With your permission, Mr. Speaker, and that of the House, I wish to make a statement about the multi-rôle combat aircraft.
As the House knows, the Governments of the United Kingdom, the Federal Republic of Germany and Italy agreed last year to enter upon the project definition phase of this project. The results of that phase and subsequent discussions between the partners confirmed the feasibility of developing a twin-seat multi-rôle variable geometry aircraft which would meet the requirements of all three countries.
On coming into office, this Government reviewed this project and concluded that it offered the most effective and economical means of meeting the requirements of the Royal Air Force for replacement aircraft in the strike, reconnaissance and air defence rôles in the later 1970s and the 1980s. We also recognised that the project offered an opportunity for a European collaborative venture of the greatest technical and industrial importance.
We have accordingly made arrangements with our German partners to begin work on the first major development phase of the aircraft. This phase is designed to lead to the flight of the first prototype and will last about three and a half years. A thorough review of progress will be made at the end of one year in the light of the more refined assessments of cost, timescale and performance which will then be available.
The Government of Italy are, in present circumstances, not immediately able to subscribe to these arrangements, but are expected to reach a final decision within the next few weeks. Should the Government of Italy decide not to continue, we have agreed with the Germans to proceed bilaterally. On the assumption that Italy decides to continue, as we hope, expected total requirements of aircraft for all three countries would be about 900 of which our requirement is planned to be between 350 and 400. The costs of the total programme are to be shared according to the relative numbers of aircraft. The estimated cost of the first phase of development, on which we have now agreed, is of the order of £250 million, of which the United Kingdom share would be somewhat less than half.
While welcoming the fact that the Government have confirmed the judgment of their predecessors that this is or can be a first-rate aircraft which will meet the needs of the Royal Air Force, underline the possibilities of international co-operation, and give a great boost to the British aerospace industry, may I ask the right hon. Gentleman whether he would agree that the value of the aircraft depends critically on maintaining the cost and performance as at present planned?
In the light of this, would he assure the House that the review which is due to take place in a year's time will be a thorough one, and that the possibility of further aircraft will be reassessed at that point? Secondly, on the question of Italian participation, while recognising the value of Italian participation as at present planned, may I ask whether the Minister accepts that, were the Italians to reduce their ultimate order for the aircraft substantially, the additional cost of third party participation might not be outweighed by the advantages of the project, and will he bear this in mind before reaching a final decision on Italian participation?
I am grateful to the right hon. Gentleman for his opening remarks. I was anxious to find some part of his defence policy which commanded my full confidence and to bring it to the House as soon as possible. I can assure him that the review which will be undertaken at the end of the first year will indeed be a very thorough one. This is, of course, an extremely expensive project, but, as I have explained, the costs are spread over a great number of years, and this aircraft is intended to meet Royal Air Force requirements for strike and reconnaissance and air defence rôles. I equally accept the point he made about the participation of a third country in the development of this aircraft.
While welcoming the statement my hon. Friend has made this afternoon, may I ask him whether the Government have given the fullest possible thought to ensuring that the basis of the share-out as between the nations in producing this aircraft will be those most capable of doing each appropriate part rather than an egalitarian multi-national basis?
While welcoming the hon. Gentleman's statement, may I ask whether he would say what consideration has been given to the possible attachment of penalty clauses in the event of a breakdown or the review not proving satisfactory at the end of the first year? What arrangements will there be for withdrawal from the arrangements?
Yes. If the programme is not running according to plan there are arrangements for the partners to agree together about steps to be taken to rectify the situation, and it would be open to a partner to withdraw completely.
While welcoming this statement, may I ask my hon. Friend if he can confirm that the operational requirement of this aircraft is more or less exactly the same as that of the TSR 2 some 15 years ago or more and that had we started to produce the TSR 2 we should have had by now sales, instead of just producing the aircraft? Would he consider setting up an inquiry into the reasons why the jigs and tools for the TSR 2 were destroyed by order of the last Government?
Would my hon. Friend consider the fact that the aircraft design leadership is being held by the Germans, who have no experience in this field, while the British have much superior experience? Secondly, would he consider the position where the Americans are being allowed to bid on the equipment for this aircraft on an equal basis with the British, Germans and French?