Defence and Security Industrial Strategy

Part of the debate – in the House of Commons at 12:49 pm on 23rd March 2021.

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Photo of John Healey John Healey Shadow Secretary of State for Defence 12:49 pm, 23rd March 2021

On this day, when we mark a full year since the country first went into lockdown, may I use this statement to pay tribute to the men and women of the armed forces, who have done so much to help the country through this pandemic? I also pay tribute to the men and women who work in our UK defence sector. They, too, responded rapidly, making personal protective equipment and ventilators, and they play a vital part in designing, producing and maintaining the equipment our forces need.

Labour welcomes the publication of this strategy; indeed, the very use of the term “strategy” is something of a victory in itself. We welcome the confirmation that global competition by default, begun by the White Paper in 2012, has gone; it is high time we put an end to a British Government being just as happy buying abroad as building in Britain. We also welcome the change to naval procurement policy, and we welcome the commitment to invest £6.6 billion in defence research and development over the next four years.

However, there is a question at the heart of this strategy: is this the start of a new era, with the aim not just to make in Britain and maintain in Britain, but to develop now the technologies and companies that we will need in 10 years’ time to procure in Britain? Labour’s determination to see British investment directed first to British industry is fundamental. When done well, that strengthens our UK economy and, as covid has exposed the risks of relying on foreign supply chains, it also has the potential to strengthen our UK sovereignty and our security. We therefore want a higher bar set for any decision to procure Britain’s defence equipment from other countries. Will the Minister state today, in the clearest possible terms, the Government’s commitment to build in Britain? How will this strategy strengthen the UK’s defence resilience by growing our sovereign capacity to replace equipment if it is lost in conflict? What is the strategy to boost Britain’s foundation industries linked to defence, such as steel?

This strategy demands a massive change in mindset in the MOD and the military, which only Ministers can lead, so will the Minister commit to publishing an update on progress, with another oral statement to the House one year from now, not least so that we can judge the Prime Minister’s boast in launching the integrated view that we will open up

“new vistas of economic progress, creating 10,000 jobs every year”—[Official Report, 19 November 2020; Vol. 684, c. 488.]

Let me turn to the money. We welcomed the Prime Minister’s extra £16.5 billion in capital funding after the last decade of decline, and we welcome the detail set out by the Minister today, but 30,000 jobs in the defence industry have gone since 2010, and nearly £420 million in real terms has been cut in defence R&D, so in many UK regions the money promised today will still be well short of what has been taken away over the last decade. With the National Audit Office reporting a black hole in the defence budget of up to £17 billion, and with the permanent secretary telling the Public Accounts Committee that not all is

“going to go on new and revolutionary kit”,

exactly how much of this extra money will be swallowed by the black hole in current programmes?

The MOD’s bad habits run deep. Only three of the MOD’s 30 major projects have a clear Government green light on time and on budget. The Prime Minister told the House:

“We are setting up a unit to ensure that we get value out of this massive package.”—[Official Report, 19 November 2020; Vol. 684, c. 499.]

I have tabled the same set of questions to the Minister twice now about the progress, powers and personnel of this unit, and he has given the same evasive non-answers both times, so now is a good time for him to level with the whole House. Will he admit that there is no unit and no plan for a unit? The Prime Minister was making it up, was he not? The important point is this: without a revolution in the way that the MOD controls procurement costs, we are doomed to see it repeat the mistakes of the past.

Yesterday, the Defence Secretary asked our forces to do more with less. Today, the Minister is asking industry to do more with more. This is a big, one-off opportunity. Ministers have got to get this right. It is no good in two years’ time if the NAO still says that the military equipment plan is unaffordable and still says there is a black hole in the defence budget. Does the Minister accept that the single challenge for the MOD now is delivery, delivery, delivery? On behalf of the British people and British forces, we will hold them hard to account for exactly that.