Defence Equipment

What steps his Department is taking to ensure that British industry can supply the defence equipment needed to meet future threats.

The MOD has been leading work to review our defence and security industrial strategy across Government, and we expect to publish the findings of this work in the spring. In our strategy we are aiming to ensure that we can access the industrial capabilities that we need to meet current and future threats to our national security.

That is good to hear. The national shipbuilding strategy reflects the strategic importance of ship systems and the supply chain that provides them. The Secretary of State will be familiar with the world-beating electric power and propulsion systems produced by General Electric in my constituency of Rugby. Will he confirm that those are considered strategic national assets and that they will be included in the Government’s thinking on the forthcoming fleet solid support ships programme?

I can certainly confirm that I recognise that many of the benefits of naval procurement are seen in the supply chain; General Electric and other systems providers play a hugely important role as part of the UK’s shipbuilding enterprise. I am committed to maximising the benefits to UK industry in all our defence procurement, within the regulations.

The extra funding is welcome and promises an overdue upgrade of Britain’s defence and defence industry. The Secretary of State talks about the rise in capital funding but not the real cut in revenue funding over the next four years. This year’s defence equipment budget is £16.4 billion, of which over half is revenue-based equipment support. How on earth has he agreed to this cut, and how is he going to meet the future threats to this country and fix the black hole in the budget by cutting day-to-day defence spending?

It is great hearing the right hon. Gentleman trying to turn a £16 billion or a £24 billion increase in defence spending into a cut and finding any way, across the budget, to get in the word “cut” so that no doubt at the next election he can claim that somehow we have cut defence spending despite the £24 billion increase over the next four years. We are planning to spend £186 billion on equipment and support between 2018 and 2028. Of course we have to balance revenue spending and capital spending in terms of the resource departmental expenditure limit throughout the process. The reason our Army and our other armed forces are different in size from what they were 20, 30 or 40 years ago is defined not just by the threat but by the equipment we have available. The proportion of our RAF that is unmanned, which will grow, of course means fewer people flying aeroplanes. That is the nature of things. If one looks at the US air force, one will see that pattern over the past 15 to 20 years.

It will be quite easy and perfectly straightforward to try to find the right balance, as long as we are defined by the threat and the ambition we need to meet. Some of the money that we have received—the right hon. Gentleman is absolutely right—is not going to buy new shiny toys in some areas; it is about fixing some of the current problems in infrastructure and so on to ensure that we are more efficient and more productive.

I appreciate the Defence Secretary wanting to downplay the real difficulties he faces, but we were told by his predecessor in 2012 that the black hole has

“been eliminated and the budget is now in balance”.—[Official Report, 14 May 2012; Vol. 545, c. 262.]

Less than a decade later the National Audit Office says that for the fourth year running the equipment plan is unaffordable and the black hole is as high as £17 billion. On the integrated review, where he promises answers to these difficult questions, may I urge him not to repeat the mistakes of past Conservative defence reviews by trying to balance the books off the back of forces personnel, industry investment and equipment support?

Since taking my post as Defence Secretary I have been absolutely determined to ensure that the figures that both we and the Treasury use are absolutely of the highest quality and transparency.

If the right hon. Gentleman reflects on the NAO’s 1998 report, he will see the same systematic problems in the management of the defence budget: phantom efficiency savings that turned out to have already been spent by other people have been a significant problem in defence for 20 to 30 years. It is not just a governing party problem. All of that has meant that when we publicise the integrated review, we will start from a baseline where we can all be transparent about our figures and trust the figures we are putting before it. I will not indulge in fantasy savings or phantom programmes. I will not allow the services to procure equipment that has a balloon payment at the end, in 10 or 20 years’ time, when it becomes somebody else’s problem.

I join the Secretary of State and others in wishing Captain Sir Tom Moore a speedy recovery. He has become a living symbol of the very British spirit that we need to get us through this pandemic, and we all wish him well.

May I press the Government on when the integrated review will be published and warn against suggestions that our infantry might be cut by up to 10,000 personnel? If this pandemic has taught us anything, it is the value of spare capacity and the built-in resilience to deal with the unexpected. With that in mind, I invite the Defence Secretary to look at deploying RFA Argus, our hospital ship currently alongside in Plymouth, and other military assets to assist with the international roll-out of vaccines to developing countries. The UK set an example by stepping forward during the Ebola outbreak, and we should do so once again with covid-19.

I thank my right hon. Friend for his question. HMS Argus has literally just returned from giving assistance in the Caribbean; she has been helping the populations there deal with the initial outbreak and all the problems. She was involved in dealing not only with the covid outbreak, but with security and making sure that the borders and so on were kept from immigration pressures as well.

On the broader issue of the integrated review, I know I have come to this Dispatch Box on a number of occasions to say it was going to be on a certain date. It will be in the spring. Obviously covid has had its effect. The No. 1 priority of the Government is dealing with covid and delivering a covid response. That does not prevent Defence, with a multi-year settlement, from setting out and driving forward, in conjunction with the Foreign Office, a plan to ensure that when the review is launched, everyone will be able to see it. I am determined that it will be done this spring, because it is important not just domestically, but for our international allies to understand the direction of travel on our defence.