Helicopter Supply Chain

Defence – in the House of Commons on 15th November 2021.

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Photo of Chris Loder Chris Loder Conservative, West Dorset

What steps his Department is taking to help ensure the resilience of the helicopter supply chain in the UK.

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

We recognise the need to understand and manage risk in our supply chains, including rotary wing, and work closely on this with the defence industry, including through the defence suppliers forum. We are also engaged with the cross-Government global supply chains initiative, which is aimed at improving resilience in public procurement.

Photo of Chris Loder Chris Loder Conservative, West Dorset

I was particularly pleased to learn of Leonardo’s £1 billion investment proposition to provide a great future for the site in Yeovil—where many of my West Dorset constituents work—as a global centre of military excellence. Will my right hon. Friend kindly ensure that we in the UK, and the Leonardo business in particular, will secure more transformational industrial innovation, as he envisaged under the defence and security industrial strategy?

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

Yes. I welcome Leonardo’s investment in West Dorset and in UK manufacturing as a whole. The defence and security industrial strategy will ensure that the UK can continue to have competitive, innovative and world-class defence and security industries. The MOD is investing in emerging technology, utilising the UK’s strong industrial and research base. Through our forward-looking strategic partnerships, we will drive collaboration on cutting-edge information.

Photo of Grahame Morris Grahame Morris Labour, Easington

I do apologise, Mr Speaker: I mean no discourtesy to you or the House but I am afraid I have pulled a muscle in my back and it is terribly painful for me to bob up and down. I draw the House’s attention to my entry in the Register of Members’ Financial Interests and the fact that I am a proud member of and, indeed, chair of the Unite group of Labour MPs.

To follow up on the Secretary of State’s previous answer, he will no doubt be aware that the Yeovil-based Leonardo helicopter-manufacturing facility has prepared a tender for the Puma-replacement contract. Will the Government deliver on their responsibility to support workers in rural communities and protect skilled jobs in the United Kingdom? Will he assure the House that the Puma-replacement contract will be awarded to a UK-based company?

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

The hon. Gentleman will have read the defence and security industrial strategy and, indeed, the reforms to the Treasury Green Book that allow me to put a premium on social value, including in respect of priorities such as levelling up and UK skills. I am determined that we make that clear in many of our interactions with industry. As a member of Unite, the hon. Gentleman will know that Unite represents not just workers at Leonardo in Yeovil but no doubt lots of workers in the aerospace industry in my part of the world up in Lancashire. We have a duty to make sure that we listen to all British workers, wherever they are.

On the new medium-lift helicopter contract, we are expecting a competition and will produce details of that for the House sooner rather than later. We expect the new medium-lift helicopter to come in by 2025.

Photo of Mark Francois Mark Francois Conservative, Rayleigh and Wickford

A fortnight ago, the all-party Public Accounts Committee published the most damning report it has ever produced on MOD procurement, including helicopter procurement. The report concluded:

“To meet the aspirations of the Integrated Review, the Department’s broken system for acquiring military equipment needs an urgent rethink, led by HM Treasury and the Cabinet Office.”

Given that not one of the top 36 MOD procurement programmes—worth £150 billion of taxpayers’ money—is fully on track, who, either at Abbey Wood or on the fifth floor of the MOD, is going to accept personal responsibility? When will the Secretary of State bring in the Cabinet Office to clean up the MOD’s mess?

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

I have read the report and, while it makes some very important points, I am sad to say that it is actually no different from the series of reports that I have read over decades. It is not any worse than some of the ones from 2008 and 2009. There are repeat problems, which is why, in seeking defence reforms, I have been determined to make sure that we get on top of these issues. [Interruption.] I distinctly remember the report that was delivered in 2010, which showed that, in one year under the Labour Administration, they spent £3 billion without even knowing where it was coming from. My right hon. Friend is right that there are lessons to be learned. We will get on it. I would be delighted to meet him to discuss what we think we can do. Many of the programmes referred to not only pre-date me and this ministerial team, but predate my right hon. Friend and his ministerial team and we need to make sure that we get on top of that issue. There are solutions to this, but we must also enforce tight timetables and then we will deliver.

Photo of Chris Evans Chris Evans Shadow Minister (Defence)

It is welcome news for the British aerospace industry that the Government have published a draft plan to buy between 36 and 44 aircraft under their long-awaited New Medium Helicopter acquisition programme. Like other Members on both sides of the House, we, too, could not let this pass without mentioning the National Audit Office report. The Government have been in power for 11 years. They have overseen a Ministry of Defence that has created a black hole of £17 billion. The Defence Secretary has stood here and said that the helicopter will be ready by 2025. Why, given the evidence that the MOD has difficulty in fulfilling its contracts, is he confident that this will happen? How long will it be before the Ministry of Defence takes these NAO reports seriously, and will it take positive action to bring some positivity around procurement contracts?

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

The reason why I am confident about the 2025 timetable is that the expected bidders in the new medium-lift helicopter programme are expected to bid mature products that have been in production not only in the United Kingdom, but in Europe and around the world. The only negotiation would therefore be around European content and European build and all the other factors that are very important to hon. Members. I am pretty confident about 2025, but it does of course depend on what extras the services want to have added on. On the issue of 10 and 20-year programmes, it is, as hon. Members who have served in the Ministry will know, that if we change the plans half way through, we incur costs or delays. That has been part of the problem for many, many decades, but it does not change the fact that defence procurement programmes are decades long, which has a greater impact than if we were just going out there and buying a car.

Photo of Dave Doogan Dave Doogan Shadow SNP Spokesperson (Agriculture and Rural Affairs), Shadow SNP Spokesperson (Manufacturing)

If the defence procurement landscape were a bit more positive, we might have some more confidence in the Secretary of State’s reassurances, but 2025 is not far away. Can he prompt the procurement exercise for the new medium-lift helicopter to replace the ageing Puma fleet, or at least clarify the pedestrian progress of this operational priority to date? Multiple “primes”, including Airbus with its 175M and Leonardo, will be looking to compete for this work as well as US contractors. We need to be able to scrutinise these contractors and their bids sooner rather than later to ensure that, no matter who wins this contract, the economic impact is enjoyed across these islands and not simply, for example, in the south-west of England.

Photo of Ben Wallace Ben Wallace The Secretary of State for Defence

I hear what the hon. Gentleman says. He will know from the shipbuilding industry in Scotland that there is a huge benefit for shipbuilding in Govan, Scotstoun and Rosyth. I am very keen to make sure that all the prosperity of the defence pound is spread around the United Kingdom. Lots of jobs are attached to all different types of projects whether they are “primes” or supporting contracts through things such as radar and sonar.