Defence

HL Deb 16 March 1994 vol 553 cc286-321

6.18 p.m.

Lord Williams

of Elvel rose to call attention to the case for a full defence review; and to move for Papers.

The noble Lord said: My Lords, in moving the Motion standing in my name on the Order Paper I shall seek to achieve three things. First, I shall try to be as precise as possible about what I mean when I speak of a full defence review and what form it might take. Secondly, I hope to indicate at least some of the major questions that such a review will have to address. Thirdly, I hope to demonstrate that it is now time—and indeed that the time has long passed—for the Government to embark on such a review.

My party has said time and time again that we cannot go on slicing up our Armed Forces without a fundamental review of our defence commitments. Recent events in Bosnia are enough to show that those commitments, particularly in UN peacekeeping, have changed radically since the last review. We shall continue to hammer that theme until the Government pay attention. The debate this evening is part of that process.

Since the Second World War there have been four full defence reviews. Each has had somewhat different characteristics. The Sandys review of 1957 was carried out in the aftermath of the Suez debacle when it was clear that our Armed Forces had become unwieldy and much of their equipment obsolete. The conclusion was that British military power could and should be sustained by a new emphasis on nuclear delivery systems, missiles and air transport. In other words, conventional forces were to be run down—for instance, conscription was to end—and an independent nuclear system was to form the centrepiece of strategy. It is noteworthy that the service chiefs were excluded from participating in the review and that no thought was given to reducing the considerable array of commitments that had built up since the war.

In the event, it became impossible to reduce defence expenditure as much as had been hoped. Furthermore, we became dependent on the United States for nuclear delivery technology to a much greater extent than hitherto. The financial implications of that did much to prompt the next review, launched by my noble friend Lord Healey in 1965. A number of changes were made, the most important being the withdrawal from a defence role east of Suez.

The next review was ordered in 1974 by my noble friend Lord Mason of Barnsley. There was a clear difference of approach. Instead of working from the base of financial pressure, the chiefs of staff were actively involved in very detailed consideration of Britain's defence commitments. These were ranked in order of relative importance and only after that the resources that could be devoted to them calculated. As a result, three overarching commitments were deemed central both to national security and to the credibility of NATO: the British contribution to NATO's central front in Germany; anti-submarine forces in the eastern Atlantic; and defence of the UK mainland. Apart from a small force in Cyprus, it was decided that all extra-European commitments for troops permanently on the ground, or ships permanently on station, could be virtually relinquished.

The last review in the post-war series was commissioned by Sir John Nott in 1981. Again, commitments were scrutinised carefully, as in the Mason review. But the analysis took a strange twist. It was the Continental emphasis that emerged as the greatest winner. The conclusions of previous reviews that we still had to have some capability to defend our interests outside the NATO area were not followed through. In that respect, the Nott review was a logical conclusion of the Sandys review of nearly a quarter of a century earlier. The nuclear deterrent would be upgraded; BAOR would be progressively re-equipped; and the navy would shed its remaining out-of-area capability and concentrate on anti-submarine operations in the eastern Atlantic.

The measures proposed were, to say the least, as noble Lords know, very controversial. And, of course, the whole issue was thrown into reverse by the Falklands episode, which showed up the basic fallacy of the Sandys-Nott Eurocentric strategy—that it was geared to deterring the greatest but most unlikely threat to the United Kingdom while paying too little attention to the much more probable threats to British interests outside Europe. As a matter of cold, hard fact, I believe that if General Galtieri had waited until 1984 to invade the Falklands, he would in all probability still be there.

Not unnaturally, the Nott review was treated extremely harshly by its critics. Perhaps it was that criticism, as much as a realisation that a defence review could be an inflexible process if handled badly, that deterred the Government from calling their next effort a defence review. The next effort was, of course, the now famous exercise entitled Options for Change, launched by Mr. Tom King in the autumn of 1989. As we know, there were accusations of failure to consult the service chiefs and of an over-powerful Treasury role. But the real problem with Options for Change was that the Treasury was at its most aggressive just at the time when the strategic assumptions about the cold war that had been inherited were themselves becoming outmoded. Furthermore, there was no in-depth analysis of foreign policy issues to accompany the defence exercise. The collapse of the Soviet Union and consequent Russian withdrawal from Eastern Europe were not originally part of the Options scene. Indeed, they were used as the justification for further defence cuts in 1993; and those in turn, as is natural, gave rise to further criticisms of undue Treasury influence.

The result is that defence policy has now fallen into a vacuum—a sort of foreign policy black hole. We have to start looking at how successive announcements of force reductions have been regarded simply as the Treasury method of slicing salami. There has been no attempt to justify them against a carefully explained set of rational criteria. Until that is done, no amount of detailed costings—and there were detailed costings in the recent Defence Estimates White Paper—will be adequate. Our defence policy will still not make overall sense.

The format of a review such as we suggest should broadly follow the Mason review of the 1970s. It should start with a wide-ranging assessment of British foreign policy and security interests. It should then analyse how Britain's Armed Forces could or should sustain them. Finally, there would be a comparison of that result with the resources that are available now and in the future; and it goes without saying that at that stage the Treasury would have a major input to make.

The questions that such a review will have to address are not too difficult to define. There is perhaps first and foremost the question of Russia. What threat can she realistically pose to British security? And is she liable in the future to pose a threat to the general stability of Europe, particularly in the east? That might easily be the case, for instance, if Russia is sensitive to the interests of Russian citizens outside the borders of the Russian Federation, as the recently announced new military doctrine clearly states. Out of that would come the question of what is to be the future extent and role of NAT() and the CSCE, and, within that, what is to be the role of the British nuclear deterrent, both strategic and (that curious expression) sub-strategic.

Following on from those questions would come the related matter of the future security of Western Europe and indeed of Britain herself. Has the European Union a role to play? Is the WEU to be the second pillar of NATO, or will it provide the framework for a future European defence force? Since both the Gulf War and, much more significantly, the break-up of Yugoslavia, have shown that serious military action by the west Europeans requires American participation and thus NATO involvement, is there any point in trying to go beyond the Rapid Reaction Corps? So far as Britain herself is concerned, should we not be looking at the effectiveness of the army in discharging its task of aiding the civil power in Northern Ireland?

Another, and possibly novel, matter for review would be Britain's interest in security in other parts of the world, and in particular our support for the United Nations. At present, and presumably continuing well into the future, there is a host of problems in which the United Nations, if properly organised and equipped, is or should be playing a role. It is not only the former Yugoslavia. Somalia, Angola, the southern Sudan and Cambodia are all on the agenda. Tomorrow's agenda may well include Palestine and South Africa. As a permanent member of the Security Council, we have a particular responsibility to the United Nations. Given our large historical and commercial interests in South Africa. for example, it is difficult to see how we could refuse participation in a United Nations transitional force in the republic, if it is asked for. Given the proximity to Israel of British bases in Cyprus, the same is true of the Levant. Does that then mean that the UN and other peacekeeping forces should be a defence priority? If it does, how might that affect the future structure of our Armed Forces?

Your Lordships will realise that I am putting all the matters that I suggest for discussion in the form of questions. It can only be thus because it would be manifestly absurd for me to try to give any answers. That is precisely what the defence review would be designed to do. Furthermore, I have not even mentioned such vitally important matters as the nuclear non-proliferation treaty, a comprehensive test ban treaty, particularly after President Clinton's decision yesterday to extend the moratorium on US nuclear testing, the Partnership for Peace agenda in Eastern Europe and the future of the UK's defence industries. All those are matters which need to be reviewed and studied.

What I hope I have done this evening briefly is to explain to your Lordships why we believe that a full defence review is now timely and necessary. Up to now the Government have taken a different view. Mr. Rifkind has said that a new defence review would not provide any information not currently available and would anyway be futile since defence is always under review. There are mini-reviews of particular support services from time to time, but the failure to bring everything together in a coherent manner is, I believe, leading to a lack of co-ordination between foreign policy-making and our force structures. If this goes on, we will soon—if we are not already there—find ourselves in the position graphically described by the same Mr. Rifkind at last autumn's Conservative Party Conference when he said: There is a limit to how far we can cut our forces and maintain the same commitments and capacity to defend ourselves and our vital interests … We must avoid creating a hollow force—an armed force that looks formidable but is in fact a paper tiger". We believe that we are close to that limit, and that sums up neatly the case for a full defence review. I beg to move my Motion for Papers.

6.33 p.m.

Lord Mayhew

My Lords, the Government have embarked on two defence reviews. There is the defence costs study which is an attempt to save some £2.3 billion in three years by rationalising the support services. On these Benches we support the principle of rationalisation. To take one small example, we have never understood why each of the three services requires its own medical and dental services. But we say strongly that the point of the review must be to free resources for the front line, not simply to reduce the PBR. The Government have made it quite plain that they take a different view and that the point is to save money for the Treasury.

The second defence review upon which the Government have embarked was described by the noble Viscount in a letter to me, for which I am grateful, as a, major independent review, not of conditions and allowances only but of the whole area of service career and manpower structures and terms and conditions of service". Again, on these Benches we do not oppose that in principle. There are anomalies which have built up over the years; for example, in Bosnia where, unlike other UN peacekeeping forces, the British forces are financially handicapped by losing the cost of living allowance which they get in Germany. That anomaly ought to be ironed out straight away.

For this kind of review it is essential that there should be sufficient military input into the review at the top level. The disaster of doing otherwise was well shown by the Sheehy Report into the police. We must have a military man at the top of the review as well. However, that is not the view of the Government. The noble Viscount wrote to me about, a review team comprising an independent chairman and some three or four independent members". They would be helped by "external consultancy assistance". In other words, the review will be conducted by people with little or no experience of the essential requirements of a military force: loyalty, courage, endurance, initiative, discipline. You do not get those things by pressing keys on a computer and coming up with some utopian management structure. There is need for a military input at the top; otherwise, like Sheehy, we shall have serious errors of judgment and needless resentment from the Armed Forces.

The Government are not conducting the type of review described so thoughtfully by the noble Lord, Lord Williams —namely, fitting future resources to future commitments. They are reducing our resources and failing to reduce commitments accordingly. Thus, they are creating serious overstretch in the services, as we all know. My noble friend Lord Bonham-Carter will deal with the need to share commitments with our allies and for closer defence collaboration with the European Union, especially with procurement.

I wish to deal simply with the one major commitment that we cannot share with our allies. I refer, of course, to the Falkland Islands. At present the cost is formidable and the future cost will be still more formidable. According to the Defence White Paper, we have permanently stationed there an infantry group, an engineering field squadron, a squadron of the RAF regiment with supporting services; submarines, frigates, Chinooks, Sea Kings, Tornados and Hercules. The direct cost of protection is bad enough, but much heavier is the cost of the reinforcement capability which the White Paper says is necessary. The future cost will be still more.

Happily, relations with the Argentine have greatly improved. The Argentine Government, democratically elected, have repeatedly condemned the invasion and insist that no such criminal action will ever be taken again. Yet the question remains: will the centuries-old conflict over sovereignty ever go away? Unfortunately, there is no reason whatever to suppose that it will. Even today, in comparatively calm conditions, a democratically elected Argentine president feels obliged to declare that the islands will be Argentinian by the end of the century.

I remember the ferocity with which, 30 years ago, speaking by invitation to the Argentine Parliament, I was assailed with shouts of: "Give us back the Malvinas". However irrational it may be, for the Argentinians the claim is a deep-rooted issue of national pride and it will not go away. I said that the claim was irrational, but we have to remember that while the world community supported us against the Argentine aggression, it opposes us on our legal claim to sovereignty and urges us to negotiate.

The Government not only refuse to negotiate, they now seriously offend the Argentinians by excluding them from the early stages of oil exploration—a prospect with enormous possibilities that could transform the whole area and which, of course, raises acutely the question of sovereignty and ownership. The Argentine Foreign Minister said last year: We have made it clear that in the absence of an understanding, we will not accept oil exploration and exploitation activities in the disputed area". In the meantime, for reasons that are not clear, the Argentine Government have ordered 36 Skyhawks from the United States. Have the Government worked out the future cost of maintaining a credible deterrent? They refuse negotiation, simply pledging themselves to enforcing without time limit the wishes of the islanders. "Without time limit"—that is the point.

Fourteen years ago the then Conservative Government proposed that sovereignty should be transferred to the Argentine in 25 years. That might have led to a settlement. However, the Government changed their mind and, in effect, gave the islanders a veto on transference; and war followed. Today they reaffirm that the wishes of the islanders must be paramount. That means that their wishes could for an indefinite period of time override basic national interests of this country. I believe that that goes too far. We have strong obligations to the islanders and we have fulfilled them at enormous cost. But they have obligations to us, too, in return. Thus, a defence review which seriously tried to match future resources with future commitment would say that Britain must start creating conditions now for a slow and honourable withdrawal from our Falklands commitment.

6.41 p.m.

Lord Bramall

My Lords, I apologise for any discourtesy in not being able to remain throughout this debate. For weeks now it has been arranged for me to address honourable Members from another place on the subject of our Reserve Forces. I felt that my duty lay equally there. So I ask the indulgence of the House if I break away during the debate, aiming to return before the end.

If there was ever doubt of the need to formulate a coherent vision of the role that this country means to play in today's uncertain and unstable world, it has surely been dispelled by the uncertainty that we witnessed as the Government slowly made up their mind whether or not to send troops to Bosnia to reinforce the remarkable success achieved by a British general. Eventually, of course, the pressures of what was happening on the ground left the Government no option but to send a substantial contribution in the shape of 900 men. That, of course, I warmly welcome. But it might have been easier if there had been a clearer understanding of where the former Yugoslavia fitted into our strategic perspective, and where this country's interests really lay.

In any national defence policy there have to be three elements: the financial and economic element; inevitably, a political element; and, of course, very much a strategic element linked to our foreign policy. The trouble is that at present we conduct our defence business with only two of those elements firmly in place. There is plenty of the financial element. Although Minsters made some effort to insist that Options for Change was not Treasury led but was a rational, reasonable response to a changing world, no one can make the same claim for the latest exercise of finding over £1.5 billion over the next three years. That is entirely Treasury led, and is arbitrary and draconian in its content.

There is also a large political element, which bows to various pressures at home and abroad. That is understandable. The decision to undertake entirely unexpected military action in the Falklands and the Gulf are examples.

The last element, that of strategic foreign policy, is now largely lacking. I know, and we have heard, that one has to be careful about the concept of a defence review if that means that what you are trying to do is to anticipate exactly whom, if anyone, you are going to confront and where and when, so that you can hold purpose-built forces for that exact contingency. That would be very dangerous. You would certainly get it wrong—as happened, as the noble Lord, Lord Williams of Elvel, pointed out, in the Nott Review of 1981–82.

Nevertheless, before you start, as we are now doing, turning your Armed Forces inside out and adopting what are known as radical (sometimes even blatantly known as Treasury) solutions—which is usually a euphemism for cheaper solutions, with scant consideration as to whether they would work even in peace-time, let alone in conflict—you have to be clear about certain assumptions against which you can reasonably do the exercise. That requires considered answers to specific questions.

The noble Lord, Lord Williams of Elvel, very ably put a great many of those questions: that of commitment; the new prospect of Russia; the future of NATO; and the future of our nuclear weapons. I shall not go over them again. I have neither the time nor the inclination to do so. I would only say: do we, for instance, intend to remain a world power with a seat on the United Nations Security Council, and with the responsibilities that go with that position? There are plenty of people who would like to take our place on the council. Do we expect, or shall we have to be prepared, to operate in what I call Division One, and not in Division Three or Four—as we had to do with others when we took on a country like Iraq which had a great deal of modern eq lipment provided by the then Soviet Union? Are we prepared to make more use of our Reserve Forces, which would be a large social step and would require legislation? And must the Armed Forces still he able to react if political pressures become great, whether or not they had contingency plans or forces ready to do so? For the record, events in former Yugoslavia will be the fourth occasion in the past 15 years when, totally unexpectedly, we have had to deploy sizeable forces although we had no particular plans to do so.

Until those matters are established one way or another at the highest level, and priorities are sorted out, it is quite irresponsible merely to say that we are going to re-design our Armed Forces purely on the basis that the Treasury requires at any particular time x million or x billion pounds from defence. Unless we get a strategic pillar into the equation, we store up appalling problems for ourselves in the future. The people most concerned with such decisions are the Ministry of Defence and the Foreign Office. There is no shortage of machinery to achieve the purpose. It is merely that the machinery is so seldom used.

There are a number of ways in which top officials from the FCO, the MoD and other interested departments can be got together to draft priorities for Ministers; or indeed, Ministers can get together. But, unless the overall problem is grasped at the top, the staff can write papers and advisers can advise till they are blue in the face, and nothing will happen—as I know from personal experience. When I was Chief of the Defence Staff eight years ago I led the Defence Staff in a number of strategic studies on all the various parts of the world, trying to establish what was important, what was of special interest and what was of less concern and of lower priority. All that would have been a great help in establishing the sort of guidelines that have been mentioned this evening. Although those exercises were treated with polite interest, no Minister was prepared to sign up to them, so they never saw the light of day.

Of course there must be a Treasury input. Of course the Armed Forces need to be continually brought up to date and organised for the future and not the past. There is so much, in so many fields, which needs doing. But, with scant strategic direction and the MoD organised as it is with the operational, administrative and financial chains of responsibility separated from one another, I am not at all confident that the right things will be done. When virtually all the current studies—of which there are at least 35—are done against the background of compelling financial savings and very little else, they inevitably get done right across the board of account holders. That is no way to get the right answer, particularly with smaller Armed Forces.

In the sense that we must look at general guidelines and get a continually updated strategy and foreign policy content into our defence policy, a defence review is needed. Ideally we should not carry out any further exercises on the Armed Forces until it has been done. At least we must be ready to measure the outcome of any "front line first" studies against some form of defence review and modify those findings when that is shown to be necessary—even if it has been that the cart has been ahead of the horse.

6.50 p.m.

Lord Ironside

My Lords, I believe that the time is not ripe to talk ourselves into a defence review which may incur severe diplomatic penalties and even lose us our seat on the United Nations Security Council, while we are struggling through Options for Change to establish new force levels and structures, which I think are needed.

I turn to the Falklands and I hope that the parties opposite will agree that a review of the Falkland Islands would be entirely out of place while the Falkland Island Government intend, with our authorisation, to publish the required legislation and license exclusive acreage to oil companies for exploration later this year. If all goes well there will come a time when the Falkland Islands Government can assume a degree of financial responsibility for their own defence and other arrangements can then be made.

As the House is aware, I and some other Peers have just returned from spending nearly five days as guests of the Commander British Forces in the Falklands. I thank my noble friend for his assistance in bringing that visit about at such a critical time. We were able to see anti hear at first hand what our defence role there is all about. I say without reservation how much we are indebted to Major-General McKay-Dick, the Commander British Forces, his staff and all his servicemen and servicewomen, for the way in which they took part in our programme and demonstrated how they carry out their tasks so efficiently, expeditiously and cheerfully in such inhospitable latitudes. They are backed up by the South Atlantic air bridge, the logistic support from the UK and of course the Royal Engineers on site. Tornados, Rapier missiles, radar and infantry are at immediate readiness with a frigate, submarine, offshore patrol vessel and forward repair ship on hand.

What was most impressive to me was to see the sense of purpose and high morale that exists within each service, jointly carrying out their tasks, knowing that they are well equipped, well accommodated, well supplied and, above all, well commanded. We can assure ourselves that we meet our "defence role one" commitments to the full in the Falkland Islands. What is vital at present is the air bridge and fishery protection. As we have a clear sovereign commitment to defence in the islands, we must ensure that the operation runs smoothly and that logistic support arrangements remain firmly in place.

But we must not forget the dependencies in the south —South Georgia and the South Sandwich Islands below the 50 degree parallel, which are part of our occupancy and have to be visited. I sense that from Whitehall they are viewed through different telescopes according to whether one is standing on the bridge of the Foreign Office or the bridge of the Ministry of Defence. Clearly the policy towards those dependent outstations must be properly co-ordinated between departments and any third-party nation must not be left in any doubt whatever that the iron fist of defence lies beneath the velvet glove of diplomacy.

While I watched the Options for Change process proceed and have seen us winning the battle for better value for money, I listened constantly to the party opposite calling for a defence review, cuts and diversification. In fact, I believe that what they are really calling for is a wholesale shakedown of defence in which they would like to see our ultimate deterrent vanish—platform, missile and warhead —into a black hole, thereby destroying our capability to meet our obligations in any of the defence roles. I hope that never happens. I believe that Trident is here to stay.

I do not say that lightly but in the knowledge that our much valued technical capability, industrial resources and trained manpower all count heavily in fighting and holding our corner in defence. I believe that the Secretary of State is steering the best course at the moment and I hope he sticks to his guns.

6.53 p.m.

The Earl of Longford

My Lords, I rise with suitable diffidence after the speech of one famous field marshall and the son of another, even though the last speaker totally misunderstood the policies of the Labour Party. However, one cannot understand everything.

My first task is to offer strong support to my noble friend Lord Williams and the policy which he expounded so eloquently. I am glad that the noble Lord, Lord Mayhew, was in the form which once led me to say that he was certain to become a future Prime Minister. It has not happened yet, but life is long and he is in good shape tonight.

I find it easy and pleasant to support the policy of our party on defence. There were moments in the 1980s when I might have wondered whether the noble Lord, Lord Ironside, had hold of the right end of the stick as opposed to the wrong end which he held up tonight. But those days are past and I have absolute confidence in the policy as stated by my noble friend Lord Williams.

My second task is to plead strongly for what one may call continuity in defence and foreign policy. I agree with all those speakers who say that those two things must be taken together. When I listen to field marshalls and the sons of field marshalls my mind goes back to one specific field marshall with whom I collaborated in a humble way many years ago; namely, Field Marshall Viscount Montgomery. When I was Under-Secretary for War in 1946 Lord Montgomery took me in his car down to the staff college. I was the only person in civilian clothes and I was placed on the platform—a shrinking form—beside him while he harangued the staff officers. He finished his address by saying, "Never forget, gentlemen, that the politicians are our masters". He was looking at me and inciting loud laughter. Then he said, "It is up to us to lead them up the garden path"—and the air was filled with even louder laughter.

That is how Monty put it in the old days and no doubt there is much truth in it, as long as the service chiefs recognise that the politicians are their masters. They are the experts. We make a grave mistake if we do not pay careful attention to their advice. But in the end, as Lord Montgomery, said, politicians are the masters and we must consider all those matters in the widest context.

I believe that the foreign policy in this country pursued under all governments, despite what the noble Lord, Lord Ironside, seemed to think, arose out of the Council of Foreign Ministers in 1947. I sat beside the Foreign Secretary, again in a very humble way. But there I was for three weeks and there was Molotov, M. Bidault and General Marshall. I shall never forget the extreme reluctance with which Ernest Bevin accepted what can only be called the division of the world—the beginning of the Cold War following the total callousness of the Soviet position. Then followed the Atlantic Pact in which Britain played a notable part both in formation and operation, and that has been the basis of our foreign policy under all governments for half a century.

That is satisfactory as far as it goes. It worked on the whole quite well along with adherence to the principles of the United Nations. But as other speakers indicated, we reach a new position. Nobody knows what the countries that once made up the Soviet Union will do and nobody knows what will happen to all their nuclear weapons. However wise one is, no one knows. All that we can do is make arrangements to study those matters in the broadest context; not just pure defence, but defence coupled with foreign policy.

If I may be allowed to make a personal suggestion, we want such a defence to be not representative of the political parties in the sense that they would be committed to it, but that leading members of the political parties should serve on such a committee. I should like to see as the head of such a committee perhaps a distinguished Foreign Office figure; the noble Lord, Lord Greenhill, Sir Nicholas Henderson, or someone like that. Whatever the details of it, I am sure that we must have a review to consider the whole world picture in the widest context and to draw up plans accordingly.

7 p.m.

Viscount Torrington

My Lords, like the noble Earl, Lord Longford, I also rise to my feet in this debate with some diffidence. My diffidence is due to the fact that my direct military knowledge is restricted to my school corps. 1 happen to think that it was probably quite a good training, however, since one of my contemporaries, Sir Charles Guthrie, has just become head of the Army.

I have just had the privilege, in company with my noble friends Lord Ironside, Lord Waverley and Lord Lyell, of visiting the Falkland Islands. I echo the thanks of my noble friend Lord Ironside to my noble friend the Minister and to General Mackay-Dick and his staff for the way we were looked after in the islands. I was immensely impressed with what I saw; with the people and their resolve; with the spirit and dedication of the officers and men of the three services; with the range and quality of the military hardware; and with the standard to which the equipment and facilities are maintained. It seems to me that the garrison is a minimum credible but effective deterrent to aggression and that Argentina would be most unwise to attempt any further military adventures.

I personally do not believe that Argentina will try again to take the Falklands by military means. However, as the noble Lord, Lord Mayhew, said, only last week President Menem again pledged to "regain" the sovereignty of the Malvinas—by peaceful means, admittedly—by the year 2000. He is assuredly not going to do this by winning himself an invitation from the islanders, even if Mr. di Tella continues to send them tapes of penguins for Christmas every year. He is not going to do it by threatening oil companies that take up licences in the forthcoming licensing round. Perhaps he is going to persuade the sheep to revolt, or perhaps even the penguins.

There is every chance—I have seen the seismic and the interpretation work that has been done—that there will be a major oil province in the Falklands. Some of the basins extend through on to the Argentine side and have already been tested. I think it extremely likely that we will see a major oil province there. I have heard the islanders say that they would like to see the revenues from that oil going in considerable measure to repay this country for its defence efforts to date. I should like to think that that means both capital and running costs over time.

I did spot one thing in the Falklands which worried me a little in the context of this overall debate. I saw a senior naval officer wearing army boots and, indeed, an army uniform. Now, lest you think this is a flippant remark, I should immediately admit that the Falklands garrison is a joint services operation and, indeed, a very fine example of all three services working together in, I believe, near perfect harmony. My only nagging fear about a naval officer in boots is that there may be a secret Whitehall plot for a new all-purpose and much slimmed down unified "defence force". If the joint services concept works in the South Atlantic, it may not be long before someone suggests that it is just what we need back home. I sincerely hope otherwise and that the excellent Falklands garrison has set no unfortunate long-term precedent.

I for one believe that there are no grounds for any further contraction in our armed services beyond Options for Change, and possibly not even that far. The world may seem a rather less dangerous place than it did 10 years ago but, as Yugoslavia has demonstrated, the countries of the former eastern bloc are far from stable, possess immense weaponry and, to our merely temporary benefit, do not seem to know whom to point it at. Today's climate may permit a reduction in British readiness but hardly justifies any reduced overall capacity and no reduction in vigilance.

7.5 p.m.

Lord Jenkins of Putney

My Lords, my noble friend's magisterial introduction to this debate reminded me, oddly enough, that during the war I was instructed that one must first receive and understand an appreciation of the general scene. Only after that, I was told, was it possible to think about a suitable strategy. As for tactics, not at all, until the appreciation was accepted and the strategy agreed. Not that I ever rose to a height at which that knowledge was of the slightest use to me but it was comforting to know that in all the chaos someone was trying to think reasonably and rationally.

It used to be the role of the War Cabinet to do the general appreciation, which it discussed with the chiefs of staff in formulating strategy. Today, the driving force too often seems to be public opinion conditioned by a press which regards the arousal of indignation as the surest way to increased circulation. There is also the input from various of our Members who may have paid a visit to various places and come back very impressed with what they have seen. That is a valuable input. However, on the question of the Falklands, I take the Mayhew view rather than the Ironside one.

Politicians and parties nowadays seem to be influenced by these uninformed surges of public opinion in formulating policy. There seems to be little attempt to relate current policy to the tenets and the different philosophies which are the source and justification of party politics. We are slipping into the American scene, where parties have no opposing and distinguishing characteristics and so, of course, there is in practice no real choice; merely a selection of personalities on one side or the other. There is no real democracy. It is no good talking about going back to basics if no one knows what they were, or even are, any more.

Much follows from this but this evening. in my few minutes, I want to demonstrate the need to survey the general scene before formulating particular policies. Noble Lords will not be surprised to know that my illustration is that of nuclear weapons. It is widely agreed outside government circles—and perhaps, who knows, inside them as well—that strategic intercontinental missiles, born out of the struggle between the Soviet Union and the West, are no longer relevant today. Yet, far from studying how to handle the new situation, the government top brass are hell bent on increasing our useless strategic capability. Instead of adapting our weaponry to the new scene, we are allowing the weapons themselves to command strategy with the result that we are facing backwards to yesterday's old and gone threat instead of evolving a new strategy designed to try to tackle today's real threat, which is that of nuclear proliferation. This is one case which quite clearly supports my noble friend in his plea for a defence review. I put forward the case as an example —I am sure there are many others—of why we need to have a look at the whole scene; not a smaller examination of particular aspects of it but a look at the whole scene.

The non-proliferation treaty of 1968 sought to freeze the situation as it was with the five then known nuclear states —the United States of America, the USSR, the United Kingdom, France and China. The treaty has not been a success, for Israel, India and Pakistan either have or are highly prepared to have, nuclear weapons and none of them is a party to the treaty.

Furthermore, states which are party to the treaty have been developing their civil nuclear capacity in a military direction. They include Iraq and not only with Soviet help, but also with clandestine help from ourselves. When I say "ourselves" I mean our Government or some members of it. I am not quite sure, but no doubt we shall know more about all that very soon. Other countries in this category are Iran and North Korea.

The breakup of the Soviet Union has replaced a known, measurable and negotiable threat with a number of possible disaster sources; uncertain, dispersed and uncontrolled, as John Simpson pointed out recently in the January issue of International Affairs. What will be the value of our policy of deterrence by ICBMs if any of this nuclear weaponry gets into fanatical or gangster hands? The Government are saying that they want to see the non-proliferation treaty extended indefinitely when it comes up for renewal next year. That is fine, but what about making it work? There is no purpose in the extinction of the ineffective before one has made it effective.

At present the NFT is neither comprehensive nor watertight, as the House of Commons research paper Redefining British Foreign & Defence Policy makes clear. I warmly commend that document to Members. I would have liked to say something about it but I have reached the end of my time. In my view, that document forms a possible basis for a defence review of the kind that I have been speaking about. I had hoped to say something about Admiral Lord Mountbatten tonight, but that will have to wait for another time.

7.13 p.m.

Lord Mackie of Benshie

My Lords, I shall not detain your Lordships for long. It is many years since I flew in a Lancaster and it is 50 years since I was on the staff in King Charles Street. Therefore, I shall not pretend to be technical. I appreciated the masterly review which the noble Lord, Lord Williams of Elvel, produced. There is no doubt that anyone looking at the scene today will realise that it is a highly dangerous one. As many speakers have said, the dangers of an all-out war which would destroy the world have receded, but there are many more dangers of a smaller variety all over the world.

A review is absolutely essential when we look at the way in which we have handled the first of these dangers and troubles which broke out in the former Yugoslavia. That has been an object lesson on how not to proceed. Eventually, after two years, it was mainly the Americans who forced us and Europe to take the kind of steps which now show some sign of producing peace, but admittedly a most unjust peace. Nevertheless, it is a step forward.

The suggestions and warnings made by the parliamentarians in the WEU and in the Council of Europe were about what should be done and that was two years ago. Our Government did nothing about that. They continued to say that they were only interested in humanitarian affairs and that our soldiers were doing a good job. The killing, of course, continued. The soldiers were doing a good job, but they were not doing their proper job. As soon as the Serbs appreciated that air power was to be used then we started to make progress.

Any review—and one is badly needed—must really concentrate on what we are going to do inside Europe. We are supposed to have a rapid reactionary force—I am sorry, a rapid reaction force; the other we have in our government. We have that force but apparently we can do nothing with it. France and Britain have put in troops, but there has been no coherence inside Europe as to what should be done. We had a situation where brutal methods of conquest were being used and we in Europe failed to stop it. We now appear to be able to stop it, but that gives a tremendous lesson as to how our thinking should be going forward.

It should be that we have a real and genuine command structure in Europe co-operating with NATO. We should be prepared to use it in the defence of peace. It should be a regional unit motivated or made legal by the United Nations. To do that it is quite obvious that we have not got enough well-trained, good units to send to places. The Government took a fortnight to make up their mind to respond to the urgent demand for troops from General Rose. It is quite obvious that any reduction in the good regiments of the army must at least be looked at, but that must be done in a European connection.

The other factor which the review has to look at is air power. There is no shadow of doubt that the main factor in the two examples which we have had of Iraq and the former Yugoslavia has been air power. We have to see that the RAF can play its part in western European forces. When air power was used to shoot down four of the six invading fighters, that had a salutary effect. That also depends on technical superiority. To my mind there is absolutely no doubt that we need a review carried out by competent professionals and with determination by the politicians to get together in Europe to produce something effective to keep the peace.

7.18 p.m.

Viscount Waverley

My Lords, I rise to share with you some observations derived from my trip last week to the Falkland Islands as a Member of the All-Party Defence Study Group, so ably led by the noble Lord, Lord lronside.

The main thrust of my contribution has been touched upon in differing ways, so I shall be brief. Many among us would agree that it is essential to recognise the importance of the military in shaping the moral fibre of the nation; a role increasing in significance at a time of declining attachments to traditional moral values.

Sir Arthur Bryant has reminded us, in an article published in the Sunday Times of 4th April 1948 that, the safety and honour of Britain depend not on her wealth and administration, but on the character of her people. This in turn depends on the institutions which form character, in particular on the throe services … which create the … martial habits of discipline, courage, loyalty, pride and endurance". While agreeing in principle on the need for defence cuts, the issue should be correctly and adequately addressed. As we have heard, the rationale for the cuts is flawed by being Treasury-driven and not foreign policy-led. The result is a seemingly disjointed approach which appears to threaten our long-term morale, effectiveness and security.

Belt-tightening initiatives in the defence field must surely be closely correlated with a well-designed foreign policy agenda. There would then be clear aims and objectives linked to defence spending; perhaps the clear identification of the nation's interests requiring protection: or our wish to bring stability to particular regions of the world; or even our need to secure first-class training grounds: in Belize, with its jungle training facilities, and in the Falkland Islands, which facilitate tri-service exercises in a friendly environment, where if low-flying recces are not carried out, the command receive telephone calls of complaint!

Benefits would also accrue from the privatisation of such services as air-bridges; for example, the route servicing the Ascension Island and Mount Pleasant base would release two Tristars, saving Her Majesty's Government many millions of pounds. Certain essential tasks, such as rapid airstrip repair as a result of enemy action, and refuelling duties could utilise, in part, Gurkhas at a 30 per cent. reduction in cost to the taxpayer.

I would, however, implore Her Majesty's Government to retain as many specialist functions as possible, in the knowledge that infantry can be trained comparatively quickly, even from scratch. This would retain our investment to date. Tight, timely accounting procedures would help to ensure that savings are more easily identifiable.

Where foreign policy considerations have an impact on the existence or continuation of a major garrison, I urge the Foreign Secretary to offer an unequivocal statement of support and commitment to the Falkland Islanders, unlike the coy utterances offered on behalf of Belize

I remind your Lordships that development of hydrocarbon resources around the Falkland Islands would he of enormous benefit to both the islands and the United Kingdom. Exploration could offer opportunities to UK companies and employment to UK personnel, as well as enabling the islands to continue their development. The islands are currently entirely self-financing in the civil sector. The potential revenue from hydrocarbon exploitation could ensure their future economic independence and also enable them to contribute to the cost of their defence.

Should we lose our traditional links with that part of the South Atlantic because of ill-considered defence cuts, we would be hard pressed to justify the loss of life endured by so many families on behalf of the liberation of those inhospitable islands.

7.23 p.m.

Baroness Park of Monmouth

My Lords, it is now over four years since Options for Change announced the peace dividend and the cuts in our Armed Forces began. Four years on, Russia has re-created, in the CIS, a leaner, stronger union, with an army of over 2 million men, sophisticated weaponry replacing obsolete weapons, an air mobile force, a new quick intervention strategy, and 30 military bases in CIS countries. The army is conducting a series of local wars and repressive measures in Tadzhikstan, Abkhazia, Moldova and the Caucasus. There were 15,000 dead among the Ingush after the 1992 intervention by the Omon and border troops.

The Russian MoD now controls the Georgian MoD (and no doubt others) since Georgia was forced into the CIS. It is a sad irony that Russian "peacekeeping" within the CIS, like her intervention in Abkhazia, actually has UN blessing with UN observers there to prove it. Moreover, the world apparently regards Russia as a valid and impartial peace-maker in Nagorno-Karabakh.

Russia's new military doctrine allows her to strike first with nuclear weapons and makes her responsible for protecting Russians living not just in the "near abroad" but in "zones of former influence". Russia has had her debts recycled by the G7, is about to join the G7, has killed COCOM, has secured most favoured nation status in Europe, and is pressing to join GATT. She has concluded a series of military, political and econornic agreements: in the Far East, military agreements with China and India; sales of MiG aircraft to Malaysia; and renewed links with Vietnam and Laos.

In the Middle East, Russia now has military agreements in the Gulf and a revival of relations with Iraq. In Europe, the Visegrad countries have been told unequivocally that they may join the Partnership for Peace (which Russia wishes to join first) but that an application for NATO membership would be unacceptable to Russia. Meanwhile, a revival of some form of Comecon, on a more equal basis, would, said Mr. Kozyrev, be a sound idea. In Western Europe, the Russians have just concluded defence talks with Germany, building on an agreement last year, which will involve joint naval exercises and training. There are also to be join NATO-Russian naval exercises.

Russia's strategy for dealing with NATO—the one organisation in Europe with power to contain her and to deter any recurrence of Russian imperialism and any campaign to regain her former sphere of influence (her present activity in the former Yugoslavia brings her right back into the Balkans)—is to destabilise it from within, a familiar communist tactic. She has skilfully used the Partnership for Peace to do this. What possible sense does it make for a NATO delegation to visit Kyrghystan, a Central Asian country, to consider a Kyrghyz application, or for Azerbaijan to apply? What must the Poles, the Hungarians and the Balts be thinking of this, and of the readiness of the European Community to consider Russia herself as such a partner while holding the Visegrad countries at arm's length in their application for membership?

My object in reminding the House that in the past four years Russia has become once more a power to be reckoned with, and that we could lose the peace, is to beg my noble friend the Minister to consider again whether, in our own long-term national interest, we can afford to relinquish an absolutely vital element in our power to influence events, to advance British interests and, in the long run, to influence and deter. Russia remains a threat if we do not maintain NATO's power to deter her, a peaceful but essential power.

There are powerful forces in Russia—whoever is in charge there—who would like to walk back into the Baltic states. If that were allowed, the next step would be the re-establishment of the former Soviet zone of influence in Eastern Europe and the Balkans and a special relationship with Germany. Meanwhile, the Americans may well see their interest, in the absence of a strong NATO, in withdrawal from Europe and a tacit understanding with Russia.

There is, of course, another and equally disturbing scenario —the possibility of a serious upheaval in Russia with consequences no one can foresee. The situation there remains very volatile. That too would produce most dangerous consequences. The far Right in Russia, supported by the still powerful KGB and by those elements of the armed forces still under MVD control, could well come to power. They would not relinquish it again.

I cannot urge too strongly that while both scenarios are possible, a powerful Russia under Yeltsin today or an unknown Russia after a coup or a collapse of order, a Russia that still possesses a strong army and a strong nuclear and chemical weapons capacity is a danger. We cannot afford to proceed further with the cuts and we should revise and review our commitment. We cannot even meet our present commitments without an absolutely unacceptable strain, and our voice in Europe, in NATO and in the Security Council will not be listened to. We need NATO, not to fight Russia, but to contain her and protect her neighbours. Deterrence kept the peace for over 40 years. We must therefore retain a credible defence capacity. It is extremely cheap at the price.

I should be the last to regret the establishment of a peaceful and prosperous Russia, content with the status quo in her potentially rich territories, but there is no evidence whatever that that is the aim of the present unstable but powerful establishment, nor that the ambitions, resentments and chauvinistic tendencies of the party, the KGB and the military-industrial complex have yet been brought under control. We should not be too ready to believe the old communist lie that unless we are very kind to the doves, the hawks will take over. Russians, and not only Russians, respect strength and firmness. We are busy depriving ourselves and our allies of the power to say no when necessary. We must not do that.

7.30 p.m.

Lord Desai

My Lords, I must first commend to the House my noble friend Lord Williams's call for a full defence review. It is a sobering experience to speak after the noble Baroness, Lady Park of Monmouth, with her vast knowledge of the Russian situation and her appreciation of the many dangers existing. They are clearly a warning to us all not to come to any hasty conclusions. But that, if anything, strengthens my noble friend's plea for a full defence review. I ask myself which of the two options she has put before us is the more plausible: a powerful Russia under Yeltsin or a possibly anarchic Russia? Either of them would give rise to serious defence problems. Someone should be taking a view of how likely are those scenarios and other scenarios which might also develop. What will happen in China when Deng Xiaoping dies? Will there be uncertainty and disorder rather than continuing economic development?

It is therefore a good idea to ask ourselves, not every year but at least every 10 or 15 years, what are our interests. I believe that there are three inter-related sets of interests. First, of course, there is the problem of defence needs and the resources that we would like to have; our foreign policy interests; and, lastly but not least, the economic constraints that we face.

Perhaps I may start with the last because I have more knowledge of that area than any other. Under the various defence expenditure projections, we are set to spend 3.2 per cent. of our GDP by 1995–96. That much was clear in Defending our Future, which we debated last year. We have come down from 5 per cent. to 3.2 per cent. The whole history of postwar defence reviews has been one of a Treasury-led adjustment, something which we cannot easily escape. One of the things we should do is to ask, "Suppose we stick to between 3 per cent. and 3.5 per cent., and suppose we expect the economy to grow by between 2 per cent. and 2.5 per cent. how much can we spend in 1994 pounds sterling on defence?" We should then have a view over the next 15 years of what resources there will be to play with. There are always emergencies. There is always and always will be reconsideration. But some long-term view should be taken. Good as the most recent White Paper was, it did not take a sufficiently long-term view of the situation, and a defence review should do that.

The second question would relate to foreign policy. The noble and gallant Lord, Lord Bramall, was correct to raise that question. Such a question has to be raised. Do we plan to be a major power, albeit a junior player, in the major league, or are we going to be a senior partner in a middle-range power league? Those are important questions. How serious are we about the European commitment? I deplore the Government's to-ing and fro-ing with regard to the European commitment. They should make up their minds; 21 years after the signing of the Treaty of Rome we should be making up our minds as to what we are going to do about Europe. What we do will determine fundamentally how we shall deploy our defence resources. If foreign policy is a major pillar of the post-Maastricht arrangements, and if we take that seriously—we do not propose to secede from the European Union—we should ask ourselves how much the European dimension influences and affects, enhances or diminishes, the need for us to have our own defence resources.

As many noble Lords have pointed out, the experience of what has happened in Bosnia does not encourage us to have much faith in the efficacy of the European Union in making decisions. We should be strengthening the European Union's mechanisms for arriving at decisions, because such situations cannot be repeated again and again.

Lastly, we should have some view about defence needs and defence technologies. In Defending our Future some interesting distinctions were made between defence roles one, two and three. Role One had to do mainly with domestic considerations; the second had to do with the old cold war scenario, and Role Three related to the new emerging and unpredictable dangers that we face.

Subject to the sober warnings given by the noble Baroness, Lady Park, I believe that it is Role Three which will be the most frequent and most demanding, because, if there are to be unpredictable small wars—I do not say far away, but not necessarily in the classic cold war theatre—that will require a different kind of defence force from what we were used to at the height of the cold war. If that is so, how will we change direction from the classic confrontational nuclear war situation to one where we suddenly need 1,000 men here or 2,000 men there? They may need to be flown quickly to Afghanistan, China or somewhere else. A defence review should consider those three factors—defence technology and resources, economic resources and foreign policy—together. Only if we have such a defence review will we have an efficient and credible defence force.

7.36 p.m.

Lord Lyell

My Lords, we are all grateful to the noble Lord, Lord Williams, for putting down this Motion which gives us the chance to put one or two questions to my noble friend the Minister. My interest was aroused when I wondered what the review might contain. I am astonished that there have been only four since the Second World War. My thoughts fall into four slots, most of which have been covered this evening. Perhaps I may go over some of those slots.

The first relates to NATO. My noble friend gave an excellent review of NATO, but I continue to look at what is the perceived existing threat which NATO could contain and how far the boundaries of NATO should be set. Should they perhaps include Poland, Belarus or other member states of what was the Soviet Union? Secondly, what will that organisation become? It has evolved considerably in the 45 years since it was set up. What should its area of development be, particularly in relation to my noble friend's responsibilities? Is the existing balance of NATO correct? Is it flexible enough to cope with a possible conflict, whatever form it might take and wherever it might break out—in its existing area or the area which might develop?

My second slot when considering defence is of course Northern Ireland. Your Lordships may be aware that I returned with my noble friend Lord Ironside from what was called a tri-service operation. Northern Ireland is a successful tri-service operation. It is mainly an Army operation in support of the RUC, but of course there is enormous support for all the security forces from the RAF and there is an important role for the Royal Navy.

We hear a great deal about peace initiatives and other political developments, but I remember the motto of the Boy Scouts, "Be prepared". The British Army is prepared day by day to respond to new developments, and it is known for the enormous tact and discipline it uses in its operations. It has been doing that for over 25 years. Let us not forget that the number of fatalities in Northern Ireland amounts to a full House of Commons. At Question Time your Lordships have been told how many men and women of the RUC have died in action. Any consideration of defence should take account of the politics and the possibility of the fluctuation of numbers in Northern Ireland.

My third slot is Bosnia and the Balkans. General Sir Michael Rose has been quoted as saying that it would be helpful to have more British Army support. That is flattering, but is it possible? The noble Lord, Lord Mayhew, referred to the Falklands and perhaps some of our views on Bosnia and the Balkans are the same. Wherever one looks at multi-service operations, one returns to the word "overstretch". It relates not only to the Royal Navy but to the Army and the Royal Air Force. We have only to look at what the Royal Air Force is attempting to do over Bosnia and the Balkans, which is placing considerable demands upon it.

My noble friend Lord Ironside and other noble Lords gave details of our recent visit to the British forces in the Falkland Islands. The British defence forces in the Falklands have first-class equipment. There is a first-class commitment from the headquarters and the commanders through all levels. Above all, they have first-class personnel. All personnel, even those in what appear to be non-combat areas, are aware of the potential threat and are ready to react.

Everywhere I went I spoke to all ranks and was constantly asked in a friendly way about the uncertainty of the general role for the defence forces. I believe that is in my noble friend's mind and that he will consider it tonight. I say without hesitation that we are extremely lucky to have the finest men and women serving in our defence forces all around the world. They have been in Northern Ireland for more than 25 years. They are able to respond quickly and superbly in. Bosnia and, above all, as we have seen, in the Falkland Islands. The 2,300 men and women in the Falkland Islands have enormous ability. To see them puts a spring into my step and into the steps of all noble Lords who have visited there. They have an enormous spring in their own steps. When I think of all our servicemen I am reminded of the great poem: Oh, it's Tommy this, an' Tommy that, an' 'Tommy, go away'; But it's 'Thank you, Mister Atkins,' when the band begins to play". To all those who are represented by Tommy, whoever they are and wherever they serve, I wish to say that we in your Lordships' House thank them. I hope that as a result of Options for Change there will still be bands to play and not tinkling music.

7.43 p.m.

Lord Kagan

My Lords, the most important lesson to be learnt in the past five years is that the Soviet Union as a military power collapsed without a shot being fired. It collapsed from within. As the noble Baroness, Lady Park, pointed out so succinctly, the Russians have taken the lesson. We are seeing chapter 1.

On 23rd April 1985 we had a similar debate in this House. It was then apparent that Russia was heading for a Napoleonic solution; not for democracy. They did not want Stalinist tyranny, but certainly firm government. Throughout the Gorbachev and Yeltsin eras almost everything in the Soviet Union was criticised and discredited—the apparatchiks, the nomenklatura and the management. However, the army was not criticised. The army was a proud and self-confident spine in Russia. Apart from the Mafia, it is the only one which still exists. The army decided to stand back and to watch what was happening. Our foreign policy of trying to force democracy down Soviet throats in huge doses was misguided. In fact, if someone had wanted to set up an exercise to discredit democracy the events in Russia would have been ideal.

When Moses took the Jews out of Egypt and into the promised land after they had been in slavery for 300 years he decided to stop at the desert and to wait for 40 years; that is two generations. He did so because he considered that they were not fit to go into the promised land—it had to be the third generation. We should have known that what Moses could not do Gorbachev could not do. Free men are bred, not appointed.

The people who are learning the lesson are those in the Soviet high command. They are standing back and watching. Instead of democracy bringing freedom to Russia it has brought anarchy. If any proof is needed that democracy is not the best form, one has only to look at the markets where professors and highly placed people sell their goods in order to eat at night. The Soviet high command is waiting not to usurp power and not to carry out a coup but to be called in to restore order and, let us not forget it, dignity. The Russians never had economic wealth but they had pride and patriotism, which linger deeply in the system.

How Russia will go about that is simple. More than 100 years ago it was Bismarck's dream in an ideal world to have German science, organisation and technology, coupled with Russian resources, raw materials and labour, which was willing to work and easily managed. That has been German policy for a long time. All we have to do is to remind ourselves that when Stalin in his purges had to remove his Minister who was handling the defence forces of Siberia, the man who was executed had a truly Russian name; it was Marshall Blucher.

The only hiccup was that Hitler tried to achieve that goal through rape. The present generation in Germany will do it through seduction. But the rebuilding of Russia is taking place right now. The only nation which can trade profitably and can get paid—and it is being paid because it is easy through barter—is Germany. Of the total help that has reached Russia in the past four years the Germans have given 40 per cent. more than everyone else combined. As regards anti-German feeling in Russia, you can forget it. Any Russian who can work in a German joint venture factory and be paid in soap, razor blades and the like is part of the aristocracy in Russia.

We are now seeing the Russian economy being rebuilt with the help of the Germans. America is looking benevolently on. It does not dislike the idea because it wants to see a strong continent from the Japanese and Asian borders right down to the Rhine. That is the real situation now. It affects us. We cannot see it very clearly as yet but the threat which faces us is not a military threat. The threat is posed because we have neglected our economy and we have not learnt the lesson which the Russian high command has learnt—that military power without a sound economic base is useless. I thank your Lordships.

7.50 p.m.

Lord Kennet

My Lords, I put down my name to speak in this debate but I am afraid that it did not find its way onto the list. I believe that the speakers to follow me have been informed of that fact.

A Treasury-dominated review of defence makes no sense—

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

My Lords, I am sure that the noble Lord would not wish in any way to impugn the services that all noble Lords receive from the Chief Whip's Office. I draw the noble Lord's attention to the fact that the deadline for putting down his name to speak is 12 noon. There is no clear indication that the noble Lord did that before 12 noon. Having said that, we greatly look forward to what the noble Lord has to say.

Lord Kennet

My Lords, a Treasury-dominated review of defence makes no sense, as many noble Lords have pointed out. "Value for money" is all right when "money" is what you start with and "value" is what you want. It is when you start with value and try to spend less on it that things go wrong. Is the Treasury really asking that RAF aircrew should be deprived of RAF maintenance services? The trust that fighting people place on their maintenance people is something that accountants do not necessarily know about. The Minister must know that privatising maintenance of the equipment on which lives depend would show that the Government do not have a clue about how the forces tick.

Mr. Rifkind has in recent months made three speeches in which he has set out his views on the wider ranges of defence. In those speeches he unexpectedly drew attention to the paradoxical situation in which this country defends its own possession of nuclear weapons, and their war-preventing role in Europe, and at the same time harps on the need to prevent nuclear proliferation elsewhere. As he winningly put it: in terms of our security interests … nuclear weapons could be said to be simultaneously part of the solution and part of the problem". Indeed. And I think we should all greatly welcome his remarks about "removing the motivation to proliferate". That is an argument that I have frequently advanced in this House.

We could have welcomed them even more if, in mentioning Iraq, he had not implied that it was Iraq which had introduced a: new and particularly dangerous destabilising factor [into an] already unstable region". It was, on the contrary, Israel's nuclear weapon programme, and Israel's attack on a reactor in Iraq, that motivated the Iraqi nuclear weapon programme. And of course, other states in the region, which have signed the non-proliferation treaty have explicitly refused to sign the other conventions banning weapons of mass destruction because of Israel's nuclear weapons.

On that whole subject, I have received more than my share of the new-type parliamentary Answers. But in this case it has not been the British national interest or even the convenience of British Ministers that was served by economy with the truth: it was rather the convenience of successive United States Administrations, who have all been in such a twist over Israeli nuclear proliferation. Now if the Government do really hope to "achieve universal membership" of the NPT in 1995, Israel's nuclear weapons have to be addressed. Perhaps the Minister can at last tell us whether they are going to do that and, if so, how.

Anti-ballistic missile missiles are part of the nuclear equation. Mr. Rifkind has announced that he is conducting a two-year national programme of pre-feasibility studies". Let us look around. Israel of course has a United States-funded ABM programme. The United States has been trying to perivade South Korea to buy patriot missiles. Those are the ones that did not down Iraqi Scuds during the second Gulf war. Clearly United States pressure is on.

What is wrong with ABMs is that the message to the other side is, "We can attack you, and you cannot retaliate because we are protected." This message is bad for mutual deterrence, bad for war-prevention, bad for arms control, and bad for stability in general. The question is not whether we can in money terms afford them; it is what message they send about our intentions.

Mr. Rifkind has also recognised that certain kinds of capability might have unpredictable and perhaps counter-productive consequences. Yes, I believe that this kind is among them. He has spoken wisely about resurgent nationalism, as we may be seeing it in Russia and elsewhere. His fear was the possibility of a general "renationalisation of defence": of a move away from a commitment to common security towards "purely national policies". Have we not all priced ourselves out of "purely national defence policies"? For the moment the world is still subject to the discipline of plurality, but if we get too hooked in firm alliance structures, we may live to regret it.

I was encouraged by Mr. Rifkind's account of the now permanent British-French joint commission. How is that going?

I conclude by endorsing what my noble friend Lord Williams said. Getting the political possibilities straight is the essential preliminary to any defence review. Will the Minister relate Partnerships for Peace with its relationship with CSCE? It appears to me that that is the prime political necessity in the present political situation.

7.57 p.m.

Lord Bonham-Carter

My Lords, there is really one general conclusion that can be drawn from the debate so far; that is, that the problem confronting any defence or foreign policy—as several noble Lords have said, the two cannot be separated—is the unpredictability of the world in which we live today. We have lived for more than 40 years in a world which was frightening but predictable. We now live in a world to which we are not at all accustomed. It is unpredictable, arid perhaps equally alarming for that very reason.

I say to those who have raised the nightmare of Russian/German collaboration that that is one of the most powerful reasons for the European Community. The idea was to amalgamate Germany within Western Europe so that such a venture could not possibly take place. It is the folly of Euro-sceptics not to recognise that. It is greatly to be deplored that in that area the Government have not made a stronger and more visible commitment. Even the most febrile Euro-sceptic must surely agree that our security and European security depend on European co-operation. That was recognised at Maastricht when it was agreed that the Community should develop a common security policy and that the instrument for that should he the WEU. Events in the former Yugoslavia over the past year indicate, as my noble friend Lord Mackie of Benshie said, how far we must go before that aim is fulfilled. They have demonstrated how weak the European Union is militarily without the backing of the United States and how inadequate is the decision-making process in the European Union in that area.

Its military weakness is insufficiently recognised. As I understand it, the European Union would be hard pressed to deploy three brigades, one of which would be French and one of which would be British. It is extraordinary that the United States, with a population of 250 million, has the military capacity to fight two regional wars simultaneously, whereas the European Union, with a substantially larger population, could not without outside help fight one.

According to the US Congressional Research Service, within the European Union only the British and the French are capable of independent contributions to peace-keeping, peace-making or, indeed, war-making operations. That is largely because most members of the EU depend upon conscript forces. Such forces cannot easily be used outside their own territory; it is an extremely expensive way of producing an efficient army; and experience has shown that peace-keeping —and, still more, peace-making—needs highly trained and highly disciplined forces. Conscript armies, with one year's training, cannot possibly supply that. Hence, if we are to talk seriously about European co-operation in defence, it is desirable that conscription as a means of recruitment is abandoned, as is happening now in Belgium and Holland, and that professional armies should be used.

A second consideration essential to the creation and realisation of a European defence policy is the development of a common procurement policy. If we really want value for money in defence, such a policy is absolutely necessary. It is ludicrous, as I believe I am right in saying, that there should be five different battle tanks within Europe. That means five different sources of spares if action takes place. A common procurement policy would lead to larger orders and cheaper and more efficient weapons.

The European arms agency which was to be set up is still, I believe, under consideration. If such a sensible and rational procurement policy is put in practice, the agency would need a rapid and determined start within WEU, together with a remit to co-ordinate, monitor and promote armament co-operation, arrange joint purchasing and ensure that the whole matter is dealt with more efficiently.

Finally, it is essential that the decision-making process to which many speakers have referred should be improved. We must develop a system for reaching decisions better than that followed over the past few years in Yugoslavia. That decision-making process has followed the formula beloved by the British Government which is called "intergovernmental co-operation". As some of us predicted, it has been exposed as being no way to reach decisions. On the contrary, it is a means of procrastination, and in the end agreement is reached at the lowest common denominator. It was the formula which was practised in the League of Nations before the war.

Moreover, it was a consequence of watching the process lead to procrastination in decision-making and agreement being reached at the lowest common denominator that inspired Jean Monnet to create the idea of the European Community. Intergovernmental co-operation can work; but, in point of fact, it only works as it did in NATO where there is a dominating power. Where there is no dominating power, it always leads to indecision, procrastination and agreement at the lowest common denominator.

It is highly relevant that we now confront the matter which is crucial to a properly working and co-operative European security policy. There is not the slightest hope of our developing such a policy unless we do so. If we depend on European governmental co-operation to reach decisions, we can be quite sure that the same old muddle, procrastination and delay will occur which have been so deplorable in our response to the Yugoslavian crisis.

8.4 p.m.

Lord Howell

My Lords, we have had an excellent and timely debate in which all the contributions, even though some of them were not directly addressed to the need for a "defence review", have in fact helped to make out the case for it. I am sure that we are all grateful to my noble friend Lord Williams of Elvel for the scope of his contribution and his initiative in making the debate possible.

At the end of the day, we have to say that the case for a defence review is now irresistible. That fact was demonstrated in the debate, in particular, and most ably, by the noble and gallant Lord, Lord Bramall, who, I am pleased to say, has now returned to the sanctuary of this House from the other place in time to listen to the concluding speeches.

My noble friend drew our attention to the fact that we have had four defence reviews since the war—namely, in 1957, 1965, 1974 and 1981—with, roughly, gaps of about 10 years between each one. However, 13 years have passed since the last one. Not to have a defence review now after 13 years can, in my judgment, only be justified on the grounds of a peaceful, quiescent situation not calling for such an intellectual exercise. As every Member of your Lordships' House knows, nothing could be further from the truth than that as regards today.

As many speakers reminded us, we live in a time of great international turbulence. We are desperate to retain our position in Europe. I am grateful to the noble Lord, Lord Bonham-Carter, for concentrating on that aspect of the matter. I must point out to the Minister that it has been a long time since the Government cut such a disreputable figure in Europe as we are seeing at present. The Foreign Secretary, for whom we have the greatest respect, is forced to go to Europe for party political reasons, and for no other strategical or international reasons, to confront most of our partners in Europe. I also very much agree with the need for us to base our future defence strategy, especially as regards procurement, on a European-led situation.

As I said, we are desperate to retain our position in Europe —or, indeed, we ought to be—and our membership of NATO, which was mentioned during the course of the debate. We are also under pressure to sustain our position on the Security Council and our leadership within the United Nations. Those are major, strategical, political factors. They, alone, require permanent reassessment and relating to the role of our armed forces and to the quality of their equipment.

I have no doubt that the Minister will tell us that the Options for Change review was in fact a substitute for the kind of review that we are now requesting. However, most of us know that that is nonsense, as history subsequent to Options for Change has demonstrated. That may have been the Government's intention, but I believe that Options for Change has proved to be a disastrous exercise so far as concerns our strategic policies; not least because the extended political commitments which the Government have been obliged to accept to maintain all their political ambitions cannot be adequately provided by the size and shape of the armed forces which Options for Change imposed upon us at the behest of 1:he Treasury.

To he fair to the Government—and looking at all those obligations through the other end of the telescope, so to speak—they genuinely wished to commit the country to play a fair part in the humanitarian relief of Bosnia, in the security of the Middle East and in the problems of Northern Ireland and elsewhere; but, taken together, they found that their willingness to undertake such obligations could not be matched by the size of the forces and the funds available to them.

The latest demands of General Rose, to whom we must all pay tribute today for his inspired leadership in Yugoslavia, especially as regards the servicemen serving under him, only illustrate that point, as the noble and gallant Lord, Lord Bramall, pointed out in his speech.

We must have a strategy in which we take on board all these various factors. We need to spend a moment considering the changes which have been imposed upon the forces even since Options for Change was promulgated. We can see at once of course that that was not a defence review, or, if it was, it certainly had many shortcomings. In April 1993 the navy faced a new round of defence cuts which reduced its personnel from 55,000 to 50,000. The army's strength was increased in February last year from 116,000 to 119,000. The RAF faced a reduction from 89,000 to 75,000. A further announcement was made that by 1995 the RAF will be reduced to 70,000. By the end of this year all these further changes will have occurred following on from Options for Change itself.

The changing political scene which we are now witnessing means that we not only need a defence review but one may be excused for thinking, given the state of the world today, that we need a continuing defence review permanently in place reporting to the nation and to Parliament from time to time.

We have had some discussion on the subject of Russia and the farmer Soviet Union. I am sure the House is most grateful to the noble Baroness, Lady Park.. and to my noble friends Lord Desai and Lord Kagan for drawing our attention to the inherent dangers in the situation there. I believe the noble Lord, Lord Lyell, also referred to that matter. When the Government were considering whether to support, or not to support, President Gorbachev—I believe they made an enormous error in that regard which I ought to mention in this House and which brought into power President Yeltsin with all the possibilities of disaster which that holds out for us—they showed they did not understand the old Fabian precept of the evolution of gradualism. It was a terrible mistake to believe that that large totalitarian state could be changed so dramatically into a democratic and capitalist fortress. That was a nonsense and to the great credit of President Gorbachev he understood that one has to go slowly to make haste. He did not receive the support which I believe he was entitled to not only from this Government but also from the United States Government. We must now face up to the resulting situation and review our dispositions accordingly. There are other considerations also, such as the situation in Northern Ireland, which has to be kept constantly under review. That is another matter of great concern, especially as the Government have entered into an arrangement with the Ulster Unionists which I believe will establish a large garrison in Northern Ireland for a long time. We need to consider the future of that situation. The quagmire of Bosnia has been mentioned by many noble Lords on all sides of the House. Also, I agreed entirely with the remarks of my noble friend Lord Jenkins of Putney—I believe this point was referred to by a noble Lord on the Liberal Benches —when he spoke about the difficulties posed by nuclear proliferation.

I cannot understand why the British Government continue to press the United States Government to maintain our testing rights in America. It is quite clear to anyone who has served on the North Atlantic Assembly, as I have, that the United States. Senate and Congress have no intention whatsoever of allowing President Clinton to continue these tests. I have recently been to Washington and I have discussed these matters. There is no evidence that President Clinton would even contemplate continuing the tests. The resolution of the North Atlantic Assembly to welcome a complete nuclear test ban throughout the world was moved by one of the leaders of our delegation, who, of course, sits on the Conservative Benches in another place. He was supported by all the other members of the delegation.

I believe it is necessary to say one or two words about procurement and to ask one or two questions which I believe need to be addressed. In a previous debate on defence in this House I raised the subject of helicopters. We have been repeatedly told that the EH 101 is the most cost effective support helicopter available to us. We accept that but we need to know when the Government will order these remarkable helicopters. We need to know that not only because of the helicopter's military significance but also because of possibilities for trade.

As regards the army, I could not agree more with the judgment of General Sir Martin Farndale when he talked recently about the dangers of the army being "double hatted". He says that the most serious development is the, absence of training above unit level. We no longer have an Army with true capability. This is not an army, it is a gendarmerie". He concludes, The Options plan has been flawed from the start because it was created against financial targets and not operational requirements". That point has been made over and over again in this House.

I must take issue with the noble Lord, Lord Ironside, who I am glad to see has returned to the Chamber. The noble Lord spoke of the Labour Party's policy in words that did not reflect his usual generous approach. I can only say that his statements—we strongly regret that he made those statements—show his ignorance not only of present Labour Party policy but also of the history of the Labour Party in respect of defence matters—for example, the legacy of Hugh Gaitskell. Some noble Lords on both sides of the House who are present today will remember that. I should remind the noble Lord,

Lord Ironside,

that NATO was largely a creature of Earl Attlee and Ernest Bevin when, in co-operation with General Marshall after the war, they helped to create this security system which has stood the test of time. That ought to be a consideration in the mind of the noble Lord when he makes judgments about policy on these matters.

As I have said, there is an overwhelming case for a thoroughgoing defence review that is conducted with absolute integrity. It should begin by matching our international foreign policy interests to our defence capability. Thereafter it should determine how those matters can be best met by the Treasury. In conclusion, I must say that we all need to be honest about this matter —the Opposition no less than the Government. If we are to have a genuine defence review against a background of all the problems in the world that we have discussed today, we must face the fact that the results of that defence review will demonstrate to us all that the peace dividend is an illusion and to achieve it might be much more costly than some people think. We must admit the implications of such a defence review. I for one would be prepared to do so.

8.19 p.m.

Viscount Cranborne

My Lords, this has been a short but extremely interesting debate. I, for one, am as delighted as the noble Lord, Lord Howell, that the noble Lord, Lord Williams, felt that defence was a sufficiently important subject for him to raise it in Opposition time, however briefly.

A number of your Lordships have used the opportunity to raise points of interest and importance in the context of the question posed by the noble Lord, Lord Williams, as to whether we should institute a defence review. As all too often in your Lordships' House, time will prevent my answering all the points made. I hope that noble Lords will forgive me and will allow me to write to them instead.

Perhaps I may begin by addressing the questions that a number of noble Lords—and particularly noble friends—raised about the situation in the Falkland Islands. I was delighted to hear that your Lordships felt that the visit had been such a success. I say to the noble Viscount, Lord Waverley, that defence of British territory, which includes the Falkland Islands, is a first priority of Her Majesty's Government's defence policy. I hope that that reassures him. I wish to reassure too my noble friends Lord Ironside and Lord Torrington that military force levels are maintained and will continue to be maintained at a level necessary to safeguard the defence of the islands, including the other South Atlantic dependencies. Perhaps I may also reassure my noble friend Lord Torrington that we certainly have no intention of pursuing his outrageous suggestion and there is no possibility that we might be tempted to produce a unified defence force and amalgamate the three services.

The noble Lord, Lord Mayhew, and the noble Viscount, Lord Waverley, mentioned the question of oil. Rather than bore the House more than I usually do, I ask your Lordships to refer to the report of the proceedings in this Chamber on 9th February when your Lordships debated the dependent territories and I was able to emphasise a number of matters in the context of the subject which the noble Lord, Lord Mayhew, raised. I said, at col. 1600 of Hansard, that we understand the advantages of co-operation with the Argentines. I repeated our undertaking that the door to co-operation remains open and that we should like to think that that is a realistic and attractive possibility. So far as I know the situation has not changed since 9th February. I hope that that provides some reassurance to the noble Lord, Lord Mayhew.

Lord Mayhew

My Lords, is the noble Viscount aware that the Argentine Government are extremely offended that the British Government refuse to co-operate in the matter of seismic exploration?

Viscount Cranborne

My Lords, with his knowledge of these matters, the noble Lord, Lord Mayhew, will also be aware that no oil has yet been discovered in the Falklands and that the arguments may yet be academic. Let us wait at least until we are talking about something other than a hypothetical situation.

Before I return to the main point at issue, I should also like to say to the noble Lord, Lord Mayhew, in relation to the review of the terms and conditions of service which has been announced, that there will be a very strong military input into that review, for all the reasons that he gave and with which I wholly agree.

Perhaps I may now turn to the nub of the question. As Professor Joad might have said, it all depends what one means by a defence review. I hope that the noble Lord, Lord Williams, will not think me impertinent if I say that I was enormously impressed by the clarity and economy of phrase with which he put his case. I hope that I shall be able to address what he said with the same seriousness.

The noble Lord said that Her Majesty's Government lacked a clear rationale for the size and structure of our Armed Forces. I wonder whether the noble Lord could have meant entirely what he seemed to imply or whether he has entirely appreciated what we have been doing in the UK defence effort since 1990. I know that the noble Lord is a fair man who studies his subject with care. He will therefore remember that in last year's White Paper, rather catchily entitled Defending Our Future, we showed that we have a sustainable set of commitments drawn up in line with our international obligations. Those commitments are supported by an effective force structure to enable us to meet them.

Indeed, that useful and important document goes further. It sets out the three roles we see for defence. I would say to the noble Lord, Lord Desai, whose speech was as interesting as his speeches in your Lordships' House always are, that he will see that the defence assets needed for Defence Role Three are virtually identical to the defence assets needed for Defence Role Two. I believe that that is clear from an examination of the celebrated Table 3 of the defence White Paper, which he and I have discussed previously in your Lordships' House.

The document then translates those roles into the list of tasks we have identified as being necessary to carry them out. That is based on the sort of coherent approach and consistency which the noble Earl, Lord Longford, advocated as being a desirable basis for our overseas policy. As the noble Lord, Lord Williams, shakes his head in his charming way, I recommend that noble Lords read the annual Foreign Office report in conjunction with the defence White Paper so that they can judge the justice of that assertion for themselves. That would include the dangers of proliferation, to which the noble Lord, Lord Jenkins of Putney, and a number of other noble Lords, including the noble Lord, Lord Howell, alluded. I am all too well aware of those dangers.

I understood the: noble Lord, Lord Williams, to suggest that we should change the basis of our approach to defence and security policies. I hope that the noble Lord will consider what has happened so far since the Berlin Wall came down. I have frequently attempted to set out in your Lordships' House since the last election the considerable progress that we and our allies have made in developing what is known in the trade as security architecture. That becomes increasingly important in the wake of the collapse of the Soviet empire. NATO has always taken first place in that context. Perhaps I can reassure my noble friend Lady Park that that will continue to be so. I am particularly glad that the noble Lord, Lord Howell, recognised the importance of that fact.

The noble Lord, Lord Williams, implied that the WEU., the CSCE and the United Nations all have their roles to play. I wholly agree. It is important that we and our allies ensure that each organisation develops a role that complements the role of the others. I hope that the noble Lord will agree with me that considerable progress has been made in that respect, particularly since the Rome Declaration. Indeed, I say to my noble friend Lord Lye11, who also referred to the matter, that in that way we can hope to erect a security system that is sufficiently strong and flexible to police the complicated and rapidly changing world in which we live.

At the same time, as my noble friend Lady Park never tires of pointing out, we would be extremely unwise to ignore the potential threat that Russia still represents. In that context I listened to what was, if I may say so, a most remarkable speech by the noble Lord, Lord Kagan. The noble Lords, Lord Desai and Lord Williams, emphasised the importance of the future in Russia and what is happening there. Russia still has a massive nuclear and conventional capability—perhaps matched only by that of my noble friend herself. Russia's history over the past few months does not, to put it mildly, inspire complete confidence in her future stability. I am glad to say that that factor was recognised by a number of your Lordships. I say to the noble Lord, Lord Jenkins of Putney, that it is partly for that reason that we judge it wise to maintain a minimum nuclear deterrent as the ultimate guarantee of our security. That is also why we have not reduced our Armed Forces to a lightly armed gendarmerie which would specialise in light peacekeeping operations only.

In the uncertain world to which so many noble Lords referred, to reduce cur existing war fighting capability would be in the highest degree imprudent. I should be disappointed if the noble Lord, Lord Williams, disagreed with that, particularly in view of his own experience as a soldier. Of course, I should ernphasise in this context that I would be the last to argue that my rejection of the gendarmerie option implies that our military posture should remain the same as in the days of the cold war, for the world, as we have repeatedly said, has changed.

The noble Lord, Lord Williams, does not feel, I am sure, in his constant demands for a review, that no change of posture is what is needed. If that is the case, I am sure that he already knows—he has politely listened to what I have had to say in your Lordships' House on many occasions, and, more importantly, he has read at least the last four defence White Papers—that our posture has indeed changed. Our forces are now more mobile, better protected and more flexible than ever before. I suggest that that reflects the unpredictability of our present geo-strategic circumstances in contrast with the more predictable and therefore less demanding static nature of the imperatives of the cold war. I am glad that the noble and gallant Lord, Lord Bramall, hinted at least, despite the clearly critical tone that he adopted, that we are making something of a nod in that direction.

Incidentally, in the context of the arguments of those who favour a reduction in the capabilities of our forces to those of a gendarmerie there is perhaps something else worth remembering. I address the remark in particular to the noble Lord, Lord Mayhew, who has on previous occasions in your Lordships' House referred to the importance of lightly armed UN peacekeeping forces. Those who advocate such a course, as the noble Lord has done from time to time, do so in general because they suppose that the only tasks our own forces will undertake from now on will be UN peacekeeping duties. That, I suggest, is a dangerous, perhaps even courageous, assumption to make for reasons that I have already given. But even if the noble Lord were correct in that assumption—perhaps I am wrong in assuming that that is what he thinks—he may care to ponder one thing. Had our troops in Bosnia not been protected in their role as armoured infantry we certainly would have sustained many more casualties than we have to date in that unhappy theatre. Even peacekeeping operations are beginning to demand troops armed almost as though for a full-scale hot war because of the proliferation of dangers to which many noble Lords have drawn attention.

The noble Lord, Lord Williams, referred to the United Nations, as did the noble and gallant Lord, Lord Bramall. I suggest to your Lordships, as did a number of noble Lords, that the United Kingdom has substantial responsibilities and interests beyond Europe. They reflect historical links and obligations, as noble Lords observed, and our position as a permanent member of the Security Council. The United Kingdom is a substantial power with a developed sense of international responsibility, which, we intend to fulfil.

The call by the noble Lord, Lord Williams, for a defence review may refer to something a little narrower. If he will forgive me, I shall explain what I mean. I refer to a review of the way my department manages defence. That means in particular, as the noble Lord, Lord Mayhew, suggested, the defence costs study which occupies so much of my time and my colleagues' time at present. I agree that all that goes with the defence costs study, and the study itself, was triggered by last year's PES settlement. However, I believe that it would be churlish not to acknowledge that as a result of that study my department has been provided with additional impetus to build on the reforms initiated during the past 15 years of my department's existence.

Noble Lords will be aware of the radical nature of the reforms and the beneficial effects they have already had in delivering value for money in defence. It is already clear that more is possible without reducing our overall defence capabilities. That is clear from some of the earlier results of studies undertaken. I believe that the present work will deliver a smaller and more effective centre, a more coherent relationship between support and front line, and a more satisfying career for servicemen and women, and civilians. Noble Lords may be interested to know that work on the study has now been in hand for over three months and some of our expectations will not disappoint.

In the context of that exercise, your Lordships will be aware that there are powerful advantages in the sheer pace of the operation. I agree with my noble friend Lord Lyell that turbulence and uncertainty are bad for morale. It is important that we arrive at our conclusions speedily and equally quickly communicate them to Parliament and our own employees. As a number of noble Lords observed, they are the finest forces anywhere.

We hope and believe that we shall have made the bulk of our proposals public by July. Some announcements may be possible earlier; I hope that your Lordships will not hold me wholly to that. Meanwhile, there will inevitably be a good deal of speculation in the press, some better informed than others. None of that will prevent our continuing with business which, despite what anyone says, is still financed by the third biggest budget of any government department—over £22,000 million in prospect in 1996–97—with a procurement budget this year of over £8,000 million, which makes us British industry's biggest customer. Perhaps I may say to the noble Lord, Lord Mackie, that air power is extremely important. That is why we are buying Eurofighter. I remind the noble Lord, Lord Bonham-Carter, that it is a collaborative venture with three of our European partners. Perhaps I may also add that joint procurement often risks not being as cost effective as it might, and national pride can often get in the way of that objective being achieved. We must be practical in our approach as well as espousing some of the aspirations that he articulated.

What does the noble Lord, Lord Williams, really mean when he makes his clarion call for a defence review? It may be an unworldly thought—if so, I apologise to the noble Lord in advance—but I cannot help wondering whether he is not using that call at least in part as a figleaf to cover his party's own nakedness in defence policy, or at least its divisions. In that he does at least, I understand, differ from the noble Lord, Lord Mayhew, who will remember that on 15th December last he called a demand for a defence review, a glorious escape route for Opposition spokesmen on defence". I wholly agreed with the noble Lord when he said that. What a pity perhaps that he seems to have changed his mind at least a little this evening. The noble Lord may feel that his party indeed needs that particular "glorious escape route". I understand that the Liberal Democrats expressed somewhat different views in their European policy document Making Europe Workfor Us, published quite soon after the noble Lord used that phrase. There his party called for a defence review and tried to distance itself from its earlier demand in August 1990 for a 50 per cent. cut in defence spending by the end of the century—a distance which the noble Lord, Lord Bonham-Carter, clearly sought to maintain today in remarking on the need for a strong European defence identity.

I understand, too, that the document called for a substantial reshaping of the United Kingdom's armed forces. I can easily see why the noble Lord feels that he needs a "glorious escape route", particularly since, as I have already made clear, the reshaping of our Armed Forces is already happening without the help of either the noble Lord or his colleagues.

Talking of "glorious escape routes", if I may borrow the phrase of the noble Lord, Lord Mayhew—and imitation is the sincerest form of flattery—I can see why the noble Lord, Lord Williams, and his party need one. After all, we should not forget—it is perhaps a vulgarity which noble Lords will allow me for once—that the Labour Party among other things would end the UK's veto on foreign policy in Europe, would cut £7.5 billion from the defence budget—more than any one of our services spends in one year—and is committed by its conference to scrapping Trident. I am delighted that my noble friend Lord Ironside recognised that, despite what the noble Lord, Lord Howell, said in his little trip down memory lane, going back to 1948. Even the noble Lord's honourable friend the shadow Defence Secretary is clearly a little uncomfortable with the last commitment. Like the colleagues of the noble Lord, Lord Mayhew, he has taken the glorious escape route and called for a defence review.

The truth of the matter is—and the noble Lord, Lord Williams, knows it—that a defence review of the kind he advocates is an irrelevance in a swiftly moving world. It takes months to photograph a situation and to devise a solution for the problems that the photograph reveals. By the time that solution is put into effect, the world will have moved on and those undertaking the review—and I am delighted that the noble Lord, Lord Kagan, says "Hear, hear" and agrees with me rather than with his own Front Bench—will be shooting at where the bird was when the photograph was taken, rather than where it is now or might be tomorrow.

The noble Lord, Lord Howell, came somewhere near to acknowledging the justice of my observation when he gave so many examples during his speech of what we have to keep constantly under review in that fast moving situation. How much better to introduce a system that is inherently flexible enough to adapt to a changing world. The noble Lord, Lord Bonham-Carter, emphasised what a changing world it is.

I am only sorry that what seems an obviously sensible approach to Her Majesty's Government does not commend itself to any of the Opposition parties with the occasional single shining exception of the Liberal Democrats' spokesman in your Lordships' House. I believe—if I may again risk being impertinent to the noble Lord, Lord Mayhew—that he has already changed parties once. Perhaps in his mode of 15th December, the time has come for him to change again and to join us on this side of the House, which is clearly where his convictions will eventually lead him.

8.42 p.m.

Lord Williams of Elvel

My Lords, I am grateful to all noble Lords who have taken part in the debate and to the noble Viscount: for his lengthy response, at least until the last five minutes. If he will forgive me, that was a rather childish knockabout. I shall just give him a small lecture on Labour Party policy and its constitution. The Labour Party will fight the next election on the basis of the manifesto which will be agreed, according to the constitution of the Labour Party. by what is known as a Clause 5 meeting. That will be the policy on which the Labour Party will fight the next election and the noble Viscount will have to wait and see what that policy is.

It is as though we are having a dialogue of the deaf. Despite his courtesy in the rest of his speech, I do not believe that the noble Viscount addressed the problems that I and the noble and gallant Lord, Lord Bramall, were addressing. I can not do more than simply lay them on the table; I have done so and the noble and gallant Lord, with all his experience, supported me. That is all I can do; it is all I have sought to do this evening. I beg leave to withdraw my Motion for Papers.

Motion for Papers, by leave, withdrawn.