Oral Answers to Questions

Peter Luff Excerpts

Monday 16th July 2012 Commons Chamber

[Priti Patel (Witham) (Con)]

9. What his most recent estimate is of the proportion of defence equipment and support contracts let to small and medium-sized enterprises.

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

During the financial year 2011-12, approximately 41% of new contracts were awarded to small and medium-sized enterprises. That represented approximately 13% of the value of all new contracts placed in the year. A significant proportion of our other business also reaches SMEs from the prime contractors through the supply chain.

[David Rutley]

I welcome the recent announcement that 41% of contracts were awarded to SMEs. They are vital not only to our security, but to the economy. What steps is my hon. Friend taking to fulfil their potential abroad as well as at home?

[Peter Luff]

I am glad to say that I find that SMEs are often particularly energetic in pursuing overseas opportunities. Indeed, many British small defence contractors begin their commercial lives exporting, rather than selling to the domestic market, which is a great tribute to the enterprise they show. UKTI DSO takes enormous steps to help SMEs. It participates in many trade delegations with my hon. Friend the Member for Aldershot (Mr Howarth), the Minister with responsibility for international security strategy. I pay tribute to DSO and to SMEs, which make a great contribution to our economy and to defence.

[Priti Patel]

There are 3,000 SMEs in the UK defence industry, and they are doing great things for our economy and vital work for our defence sector. What is the MOD doing to make Government business more accessible to these SMEs?

[Peter Luff]

My hon. Friend might apply for an Adjournment debate on that topic, because it would test your patience, Mr Speaker, if I were to list all the things we are doing to help SMEs, which include producing simplified standard contracts, making SMEs aware of tendering opportunities, and ensuring they are paid quickly. However, I attach the greatest importance to the establishment of the suppliers’ forum for SMEs, which I chair, and which enables us to pursue in detail both the concerns of SMEs and the issues we have in dealing with them. That is a very fruitful discussion, which is leading to a radical simplification of the way in which we do business with SMEs, and in due course it will create many more opportunities for them.

[Mr Speaker]

I always have patience for orderly answers, but not for speeches masquerading as answers. I know the Minister will readily accept that point.

[Kevin Brennan (Cardiff West) (Lab)]

On defence contracts, will the MOD’s current plans inevitably result in more contracts for companies such as G4S?

[Peter Luff]

That is not my responsibility. I was talking about defence equipment and support contracts, and as far as I am aware—I stand ready to be corrected—G4S has no role in such contracts.

[Jim Shannon (Strangford) (DUP)]

Many SMEs in Northern Ireland are involved merely on the periphery of large MOD contracts. What steps are the Government taking to ensure that there is a fair distribution of defence contracts and fair business opportunities for SMEs in Northern Ireland?

[Peter Luff]

It is one of the sadnesses of the structure of the UK defence industry that defence industries are relatively few and far between in Northern Ireland. Of course, Thales is the prime example of an excellent company doing first-rate work in Northern Ireland; I visited it earlier this year, seeing for myself just how good that company is, and it makes a huge contribution through the supply chain. The small and medium-sized businesses of Northern Ireland can also contribute to other contracts throughout the United Kingdom, and I am sure they are doing so in a realistic and strong way.

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[Graham Jones (Hyndburn) (Lab)]

11. What steps his Department is taking to maintain skills levels in the defence manufacturing industry.

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

The “National Security Through Technology” White Paper published in February emphasised the need for a strong skills base in the UK to ensure that the armed forces and national security agencies have access to the technology, equipment and support they need. That is why we are creating the right conditions for companies to invest in the UK, encouraging innovative small and medium-sized enterprises, investing in defence science and technology, and strongly supporting responsible defence and security exports. We are also working closely with the Department for Business, Innovation and Skills on a range of initiatives to maintain and develop engineering and scientific skills, including initiating a dialogue with the defence industries similar to that taking place through the successful aerospace growth partnership.

[Graham Jones]

There are reports today in the newspapers that the F-35B programme is to face substantial cuts in the US. Has the Minister had any indication from his counterparts in the US of a reduction in the number that will be procured, which may affect defence jobs in east Lancashire?

[Peter Luff]

I remember a good friend of mine, a general, who retired recently from the British armed services, who said he would know that he had retired when he started believing what he read in newspapers. I would strongly recommend to the hon. Gentleman not to believe what he reads in newspapers. The United States remains strongly committed to the programme. The F-35B is an outstanding aircraft, it is flying extensively, and my right hon. Friend the Secretary of State will receive our first two aircraft on Thursday. The hon. Gentleman should be a little sceptical.

[Mr John Baron (Basildon and Billericay) (Con)]

12. What account he took of recruitment capability in determining regimental disbandment.

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[Mr David Evennett (Bexleyheath and Crayford) (Con)]

14. What plans he has to improve the helicopter capability of the armed forces.

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

The Ministry of Defence is making significant investment in helicopter capability, including: buying an additional 14 Chinook helicopters and modernising the existing fleet; completing the life extension programme for Puma; upgrading the Merlin helicopters and our attack helicopter capability; and replacing the current Lynx fleet with new Wildcat helicopters, the first of which was formally handed over to the MOD at the Farnborough international air show last week. My right hon. Friend the Secretary of State also announced a £250 million support contract to sustain these in service. That is a substantial programme of investment that will ensure a strong and credible helicopter capability.

[Mr Evennett]

I welcome my hon. Friend’s reply. Will he update the House on plans to marinise the Merlin and upgrade Apache?

[Peter Luff]

The Department is currently exploring options for upgrading the mark 3 and 3A helicopters as part of an assessment phase for the Merlin life sustainment programme. It will look at obsolescence issues and the ship optimisation upgrades needed for routine operation at sea. All options are still being considered, so I cannot tell my hon. Friend what he wants to know until the conclusions are available. The decision on exactly how many Apache helicopters will be upgraded will be taken at a later date, but we plan to sustain their capability until their out-of-service date, which is 2040.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

The Minister will know of my sincere wish to see air-sea rescue remain within the Department. What contingency plans, if any, does he have on helicopters as far as air-sea rescue is concerned?

[Peter Luff]

I have every confidence that my hon. Friends in the Department for Transport will secure that facility very successfully during the competition they are running.

[Andrew Selous (South West Bedfordshire) (Con)]

T1. If he will make a statement on his departmental responsibilities.

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[Julian Smith (Skipton and Ripon) (Con)]

T2. Can the Minister update the House on the range of protected vehicles available to our troops in Afghanistan?

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

Yes I can, and I have heard very moving testimony from those who have returned from Afghanistan, and from the families of those in Afghanistan, about the effectiveness of such vehicles. We have a range of options that balance firepower, mobility and protection, including Huskey, Mastiff, Warthog, Warrior, CVR(T)—combat reconnaissance vehicle (tracked)—Coyote and Jackal; and the latest protected mobility vehicle, Foxhound, which is being deployed to Afghanistan now, will reinforce our commitment to provide force protection and proper protection against the improvised explosive device threat, while providing maximum utility. It is a good package.

[Tristram Hunt (Stoke-on-Trent Central) (Lab)]

T4. The armed forces careers advice centre in Hanley in my constituency is the second busiest in the country, but, under the Defence Secretary’s ill-thought- out plans, its recruits will not be able to join their local battalion, the Staffords. On recruitment, his numbers are not wrong, but, rather than acting like a desiccated calculating machine, will he support the campaign to keep the Staffords’ name in the Mercian Regiment by merging it with 1st Battalion the Cheshires?

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[Amber Rudd (Hastings and Rye) (Con)]

Will the Secretary of State confirm that the Scout specialist vehicle will go ahead, giving much needed certainty both to the armed forces and the supplier, General Dynamics, a valued employer in my constituency?

[Peter Luff]

I can confirm that. The Scout specialist vehicle programme is currently in the demonstration phase. The first vehicle platform test rig was rolled out on 6 June this year and pre-production vehicle prototypes are due to begin delivery from 2013. The successful completion of the demonstration phase will lead to a main investment decision at main gate, currently planned for 2016. That is good news for my hon. Friend’s constituents, and I thank them, through her, for what they are doing to create that important capability for the Army.