Mr. Speaker

I draw the attention of the House to the fact that many right hon. and hon. Members wish to take part in the debate. I ask, therefore, for brief contributions today.

4.11 pm
The Minister of State for Defence Procurement (Mr. Geoffrey Pattie)

In opening the second day of the debate, I should like to describe the purpose of our defence procurement effort, some of the equipment programmes currently under way and those planned for the future, and our relations with industry.

This year we shall spend over £7 billion on defence equipment. The proportion of our defence budget that that represents has steadily been increasing and now stands at 46 per cent. That vast sum takes a substantial proportion of the total output of several sectors of British industry, for over 90 per cent. of it is spent with British suppliers. The primary purpose of expenditure on defence equipment is, of course, to satisfy the needs of our armed forces. However, a secondary aim is to ensure the continuing existence of a national defence industrial base that is capable of satisfying those needs both now and in the future. The necessity of sustaining Britain's defence industries was vividly demonstrated last year by the testing requirements of the Falklands campaign and the dedication and versatility shown by our defence contractors in meeting those requirements during that period of crisis. Their contribution to our victory should not be underestimated.

In his speech closing the debate yesterday my hon. Friend the Under-Secretary of State for Defence Procurement spoke about some aspects of conventional equipment for the Royal Navy. I trust that there will be other occasions later in the year when my hon. Friend and I can give the House a more detailed report on all the major equipment programmes for our forces. However, I shall now describe some of the high technology equipment programmes currently under way for the Army and Air Force.

I should first emphasise that our high technology equipment developments are almost invariably a result of collaboration between the defence research establishments, where the fundamental work on a particular defence application will have been carried out, and industry where the high technology elements are incorporated into a particular weapon system. Much defence research is in high technology, and Ministry of Defence establishments have a well-deserved reputation for excellent innovative work. For example, the royal signals and radar establishment at Malvern this year won two Queen's awards for technological achievement—for infra-red detectors and for high resolution X-ray detector crystals—taking its total tally to five awards since 1979.

Whilst research and development in the Ministry of Defence programme is, of course, directed towards defence objectives, the value of defence-inspired technology to industry at large is fully recognised. The Department attaches great importance to securing civil spin-off from defence research whenever possible. In the past, defence research has made major contributions to manufacturing industry in aerospace, consumer electronics — for examply, liquid crystal displays in calculators and digital watches—and engineering. We are always on the lookout for ways in which we can improve and facilitate the process of spin-off. Recently, we invited a wide range of industrialists, financiers, and management consultants to a seminar on spin-off, and we are about to commission a major management consultancy study into how greater benefits can be secured.

Sir Geoffrey Johnson Smith (Wealden)

What my hon. Friend has said sounds very good, and I do not mean to decry it. However, is he aware that there has been criticism about the large proportion of our defence effort, in comparison with other countries, that goes on research and development? How convinced is my hon. Friend that some of that money might be better spent in the civilian area?

Mr. Pattie

I am aware of my hon. Friend's point. It is important for him and the House to appreciate that in the total research and development budget in the last full year of £1.8 billion, about £300 million was devoted to what we would understand as pure research and the other £1.5 billion was project-related. I take my hon. Friend's point, but we are meeting that criticism, which has been justified in the past, by ensuring that industry gets more contracts and is progressively more involved in our research programme.

Returning to the military application of defence research, a good example of the collaboration between research establishments and industry—in this case the royal ordnance factories—is the Challenger tank, fitted with Chobham armour developed at the military vehicles and engineering establishment. Over the next few years four regiments will be equipped with Challenger. I am sure that the House will recall that the first tank was rolled out by ROF Leeds in March this year. To keep pace with the ever-increasing size and quality of Warsaw pact armoured forces, we also have a programme of improvements that will keep both Challenger and Chieftain in the forefront of armoured warfare technology. Thermal imaging is another area where our research establishments—this time RSRE Malvern—have given us a world lead. To improve our night fighting capability—the importance of which was so well demonstrated in the Falklands last year—thermal imaging sights are being developed to fit both Chieftain and Challenger. In addition, thermal imaging night sights are being fitted to our Swingfire and Milan anti-tank guided missiles. That will enable them to be used more effectively at night and in conditions of poor visibility.

The RSRE also played a major role in the development of the Rapier missile system which, together with Blowpipe, provides the Army's integral air defence, the operational effectiveness of which was amply demonstrated in the Falklands campaign. Major improvement programmes are under way to maintain their operational effectiveness in the sophisticated electronic warfare environment to be expected during any conflict in Europe. By the end of next year, all towed Rapier units will have increased immunity to electronic countermeasures, enhanced surveillance radar and improved reliability and maintainability. Within the next year or two years, improvements to the Blowpipe missile and aiming unit should also be in service.

For the Army, I should like to mention some of our plans for new command, control and communications equipment, without which the Army could not function. The battlefield artillery target engagement system —BATES—is expected to enter service in the late 1980s. It is a computer-based system that will enable the artillery to make more effective and efficient use of existing resources by concentrating fire on the highest priority targets.

A prototype system of WAVELL — an automated command and control system that permits rapid handling of tactical intelligence and other data—has undergone successful trials with 1(BR) Corps. The first production contract is expected to be placed shortly. Although the equipment will not be fully into service until later in the decade, the first production deliveries of PTARMIGAN —the new trunk communications network—are expected this year.

For its role on the central front, the Royal Air Force will need an advanced agile fighter aircraft to meet the expected air threat in the central region in the mid-1990s and beyond. To give a sounder base for future decisions on an aircraft for that role, we are participating in the experimental aircraft programme, a joint venture involving both royal aeronautical establishment Farnborough and industry.

Mr. John Wilkinson (Ruislip-Northwood)

Is my hon. Friend saying that the air staff has at long last officially stated a requirement for such an aeroplane? Surely that is the implication of his remarks when he says that the RAF will need such an aircraft.

Mr. Pattie

With respect, that is not the implication of my remarks. It is one thing to say that a need is recognised. That is clearly accepted by the Royal Air Force and by my ministerial colleagues. As my hon. Friend knows, an air staff target and requirement need precise delineation. That has not yet been achieved, but it is currently being worked for.

The experimental aircraft programme will bring together and demonstrate in one aircraft a number of advanced technologies which will be applicable to a variety of future aircraft designs. We are examining carefully with our European partners the potential for the collaborative development and production of a combat aircraft, and discussions so far have been encouraging.

Mr. Churchill (Davyhulme)

Is my hon. Friend aware that this country pioneered carbon fibre technology? I recognise that the Government do not have complete control over contractors, but is it not unacceptable that the prototypes of the agile combat aircraft are being built with Japanese carbon fibre when equivalent fibre is available in this country, which would provide British jobs?

Mr. Pattie

There must be an extremely good reason for that detailed development, and I shall be happy to look into it. I agree that we pioneered carbcn fibre, as we have pioneered so many other things but have not always recouped the benefits. I am grateful to my hon. Friend for drawing that to my attention.

Dr. John Gilbert (Dudley, East)

The urgency of this matter sometimes baffles me. The predecessor to this requirement—the AST403—existed when I arrived at the Ministry of Defence in 1976. Not much has been done in the past seven years. I am glad to have the Minister's assent to that. Is there now agreement within and between the Ministry of Defence and our allies on whether this aircraft should be optimised in the ground attack or air superiority role?

Mr. Pattie

The right hon. Gentleman, having previously done a job closely approximating to mine, will appreciate that there is an element of what one might call moving target about this kind of situation. The latest thinking is that an air-to-air superiority aircraft is envisaged, although such an aeroplane would obviously need to have a satisfactory ground attack capability.

There has been much interest by hon. Members in the choice of defence suppression weapons especially for the Tornado GR1, on which we hope to make an announcement shortly. For the present, there is nothing that I can add to earlier statements; and the subject was, of course, debated only last Wednesday. An anti-radiation missile is only a part, albeit important, of the comprehensive range of enhancements to our offensive support and strike attack aircraft as;ociated with the introduction into service of Tornado GR1, and subsequently, in the late 1980s, the Harrier GR5. We have placed the production order for the JP 233 airfield attack weapon to be carried on Tornado GR1 In addition, we are acquiring an improved version of the BL 755 anti-armour weapon as an interim measure until an advanced "smart" anti-armour weapon, for which studies are under way, is available in the 1990s. Tornado GR1 will carry the Sky Shadow electronic countermeasures pod, and the RAF's remaining Jaguar, Harrier GR3 and Harrier GR5 will be equipped with a radar warning receiver and active ECM equipment.

I should add a word about our experience of Tornado GRI now that it is in service. The RAF is delighted with the aeroplane, which is meeting reliability and performance standards. Nos. 9 and 617 squadrons are already operating with Tornados in the United Kingdom and the first RAF Germany squadron will redeploy to RAF Laarbruch this year. A total of seven Tornado GRI strike attack squadrons and a further Tornado GR1 reconnaissance squadron will eventually 13:, based in RAF Germany. One reconnaissance and two strike-attack squadrons of GR1s, plus aircraft of the Tornado weapons conversion unit will be based in the United Kingdom.

Mr. Robert Atkins: (South Ribble)

I appreciate that my hon. Friend cannot give details, but will he confirm that the Ministry of Defence and the Foreign Office support the proposal to sell Tornado to Oman and to Greece, which is crucial to the development of the export potential of this aeroplane?

Mr. Pattie

I shall deal later with matters of substance relating to sales of defence equipment, but I can give my hon. Friend a simple one-word assurance—yes.

My hon. Friend the Member for Aldershot (Mr. Critchley) asked several questions yesterday about the planned level of defence expenditure. In particular, he asked whether 3 per cent. growth and supplementary funding of Falklands expenditure would be extended beyond 1985–86 and whether growth higher than 3 per cent. would be planned to raise the nuclear threshold. He will not be surprised when I say that he must wait and see. The level of defence expenditure to 1986–87 will be considered in this year's public expenditure review. The issues that he mentioned will be addressed in that review, but clearly I cannot prejudge the outcome.

Several hon. Members, including my hon. Friend the Member for Aldershot, referred to the possible inclusion of the British independent deterrent in the Geneva negotiations on strategic nuclear forces—START. The priority is to achieve a reduction in the large arsenals of the super powers. The United States, with the full support of its allies, has put forward proposals for substantial reductions in missiles and warheads. The Soviet Union, while rejecting the specific proposals, has apparently accepted the concept of reductions.

Although the independent British deterrent represents only a few per cent. of the massive Soviet strategic force, we have not ruled it out of the strategic arms control negotiations. As my right hon. Friend the Secretary of State said yesterday, we have made it clear that if circumstances change and the Soviet threat to the United Kingdom is substantially reduced, we are prepared to review our position. Furthermore, we have made it clear that the British force would be of the minimum size compatible with ensuring a cost-effective deterrent at all times.

Our decision to procure the Trident D5 does not necessarily imply that we intend to deploy the maximum theoretical capability of that force. My right hon. Friend made it clear yesterday that if START led to a substantial breakthrough in the scale of world deployment, the Government would take that into account in deciding our irreducible level of deterrent. At present, however, the priority must be to achieve parity between the two superpowers at substantially reduced levels of strategic forces.

My hon. Friend the Member for Aldershot asked whether the policy of no early first use of nuclear weapons was the best that could be hoped for in Europe. The Government and our NATO allies are constantly seeking to strengthen our conventional forces in Europe as a means of raising the nuclear threshold. We believe that the successful combination of new technology and new tactical concepts holds out considerable potential for progress towards that goal. Although we wish to push back as far as possible the point at which we might have to consider the use of nuclear weapons, we do not think that it would be sensible to adopt a policy of no first use of nuclear weapons.

In deterring war of any kind, NATO must ensure that the Russians do not believe that they could embark on a war in Europe without the risk of an escalation to nuclear war. Their uncertainty makes for effective deterrence. This does not mean that NATO is committed to any decision in principle to use nuclear weapons first at any given stage in a conflict. It simply means that, in the interests of preventing war, it would be wrong to volunteer to renounce the option.

I mentioned earlier that more than 90 per cent. of expenditure on defence equipment is spent with British industry. That does not mean that we operate a "buy British regardless" policy. We buy British when this gives us the best value for money. I should explain what is meant by "value for money" in this context, as this dictates the nature of our relationship with industry. It is not necessarily the same as choosing the cheapest tender. When deciding on the purchase of an item of defence equipment, we take into account not only the initial cost but, as far as we are able to calculate these things, the running costs and spares costs—the so-called through life costs—of the equipment and compare them with those of other options available to meet our requirement. Those calculations are not straightforward. They create problems for items of equipment that might be at the frontiers of technology but we do our best to make as complete and reliable an assessment as possible.

Another deciding factor can be the importance of retaining a British industrial capability in key areas of defence technology. However, our defence firms must maintain and improve competitiveness if we are to keep a strong defence industrial base. The Ministry of Defence has other reasons for being tireless in its search for value for money. Above all, we must counteract what my predecessor, Lord Trenchard, liked to call "the road to absurdity" —the apparently inexorable real increase in cost between one generation of equipment and the next. If nothing were done to mitigate that trend, in about 80 years the entire defence budget would be sufficient to purchase just one tactical aircraft.

The measures that we are adopting to tackle the problem were set out in chapter IV of last year's Defence White Paper. They include the closer involvement of industry in our forward planning; encouraging industry to participate in joint ventures with the Ministry of Defence in the development of new equipment; the move away from "cost plus" contracts to fixed price and other incentive arrangements—that involves the inclusion of enforceable contract conditions to maintain discipline on defence contractors and ensure value for money; the enhancement of the sales potential of equipments designed for the United Kingdom services; the eradication of over-sophistication in weapons requirement; the intramural drive to reduce overheads and improve efficiency in our procurement process; and the pursuit of collaboration where appropriate.

Mr. Wilkinson

Why could not the United Kingdom go in for public tendering for major defence equipment contracts as is done in the United States? Surely that would be the best guarantee of value for money and the competitiveness of British industry.

Mr. Pattie

My hon. Friend and I will have to discuss what he means by "public tendering". We invite companies that we have reason to believe have the capability in the relevant area. I do not know of any major example when we have omitted anyone. Where there are competitive possibilities, we get a full range of options, examine them, and invite people to tender.

The programme that I described before my hon. Friend's intervention involves long-term detailed work. Perhaps one example will illustrate the effect that it is having. I shall give that of the EH 101 helicopter, which is intended in due course to replace the Sea Kings currently in service. This aircraft is not now being developed as a purely United Kingdom defence requirement, which would be expensive, but as a joint venture collaborative project between the British and Italian Governments, the Departments of Industry in each country and the two companies involved, Westlands and Agusta. It will primarily be a civil helicopter, with military variants. It is a substantial programme and an interesting example of a new form of collaboration. I am sorry that the hon. Member for Yeovil (Mr. Ashdown) is not here today, as he was less than kind yesterday about the efforts that the Government had made in their dealings with the Italian Government to bring the programme forward. It is exactly on track and there are no problems with it.

We have made great progress with such efforts to achieve better value and enhance the competitiveness of United Kingdom defence industries, but we must continue to search for means to obtain as much of the benefits of competition in defence procurement as we can. We are therefore exploring the further scope that might exist for increasing competition at the concept, feasibility and early development phases of contracts and for increasing competition at the production phase of contracts, including dual sourcing when that would make sound economic sense.

I must emphasise that we are at the early stages of considering such options. The possible benefits to be had from throwing competition open at the production stage to a range of firms which have not all been involved in the development programme have still to be assessed in depth. However, this subject repays detailed examination, and we shall be continuing with the analysis in coming months.

Ministry of Defence civilian staff make an extremely important contribution to our defence effort in research and development and in other roles. Their efforts during the Falklands campaign bear that out. However, just as we are striving for better value for money in our purchases from industry, so we are utterly committed to controlling the running costs of the Ministry of Defence and especially to reducing staff costs. Since the Government took office in 1979 United Kingdom-based Ministry of Defence civilian staff have been reduced by nearly 39,000 to 209,000, and we are well placed to achieve the target of a reduction to 200,000 staff by April 1984.

As part of those economies, and in line with our aim to concentrate resources on our front line and its direct support, we have examined the possibility of contracting out cleaning tasks in nearly all Ministry of Defence establishments. In almost every case it has emerged that contract cleaning would save money. The exceptions are isolated units where the cleaning task does not amount to a full-time job. So far we have approved contracts at 625 establishments, at a saving of more than 5,500 complemented posts and an estimated £11 million per year. The case for contract catering s not so conclusive and we are therefore letting out catering contracts only in a very few cases.

I mentioned earlier the need to enhance the sales potential of British equipment. It is becoming increasingly apparent that the home market, represented by the needs of our own forces, is not sufficient to sustain an adequate defence industrial base. Our ability to orovide the Services with the weapons systems they require and the survival of our defence industries in their present form depend more than ever on a vigorous but responsible defence sales policy. Acknowledging that, the Government and their predecessors have steadfastly supported the sale of defence equipment overseas whenever that is consistent with our wider political, strategic and security interests.

Mr. Mark Fisher (Stoke-on-Trent, Central)

Is the Minister aware that, when answering questions this afternoon about General Matthei's visit here in March, the Foreign Secretary said that General Matthei had met the chief of air staff and discussed the sale of weapons?

Mr. Pattie

I do not think that that has been denied. I have not denied it.

Mr. Tam Dalyell (Linlithgow)

rose—

Mr. Pattie

May I make it clear before I give way to the hon. Gentleman that I have been generous in giving way and that this will be the last time?

Mr. Dalyell

Were arms sales discussed with General Matthei? The hon. Gentleman's answer at Question Time was no.

Mr. Pattie

In conjunction with his hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher), the hon. Member for Linlithgow (Mr. Dalyell) has since written to me and I have given him the answer. I gave a straightforward answer, which is hat we were not discussing arms sales. I am happy to put that on the record.

Mr. Fisher

That is not what the Foreign Secretary said.

Mr. Pattie

I am not aware of what the Foreign Secretary said today, as I was not in the Chamber at the time.

Arms sales arouse strong emotions tut the political and economic arguments speak for themselves. In political terms, we believe that the supply of de fence equipment to friendly nations, often backed by military advice, training and support, underlines our concern for their security, strengthens their ability to resist aggression and helps to protect Western interests. We must also accept, unpalatable as it may be, that a refusal to supply arms often opens the door to another supplier who is hostile to Western interests and hence undermines our influence.

I must emphasise however, that defence sales are made within a policy framework laid down by the Government which takes special account of our security interests, regional balance, human rights considerations and our obligations to the United Nations. Each application for an export licence is considered individually and contentious cases are referred to Ministers before decisions are taken. No equipment is sold to regimes when it is likely to be used for internal repression.

In economic terms, overseas sales play a major role in maintaining the profitability of our defence industries. I am delighted to announce that, yesterday, Western Helicopters, Rolls-Royce and British Aerospace signed contracts for the supply of Sea King helicopters, Gnome engines and Sea Eagle missiles to the Government of India. The equipment we sell overseas consists predominantly of high technology products with a high added value. Hawk and Jaguar aircraft and Rapier missiles have all sold well recently.

It is essential for Britain to maintain an innovative capability in such areas by keeping skilled design and production teams together as a springboard for future industrial development. That can be done only if the production runs are long enough to recoup the substantial investment involved and earn a reasonable level of profits. Since our requirements do not provide the long production runs now needed to secure an adequate return on high technology investment, overseas sales are vital.

Under this Government and their predecessors defence sales have grown steadily. Total receipts are expected to reach £2,400 million in the current financial year compared with £1,500 million in 1981–82. That is a healthy contribution to our balance of payments in a period of recession, accounting for about 3 per cent. of total exports. Opposition Members should also remember that defence sales sustain approximately 154,000 direct and indirect job opportunities in the defence equipment industry and account for 25 per cent. of its total output. Although many of our sales are made to the developing countries, notably in the middle east, it is especially gratifying that we are steadily improving our sales to our major NATO ally, the United States. In this market we measure success by the ratio of defence purchases which each country makes from the other. In 1977 the ratio was 4:1 in favour of the United States, whereas we now assess it to be only 2:1. By any standards that is a significant achievement, which demonstrates that we can succeed in the world's most demanding market place.

In addition to our recent success with the Hawk aircraft, our prospects of selling to the United States the EMI Searchwater radar, nuclear, biological and chemical suits, the 81 mm mortar, more combat support boats and the Marconi ICS3 high frequency communication system are encouraging.

As with the rest of the defence industries, the royal ordnance factories must improve their ability to meet the requirements of overseas customers and compete effectively on the international market. The royal ordnance factories are a unique part of the British defence industries, as they have been in Government hands since their foundation. They have a fine record, but we believe that they will do even better if freed from some of the constraints of operating within the Civil Service and given the means to develop their products and respond to market opportunities.

To that end we intend to introduce legislation this Session to change the status of the royal ordnance factories to enable them to operate in a more commercial environment under the Companies Acts 1948 and 1981. We intend to involve private capital directly either through sale to the private sector, joint venture or flotation of shares. Since last May we have been preparing the royal ordnance factories for this new role as a free-standing commercial undertaking, and we have already set up their own sales arm. A new chairman with wide experience of industry has been appointed and we plan next to transfer the staff and facilities necessary to give them a capability in design, development and applied research.

The royal ordnance factories face a challenging future, but the opportunities are great. I have no doubt that the plans represent by far the best way for them to improve their competitiveness and to succeed in their markets. I am confident that they will thrive in their new environment.

We are very conscious of the contribution that smaller firms in the defence industry can make to a competitive and innovatory defence industry. When we invite firms to tender for defence contracts we take care to include smaller firms for such work as they are qualified to accomplish. Aside from contracts placed at local purchase level by defence establishments, most defence work these days is done through industrial prime contractors rather than direct with smaller subcontractors. Therefore, we actively encourage the major prime contractors to recognise the long-term value of sustaining a thriving and vibrant small firm sector within the British defence industries, and we make it clear to defence subcontractors that it is their responsibility to persuade the prime contractors that they can meet their requirements competitively.

However, I freely recognise that to many firms, not just the small ones, the Ministry of Defence is a daunting labyrinth which the uninitiated enter at their peril. Therefore, I am planning shortly to issue a booklet of guidance to firms — especially small firms, but not limited to them—on how to become defence contractors and whom to contact to find out more about possible defence requirements for their products. In this latter respect we plan to include about 60 useful telephone numbers in the booklet so that firms which wish to know what part of the Ministry's purchasing organisation deals with their products can go straight to the right place.

As I said earlier, the first duty of the defence procurement organisation is to meet the equipment requirements of the armed forces. The constantly escalating threat from the Soviet Union and its allies means that we can never be complacent in that task, but our success in the Falklands campaign demonstrated that our equipment works in practice.

We shall continue to play our role as the centre point of a vibrant defence industrial complex that is an enormously vital part of the national economy, contributing excellent research and development with a commitment to spin-off to civil companies sustaining more than 700,000 jobs and making a significant contribution to our export performance. Hon. Members with contacts in the defence industries will confirm that the Ministry's relations with industry have become better, more harmonious and mutually constructive, which must be good for our forces and for the nation.

However, there is no doubt that, with the increasing complexity of defence equipment and the consequent cost escalations, the task of providing the Services with the kit that they want, when they want it and at a price we can afford, will become ever more difficult. We recognise that, and I have every confidence in assuring the House that we can face the challenge.

4.45 pm
Mr. Kevin McNamara (Kingston upon Hull, North)

The House will look forward to considering in more detail the procurement policies for the services when we return after the recess. We look forward to examining in more detail the Minister's comments this afternoon and some of the facts and figures in the White Paper. However, some of the matters that he mentioned this afternoon are worthy of our attention now.

Unlike Conservative Members, I was not glad to hear about the savings that the Minister said could be made by contracting out cleaning services in military establishments to private firms. In the spring of this year the House annulled the fair wages resolution, which had been introduced to ensure that those who worked in such a service had a proper wage and were not exploited. We all know about the exploitation of unmarried mothers, single parents, and pensioners in the contract cleaning industry. It is no consolation to the House to know that the Government have made a substantial saving at the expense of some of the most underprivileged and vulnerable people in society. Perhaps the Government will tell us whether those savings were made as a result of wage cuts. In the present climate of opinion in the Government, that request will fall largely on deaf ears. However, I must put it clearly on the record that the Opposition deplore the exploitation in the contract cleaning industry and the fact that the Ministry of Defence is profiting from that exploitation.

The Minister mentioned the royal ordnance factories — the House will know that there are famous tank factories in Leeds—and said that private capital would be introduced. How much foreign capital will be allowed in? Will the Government draw up specifications to ensure that they maintain their majority shareholding and that there is no possibility of foreign capital influencing the policies of the royal ordnance factories? Will the proposals mean a change in many of the advantages enjoyed by the present employees within the Civil Service, such as pensions and guaranteed jobs? Those matters will probably be explored in more detail by my hon. Friend the Member for Thurrock (Dr. McDonald) on another occasion, but they are of immediate concern to the Opposition. When we are returned to government, the royal ordnance factories will be taken back into public ownership.

The Minister paid tribute to the work carried out by defence contractors during the Falklands campaign. I join him in paying that tribute, and I pay special tribute to the shipbuilders and boilermakers in Hull, who worked so hard to get the Norland ready for sea but whose firm has now gone bankrupt. I also pay special tribute to the workmen on Tyneside and in the dockyards of the southeast of England, who have lost their jobs. The Government are not concerned with their future, now that they have served their purpose, nor are they concerned about British merchant seamen.

We had enormous difficulties taking ships from trade to form the armada that went to the south Atlantic. The Government should be examining their conscience, not only about the future of the individuals concerned, but about the whole of our defence profile and the enormous cut that has taken place in the Merchant Navy. We have taken ships away from trade and picked up men from unemployment, and once we have used them we cast them aside.

We listened to the Minister of State for Defence Procurement with more interest than we did to the Under-Secretary yesterday—I am sorry that the latter is not in his place. Yesterday, we had a fascinating account of the work of the Controller in a former third sea lord's office. I am sure that we are much the wiser for knowing what is going on there, but the Under-Secretary did not answer any of the points raised in the debate. The hon. Member for Aldershot (Mr. Critchley) has three questions still to be answered, of which the key one is whether the Prime Minister and the Foreign Secretary are to go to Moscow.

The Minister skated quickly over HARM and ALARM and said that he had nothing to add to what was said in a debate last week. That is disappointing, as a fortnight or three weeks ago we were expecting a decision that would resolve this matter. Are we likely to have a decision before the House goes into recess? It is important that people should know this decision. I understand that the Secretary of State for Defence and the Prime Minister are locked in mortal combat with the Chancellor and the Foreign Secretary over the future of this systern. If we are to have the system — I believe we need it — it should be manufactured in this country by British Aerospace, which would ensure jobs and ensure that the frontiers of technology are in our control, that is of the utmost importance.

Yesterday the Under-Secretary made an amazing statement when he replied to a question raised by my hon. Friend the Member for Linlithgow (Mr. Dalyell) concerning a primary jet trainer to replace the Jet Provost. He said: Among the likely contenders could be the Pilatus PC7, which is designed in Switzerland, another trainer aircraft from Brazil, a new design by Fairchild of the United States and the Firecracker, which is produced by Desmond Norman in the Isle of Wight. If a foreign design were chosen, it is likely that the aircraft would be produced under licence in the United Kingdom. —[Official Report, 19 July 1983; Vol. 46, c. 260.] The Minister failed even to mention among the contenders, never mind giving it pride of place, the P164, the new British Aerospace basic trainer, designed in the constituency of the hon. Member for Beverley (Sir P. Wall), in which I declare a marginal constituency interest. It is as though the Government have already written it off, but it is only a few weeks since the draft air staff target 412 was issued. The Minister knows that British Aerospace has been working on the project to replace the Jet Provost for a long time, and it has invested a considerable sum of its own private venture capital. That omission last night was a disgrace. I do not wish to rehearse all the arguments about why British Aerospace should have the order, but if a new basic jet trainer, British designed and built, is bought by the RAF, that will be of tremendous importance.

Mr. Pattie

What it was not possible to say, for lack of time last night, was that the required in-service date for the aeroplane would mean that an existing aeroplane would have to be used. The P164, as the hon. Gentleman will accept, is still only a paper design and has not been realised, whereas all the aircraft specified in my hon. Friend's reply are already in flight.

Mr. McNamara

Why then do we have air staff target 412 if it is not relevant to British Aerospace?

Mr. Pattie

British Aerospace may be one of the companies involved in manufacturing under licence, and it knows that.

Mr. McNamara

The Minister is being bounced again. When I raised this matter last year, the implication was that the replacement for Jet Provost was not of immediate urgency for the RAF. Now, 400 potential jobs each in Brough and Prestwick will not be realised if what the Minister has said is correct and the new British Aerospace design will not be considered by the air staff. We shall lose a large potential export market that has been built up by the Hawk trainer and the Harrier. If the RAF staff buys an aircraft that it can have quickly, off the shelf, ready-made from a foreign country, it will eventually have to be adapted by stretching, or shrinking from the inclusion of equipment and facilities. It will be more difficult to service and less capable of generating exports, and there would be considerable job losses. I am surprised at this decision taken and the announcement made by the Minister.

Sir Patrick Wall (Beverley)

I agree with the hon. Gentleman. Is he aware that representations were made to the Defence Committee by British Aerospace only last year, and it was turned away and told that the Jet Provost would go on for many years and there was no need for any replacement? This is a rather sudden change of view by the Government.

Mr. McNamara

The hon. Gentleman is right. This seems a remarkable and very quick change of view, which is contrary to what the industry expected and the impressions given to the House last spring on this matter.

Mr. Dalyell

No one has taken more interest in Northern Ireland than has my hon. Friend. Has he heard the strong rumours and the talk of manufacturing 150 Brazilian-designed trainers by Short Brothers in Belfast?

Mr. McNamara

I am aware of that strong rumour, but the trouble is that we hear repeated rumours. I am surprised that the RAF, knowing what it would need in this, as it must have, did not go to British Aerospace earlier to give its staff specifications.

The White Paper says in chapter 1: We cannot afford policies based on emotion rather than logic, nor theatrical gestures which would achieve nothing save to weaken our own security. We agree with that 100 per cent.—it is the only part of the White Paper with which we agree. The Government's policies are based on a knee-jerk, unthinking emotional reaction to a threat that is neither as great as they anticipate nor as incapable of resolution as their policies seem to suggest. It is an unthinking harking back to past glories and a keeping up with the Reagans and Andropovs—the nuclear Joneses — in pursuit of the great deterrent of Trident. Trident may be a great theatrical prop, but we shall never see it. In the next few years it will become a nuclear mirage that will never materialise.

It is the Labour party's argument that the pursuit of Trident does three things. It distorts our conventional forces, weakens them and over-extends them. Therefore, it weakens our role in NATO and our ability in the Falklands and adds nothing to the sum of Western security. It gives greater accuracy to kill more people with its number of warheads, and adds not to our security but to the ability of the world as a whole to blow itself up 100 times over if it wants to.

Ignoring for the sake of the argument whether Polaris or Trident should be in either INF or START, the Secretary of State made a remarkable statement in reply to my right hon. Friend the Member for Lewisham, Deptford (Mr. Silkin) in Defence Questions. The Secretary of State said: I thought that I had made it clear that if in the class of weapons systems to which Polaris belongs there was a significant and substantial breakthrough in deployment between the Soviet Union and the United States this country would not stand aside from that decision."—[Official Report, 12 July 1983; Vol. 45, c. 763–4.] One felt, listening to that statement, despite the Prime Minister's previous statements that Trident was "a weapon of last resort," that there were nevertheless circumstances in which Trident might be negotiated away by this Government. In fact, a flexibility of approach was beginning to appear— not much, but some — and an awareness that, if necessary and if the United States and the Soviets were to reach an agreement of their own accord which meant our giving up Trident, the British Government, while perhaps regretting it, would go along with it.

However, yesterday the situation had changed. Yesterday, the Secretary of State was a little more precise than he was the week before. He said: If those negotiations were to lead to a substantial breakthrough, we have made it clear that Britain, in reviewing the future size of its irreducible minimum deterrent, would not stand aside from such a breakthrough. In the intermediate range nuclear weapons talks—". Then the right hon. Member for Plymouth, Devonport (Dr. Owen) intervened, in an endeavour to understand more clearly, and asked what the words "would not stand aside" meant. He went on: is he saying that we would reduce substantially the number of Trident missiles and warheads and that we would be prepared to put the Trident missile system into the negotiations and effectively take it into account in such a substantial reduction of strategic weaponry? The Secretary of State replied: I thought that the right hon. Gentleman would understand". He dodged the question, except that he said it in this way: I thought that the right hon. Gentleman would understand that what I am saying is that, if in the strategic arms reduction talks there were to be a substantial breakthrough in the scale of world deployment, that would be taken into account by the British Government in deciding their own irreducible level of deterrent in the new context that would then exist. I hope that the right hon. Gentleman will welcome that statement. It appears therefore that there are two levels of irreducible minimum—one level if there is agreement, and another if there is not agreement.

What was more significant, and what alarmed Labour Members even more, was when the right hon. Member for Brighton, Pavilion (Mr. Amery) asked: Will my right hon. Friend make it clear that there is an irreducible minimum and that, however much the Soviets and the Americans reduce, we could not go much lower than what is now proposed? The right hon. Gentleman replied: My right hon. Friend will have noticed that the word 'irreducible' is clearly enshrined in my speech." — [Official Report, 19 July 1983; Vol. 46, c. 187–8.] Like "Calais", for our late sovereign Queen Mary, it is probably engraved on his heart.

We are in a difficult and sad position, because we do not know what "irreducible" means. Does it express a determination, as now seems likely, to judge from what the Minister of State said today, that no matter what happens in START, and whatever accords are reached by the United States and the Soviets, the British Government will ignore them and will not give up their independent nuclear deterrent, Trident? Is that what it means? That, I believe, is what the right hon. Member for Pavilion understands it to mean, and it is what I understand it to mean. If that is so, it is a bad day for this country, and it is a bad day for the concept of collective security.

Mr. Churchill

Is the hon. Gentleman incapable of understanding that, to the overwhelming majority of the people of this country who rejected outright one-sided disarmament—the proposition that his party put to the electorate in the general election — it would be unacceptable for us to get rid of our nuclear weapons while tens of thousands of Soviet nuclear warheads remained targeted against this country and against our Allies? Does he not understand that it would be reckless and irresponsible for us to go below an irreducible minimum? I understood from what my right hon. Friend said yesterday that we would certainly be prepared to consider the numbers of warheads to be deployed on the new Trident system, but that we cannot go below one submarine guaranteed on station at any given time.

Mr. McNamara

I am glad to have the hon. Gentleman's interpretation of the words of the Minister of State and the Secretary of State. If he is right, no doubt they will confirm it, but I believe that opinion in this country is dead against our maintaining Trident and against some of the hon. Gentleman's ideas. What we have heard from the hon. Gentleman and what we heard from him during the election campaign is a complete distortion of Labour policies. [HON. MEMBERS: "What are they?"] I shall certainly tell the House what they are all about. I am about to do so, and my hon. Friends know that what I shall put forward will be the pure juice of Socialist defence policy. They have nothing to worry about when they know that I am at the Dispatch Box.

So no matter what the United States and the Soviet Union decide, we shall ignore their decision. That raises enormous problems and makes us question the Government's real defence policy. If that is true, we are embarking not on a collective defence policy but on an insular defence policy, and NATO will be a mere convenience to this Government—to accept or reject its decisions, as the fancy takes them. This insular policy will not be accepted by our American allies, or by our NATO allies.

Underlying the Conservative party's attitude on maintaining our own independent deterrent is a basic distrust of the Americans, a feeling that when the crunch comes they will leave us in the lurch. That is what it is all about. Otherwise, the Government would know that the proper and most effective way for us to play our role in defending Europe and the free world would be to put our money into conventional forces.

Mr. Nigel Forman (Carshalton and Wallington)

rose—

Mr. McNamara

No, I shall not give way. I have given way quite a lot.

That would be a better way to protect the free world than seeking to duplicate what the United States is already doing. There are no circumstances in which this country would want to use this weapon of last resort when the United States also would not want to use it.

Mr. Forman

rose—

Mr. McNamara

I have told the hon. Gentleman that I will not give way. I have given way at least three or four times. The hon. Member for Carshalton and Wallington (Mr. Forman) should stop acting like a yo-yo.

Moreover, I do not believe that we have an independent deterrent, for the reasons that we al.. know, which are connected with its manufacture. If the United States left Europe in the lurch, it would not leave in the hands of the United Kingdom Government a weapon so powerful that its use by that Government could drag the United States willy-nilly into a war that was not of its own making. That is what the Government are suggesting.

If, at any time, we were to launch one of these dread missiles—God forbid that that should happen—nobody in the Kremlin or elsewhere would be wetting a finger and putting it to the wind to see whether it had come from a British or an American submarine. All they will know is that there is a Trident missile coming at them, they will retaliate hither and thither and its source will not matter one little hit. The same argument applies to Polaris. I accept that 100 per cent. That is why we should not have Polaris either and that is why it is the Labour party's policy to negotiate out Polaris in the next five years. When we come to power we shall get rid of Polaris.

The Americans would not allow us to use Trident if they were to desert Europe. There are nc circumstances in which we could use this weapon without United States agreement. Therefore, I see no purpose in having it.

One great argument in favour of unilateral nuclear disarmament that we advanced during the general election—

Dr. Keith Hampson (Leeds, North-West)

Look what happened.

Mr. McNamara

When we advanced it, we did all right. Those people who equivocated cid not do so well.

Dr. Hampson

Not the majority of the British people.

Mr. McNamara

If the hon. Gentleman is going to start talking about majorities I can tell him that the majority of people in this country voted for parties that did not want Trident.

We argued that by maintaining our existing deterrent we were increasing the possibility of the proliferation of those weapons. Although we did not believe that to give up our deterrent would cause other countries to do so immediately, we felt that it would put a strong moral pressure on other countries not to go ahead with manufacture and production of those weapons that they had the capability to produce. The possession of nuclear weapons by the two super-powers alone is a greater guarantee of safety than if Britain, France or China had them.

Now we have decided that we shall only have an irreducible minimum. We are entitled to ask what will happen if the Ayatollah or President Gaddafi felt that he too must have an irreducible minimum. What if President Bignone's Government in Argentina were to decide that they wanted an irreducible minimum, financed by the IMF and supplied with spare parts by our colleagues in the EC? In such circumstances proliferation becomes worse and worse. That is why we believe it to be in the interests of the world to ensure that those terrible weapons remain within the purview and monopoly of the United States and Russia.

Dr. Hampson

And France?

Mr. McNamara

Yes, the French as well.

The Secretary of State's statement yesterday has soured the atmosphere surrounding START and he has also set back the INF talks. The Government are saying that, whatever the result of any international negotiations, they are unwilling to negotiate away Trident or Polaris. They then expect the Russians to negotiate and completely to ignore the British and French deterrents. That is an unreasonable stand to take. They should be included in the discussions that will take place.

What does "an irreducible minimum" mean in terms of warheads, missiles and submarines? The hon. Member for Davyhulme (Mr. Churchill) suggested that, in order to have an irreducible minimum, we wanted one submarine on station, one on standby and one in refit — three submarines in all. How many warheads would we want and how many delivery systems would we require? What is our irreducible minimum? From all the talk about Trident when it was introduced I should have thought that the proposals that were put forward by the Government were already the irreducible minimum. After all, it is "a weapon of last resort", as the Prime Minister says. It is the Doomsday weapon. On the Government's own terms we do not need more than an irreducible minimum. Have we been planning for more than an irreducible minimum? What does all that mean?

The Government, having made polite noises during the election and suggested that if things went well they would put Polaris and Trident into the discussions, in fact meant nothing of the sort, and they have been found out. The Government will stand outside whatever agreements are made in Geneva and will contribute nothing to world disarmament. That will be a sad day for Britain, but that is the Government's present policy—although I do not believe that it will continue.

Economic events in Britain and politics in NATO will force the Secretary of State and the Prime Minister to change their stance. We had our first indication of what is likely to happen last week. No sooner was the Secretary of State recovering from the intoxication caused by the fact that the defence budget will rise from £16 billion to £22 billion by 1987 or 1988 than he was sobered up by a large bucket of cold water from the Chancellor, demanding a cut of £230 million. He had, if we are to believe the press, been bounced by the Chancellor, who I believe is known to his friends as Niglet. What a headline was missed— "Tarzan bounced by Niglet" or "Chancellor mugs Secretary of State". Of course, it has been shrugged off in the Ministry of Defence. It has said that only one job in a hundred will go on a payroll of 500,000. I should have thought that the loss of 5,000 jobs was important, if not to the Minister and his colleagues, at least to the employees involved.

Perhaps the most damning criticism of the Ministry of Defence came the next day, when the various briefings given to the press by the Ministry appeared. A correspondent in The Guardian said: Looked at another way, the cuts amount to no more than five days' expenditure by the Defence Department, an adjustment relatively so small that it is almost too fine for the ministry's contractual machinery to handle. It was almost as though the Chancellor had gone along and put his hand in the petty cash box. The figure of £230 million is 'too fine to handle'. For them, it is something to be ignored and lost but in any other Departments it would have been totted up in terms of hospital beds lost, school teachers unemployed or council houses not built.

Where will the £230 million cut come, and what will happen? Even more important is what it forebodes for November. Will the Chancellor go mugging in the spending Departments again? Will he bounce the Secretary of State, as he and his colleagues complained last week, or will the Chancellor put the boot in and then jump on him? This is a serious matter because we are discussing the Estimates and their likely effect on the economy and on the future equipment and standards of our forces.

Analysts have made two main points about the adequacy of existing funding arrangements. First, they wonder whether the assumptions about the general rate of inflation upon which the cash limits have been made are sound. They suggest that they are very dodgy indeed, particularly as the proposed industrial take-off, on which many of the cash limits were based, has not materialised. Secondly, there is the assumption of the cost of new weaponry. Credit has been given to the rate of inflation in the cost of military hardware. There is at present no evidence that it will come down to the rate that is expected. If that is so, the Government's five-point policy will be considerably at risk. That policy is based upon the nuclear option, United Kingdom protection, NATO maritime, NATO conventional and out-of-area activity. During the next five years, that policy will probably have been underfunded by 10 per cent. to 15 per cent.

Even if the Secretary of State is not bounced again in November — he probably will be — the Government's defence policy will be considerably suspect. There have already been cuts of £230 million. If there are further cuts of £500 million in the autumn, the total will more than cover the cost of the Falklands garrison. Therefore, rather than the Treasury separately funding the cost of the garrison, it will be directly funded from the defence budget, and the contingency fund might never have been raided.

What will the Secretary of State do then? He will begin to flounder. He will try to cut staff and put out work to private industry, thinking that that will save money. He will play with the idea of privatising the Household Cavalry — free rides around the park. He will cut back—

Mr. Richard Holt (Langbaurgh)

Will my hon. Friend give way?

Mr. McNamara

I am flattered to be called the hon. Gentleman's hon. Friend, but I will not give way—

Mr. Holt

Has the hon. Gentleman forgotten the bombing of the Household Cavalry and—

Mr. Deputy Speaker (Mr. Harold Walker)

Order. The hon. Member for Kingston upon Hull, North (Mr. McNamara) is not giving way.

Mr. McNamara

I am well aware of the role played by the Household Cavalry. I am not making a sick joke. I am pointing to the foolishness and defeatism of the Secretary of State's defence policy. He will try to make savings wherever he can. Our conventional forces will become distorted and unbalanced and our allies will begin to worry. He will eventually have to come to the House with a new White Paper.

What the right hon. Gentleman is seeking to carry out cannot be carried by our economy, will not be carried by his colleagues and will not be accepted by the Chancellor of the Exchequer. When that happens, the irreducible minimum will be reduced out of all context. Serious decisions about our nuclear defence policy will then have to be made. There will be enormous pressure on the Government to give up their pretence of maintaining Trident. That will come about not only because of what is happening in Britain, but because the United States Government will eventually want to make a deal with the Soviets. They will ensure that they get their deal despite Britain.

Our European allies will continually worry about the pressure on our NATO commitments. The pressure on the cruise decision and the agitation of the peace movement throughout Europe has forced NATO leaders to recognise that first use and early use of nuclear weapons is not an acceptable policy in the west. It is not accepted either politically or economically.

Mr. Wilkinson

On a point of order, Mr. Deputy Speaker. Mr. Speaker enjoined right hon. and hon. Members to be brief. May I suggest that this vapid filibustering by the hon. Member for Kingston upon Hull, North (Mr. McNamara) verges upon the tedious and repetitious?

Mr. Deputy Speaker

Hon. Members are responsible for the length of their speeches. I am sure that the House recognises that a number of hon. Members are awaiting the opportunity to take part in the debate. I repeat Mr. Speaker's plea for short speeches. However, I repeat that hon. Members are responsible for the length of their speeches. The hon. Gentleman has not raised a point of order.

Mr. McNamara

I am aware of the length of my speech, which will shortly be concluded. If Conservative Members continue to barrack and ask me to give way, which I do as often as possible out of courtesy, that will lengthen the time that I take for my speech—as will having to explain why my speech has taken the time that it has.

Because of the political pressures of NATO, the economic pressures of Britain and the pressure exerted by the United States, we will have to give up Trident as a weapon, and I welcome that.

As I said earlier, the Government's policy is based on emotion. It is lacking in logic. It is filled with theatrical gestures. It achieves nothing but weakening our nation's security and putting the NATO alliance at risk. That being the case, the House should not support either the White Paper or the Estimates.

5.25 pm
Mr. Julian Amery (Brighton, Pavilion)

The speech of the hon. Member for Kingston upon Hull, North (Mr. McNamara) reminded me of a thick sandwich. There was some meat in it, and I shall deal with that first.

My right hon. Friend the Secretary of State quite rightly gave first priority in his speech to NATO. The NATO area covers the land, sea and air approaches to our islands, and long may that continue. However, none of us can be sure that NATO will exist for the 40 or 50 years for which the Trident programme is devised. I am concerned about my right hon. Friend's reference to bringing our independent nuclear programme to the conference table. I do not see how that programmme can be reduced if we take account of any improvements that may be made by the other side. I have always thought that five boats would be better than four, but, accepting that four are enough, I do not think that we can reduce below that.

I do not want to read too much into what was said yesterday, but I want an assurance that what was said was said in concert with our French allies. If it was not, I would feel that there was cause for grave concern.

Mr. John Silkin (Lewisham, Deptford)

The right hon. Gentleman said that NATO might not exist in 40 years and that, therefore, we would need a weapon of ultimate resort. In what circumstances does he envisage us being able to use Trident, even as a deterrent, if that was against the wishes of the United States?

Mr. Amery

I understand that Trident will be under our sole control. The warheads will be manufactured in Britain. I do not see why we would be unable to use it, just as a shotgun bought from a foreign firm can be used against a pheasant if the shotgun owner so wishes.

Mr. Silkin

I am sorry to detain the right hon. Gentleman, but I am sure he understands that this is an important point. The basis of the agreement between Mr. Macmillan and President Kennedy at Nassau in 1961 was that only in the case of supreme national emergency could Britain use Polaris. That condition applies also to Trident. Surely that means that it is for the United States and Britain together to decide what is a supreme national emergency. That implies that the two countries must be in agreement. In those circumstances, I cannot see how it is possible for us to use Trident without the agreement of the United States.

Mr. Amery

The right hon. Gentleman is taking an unduly legalistic attitude. If the weapon is under our control and we think that there is a supreme national emergency, we are free to use it. That was recognised by President Kennedy at Nassau. The decision did not depend on him, and he knew that perfectly well. It is for us to decide what constitutes a supreme national emergency.

I come now to another aspect of the White Paper. A number of us, not least my hon. Friend the Member for Beverley (Sir P. Wall), have been talking for some years of the importance of the threat not to the NATO area, but to the peripheral areas. It is not such a mortal threat immediately as the threat to our island itself, but it is in some ways more tempting to the potential aggressor. He could, for example, risk an attack on the Gulf, with its oil resources, without incurring as great a risk of nuclear war.

The White Paper does not say much about that threat. Let me enlarge on it. There are about 22 divisions of the Red Army on the Iranian border, about 100,000 men in Afghanistan and 40 divisions in the far east. All these forces have associated air power. The Red Navy is in the Indian ocean and increasingly in the Pacific. There are also well established detachments of Soviet forces in Syria, Aden, Vietnam and Cuba, which could rapidly be reinforced. I think we all agree that only the United States can take the lead, with such local allies as it can find, in meeting this threat. It is doing so by sea with the development of the rapid deployment force.

The United Kingdom can make a contribution to meeting the threat, which is directed against vital interests of Britain and the rest of Europe in the middle east, southeast Asia and Africa. We can make a contribution, and to some extent we are already doing so, by associating the United States with us in Diego Garcia, by our possession of the sovereign base areas in Cyprus, by the special relationships that we still have with Oman and some other countries, by naval detachments in the Indian ocean and by the provision of NATO forces, including forces that are based at home, that coud be made available. Ascension Island has already proved valuable to the United States as well as to us, so our facilities on the Falklands may prove not unimportant to the United States in the years ahead. Britain is not the only Western ally that can make a contribution. The French can do quite a bit and they already make a contribution.

I should like an assurance from my hon. Friend the Minister of State that contingency plans for crises that might develop in these areas are discussed between our staffs and those of the United States and France.

The object of planning in NATO and in the outer areas is to deter potential aggressors from starting a war; but we must not forget that war is already being waged on a substantial scale by the Soviet Union against the West. It is war of another sort, but one to which we cannot be indifferent. Important areas are being conquered by the Soviet Union with its own or allied forces. Angola is an obvious example. The Soviet Union has put 20,000 or 30,000 troops into Angola, with a number of East German forces. I think that there are 15,000 Cuban troops in Ethiopia with about 2,000 or 3,000 Soviet troops. It has an enormous army in Afghanistan and it is assisting the Vietnamese in Kampuchea.

The Soviet Union is meeting stiff resistance from the local populations in all the countries to which I have referred and it must be in the interests of the West to give that resistance every possible piece of effective backing to prevent the Soviets from consolidating the gains that they have been making. The Soviet Union has been conducting unprovoked aggression and if it were to succeed in establishing itself in Angola, Ethiopia, Afghanistan and Kampuchea, those countries would surely become launching pads for further Soviet expansionism from Angola to Namibia, from Afghanistan to the Gulf and Pakistan, from Kampuchea to Thailand and from Ethiopia to offensives against Somalia.

Another aspect of the undeclared war is the Soviet Union's support of anti-Western movements. These are not necessarily Marxist or Communist—many of them are not — but they seek to destabilise and overthrow Governments and countries with which the West has important economic or political relations. The Americans are facing this problem in El Salvador. A large section of the PLO appears to be entirely under Syrian and Muscovite influence. SWAPO has always been largely in Russian hands. The Somali rebels that are used by Ethiopia are another case in point.

All these movements receive political support and moral encouragement from the Soviet Union. They receive Soviet training in both military and terrorist operations, and they receive Soviet supplies and equipment and propaganda backing. Of course some of them have their own indigenous reasons for operating as they do, but they are being used and exploited by the Soviet Union across the board.

The Soviet Union's objective is to destabilise countries that are pro-Western and, if the opportunity presents itself, to take them over. It is a creeping process. Each gain becomes a launching pad for the next operation. Aden, for example, became the launching pad for the Soviet Union's operations in North Yemen, Nicaragua becomes the launching pad for El Salvador, Ethiopia for Somalia and Afghanistan for the Gulf.

How should the West respond? Britain has had long experience of these operations and so have other countries. There are pretty clear limits to the extent to which a guerrilla movement can be beaten by the adoption of purely defensive operations. We were able to defeat the guerrilla movement in Malaya with the help of Thailand. The Persians, ourselves supporting the Omanis, did so in the Dhofar. But experience has shown that a guerrilla movement can generally be beaten only if the base from which it operates is destabilised, and its base will usually be found in the neighbouring country.

We need a special operations and political warfare organisation at the interface of foreign policy and defence strategy. Its objective would be to destabilise the other side's base, and, as opportunity came, to roll back its control over Angola, Afghanistan or whatever country it might be.

Our American allies are already active in this area, and quite openly so. The CIA is a powerful organisation; its chief is known to be a member of the cabinet and its operations are freely discussed in Congress, sometimes critically and sometimes encouragingly.

Our French friends have done quite a lot in Africa, and it is well known that they solved the problem of the mosque at Mecca when it was seized by rebel forces.

We in Britain have a long tradition of supporting resistance. That tradition goes back to the Marlborough wars, the Napoleonic wars and Lawrence in the first world war. It was certainly maintained in the second world war, when Britain was the most successful encourager of resistance both in Europe and in the Japanese occupied territories. What is the position now?

The campaigns in Oman and the Falklands showed that our SAS and SBS capability is one of the best in the world; but I suspect that something more is needed. We need an organisation to support resistance similar in character, although not necessarily in size, to the organisation that we had in wartime to sustain resistance in the occupied territories. It is almost taboo to talk about so-called clandestine operations, but I make no apology for raising this in Parliament. As we sit here, a subversive war is going on in the middle east, in Africa, in south-west Asia and in central America. Moscow makes no secret of its support for subversive movements. The Soviet Foreign Minister may talk about non-interference as a principle of Soviet policy, but the Politburo makes it quite clear openly and efficiently that it supports "progressive movements".

I see no reason for us to accept the Soviet doctrine that Soviet gains are irreversible. On the contrary, if we claim to champion the cause of freedom we must proclaim our determination to sustain resistance against tyranny and to do all that we can to recover lost ground.

Several Hon. Members

rose—

Mr. Deputy Speaker

Order. Before I call the right hon. Member for Plymouth, Devonport (Dr. Owen), I must tell him that Mr. Speaker has not selected the amendment that stands in his name and that of his right hon. and hon. Friends, but that it will be in order to discuss the matters contained in the amendment.

5.41 pm
Dr. David Owen (Plymouth, Devonport)

This debate takes place against the background of an extraordinary sequence of events. The Secretary of State for Defence published his White Paper and the ink was barely dry before the Chancellor removed £230 million from the defence Estimates. We are now told that the Cabinet is likely to meet tomorrow to discuss further reductions in defence expenditure. The problem that the Government face is that, even allowing for the 3 per cent. increase in real terms in defence spending, which I support, they already have within that White Paper enough commitments to make it extremely hard to live within that financial constraint.

We already know that the defence budget faces an acute crisis in 1986–87. In that year, the Treasury's acceptance of the NATO commitment to a 3 per cent. increase in defence spending comes up for review. In that year too, the contribution given by the Chancellor in exceptional circumstances for the garrisoning and the replacement of the battle losses of the Falklands comes to an end. There is no doubt that in the present economic circumstances it will be immensely difficult to continue on the present projected defence strategy beyond 1986–87.

What is to be done about this? I must draw attention to what the right hon. Member for Lewisham, Deptford (Mr. Silkin) said yesterday in answer to my intervention. He justified the reduction in defence spending which various parts of his party want—it seems to be a little unclear—on the basis that there had been a fall of 15 per cent. in the gross national product. I do not know where that figure came from but I have studied the gross national product and it has increased in every year under this Government, as indeed it has done under all Governments. Our relative poverty in relation to the European Community is due to the fact that we have expanded our wealth at a much slower rate, but our wealth has increased in every year.

In fact, over the years that were mentioned, rather than a 15 per cent. fall, there was a 37 per cent. increase. The right hon. Gentleman may have been referring to industrial output, which has fallen, but even that has fallen by only 8 per cent. If the right hon. Gentleman is so way out in thinking that there has been a fall in the gross national product of 15 per cent., no wonder his defence policy is in such a mess. It causes us much concern that the principal defence spokesman of the so-called official Opposition can be so far removed from the financial realities of the day that he can project his defence p