the new armoured reconnaissance regiment, to the plans to place frigates in extended readiness being revoked, and to the increasing strength of the RAF Harrier squadrons as examples of the increases which the noble Lord might not have felt were being made as a result of this exercise. On commitments, I advise the noble Lord that we have tried to be as open as possible about how we relate our defence capability to our commitments. I refer the noble Lord once again, as I know I have previously —I hope that he will forgive me for raising this point again—to the 1993 White Paper which revealed that a great deal of work had been done on that subject. We shall keep that analysis up to date in an attempt to be able to justify our provision of defence capability to the noble Lord and to other Members of your Lordships' House, and so that we shall be able to give an affirmative answer to questions such as the noble Lord has asked.

Lady Saltoun of Abernethy

My Lords, first, can the noble Viscount say whether any study has been undertaken as regards how much of the saving that will be made by these cuts in personnel will be absorbed in unemployment benefit, income support and so forth? Secondly, have the Government any plans to bring any new industry to the Dunfermline area around Rosyth where I understand that unemployment is already about 20 per cent? Finally, turning to the Army, the noble Viscount announced considerable additional training programmes, but with overstretch at its present level, how is the time to be found for that extra training?

Viscount Cranborne

My Lords, taking the noble Lady's last point first, I advise her that the Government are still committed to their prediction of an average emergency tour interval of 24 months by 1995-96. I have made that commitment many times in your Lordships' House and we are still sticking to it. I hope that the noble Lady will find that at least some comfort in her allegation of overstretch.

On the question about bringing new industry to Dunfermline, I hope as much as the noble Lady that new industry will go to Dunfermline where, as she knows better than I do, there are considerable industrial skills. Although it is not the business of the Ministry of Defence to bring that investment to Dunfermline, I can advise the noble Lady that my honourable friend the Minister of State for Defence Procurement has set up close lines of communication with other government departments. That is designed to ensure that the Ministry of Defence can be as helpful as possible to the efforts of those departments which are responsible for attracting investment to particular areas which have suffered as a result of defence closures.

The noble Lady's first question seemed similar to the question asked by the noble Lord, Lord Avebury. As I said then, it is not possible to estimate the effects of staff redundancies on the social security budget. I refer the noble Lady to the remainder of the answer that I gave to the noble Lord.