Global Combat Air Programme Treaty

I welcome the Defence Secretary to the Dispatch Box.

Thank you for that warm welcome, Mr Speaker. With permission I would like to share details of the treaty that I signed with my Japanese and Italian counterparts last Thursday.

A year ago, the Prime Ministers of the UK, Japan and Italy agreed to work together on a joint programme to develop a new generation of military combat aircraft. Supersonic and armed with an array of revolutionary new capabilities, our global combat air programme, or GCAP for short, will deliver vital military capability, strengthening and sustaining our combat air sectors, and setting the standard for future combat air. Above all, it will bolster our collective security. The fact is that we are living in a much more dangerous and contested world. Our skies and international airspace are increasingly contested, not least from threats posed by Russia and China. All three treaty countries are already making significant investments in combat air to pursue these lofty ambitions. During recent years, the Ministry of Defence alone has invested £2 billion in UK combat air technology, with a further £600 million from industry to shape the capabilities and develop the necessary skills pipeline to deliver this state-of-the-art aircraft for the future.

Today I am pleased to announce, as an early Christmas present to the House, a major milestone in that programme. On Thursday 14 December in Tokyo, alongside my Italian Defence Minister colleague Guido Crosetto and my Japanese colleague Minister Minoru Kihara, I signed the GCAP treaty. It establishes the legal basis for the formation of a new GCAP international governmental organisation. As everyone seems fond of acronyms, the GIGO—or, as Guido Crosetto told me, the “JIGO”—is now formed. It is with great pleasure that I now confirm that the headquarters of the GIGO will be in the UK.

The GIGO will be responsible for delivering vital military innovation, strengthening our trinational industrial capacity, and getting the most punch out of our pounds, euro and yen. While located in the UK, it will, however, be a partnership of equals, which is why the first chief executive of the new GCAP agency will be from Japan, and the first chief executive officer of the joint venture will be from Italy.

It is worth spending a brief moment reiterating why GCAP is so strategically important. It will immeasurably enhance our freedom of action, ensuring that the RAF has the global reach and cutting-edge capabilities it needs to conduct operations and exercises for decades to come. It will deepen our collaboration with partners in the Euro-Atlantic at a time of increasing instability, and it will also ensure that we remain a key player in the Indo-Pacific theatre, which will only grow in geopolitical influence and importance over decades to come. Indeed, our new treaty already builds upon our existing defence relationships with Japan, complementing the recently signed reciprocal access agreement, which facilitates mutually beneficial defence co-operation, and I was able to speak about that in Japan last week.

I thank the Defence Secretary for his statement this afternoon and for early sight of it.

We welcome the treaty that he signed on behalf of the UK last week with Japan and Italy, and we warmly welcome the decision to locate the GCAP government headquarters in London. The treaty is the latest in the planned steps for developing our tri-nation sixth-generation fighter and weaponry. Ukraine has shown us that some of our strongest allies are in east Asia and the Pacific, and we share with them concern about China’s growing military power and assertiveness in the region. We want to see peace, stability and deterrence strengthened in the Indo-Pacific. GCAP is, like AUKUS, a strategic UK commitment to contribute to that. I know it is welcomed in Washington and Canberra, just like AUKUS.

Most importantly, developing a sixth-generation fighter will ensure that we can continue to safeguard our UK skies and those of our NATO allies for decades to come. It will inspire innovation, strengthen UK industry and keep Britain at the cutting edge of defence technology. The Defence Secretary is right to report that to the House.

Defence industrial collaboration underpinned by treaty is unusual. It is a multi-decade undertaking for this nation. As the Secretary of State says, it should command support across the House, and Ministers should report on it openly and regularly. May I ask him what scope the treaty allows to work with other allies, both at a secondary level and as primary partners? Does article 50 ensure that the export problems with the Typhoon will not be encountered with GCAP? When will he lay the treaty before Parliament for ratification?

This month, the National Audit Office reported on the MOD’s equipment plan. It exposed a £17 billion black hole in Britain’s defence plans and showed that Ministers have lost control of the defence budget. In June, the defence Command Paper reaffirmed that the UK would spend £2 billion on this project “out to 2025”. Will the Secretary of State confirm what funding has been made available for GCAP in the defence budget for 2025 and 2026? In response to a written question, the then procurement Minister, the right hon. and learned Member for Cheltenham (Alex Chalk), told me back in March:

May I start by warmly welcoming the right hon. Gentleman’s welcoming of this treaty signing and the overall programme? As I say, Members on both sides of the House agree that the defence of the realm comes first. In an ever more dangerous world, it is important to have the facilities that a sixth-generation fighter aircraft would bring.

The right hon. Gentleman mentioned that the HQ is coming to London, but I want to put it on record that it is coming to the UK. We have not decided a location for it yet. I think there are 20-plus potential locations, so I would not want to assume that it will be based in London. We are not as London-centric on everything as he may be.

The right hon. Gentleman asked about examples of working internationally previously. It is worth pointing out that the Typhoon was Italian, British, German and Spanish, and it has been a very successful programme. We are used to working with partners, including Italy, which is involved in this programme.

The right hon. Gentleman asked about article 50 export issues. I think his question is born out of a specific concern about German export licences, which we believe are resolvable. Time will tell. On a wider basis, we recognise that such an aircraft can only be truly successful if the market is greater than the UK, Italy and Japan.

The right hon. Gentleman asked about the broader equipment plans, and he mentioned the £16.9 billion programme. There are a number of caveats. Of course, we have seen huge inflation, but at the other end we have also seen a big expansion of the amount of money that is going into our 10-year equipment programme. That number, which was a snapshot in time, was taken before the refresh and takes into account programmes that will and will not happen, so it is not quite as black and white as he presented.

The right hon. Gentleman asked about cost sharing on the programme. That is part of what the process of discussions both on the treaty and on the new GIGO organisation will ascertain. That is because the industrial capacity and capability of each of the three countries is important, as is the intellectual property that will be brought forward. That is part of what that organisation is currently establishing. It cannot be prejudged simply because we are likely to have greater industrial capacity in certain areas relative to other countries. The amount of project ownership will therefore fall on these factors: how much money goes in, the intellectual property and the industrial capacity.

In welcoming this project for a long-term future aircraft, may I ask the Secretary of State whether he agrees that the threat picture that will face it will in large measure depend on the outcome of the conflict between Ukraine and Russia? Can he say anything to the House about the efforts that he and fellow NATO members are making to ensure that Ukraine has some current aircraft with which to defend itself, so as to improve the prospects that will face us when this future aircraft comes into being?

My right hon. Friend is absolutely right to say that air facilities and combat capabilities are essential to Ukraine, as we have seen. That is not just aircraft but unmanned vehicles of all types. That is why this aircraft—it will be known to some in the House as the Tempest, which was the name when we originally set off—will have the facility to fly unmanned. We know that Ukraine has chosen the F-16. We do not fly F-16s, but to persuade the world to give Ukraine aircraft, we offered the first training. That seemed to create a situation where other countries pitched in. We do, of course, help Ukraine in many other ways on unmanned aerial vehicles, some of which perhaps we will not go into here.

I thank the Secretary of State for advance sight his statement. The SNP welcomes this defence co-operation between responsible allies that will be taken forward. The Secretary of State rather brushed away the question from the Labour shadow Secretary of State about the £17 billion black hole in the defence equipment budget. Since the Secretary of State mentioned expansion, will he expand on that? Will he guarantee that other areas in defence spending are not to be sacrificed and that they will get the support that is required? When will he come to the House to detail how that support will be delivered? I will come back to that in a moment.

The Secretary of State talked about the additional market for this equipment. What concerns are there about Saudi Arabia joining the programme and the potential use of future combat aircraft in Yemen? What assessment has been made of the possibility of the programme increasing tensions with China and worsening the situation in the Taiwan strait?

Finally, I want to come back to finance. Can the Secretary of State detail how the UK will adhere to its treaty commitments if the shortfall in the MOD budget increases to £29 billion, as projected?

I should point out again that it is not a shortfall in the budget but a snapshot of a forecast done before the refresh.

That is semantics.

It is not, simply for the reason that the projects in there may or may not go ahead. The largest increase in that budget was to do with the nuclear enterprise, which we all know the hon. Gentleman does not approve of in the first place because he does not want us to have that ultimate security of constant nuclear defence at sea. We are totally committed to that, and will make sure that it always exists.

The hon. Gentleman asked a good question about Saudi or any other country’s engagement. A programme of this nature is of great interest to many other nations. We receive constant inquiries. The Saudis have been partners with us in air combat for many decades—since Margaret Thatcher’s time at this Dispatch Box. We will see how their interest develops. He mentioned Yemen in relation to Saudi Arabia. Surprisingly, he completely failed to mention that Houthis from Yemen have been attacking ships, including the British ship HMS Diamond, which fired down one of their unmanned aerial vehicles this weekend.

The reality, as ever, is that the hon. Gentleman misunderstands the global context. We will back our RAF to have sixth-generation aircraft capable of being the best in the world.

This is a really exciting announcement, and I congratulate the Defence Secretary. As we procure the sixth generation, we will become a leading nation in advancing air capability. Our world has turned a dark corner and has become more angry. It is right that we collaborate internationally—that is the way forward in upgrading our defence posture. He did not mention how many airframes he planned or hoped to build—perhaps that was deliberate. He did mention the F-35B. We originally wanted more than 130 of those, but we might be lucky to get half that. As has been said, the world will look very different in 2035, and we will need more F-35s. Can he confirm how many of those airframes will be procured? I do not apologise for saying this again and again: is it now time to increase our defence budget to 2.5%?

I thank my right hon. Friend for his points. He is right that having a sixth-generation aircraft in our fleet will ensure that we keep ahead. He will know that Typhoons are at four and a half, and the F-35B is a very capable fifth-generation aircraft. Our current plan is to have 48 by 2025, and another 27 after that. For 2035, it is not possible right now to provide an exact number of a sixth-generation aircraft that is yet to be designed and built. As my right hon. Friend the Member for New Forest East (Sir Julian Lewis) pointed out, we do not know quite what the shape of air war will be at the time, particularly with drones, swarms and many other developments. We do know that air combat will continue to be vital in future, and that we will have the best form of air combat available through GCAP.

I thank the Secretary of State for his statement, delivered in his usual “never knowingly undersold” style. I welcome the treaty, but does he agree that if GCAP is to be successful, he must ensure that we have a vibrant manufacturing base in the UK? I do not know if he is aware or whether his officials have briefed him, but following the completion of the Qatari order at BAE Systems at Warton, there is no more manufacturing taking place at that site. What will he do to fill the gap between delivering the development phase of GCAP and the final aircraft?

It is worth pointing out that the Tempest programme, the UK side of GCAP, already employs 3,000 people in this country—I mentioned that £2 billion has been spent so far—and the right hon. Gentleman will be interested to hear that 1,000 of those are apprentices. He asks about a factory run by what is essentially a private business, or rather not Government, in BAE—

No, it’s not!

It is factually true to say that it is a private business. I was going to answer the right hon. Gentleman’s question by saying that he will perhaps be aware that there is further interest in Typhoon around the world. I cannot go into specifics, but I very much hope that it is successful in winning that. As a Government, we will certainly be fully behind that.