PARLIAMENTARY DEBATE
Modernising Defence Programme - 18 December 2018 (Commons/Commons Chamber)
Debate Detail
First, I should put the MDP in context. The 2015 strategic defence and security review was the right plan for defence at the time. The Government put the defence budget on a firmer footing, increasing throughout the life of this Parliament. Defence is much stronger as a result. NATO is growing in strength, and the UK is a leader. More allies are meeting the 2% spending guideline, or have developed plans to do so. We are the second largest defence spender in NATO, one of only a small number of allies to spend 2% of our GDP on defence and to invest 20% of that in upgrading equipment.
We can be proud of what we have achieved since 2015, but we also have to be vigilant. National security challenges have become more complex, intertwined and dangerous since 2015, and those threats are moving much faster than was anticipated. Persistent, aggressive state competition now characterises the international security context. In response to the growing threats, the MDP was launched in January.
In the last year, our armed forces have demonstrated their growing capability, engaged globally, and supported the prosperity of the UK. The Royal Navy has increased its mass and points of presence around the world. We have taken steps to forward-base the Army, enhancing our global posture. The Royal Air Force has continued to innovate, and it celebrated a proud past in RAF 100, marking 100 years since its creation.
Progress has also been made in cyber and space, as the changing character of warfare makes both domains increasingly important. We have reinforced the UK’s position as a leading voice in NATO and on European security. Our armed forces have also led the way for global Britain, tackling our adversaries abroad to protect our security at home, and nurturing enduring relationships with our allies and partners.
Through the work over the past year, the MDP has identified three broad priorities, supported by the additional £1.8 billion invested in defence. First, we will mobilise, making more of what we already have to make our current force more lethal and better able to protect our security. The UK already has a world-leading array of capabilities. We will make the most effective use of them. We will improve the readiness and availability of a range of key defence platforms: major warships, attack submarines, helicopters and a range of intelligence, surveillance, target, acquisition and reconnaissance, or ISTAR, platforms.
We are adjusting our overseas training and deployments to increase our global points of presence, better to support allies and influence adversaries. To improve the combat effectiveness of our force, we will reprioritise the current defence programme to increase weapon stockpiles. We are also accelerating work to assure the resilience of our defence systems and capabilities.
We can mobilise a full spectrum of military, economic and soft power capabilities. Where necessary and appropriate, we will make sure we are able to act independently. We will also enhance efforts with our allies and partners, aligning our plans more closely with them, acting as part of combined formations, developing combined capabilities, and burden sharing. We continue to invest in, and grow, our global network of defence personnel and the education and training we offer in the UK and overseas.
Secondly, we will modernise, embracing new technologies to assure our competitive edge. Our adversaries and competitors are accelerating the development of new capabilities and strategies. We must keep pace and conceive of our joint force as consisting of the five domains of air, land, sea, cyber and space, rather than the traditional three.
We must modernise, targeting priority areas. A major new step will involve the improved Joint Forces Command, which will be in a better position both to allow defence to play a major role in preventing conflict in the future and to improve our cyber operations and capabilities across the armed forces, but also across Government.
This year, Defence’s innovation fund put £20 million towards projects in areas including unmanned air systems, virtual reality training, and enhanced digital communications for the future commando force. The fund will grow to £50 million in the next financial year, increasing the scope, ambition and value of the projects it can support.
We will launch new spearhead innovation programmes that will apply cutting-edge technologies to areas including sub-surface threats to our submarines; our intelligence, surveillance and reconnaissance capability; and command and control in the land environment.
To drive innovation and change through the Department, I am launching a transformation fund. Next year, I will ring-fence £160 million of the MOD’s budget to create the fund, which will be available for innovative new military capabilities. I will look to make a further £340 million available as part of the spending review. This fund will be available for new innovative military capabilities that allow us to stay one step ahead of our adversaries. Together, these and other steps will enable the acceleration of our modernisation plans.
Thirdly, we will transform, radically changing the way we do business in defence. We need to improve markedly the way we run defence. To sustain strategic advantage in a fast-changing world, we must be capable of continuous and timely adaptation. We will embrace modern business practices and establish a culture that nurtures transformation and innovation. We also need to create financial headroom for modernisation. Based on our work to date, we expect to achieve over the next decade the very demanding efficiency targets that we set in 2015, including through investment in a programme of digital transformation. We will develop a comprehensive strategy to improve recruitment and retention of talent, better reflecting the expectations of the modern workforce. We will access more effectively the talents of our whole force across all three services, and regulars, reserves, civil service and industry partners.
Looking ahead, dealing effectively with persistent conflict and competition will increasingly hinge on smarter and better informed long-range strategy. To help to achieve those goals we will establish a permanent net assessment unit, as well as a defence policy board of external experts, to bring challenge to defence policy and strategy. Our achievements under the MDP have made defence stronger. The capability investments and policy approaches set out, with the extra £1.8 billion of defence funding, will help us to keep on track to deliver the right UK defence for the challenging decade ahead.
Without a shadow of a doubt, there is a lot more work to be done as we move towards next year’s spending review. We must sustain this momentum if we are to realise our long-term goals of increasing the lethality, reach and mass of our armed forces. I will do everything in my power to make sure that the UK remains a tier one military power in the decade ahead, and that we continue to deliver the strong defence and security that has been the hallmark of the Government. I commend this statement to the House.
I know that Members will be relieved that the review has finally been published—all 28 pages of it, 10 of which are photos or graphics—some six months after it was originally promised, because we all recognise the growing and diverse threats this country faces. However, given the amount of time it has taken, given the endless reports of the Secretary of State’s rows with various Cabinet colleagues, and given his commitment in the summer that this would lead to
“a major programme of top-down transformative reform”—[Official Report, 19 July 2018; Vol. 645, c. 28WS.],
it is staggering that the end result is so underwhelming. The review does nothing to solve the affordability crisis facing the Ministry of Defence, a crisis that the Secretary of State has completely failed to get to grips with in his year in office.
The Secretary of State promised that the review would not be fiscally neutral. The Minister for Defence Procurement promised that it would
“put UK defence on to an enduringly affordable footing”—[Official Report, 5 November 2018; Vol. 648, c. 44WS.],
but I ask the Secretary of State how can it, when it includes no new money? Despite the £l billion that was announced in the Budget, the MOD’s own figures show that the funding gap in the defence equipment plan alone is somewhere between £7 billion and £15 billion. That leads to a very simple choice: either the Government must come forward with enough additional funds to fill that gap, which the Secretary of State has completely failed to do, or he must be honest about the difficult choices that have to be made.
We know that 84% of the MOD’s funding gap occurs in the next four years. According to the National Audit Office, that means that Ministers must make
“immediate savings decisions rather than relying on longer-term cuts or efficiencies”.
Can the Secretary of State tell us what those decisions are? Which programmes has he decided to defer, de-scope or delete? We all agree with the need to make savings wherever possible, but the MOD’s over-reliance on projected efficiencies which do not materialise has been a persistent problem. Will he accept that sorting the mess in his Department’s budget cannot simply be done through efficiencies?
Turning to the announcement of a transformation fund to develop new and innovative technologies, something one would assume his Department was doing in any case, can the Secretary of State confirm that the £160 million that has been earmarked comes from existing budgets and there will be no new money? What assurances has he received from the Chancellor that the remaining £340 million that is not currently in his budget will in fact be forthcoming?
Personnel are at the very heart of our country’s defences. Last week, the NAO published a damning report on the Army’s recruitment contract with Capita, the latest reminder that this company is failing badly and that MOD is failing abysmally to manage that contract properly. Ministers have made endless promises to take action to deal with this problem, but nothing has been done. Does the Secretary of State accept that it is now time to scrap that contract and take the service back in-house?
The news that the UK will not now be able to participate in the secure aspects of the Galileo programme is immensely concerning, as is the Government’s failure to answer straightforward questions about where the funds for the proposed UK satellite system will come from. In light of that, and with only two sitting days remaining, can the Secretary of State confirm that it is still his intention to publish a space strategy by the end of the year, or is this yet another decision that the Government will be deferring?
On the Labour Benches, we have always accepted the principle of the review. Threats have evolved since 2015 and our response must adapt as well. We recognise the importance of interoperability and burden-sharing with allies to maximise the UK’s defence capability for the future, but at a time when this country faces ever-increasing threats we do not believe that the Department’s affordability crisis can simply be ignored. That is just grossly irresponsible.
The hon. Lady says we put too much emphasis on efficiencies. It is right to expect every Department to look at how it can run things more efficiently. We have achieved 70% of our efficiency target. Over the next 10 years, we hope and believe we can achieve all of our target. We remain positive that that is something we can deliver.
On Galileo, the Department for Business, Energy and Industrial Strategy will be introducing a report in the early part of next year on satellite strategy, but I do not think it makes sense to continue to hand over money to the European Union in terms of a satellite programme that we will not have access to or industrial benefit from. That money can be better spent with other allies in developing our own capabilities.
When the modernising defence programme was announced over a year ago, it was supposed to be a sustainable and affordable defence settlement. It fails on both of those challenges. It is of course welcome that the Secretary of State managed to announce some pots of funding today, but the £1.8 billion he references is only for this year alone. That hardly shows the mark of a sustainable programme. It is also remarkable that he leaps between what he is going to spend and wanting more money from the Chancellor. That shows that the MDP has spectacularly missed the point of why it was initiated in the first place.
After meeting me in March this year, the Secretary of State knows that my party wanted to see a focus on the High North. He knows that we wanted a focus on Scotland’s maritime territory, but both those things are missing from the statement. He has not addressed the £15 billion black hole identified in the equipment plan by the National Audit Office. Of course, he knows that we wanted to see something in the statement about the declining size of the armed forces, but sadly, that was missing as well.
For the longest defence review in the history of his Department, it looks to me as though these conclusions are extremely thin, to be charitable, so will the Secretary of State finally stop storing up problems for the future? Will he make a switch to what we have suggested—multi-year defence agreements, which in fairness, there seems to be a vague nod to in his statement—or is he going to leave it to one of his successors to give our armed forces the certainty that all of them deserve?
“The force structure that emerges from the MDP must be supported by a robust and sustainable financial settlement”.
Can the Secretary of State point sceptics like myself in the direction of the section of the report that he has placed in the Library, so that we can judge for ourselves whether his Department seems likely to deliver the “sustainable and affordable” settlement that he promised a year ago?
Will the Secretary of State set out what his Department is doing, ideally on a multilateral basis, to ensure the ethical use of autonomous and artificial intelligence systems announced in his statement today?
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