Iraq: Defence Industry Contracts — Question

– in the House of Lords at 2:53 pm on 27th April 2009.

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Photo of Lord Astor of Hever Lord Astor of Hever Shadow Minister, Defence, Shadow Minister, Foreign Affairs, Shadow Minister, International Development 2:53 pm, 27th April 2009

To ask Her Majesty's Government what steps they have taken to use contacts between Her Majesty's Armed Forces in Iraq and the Iraqi authorities to support the United Kingdom defence industry in bidding for contracts for the re-equipment of the Iraqi armed forces.

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, support to the United Kingdom defence industry in bidding for contracts for the re-equipment of the Iraqi armed forces is provided by United Kingdom Trade and Investment staff and our defence attaché in Baghdad. Her Majesty's Armed Forces in Iraq are responsible for providing support to the Iraqi security forces and are not involved in equipment procurement issues.

Photo of Lord Astor of Hever Lord Astor of Hever Shadow Minister, Defence, Shadow Minister, Foreign Affairs, Shadow Minister, International Development

My Lords, I am grateful to the Minister for that reply. As a main coalition partner, our Armed Forces have made huge sacrifices in Iraq, yet we have sat back and watched the Americans walk away with one of the biggest rearmament and rebuilding programmes ever seen, leaving us with virtually nothing. What representation does DSO have in Iraq, and with billions of dollars of future sales expected, will it now take a more dynamic official role in promoting British companies there?

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, I appreciate the sentiment expressed by the noble Lord, but he is slightly understating the presence and activity of UK representatives in this matter. None the less, it is the case that there is a clear Iraqi preference to make procurement for its Armed Forces through United States foreign military sales. Indeed, you could say that they are rather dependent on a foreign military sales system because it is easier for them. However, they are making moves towards direct contracts with other countries and we will be encouraging that.

Photo of Baroness Symons of Vernham Dean Baroness Symons of Vernham Dean Labour

My Lords, is not one of the problems the fact that DSO no longer exists and the very specialised work that it undertook is now being undertaken by UKTI? What assessment is being done to look at whether UKTI is as effective as DSO used to be, with the support that it had from the Armed Forces, in promoting British defence companies in the sort of way that the noble Lord's Question implies?

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, I do not think that there is any evidence to suggest that since the transfer of responsibilities and location for DSO there has been any diminution in its work rate or effectiveness. I think that it is actually quite desirable to extend and deepen the expertise of UKTI as a whole in both the defence and the security fields. However, if there is a concern, it is one that I will watch out for with a personal interest.

Photo of Lord Lee of Trafford Lord Lee of Trafford Spokesperson for Defence, Spokesperson for Culture, Media and Sport

My Lords, I gather that the defence industry is grateful for the noble Lord's efforts to include defence equipment in the MoU that is, as I understand it, being negotiated between our Government and the Iraqi Government. However, I have talked with the Defence Manufacturers Association and it believes that there is a particular problem with the translation and language aspect, particularly for our smaller defence-equipment exporting companies. Is there any possibility of reinvolving for mutual benefit the Iraqis who were interpreters for our forces, some of whom were brought out of Iraq?

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, the noble Lord is right that we have included representatives of this sector in many of UKTI's activities. Indeed, on my recent visit to Iraq, I was accompanied in the business delegation that I led by a number of company representatives from this sector. In answer to the noble Lord's specific question on translators, he makes an important and interesting suggestion. I will look into it and I will write to him.

Photo of Lord Hamilton of Epsom Lord Hamilton of Epsom Conservative

My Lords, does the Minister accept that one of the questions always asked by people who might buy British defence equipment is whether it is being used by the British forces? That is why the link between DSO and the Ministry of Defence was so essential in the past. It is very difficult to get that link working when it is in another department.

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, I appreciate the noble Lord's point, and I am sure that the link is an important one. However, the link has not been lost in DSO's movement from the MoD to UKTI. I think that a rather well integrated and seamless operation is still being mounted. I will personally take an interest in this to ensure that that seamless operation is maintained in the future, as it has been in the past.

Photo of Lord James of Blackheath Lord James of Blackheath Conservative

My Lords, can the Minister indicate whether Iraq is a designated area for support from ECGD for any contracts that are won by British companies?

Photo of Lord Mandelson Lord Mandelson Secretary of State, Department for Business, Enterprise & Regulatory Reform, Secretary of State for Business, Enterprise and Regulatory Reform

My Lords, that issue was raised during my business delegation visit to Iraq and I am following it up. There is some resistance in view of the considerable risks involved. However, I think that it would be a great shame if through the absence of ECGD cover we were to lose important commercial opportunities which would be of as great a benefit to the Iraqi people and their commercial objectives as they would be to our businesses in this country.