§ Mr. ButlerTo ask the Secretary of State for Defence when he expects to be able to make an announcement on the future of the Royal Air Force's Hercules fleet.
§ Mr. RifkindThe Government place a high priority on the maintenance of an effective tactical air transport capability and have examined a range of options on this question. Our plans fall into two distinct parts: first, we have an urgent operational requirement to replace and refurbish that part of the Hercules fleet which is nearing the end of its operationally useful life. For this immediate requirement, I have concluded that refurbishment would provide poor value for money.
The Government have accordingly decided to meet the urgent operational requirement of the RAF by purchasing 25 C-130J Hercules II aircraft from the Lockheed Aeronautical Systems, subject to the satisfactory conclusion of a contract. Lockheed has agreed to place contracts to the value of 100 per cent. of the order with United Kingdom companies. At least 10 per cent. of the value of these contracts will be for work directly on the C130J aircraft itself. As a result, some 36 United Kingdom companies will be participating in the production of C130J not only for the RAF's order but also for aircraft supplied to other nations.
Although the FLA is not available to meet this requirement, it is expected to be available to meet the need to replace the balance of the Hercules fleet and other possible air transport requirements. This would lead to a requirement for between 40 and 50 FLA. The United Kingdom will, therefore, rejoin the FLA programme at the end of the feasibility phase provided that it is managed on a commercial basis under the umbrella of the Airbus consortium. Resources will need to be available at the time and our requirements on price and performance must also be met. Commercial management should include United Kingdom firms being given the opportunity to compete in the programme fairly and on merit. A programme of work on FLA has been set in hand with our partners.
This decision will ensure that our urgent operational requirement is met in the most cost effective way, while bringing substantial benefit to United Kingdom industry which will stand to gain from both programmes.