I call to order today’s House of Commons Defence Committee evidence session on the work of the Secretary of State for Defence. It is a pleasure, Secretary of State, to have you back before our Committee; thank you for making yourself available. It is also a pleasure to welcome once again David Williams, the permanent secretary at the Ministry of Defence, and General Dame Sharon Nesmith, the Vice Chief of the Defence Staff—a very warm welcome to you all. At the outset, Secretary of State, I thank your good self and the Ministry of Defence staff for the co-operation with respect to the various classified and secret briefings that have been provided at the Ministry of Defence building, and for the various visits that we have had within the UK and abroad. Will you also convey thanks to your Ministers for making themselves available to provide regular in-brief briefings to me, as and when there are significant developments, especially international developments? Please convey our thanks to your team on behalf of our House of Commons Defence Committee. Having said that, I have a bone to pick regarding the information that is available to the Committee. Secretary of State, as you are aware, during our first interaction back in November last year, seven months ago, you rightly said that you wanted a new relationship with Parliament and with this Committee, and that you wanted to increase transparency and the flow of the information that is provided to us. Unfortunately, there are various examples of that standard not being met. Let me illustrate. First—I am glad we have the permanent secretary present—we were promised a headcount of the Department and the plans to reduce it, including plans to reduce the number of generals, admirals and air marshals. To date, the Committee has not received that. Secretary of State, you, your good self, promised to share with the Committee the latest Armed Forces continuous attitude survey. We have not received that. General Sir Rob Magowan promised to provide information on the percentage of fighting force that was represented by the 10,000 personnel deployed in 50 operations around the globe. Unfortunately, we have not received that either. There are several other examples. Let me also, permanent secretary, bring to light our evidence session in December, when you promised a note on the precise recruitment pipeline timeliness, Capita’s recruiting pipeline, and a note on the Annington Homes deal. Unfortunately, we have not received any of that. In addition, there is the DE&S war game with industry. The reason why I am rattling off several examples, Secretary of State, is that I know that you are committed to transparency and providing information, but I think you can hear in my voice the exasperation and frustration on the part of the Committee that, over seven months, we have not received those various things. It is my understanding that the information is ready to send to us, but unfortunately is being held up on account of clearance at some point within the MOD. Do you think that that is acceptable and what can you do to change that?

It is very good to be with you, Chair. Thank you for your welcome, and I thank your Committee members for the passion, the expertise and the challenges that they bring to defence business in the House. You invited me to say a few opening words, but perhaps I will come back to that, after trying to deal with the series of points you have put to me at the outset. First, of course I will pass on the Committee’s gratitude for and recognition of the classified and secret briefings that you have had, and of the support for your visits over this past year. I hope that at least the longest serving members of the Committee will be able to draw a distinction between the level of information, the level of co-operation and the degree of briefing that your Committee has access to compared with previous Defence Committees—certainly those that Mr Twigg served on—and how the Government at the time and the Department dealt with them then. I assume that you have written to me with a compilation of all those points that you have now raised—

The Committee Clerks have been chasing on a fortnightly basis.

If you have written to me with that compilation that you have just put to me, I apologise, because it has not yet come to me. I will respond to that immediately, but will speak on one or two of them now. The latest version of the Armed Forces continuous attitude survey was published in May. It is available to you and your Committee, just as it is to us. On the deployed personnel around the world, the most recent figures that I looked at compared with November—I think you cited the 10,000 from General Magowan—is somewhere over 8,500 in 38 countries on 50-odd operations. Of course, we will give you—within reason, with the caveat, clearly, for special forces and other very highly classified operations—what data we can on that. If you have been waiting for that for seven months, I apologise. I had not realised. Likewise, I apologise if you have been waiting seven months for the recruitment data, but the data you would have got in November has been overtaken by the progress we have made. We still have a lot further to go, but I will make sure that you have that recruitment and retention data, because that hits to the heart of our ability to deal with the recruitment and retention crisis we inherited after 14 years in which, I am sorry to say, the previous set of Ministers set recruitment targets for each of the services and missed them in in each and every year.

I appreciate that response, but it would be good to get that in writing, so that we can do our work effectively. Otherwise, it really hampers our ability to get rid of the backlog and to move forward in a meaningful way. More strategic, long-term matters have been discussed, namely the equipment plan. We are still awaiting last year’s annual MOD report, the annual session with the permanent secretary and the annual shipbuilding update. All those things were discussed. By the way, the annual shipbuilding update is from two and a half years ago, and we are still none the wiser about it. My good friend Geoffrey Clifton-Brown raised those issues at his Public Accounts Committee when Derek Twigg, a member of our Committee, guested there. When will those things be received? Why are things taking so long and what can you do to change that?

You asked for a more strategic view of what, as a new Government with a newly elected mandate, the new, different vision of defence to respond to the new-era threats that we face is. A month ago today, we published the strategic defence review, which sets the vision and the framework within which we will now pursue the reforms that are already in place and that we need to take further. We will develop the policies that we need to develop and reinforce the warfighting readiness of our Armed Forces. That gives the Committee the strategic framework, which I have no doubt you will want to discuss, within which this Defence Department and this Government will work.

Secretary of State, with all due respect, the SDR is good as an overarching document, but Committee members are more interested in the detail of the equipment plan stuff and the accounts. The SDR would never encapsulate things such as shipbuilding. We need the facts and figures on those things so that we can see progress on what has been promised by Government. Hopefully you can appreciate the nuance.

I think your Committee members, particularly those elected for the first time a year ago this week, will also appreciate that the details of plans that previous Ministers in a previous regime might have had responsibility for and published are rather less relevant than the decisions that we have already taken this year and will take in the future within the framework of the strategic defence review. The annual report and accounts essentially marked the end of the previous Government. If the Committee wants to question me on them, I am happy for it to do that. If you want to do a session where you question officials on them, of course you can do that. The accounts and decisions of our Government will be reflected in the annual report and accounts to come. They will reflect, in a way that the current accounts and report do not, the fact that we have a £5 billion boost to defence spending this year. In two years’ time, this Government and this country will spend 2.5% on defence for the first time since 2010.

Now that I have got that off my chest and we have certain things on record, I hope that we will be able to get the information. Thank you for your clarification. I hope that you will get that actioned as soon as possible so that we can have that information. Let us move on to the NATO summit.

Just before we move on, Chair, I apologise to you and the Committee for the bits of follow-up that have been stuck in the system rather than with the Secretary of State. It is not good enough and you should expect better. It is not consistent with the clear direction from the Secretary of State and ministerial team about the importance of timely transparency to Parliament and to this Committee. Frankly, the answers that came back for some of them were not very good, so we have been round the buoy. Then it just becomes a question of their relevance. I am happy to follow up on that list with the Clerk and get you answers to those questions, some of which will have moved on, as the Secretary of State says, over the course of the last few months, not least with the decisions made in the SDR, and some of which will be fleshed out later in the year through our SDR implementation work. I am happy to commit that we will come back on the outstanding questions in the next couple of weeks at the latest.

Thank you for your commitment, Mr Williams. It is my job, on behalf of the Committee, to make sure that our Committee is accorded the due respect and prioritisation by the MOD to ensure that we can do our job on behalf of Parliament and the British people. Let us move on, Secretary of State, to the NATO summit and defence expenditure. Can you update the Committee on last week’s NATO summit, specifically on the financial commitments agreed by the UK? I know the Prime Minister made his statement in the House.

By all means. Will you permit me a segue at this point to offer a few opening remarks, which you invited me to do before the Committee? That is not least because you said the Committee wants detail and I can provide a list of the detail of the ways that we as a Government, ministerial team and Department have been delivering for defence over this first year in government. Chair indicated assent.

I will start with the strategic defence review, because that will set the nature and framework of the exchanges that I will have with you and your Committee in the coming years of this Parliament. The strategic defence review represents a generational shift in the approach to defence and a determination to move to warfighting readiness to deter the threats we face and strengthen Euro-Atlantic security. It is, if you like, the plan for change for defence. It is a plan to step up and lead in NATO and learn the lessons from Ukraine; it is a plan to boost British jobs, businesses and innovation right across the UK; and it puts, for the first time in a long time, our defence people at the heart of our defence plans. It is the way that we will make our Armed Forces stronger and the British people safer. You may want to come on to the broader questions we face at the moment, but for now, I will say we welcome strongly the ceasefire between Iran and Israel, and the reports of a potential ceasefire between Israel and Hamas. We are working to support those efforts, and we await news of developments. I say to the Committee on day 1,224 of Putin’s illegal invasion of Ukraine that we cannot lose sight of the war in Europe and the Ukrainians’ fight to defend their own country. In terms of the year we have had, we have been delivering on the manifesto commitments that we made on defence this time last year. The SDR has been published; 2.5% defence investment was announced three years earlier than anyone expected; the Germany-UK defence agreement was signed within 100 days; an EU-UK security pact was agreed; a National Armaments Director post was established and recruitment is well advanced; a military strategic headquarters is now established and operating; legislation on an Armed Forces Commissioner was passed and recruitment is under way; the NATO test was completed within 100 days; and Ukraine support is now stepped up to record levels in the UK, with at least £4.5 billion in military aid this year alone. In terms of detail, we have gone further than that in delivering for defence, signing nearly 800 major contracts to support thousands of jobs since July; agreeing with NATO allies to spend 5% of GDP on national security by 2035; buying back 36,000 military family homes from private hands to public ownership, reversing probably the worst privatisation in history undertaken in the dying days of the Conservative Government in 1996; investing £7 billion this Parliament to fix forces housing, including an extra £1.5 billion for forces family homes; building a new £50 million UK-wide support system to ensure we have support for veterans; awarding our forces personnel last year the highest pay increase they have had for nearly over 20 years, and following up this year with an inflation-busting pay rise. I can sit before this Committee as the first Defence Secretary who can say, “Now no one who serves our forces in uniform will be paid less than the national living wage.” None of that would have been possible without the most amazing people I have the privilege to work with day in, day out, military and civilian alike, from directors to desk officers, from service chief to chefs to coders. I am grateful to them all—many roles, one defence.

Thank you for that overall perspective. It is the Committee’s intention to go into each of those issues in detail, including the Middle East developments that you alluded to. Coming back to the NATO summit, are there any other financial commitments that have been agreed by the UK that you would like to highlight to the Committee? Professor Malcolm Chalmers from RUSI estimated that an increase in funding from 2.5% to 3.5% of GDP equates to an extra £40 billion annually. Will that extra money accelerate delivery of the current SDR, or will Defence’s capabilities expand further? If so, in what areas?

On spending and the NATO summit, for the first time, the 32 NATO allies have recognised, as we argued in our election manifesto, in the strategic defence review and in the recent national security strategy, that an essential part of national security is not just what the Armed Forces and Defence do, but what we do on national resilience—what we do to protect civilian infrastructure and for cyber protections. If you like, it is the article 3 commitments that all nations sign up to as part of the NATO alliance. For the first time, that is a 5% commitment in 10 years’ time. That is a benchmark, as NATO described it, for all 32 nations to see core defence spending and wider national security spending hit 5%. That is a benchmark that we have welcomed. It is one we argued for and one we have signed up to as a Government.

Will the increase from 2.5% in 2027 to 3.5% by 2035 be tapered? Should we expect further increases in this Parliament beyond those set out by the Chancellor at the spending review?

What you should expect, what the country can look forward to and what Defence can plan on for the first time is 10 years of rising defence investment—a certainty and a profile that no one serving in uniform today and no one working in Main Building today has ever in their career experienced. In this Parliament, we have set out exactly how we will fund the commitments we have made: the extra £5 billion boost this year, our first full year in Government; the 2.5% that will be reached in 2027 by switching money directly from the overseas development aid budget into defence, a tough decision that we took because of the importance of meeting the threats that we face; and then an ambition to hit 3% in the next Parliament, alongside the benchmark that we have endorsed of a 5% national security spend as part of our NATO commitment.

Welcome, Secretary of State. You will appreciate that this Committee is a bipartisan Committee, and defence has always been a bipartisan question, so I personally think that it ill behoves you to make disparaging comparisons between yourself and your predecessors. I think Ben Wallace was at least as serious a Secretary of State as you are, and when you have served as long as he did, we can make the comparison. I put the question to the Clerks whether the quality of responsiveness to information had improved or fallen over the last two years, and the answer is that it has significantly fallen. I want to say two things. This thing about responsiveness is not just about whether you have filled in a few forms; it is about whether you are responsive to Parliament—whether you are attending to the concerns that we have on behalf of the democratically elected Parliament of this country, to exercise proper accountability and scrutiny over the Armed Forces. If you are not willing to do that, then let us know, and if you are willing to do it, then give us the dates by which we can expect to have the information. We do not want to have to put date stamps on everything we talk about, but it is important, okay? Can we just mutually agree that?

I am not looking to make disparaging remarks about the previous Government; I am stating facts and I am drawing differences. But on the important question of any ministerial responsibility and accountability to Parliament, Mr Norman, you and I are entirely on the same page. You have my commitment; you had it in November. If I am falling short, and those who are working with me and for me are falling short, then I need to know. We will rectify that, because it is fundamental to me that we are part of an elected Government, accountable to Parliament, and that you on the Defence Committee in particular have a job to do on behalf of the public and those who serve in our forces to hold us to account.

I am grateful for that. You appreciate, Secretary of State, and I think everyone on this side appreciates, that it increases your authority to be responsive to accountable measures and mechanisms put in place by us. On the SDR communications, you wrote to us on 11 July to indicate that there had been a problem with the reading room—that that was the nature of the communications failure—and that the Committee had not received the documents it was supposed to have received until 12 noon, a delay of two hours. In fact, the communications problem was much worse than that. There was in fact no reading room—the Clerks have confirmed that to me. There should have been a reading room in Parliament where members of this Committee could have reviewed the document. If we are setting a regime for the future, can you make that commitment now, so there is no ambiguity? Of course, it is not just about this Committee; it is also about the 21 interviews that Ministers had with the media before Parliament itself was informed, and about the personal briefings that were given by Ministers or officials to senior people in industry beginning that morning at 8 o’clock. The question of accountability in relation to the SDR goes well beyond the letter you wrote, and the facts that you recounted in your letter were not, in fact, accurate. Could you revisit that?

Mr Norman, I am actually not clear what letter you are referring to that I have written to the Committee about this, especially—

Secretary of State, it was a letter that you wrote back to me—

Especially because what was in that letter would be accurate and precise. What we found when we were preparing to release the strategic defence review was that the Department had no established systematic procedure for ensuring that those who need and should have access in advance to something as strategic and important as the strategic defence review could get it. There was no system for doing that. We did our best and interrogated the system for any record of what was done, including for Opposition Front-Bench spokespeople, for this Committee and, actually, for those important stakeholders such as business, trade bodies, academics and ex-forces chiefs. I have now put in place a procedure and a system—I confirmed this to the Speaker and in the House last week, and I am content to share a copy with the Committee as a follow-up to this session—for how in future, for major strategic documents like this, the next of which I anticipate being the defence industrial strategy, this Committee and, more importantly and more widely, those leading on defence for the Opposition parties in Parliament can expect to have information, briefing and potentially copies of a strategy ahead of a formal statement in the House, on the basis, of course, that they remain confidential.

Properly confidential, yes. That is helpful; thank you. I might ask the Clerks to revisit with your office what has gone wrong in that letter of 11 June. I will not read it out, because we do not have time.

If there is anything wrong, I absolutely want to know about it.

Okay. We will do that—thank you. I have a quick question about spending. Is the Chagos Islands settlement included in the 2.5% defence budget that you have outlined for the next three years?

As I think has been confirmed in the House, the cost of the Diego Garcia settlement will be split between the Foreign Office and the Ministry of Defence.

And will fall within the 2.5% budget that we are talking about.

The total cost is £101 million a year. That is less than 0.2% of the defence budget. At net present value, the total cost of it is £3.4 billion. I have to say, Mr Norman, that for something that sits at the very heart of our unique US-UK defence, intelligence and security relationship—we do things together on and from Diego Garcia that could not be done anywhere else in the world—that is a profoundly good investment for this country, for our alliance and for the wider security that we can help guarantee.

Thank you. Am I right in thinking that Sizewell C—a civilian nuclear power station—is included within the 1.5% additional defence commitment?

I think we are less than a week since the NATO summit and the agreement. The Committee will have had the guidance from NATO, because I promised to send it to the Chairman ahead of this session. By the way, that NATO guidance has not been published at the moment, but it gives an indication of the way that NATO is looking at definitions. That does include critical infrastructure. The whole notion of this 1.5%—this question of national security—is a recognition of the way the world is changing. It is reflected in the SDR. Our national security is not just about our defensive security now. You have to take in our cyber-security, our energy security, our border security—all arguably things that the public recognise are important parts of a country that is safe and resilient. Those sorts of decisions will come in due course, so I cannot give you a firm answer now; I can only point you to what the NATO guidance set out a week ago.

That is helpful; thank you. In the spending review, current spending in MOD increases by 0.7% a year for the next three years. Given that defence inflation will probably be higher than regular inflation, for reasons we know, that effectively means that the actual amount of new spending that can be incurred on readiness will be at least static. How will you fund things such as the massive increase in drones that we need in order to be anywhere near meeting the lethality targets of the Armed Forces?

Many things become possible because of the record increase in defence investment in this Parliament, which we have not seen since the end of the Cold War—

Even if it is 0.7% on current spend?

Many things become possible, but not everything, and we will settle those in the detailed work that we have now started to produce a defence investment plan. On drones, you may have seen that autonomy, innovation and new tech, combined with some of the heavy metal of our traditional platforms, was very much a theme of the strategic defence review. We have been able to act within just four weeks, and I announced that we would increase to £4 billion in this Parliament the investment that we make in autonomy—in drones. That is more than double what was in the budget before. It is largely capital expenditure, and we will learn the lessons from Ukraine. We will not just produce better and more drones for Ukraine—we will increase the drones we supply to Ukraine this year at least tenfold—but step up the pace of learning those lessons and put that technology into the hands of our own warfighters. That is a big contribution to being able to make our forces stronger and more capable of deterring any would-be adversaries. We are starting to lead the way within NATO in this new realm of autonomy. Working as closely as we do, uniquely, with Ukraine, we are probably best placed within the NATO alliance to understand and implement that.

As the Defence Secretary said, for certain categories of drones, it is capital investment. Our annual real-terms growth in our capital budget over the spending review period is about 7% a year, so the capital budget is growing rather higher. For drones that might be funded through current expenditure—to use your phrase—such as one-way attack drones, that will be covered within our munitions pipeline. We have set aside money in the SDR for munitions and always-on production, so whether it is artillery shells or one-way attack drones, they will come under that heading.

That is helpful. Thank you very much.

Secretary of State, the purchase of the F-35A represents a change in the UK’s nuclear posture. The use of that deterrent will require US backing. Why have the Government decided to pursue this approach rather than a new sovereign nuclear capability?

You are right, Mr Twigg: it is a change in our posture. Some have described it as the most significant change in our nuclear posture for a generation. It is alongside and additional and separate from our continuing total commitment to our independent nuclear deterrent delivered through CASD, and it is a recognition that this is a way that the UK can recognise the rising nuclear risks that we face as part of the increasing general threats, that we can step up and play a stronger role within NATO and that, in this way, we can help reinforce the deterrent strength of our NATO alliance.

Is it still the plan to purchase a total of 138 F-35s, and can we expect the F-35A to make up the greater proportion of that purchase?

We have done nothing to that ultimate 138 figure. The immediate—

So that is still the plan, is it? And when do you expect that to—

The immediate next tranches of F-35 purchases total around 27. We will swap in the purchase of 12 F-35As for what would otherwise have been 12 of those 27 F-35Bs.

When will we have purchased the 138?

I would expect those F-35As to start being delivered before the end of the decade.

Isn’t it the case that the work share for the UK on the F-35As is less than on the F-35Bs? [Interruption.]

Order. Sitting suspended for a Division in the House. On resuming—

I am pleased to inform everyone that we do not anticipate any further Divisions—touch wood.

Secretary of State, I was talking about the work share in terms of the As and Bs, and how it will be less on the As. Can you say something about that? Obviously, we want to give as much work as we can to our industry.

At this stage, we are still in early negotiations with industry, having just announced the decision last week. I would expect it to be broadly similar. I confidently expect the cost of the As will be around 20% less than the Bs, but the work share question and the support for UK-based jobs is still to be finalised and determined. I will report that to the Committee as soon as I can.

If it helps, the work share that we have agreed, which is around 50%, is a programme work share. There is UK content in every F-35 whether we are buying it or not. The question about how much work is coming into the UK is about the overall programme balance across all of the F-35 nations.

We go back to the figure of 138 that you hope to buy by the end of the decade—

No, not 138 by the end of the decade. I said our plan for the next tranche totals 27. Within that, I am now planning, as a result of the decision, to swap 12 of that next purchase of 35Bs for 35As. I expect those to start being delivered by the end of the decade, just to be really clear.

So we do not have a date for when we will have all 138.

No.

At the moment, for instance, Australia are on for about 90, aren’t they?

But Mr Twigg, you know the F-35 programme better than anyone. This is a programme that is going to stretch into the 2030s, the 2040s and the 2050s.

So at the moment we do not have a plan for reaching that figure.

No, the—

All right.

Just to be really clear, the fresh decisions as a new Government within the context of the strategic defence review, reflecting this, as you said, significant change in the UK’s nuclear posture with the 35As will be decisions that I take in the context of the new few months and the defence investment plan, which we will complete and publish in the autumn.

On the basis of the defence industrial plan and obviously maintaining a strong defence industrial base, what does that say for the future of Typhoon purchases? What is the plan?

The plan for any future Typhoon purchases will be based on decisions that are taken in the context of that defence-investment planning process over the next few months. You will note on Typhoon that the strategic defence review confirmed its importance, confirmed its role and confirmed the strong recommendation, which we have accepted, that we look to upgrade our Typhoon fleet. We have to recognise just how important that has been.

So we can expect an increase in the number of Typhoons being bought.

The SDR recommendations were about upgrading our Typhoon fleet.

I am talking about new Typhoons.

I appreciate that; I am trying to find a way of answering you. The components and composition of our future combat air requirements, purchases and sequencing, which will cover F-35s, Typhoons and any other developments, will be made in the context of the defence investment planning process over the next few months. I cannot give you that answer now, but I can point you to the recommendations made in the SDR, which, as I have said, will be the framework and the vision within which we will look to develop defence, including our combat air capabilities.

Just for clarity, you cannot at the moment give any commitment or be clear that you will purchase more Typhoons, as of today.

I have made clear what the recommendation is and I have made clear the period and process within which any decisions like that will be taken. They will not just be isolated decisions; they will be in the context of the budget profile that we have available. For the first time, as I said to the Committee, there will be a certain decade of rising defence expenditure, but there are nevertheless some significant pressures in the next two years because we are still dealing with the overhang of a previous period of—without being disparaging and stating the facts, Mr Norman—a programme that was too often overambitious, overcommitted and underfunded, as the Committee is well aware.

Thank you for your support, Mr Martin. I note and welcome it. To refer you again to the strategic defence review, what that recommends and points to, and what we have started to work on already is the development of our carrier capabilities. That is not just about the F-35s on board. It is to develop Europe’s first hybrid air wing off the carriers within NATO. Some more advanced capabilities are likely to be developed through the autonomy and some of the missile technology, as well as the additional F-35s, which will be part of developing our carrier capabilities for the future.

The F-35As are going to be part of the operational conversion unit, which is a more effective and efficient way to run some of our training for the F-35. In that sense, we are not anticipating it having any impact on the operational outputs—

That is right. We will be training on the Alpha, rather than the Bravo.

Secretary of State, I like you, but I also like Mr Twigg, because Mr Twigg asks great questions. He asked you, on the tactical nuclear capability, why did we not go for a sovereign capability? Why did we go for a dual key? You gave him a very long answer, but you did not answer that question. Will you give it another go, please?

First, we have our sovereign capability: it is CASD. It has the total determination of this Government to maintain, develop and upgrade it for the future. Secondly, on the decision we have taken with the dual-capable aircraft and the contribution that the UK can now make, this is an existing NATO nuclear mission. We do not need to substitute for that. The best thing we can do is to contribute to it. That is exactly what we have now given ourselves the scope to be able to do, by this decision to purchase the 35As. I think I did say to Mr Twigg, this is a way of the UK stepping up and helping strengthen NATO’s deterrence—warmly welcomed by the NATO General Secretary, by NATO allies and by the US as a reinforcement of the credibility of NATO’s existing nuclear mission. For those reasons, the Prime Minister and I took that decision. I am glad to say that within three weeks of the strategic defence review making that recommendation, we have been able to make the decision. We are now getting on with putting it into practice.

Did we have the option to have a UK sovereign tactical nuclear capability?

Conceptually and in theory, I guess we could have. That was not something that the SDR suggested was a good thing to do, and it is not something that would necessarily be consistent with my ambition or the manifesto commitment that we made at the heart of the strategic defence review, which is that European nations need to step up and do more of the heavy lifting within NATO now. The UK needs to develop and demonstrate, as we are, a stronger leadership within NATO. That is action we can, and are, taking now. It reinforces the deterrence for our Alliance in the immediate years ahead. It seemed an important recommendation, and an important decision to take.

I have a couple of things to come back on. On work share, the F-35As do not have a Rolls-Royce lift fan in them, so for every B that is removed from the programme, Rolls-Royce loses some work share. May I confirm that?

My point of view is that we need to look at the number of F-35Bs being bought over the whole programme through the Joint Programme Office, rather than just the UK.

There are only two purchases of F-35B, so the reductions in F-35B as a result of the F-35 programme mean that Rolls-Royce does not get an equivalent work share.

The question then comes back to the fleet mix in potential further tranches of buying beyond the first two tranches that we have talked about.

Absolutely, and that was my follow-on question. General, you mentioned that those aircraft had been purchased for the OCU. It makes entire sense that you would reduce the complexity and operating costs of the training aircraft. There is a lingering question about the signalling of what the rest of that fleet looks like. If we have bought them just as a squadron of 12, it is a squadron that can only be committed to NATO because you are not buying anything else around them. There is no air-to-air refuelling, so they are a NATO commitment or a training unit—correct?

I think that is correct. The reason we would want to invest in the tactical nuclear capability is so that we are making NATO more lethal.

Okay, but the reason for buying them is to reduce the operating costs of the training aircraft. That was quite clear in the RAF statement that was released. So the logic for buying them was that you are trading out Bs for As. Your remark was that you are trading out some Bs for some As to reduce the operating cost. They are basically a training aircraft with benefits. They are also the nuclear option, and you can commit them to NATO, but you could not use them anywhere else because you do not have a tanker or any of the other support.

Right, yes.

Looking at it externally, the consequence to the UK industry is that Rolls-Royce will lose out, but we do not have to worry about losing out on Typhoons because there is no greater design on F-35A at the moment. Is that reasonable?

Yes. I think what I was tripping over was the principle of investing in the tactical nuclear capability. The most impactful, in terms of time and who we are partnering with, seems to be through the F-35A programme. So that we retain our carrier capability, we would not want that to displace some of our F-35B, and therefore we put them into the operational conversion unit. I think the logic flow was like that, rather than that it was a—

Training aircraft with benefits.

Yes, exactly.

Thank you all for your time today. What do you feel are the main challenges that we face in delivering defence reform? I will put that to the Secretary of State first.

I think the main challenge at the outset is to have a clear vision and a sense of what needs to be changed. I tried to develop that in opposition. We made commitments in the manifesto, which we now have in place. In the end, the main challenge of defence reform is that it is never complete. It requires strong leadership right across defence, including, in particular, the leaders of the four main areas. We have now established the NAD group—the National Armaments Director group—the MSHQ, the Department of State and the Defence Nuclear Organisation, as well as the political leadership, but it has to be pursued with relentless attention. In political terms, it is something that brings no front pages or photo opportunities, but it remains my view, one year into this job, that unless we drive further with the reforms and deliver them during the course of this year and this Parliament, we simply will not be able to deliver what is required of us to meet the objectives in the strategic defence review. We will not be able to say to people, “In Britain we are investing more in defence, and here you can see the benefits,” and carry that opinion with us.

I will direct the same question to Mr Williams.

I would rather talk about the opportunities of defence reform. The programme is looking at structures, processes and, critically, people, ways of working and the relationship between the four areas of the Department that the Secretary of State set out. I think the opportunity is around much clearer accountabilities and responsibilities and around de-layering and simplification of our process. There is a bit of an MOD culture that if a decision is worth making, it is worth making five or six times. We would quite like to make it once, and then get on with delivering and implementing. The reform programme is integral to that, and integral to the delivery of the strategic defence review. The ambition on investment in capability at pace to meet the threat that the country and our Armed Forces face, the changed relationship between the Department and industry and the way we want to foster innovation—the kind of reforms we are setting out through this reform programme are critical to delivering on the ambition in this SDR. Of course, in a reform programme you have to make sure that you have that vision, that you have the processes right and the emphasis on implementation. It is definitely about leadership—communication, communication, communication—to make sure that the whole organisation has got it, but I think this is a great opportunity. The linkage of the SDR and reform means it is reform with a purpose, which helps to land it with people.

I love a good opportunity and I love that we are being ambitious, but unless we accept where the challenges are and own them, we will not be able to deliver. You have already mentioned the way the MOD works; we have frequently discussed in this Committee that it is currently not very efficient and is holding back a lot of our current defence. Do you think you will be able to overcome that with the reforms you are going to put on the table?

Let me give you a practical example: one of the things we will do is to move to a single approval for our major investment decisions. Some of those approvals, because of their nature, will need to be approved in Main Building, by Ministers, with senior input, but in that instance the case will come straight up, with appropriate scrutiny and support, rather than going through an approval in a frontline command, approval in Defence Equipment and Support, in the DIO and at the—in our jargon—two star, three star and four star level. It is about collapsing and simplifying the process. That does not mean there will not be engagement between the four areas of consultation; but, by being really clear about who the decision maker is and making sure they have the evidence and information they need to make that decision—both the downward empowerment and the upward escalation when we hit blockers—defence reform has as good a chance as any of the reform programmes I have been involved in. We are already making progress; there are tangible signs of progress since we moved to the new structure in April and our people are feeling it. That is different.

Secretary of State, you have described the defence reform as a Parliament-long programme. How far along do you feel we are in the programme? What aspects are complete, and what aspects do you see that remain to be done?

Well, we are one year along. We have made some major structural, really serious organisational changes, but we have now laid the foundations, and getting the wiring—the horizontal links—between the four major areas is important. To be honest, we are all politicians and political leaders; we strive to be able to say things in ways that people who are not specialists can understand. The real challenge is twofold: it can become a question of organisational structures or management-speak very quickly. For me, unless we hold one of the principal purposes of the reform, which is to get better, faster kit in the hands of our warfighters—in other words, what we want to achieve through reform—in mind, we will not succeed. Unless we can make changes that mean that people’s contribution to doing that is easier and different—not just the titles, the obligations and the performance metrics of the very senior people—then again, we will not succeed. These are what I see as really important foundations. Instead of each of the service chiefs having their own investment budget to make investment decisions, there is one budget now with the National Armaments Director group. Instead of taking an average of six years to get to contract for major platforms, we have specified a reduction of the target to two years. We have similarly reduced the targets for upgrades of weapon systems or spiral development of radar systems and comms systems to one year. For those things where we need to use commercial exploitation to get them into hands and defence more quickly, we have a target of three months. To make that specific, in what might be called lethality, which is essentially part of the autonomy area, we had 27 different overlapping programmes in four different commands, run by 10 different senior responsible officers. We now have one programme, one SRO and the potential to make technical specification decisions but, most importantly, procurement decisions in the round rather than fragmented. We can draw in industry, which has the capability to create solutions that we cannot necessarily, with all due respect, come up with either in the Department of State or in the military. We certainly cannot do it as politicians. We have got the chance to do things differently, better and quicker, with the purpose that we are here to strengthen our Armed Forces. Part of that is getting better kit more quickly into hands, to keep up with the accelerating pace of technology. If we do not do that, we can see that Russia, China and Iran, our potential adversaries, and those that combine to threaten us, are doing that.

You mentioned the National Armaments Director and said it will help defence become an engine for growth, which I appreciate is working for Barrow-in-Furness. How much priority do you expect the director to give to developing the UK’s defence industrial base while making acquisition decisions?

It will a be hard-wired major criterion in any investment decisions that we take for any of the capabilities or technologies that we purchase on behalf of the British taxpayer. In other words, and this Committee has probably heard me say it before, we will look to direct more of the British taxpayer’s investment in defence towards support for British businesses, jobs, innovation and technology.

When do you expect them to be appointed?

We have got the post established. We are well down the track with recruitment. I hope they would be appointed and confirmed publicly soon.

I know you want to move on, Chair, but is it helpful if I share a reflection? Having been in the organisation for longer than I would admit, it feels very different with this reform. I have said for a while—as a personal reflection—that the thing we need to fix is to have a balanced programme. That is what the SDR and the defence investment plan will help us do. Then we should sort out the way we deliver and operate as defence, and that is the defence reform. I frequently say that on our watch this is the opportunity to miss, because we have to do it now. We touched a little on the SDR. From the defence reform perspective, there are three game changers, which we have not seen in previous attempts to change our operating model. With the first one, I know I am amplifying what David said, but we have never been clear about who is the decider. Being clear about who decides and how that flows through the organisation is a tangible shift that we feel already. That is literally who is the decider. Secondly, it is the relationship of the CDS with the chiefs. It is about an integrated force. We are good at doing that operationally. We have been less good at doing that about our future force, so force design will feel very different. Then of course, when it comes to the National Armaments Director, from my perspective as a chief, what I care about is having the capability and the timeframe that I need. I want to have an industrial base that is resilient, and frankly I do not want to worry about doing that. That is what is a game changer, from a NAD perspective.

To keep us all up to the mark, including me, I am also appointing to a new post of strategic adviser and head of review and challenge—in other words, to take the lessons that I think worked well during the strategic review process of bringing in external experts, but with a specific review and challenge process. Malcolm Chalmers will be joining us from RUSI to play that role in that new post. He will reinforce the policy muscle of the Department. To be quite honest, he is a one-man intellectual powerhouse on defence. In particular, he will become the head of a review and challenge within the Department, to me—so not just advising me, but challenging me—but also to leaders in the main areas.

Secretary of State, can I also get an undertaking from you that we can have a post-appointment session with the new permanent National Armaments Director, please?

You absolutely have my undertaking on that—although I do not at this point want to tell them that, in case it puts them off; but I am sure they will welcome it.

Thank you very much; I am sure they will. There is quite a lot of ground to cover, so may I request that Members please make questions as succinct as possible and that our esteemed panellists make their responses as incisive and concise as possible? For a perfect example of that, I call Lincoln Jopp.

I want to come in on the back of the defence reform and the drive to speed things up. Obviously, getting defence export licences has pretty much ground to a halt within the last 12 months—defence companies in my constituency tell me it is much, much slower. As part of the reform reorganisation, would the Department consider making a bid to take the granting of defence export licences in-house under the National Armaments Director, so that the export side of NAD’s job is made quicker and more efficient?

You would have to work harder, Mr Jopp, to convince me that in principle that is a good move, for this reason. In my view, there is a merit and a credibility in having a regime that is the responsibility of a different part of government. If you want it to be an exports licensing regime that is properly conducted, I think you need that to be separate from the part of government that will, from this point on, be responsible for driving and increasing this country’s defence exports. One of the recent machinery of government changes that has been confirmed—one of the recommendations in the strategic defence review and one of my ambitions—has been to create a defence exports office. That is now being set up: it is being set up in Defence, it will be composed of great people from DBT and experts from within Defence, and it will link with the network of representatives we have right across the world. But fundamentally, it will enable us to reflect the reality of the world now, which is that many nations do not simply want to be high-status customers buying a kit from us. What they are looking for is a partnership and a defence and security relationship. Therefore, at the heart of this needs to be a Government-Government relationship. My experience, I have reflected over the last 12 months, is that, for the really big potential export campaigns, run with British-produced kit, the role the role of Ministers and Government is so much greater than I think I had appreciated, but we have to reflect that if we want to be more successful.

Secretary of State, you are very committed to innovation and enhancing and modernising our capabilities—that is clear in the SDR. As part of defence reform, you have created and established UK Defence Innovation, UKDI, which you announced some months ago—there was a press release yesterday about that. Just to get some detail on that, if I may, who is that going to report to directly?

That will be within the NAD group.

Who will it report to? Will it be the NAD?

It will report to the NAD.

Directly to the NAD; okay. In terms of ministerial portfolio, I assume that the NAD belongs to the defence procurement and industry Minister. Would that be correct?

No, the principal accountability—in terms of ministerial portfolio and responsibility, the Minister who will work most closely, and who day to day will do much of the work and the holding to account, the pressure on delivery, will clearly be the Minister for Defence Procurement and Industry. Fundamentally, the four levers are the NAD group, the MSHQ, the Department and the Defence Nuclear Organisation, and I meet them regularly individually and I meet them regularly as a group, and there is the formal accountability to the defence board, but there is the working strategic accountability, in my view, to me as Secretary of State.

So if you were running UKDI and you were the person in charge of that, would you be a two star or a three star?

We are standing up the organisation now. It will be fully in place in about a year’s time. We will look to recruit ahead of that. We will settle those questions as we go into that field. What we need is a really first-rate candidate.

If you were running UKDI and someone asked you the question, “Who do you see as your political champion? Who is the elected politician of the people in the Defence team who is driving this and championing this agenda for you?”, who would be the one person?

If you were applying for the job, let us just imagine because you have got an interest in it, and we were having a fireside chat about that, I would say, “Look, you have got an opportunity here. You sit within the NAD group, you are at the cutting edge of what our Armed Forces need, you are at the cutting edge of where the real impact on British industry and British jobs go, and this is a post that has been jointly developed”—and jointly announced, actually, this move—“by the Chancellor and the Defence Secretary. You will be in a unique position, within that NAD group, to have two Cabinet members jointly who will look to back what you do. But by the same token, follow particularly closely how well you do it.”

Sure. We all understand that the Chancellor is very supportive of the defence agenda. I meant more within the defence team, and particularly by comparison to the American model, where DIU, Defence Innovation Unit in the Department of Defense in America, reports and is championed by the Secretary of State and was established and personally championed by previous Secretary of State Ash Carter, and a lot of people, when you chat to them, say that is why it had success and the ability to actually drive adoption and innovation in the US model. There are some fears, as you will know, Secretary of State, that UKDI, as a concept, will be buried in bureaucracy quickly unless it has a political champion who is named and identified.

Look, I will take that, if I may, as a point of design as we set the organisation up and as we appoint the head, but simply to say, and to reflect the conversation earlier with Ms Scrogham, that this is bringing together what are at the moment fragmented programmes, fragmented responsibility for defence innovation. It is an opportunity to consolidate that, give it fresh leadership and take it into areas that we have not touched before.

Thank you, Secretary of State, for this very interesting conversation. Just to follow up on this, obviously the NAD, from your point of view, will be a powerful driver of procurement, improvement, rapidity and change. How are you going to set up that office? One could have two worries. One would be that they will just go into Main Building, after which the walls will close and you will never see them again. The second might be that they are going down to DE&S and will somehow be dislocated from the Whitehall machine. How are you going to manage that so that they have the requisite authority, but also the purpose and the drive to meet your needs?

I think the requisite authority lies in the construct of the post and the range of responsibilities within the NAD group that it has. Within that is a post that will run DE&S. It is not somebody that will also do that job at the same time. Look, in the end, like with almost anything, it is also about getting the right person, and I am confident we should be able to do that. David, have you anything to add on that?

Very briefly.

I hope I haven’t got a little bit too disobliging about MOD.

It is a combination of the right person, the team, and where the priorities are. You can imagine a NAD that spends quite a lot of time trying to run the combination of organisation with 30,000 people. That is not what we are after. We want somebody who makes sure that the leadership team around them is delivering, but also has that strategic engagement with industry and strategic engagement internationally—for instance, through NATO national armaments directors and so on. So there is an up and out dimension that will be really important alongside Ministers, as well as making sure that the leadership team of the various components in the NAD group are delivering as they need to.

You will know the capability target horizon stretches almost two decades. The commitments that we and the other NATO nations signed up to last Wednesday at the NATO summit endorsed a new set of capability targets. That will frame a major part of the priorities and the focus for our decisions now in the defence investment planning process.

We have not met all the targets that we set. The point about the targets is that they are part of defining our contribution to the NATO collective defence and deterrence and they stretch every nation to do more. That is exactly what we will do.

First, the capability targets are exactly what they are: targets. They are designed to push and stretch. They do that with all our nations. They are doing it with us. They are an important part of our drive to transform and modernise what we can do. General Nesmith might want to deal with this particular question, but you will know that NATO does not publish capability targets—it does not publish performance against capability targets. It does not publish, therefore, the new set of capability targets that flow from last week’s summit. But if the Committee would like a briefing on the capability targets that we have accepted as, in part, the definition of how we will in the period ahead look to contribute more to NATO, then, as a follow-up to this session, in a way that it is not possible to do in an open session like this, we will answer some of the questions that you have.

It would be excellent if that could be facilitated. Thank you for that.

On the specifics, General Nesmith might want to add something.

Perhaps to reinforce, we are very clear-sighted on the commitment to the capability targets. They are absolutely to be delivered over time. We recognise that there is risk against our ability to meet some of those capability targets. The work of the defence investment plan will, of course, be to work out how we prioritise and sequence those areas of risk to address them most quickly. We are also very focused on what SACEUR has said are the priority things that he wants us to deliver, of which the reserve corps is one of those things. CGS has been very clear about his intent to deliver against that ask. Much of what the SDR talks about is how to increase lethality. At his land warfare conference, he talked in some detail about his vision of how to change lethality—less about the input structure, more about the output of effect. That is what we need to demonstrate to NATO, and for other NATO nations to do the same.

The SDR sets out a vision—a transformation, as you say—for the next 10 years and beyond. You can crystallise it, essentially, as planning, equipping, training and deploying as an integrated force, rather than as separate services, and doing so in a way that brings the power of new technology—AI, autonomy, drones—alongside the heavy metal of what we already have. Let me segue to your question from your previous question. I would expect the capability targets that we settle in 2029, after the cycle of four-year review, to look different from the ones we have signed up to today. Especially with my ambition from the SDR to make the UK the most innovating European nation within NATO, we will be able to demonstrate that we can achieve some of the deterrent and defence effects that the current capability targets require in different ways.

It is not jam tomorrow; the SDR is for a 10-year-and-beyond period. The question is, what can we do now? How do we sequence the period? We have been able to produce the strategic review, just a month ago, and we have already been able to say, “Right, we’ll set up”—and we have started to do it—“a Cyber and Electromagnetic Command.” We have been able to commit to doubling the budget for autonomy and drones to £4 billion in this Parliament alone, and in this Parliament we will invest £6 billion for munitions, including new munitions factories. I could go through a list of the decisions we have taken and the action that we can take—that we can get under way now, not in the early 2030s—but, clearly, we cannot do everything at once.

Jam and Marmite today.

As I mentioned, we have a lot of ground to cover. I want to make sure that all Members get the opportunity to ask questions.

Secretary of State, was the recent US military action against Iran legal, in the view of MOD lawyers?

That sort of legal advice is not public or disclosed. We are totally at one with the US, and with a number of other allies, that Iran can never be allowed to develop a nuclear weapon. The US struck those nuclear targets, and we now have a ceasefire in place. We welcome that. The challenge now—this was part of the discussions that the NATO nations had last week—is how we build on that to make sure that we get a diplomatic process and lock on Iran. As the Prime Minister has argued, in the end, the only way to secure a sustainable, verifiable situation in Iran, in which they cannot try to reactivate a nuclear weapons programme, is to do so diplomatically.

If we are totally as one with the US—that is the phrase you just used—why can you not say publicly that you support the US’s actions?

I welcome the situation we are in now, including—

So you are prepared to welcome the ends but not the means.

Including the fact that we have a ceasefire and a degraded, if not destroyed, Iranian nuclear weapons programme. The way of securing that, and the argument that President Trump is leading, which we and other allies are supporting, is to say to Iran, “Look, we need to negotiate for the future now—the future of your country, but a future that involves no nuclear weapons programme being re-established in your country.”

When you speak to your opposite number in the US, how understanding are they about the fact that the Government have not been able to support them publicly?

As we have been for decades, and as we were under the previous Government, the UK and the US are and absolutely remain the very closest of defence, intelligence and security allies. We continue to do things together as two nations that no other nations do. That relationship is very strong at a military level, and it is strong at a political level across the realm of defence as well.

We have heard about defence reform and how the governance model makes sure that someone is identifiably in charge. PUS, under this new model, you and CDS will sit as two on the quad, correct?

Yes.

Okay, good. Could you explain how the quad is functioning as a strategic leadership body now, and how it interfaces with operational and security issues such as the Brize Norton security breach?

I would describe the quad as a leadership group. It brings together the CDS, me, the National Armaments Director and the Chief of Defence Nuclear. It is not formal governance; we all sit on the defence board with Ministers, the non-executive directors and other members of the executive team, and we have a formal executive committee that is the senior governance at official level within the Department, so I draw a distinction between governance and leadership.

And accountability, critically. We heard earlier that someone is very definitely in charge now. That is something that you enjoy. Someone is very definitely accountable, and there should be an accountability process or risk management process that goes along with it, correct?

Yes, and that process—

Can you explain that to me?

The risk and accountability process works through formal governance—how each of the areas is delivering against its plans, reviewed through regular performance information, through the executive committee, through the defence board. But as the Defence Secretary has also said, we meet both individually—indeed, we had our holding to account session this morning—

In that holding to account meeting, you would have spoken about the risks that were tolerated further down in the system, correct?

The risk conversation we have been having principally at the defence board, looking at a set of strategic risks—

Is this a risk that would have been discussed at that board?

Security of the estate?

Yes.

It was on our risk register, and—

Okay, brilliant, so it is a strategic risk. On your five-by-five, that would be right in the red, right? It would just be about the likelihood of that risk manifesting.

It is about likelihood, consequences and risk appetite. That risk appetite becomes an important input into investment decisions through the defence investment plan about the sequencing of investments that we are making.

Brilliant. Just for the lay, you have identified that the consequences of this risk manifesting are so great that it should exist on the defence board, therefore it is a strategic risk, and the likelihood of it is something that you manage with resources. Correct?

Well, you can use resource to mitigate the impact as well as the likelihood.

Or you could tolerate it.

Yes.

Who owns the resources that mitigate that risk in the quad?

For security of our built estate, the security policy—the parameters within which the Department operates—is owned by a team that reports to me within the Department of State.

So you—because only you appear in the quad. You would be accountable for either tolerating or mitigating that risk.

For our policy on security. Delivery against that policy, including aspects of sequencing, sits out with the owners of the individual bits of the estate.

I assume in the meeting this morning that you said, “Secretary of State, at Brize Norton I have a risk that is a strategic risk that is highly likely to happen. I don’t have the resources to address it. Therefore, it’s something that you have to take off my hands.” Is that correct?

That is not the conversation that we had this morning. As Ministers have made clear, we launched an immediate review of some of our security issues around the built estate, particularly in the UK. The first phase of that review reported to me, as the security policy owner, and to the Vice Chief of the Defence Staff.

The person who is responsible for it—for applying the resource to mitigate a risk. If you cannot, is it a risk that you would carry yourself, or is it one that you would brief to the Secretary of State? I am just trying to work it out. We have got this new reform thing, and it all seems like it is going well. I just want to know what the Government’s process looks like at the moment.

I am responsible for setting the security policy. The allocation of resources to meet the parameters and the requirements set out in that policy are a matter for the four areas of the Department, depending on who owns the estate. In the example of Brize Norton, that is an issue for Air Command reporting into the MSHQ. There are clear accountabilities within an issue, but on most issues like this, it is the combination of those accountabilities that gets you to the aggregate picture. I have not asked the Secretary of State to own that risk.

So you are tolerating it yourself.

Based on our initial findings, one of the issues that I think we will want to take into the defence investment plan is having the right balance between infrastructure, technology and people to ensure that the security of our built estate is in line with our risk appetite.

Before I let this go, to be clear, under the new structure, the Chief of the Air Staff must have transferred this risk up to you through his own risk management system, and it is a risk that you own the resources for or are tolerating, and therefore accountability sits with you. I assume, Secretary of State, that you would have been briefed of the risks that exist outside of parameters, such as the one at Brize Norton.

I think it is fair to say that the immediate action as a result of this was about reinforcing the security at Brize and a selected number of other sites, and upping the state of readiness and vigilance and some of the measures on all sites. But in terms of what I think you are driving at here—assessing and then settling judgments around the risk and ownership of the risk—that will emerge from the second phase of the review that I have commissioned. That is looking, in the light of Brize and in the light of the strategic defence review’s recommendation—which did point to Brize but needs to apply across the piece. In general terms, we need to take our homeland security more seriously, but that second part of the review is looking at an assessment of the vulnerabilities and asking what sort of assurance we would need in place to reduce those vulnerabilities and the risks, and then the specific governance questions, as you put them, would emerge from that. Ownership of the risk and who—

So the governance is one thing. I will let it go, but the important point is that risks should be assessed. If you do not have the resource or you are not responsible, they should be transferred up. The buck stops with the PUS, as one of the four on the quad who is responsible for it, and if he cannot control those risks and they exist outside of scope, he should brief you on them and you should be made aware.

There have been briefings on the specific incident at Brize Norton. On how we have been approaching the issue, I think the focus in the strategic defence review on the importance of the strategic base, on the threats that we face and on the importance of resilience means that our risk appetite is not in the same place now, regardless of the incident at Brize, that it might have been two or three years ago. As we get into the defence investment plan, I would expect resources to follow that change in risk appetite.

Thank you very much. Let us move on to Ukraine and the coalition of the willing.

Secretary of State, we have had 40 years of peace dividend, with successive Governments enjoying that. You have inherited an alarming situation, and you have laid out during the session lots of strategic aims over the next 10 years to rectify that, including increased spending. I am grateful for all that detail and we now have it on record. I would like to bring us more to the present day—2025. We know how unpredictable the world is, and how Russia is an unstable actor that is aggressive and willing to conduct murderous invasions with no warning. There is speculation, of course, about where and when it might do this next. Some people think that it might do it in 2029 or 2030, and some people think that it might do it very quickly, when we are not expecting it. I want to ask you about today and our warfighting ability. You described the SDR as a plan to move to warfighting readiness, which tacitly implies that we are not at warfighting readiness, or of the scale that you would like us to be, which I think is understandable. If we had to go and defend NATO’s eastern flank—I am not specifically talking about Ukraine; it could be Estonia, Finland or any of the Baltics, such as Latvia or Lithuania—what could we realistically field in 2025?

In Estonia, we would already have around 1,000 troops there—an integrated deterrence and defence planning and exercising already in place with the Estonian force—and we would respond not just as the UK but as part of a 32-strong NATO alliance. It is that strength that has helped deter Russia from that type of action in the past, but it is also that strength that needs to be scaled up now because of the perception and assessment of increased risks, as you say, Mr Thomas. That is what both the funding and the capability commitments that you saw in the NATO summit were all about, as well as the commitments that we as a UK Government have made as a result, alongside the strategic defence review.

General, let us say there is a 32-strong coalition deploying in 2025—I am talking about 2025, not the future, with future spending. Britain, as the Secretary of State said, has roughly 1,000 troops in Estonia. What kind of numbers can Britain deploy in 2025 as part of an imaginary NATO coalition? We have mentioned 1,000 troops so far. We have got that, but what else can we deploy?

Would you like to have a conversation about the coalition of the willing work?

No, just the question that I have asked you.

As the Secretary of State has said, I do not think it is appropriate that I talk about the detail of numbers. As part of the wider NATO plans—what is being asked of us in the NATO force model—we are delivering against the commitments that we need to at the appropriate scales over the next couple of years. We would be the first to say that we of course would be ready to fight, but we would also say and acknowledge that there are risks in our ability to do that. Everything that we have talked about so far in the defence review, and indeed the reform, is about making us more lethal and stronger as part of a stronger NATO.

The SACEUR has a plan for exactly what you are describing. The UK has roles to play within that plan. If that sort of action was undertaken by Russia, that is the response that it should expect, and the UK would play a part in that.

Okay, fine.

My community of Aldershot plays a role in homeland defence and resilience as the HQ of Standing Joint Command is located there. It was great to see a focus on that in the SDR. How will the SDR help to better protect our critical national infrastructure?

So you are not talking about the Aldershot base in particular. Are you talking about civilian critical infrastructure?

I am talking about the national context. How are we going to support critical national infrastructure?

I would say that, for the first time for us, certainly since the end of the Cold War, the strategic defence review has underlined the potential vulnerabilities. It has drawn attention to the increasing pattern of threat or even attacks and sabotage that we have been seeing—undersea cables, networks, cyber-attacks and threats of sabotage on the mainland. It sets a challenge to us, as a nation and as a Government, to be able to do that. We have a lead role to play in defence and the forces, but it is not entirely our job to contribute to that. That has to be led from the centre. That was the value of seeing the national security strategy follow rapidly behind the strategic defence review. That starts to point the way to the challenges we have to meet on homeland security.

I would really like some idea of what this looks like in practice. How do we support our critical national infrastructure?

It is hard to be specific at this stage about what it looks like in practice. Some suggestions are set out in the strategic defence review—for instance, it recommends that we make much better use of our reservists, that we do more than we do at the moment to maintain a relationship with and an expectation of those who leave the full-time forces to create what it calls a strategic reserve, and that we look at what potentially needs to be put in place if civilian critical infrastructure came under a more sustained, different attack.

In the last 24 hours, we have heard that the vulnerabilities at the substation at Heathrow that caused the fire were identified in 2018. We have had that information for several years and not done anything about it. What are we going to learn from that situation?

Frustratingly and shamefully, that has too often been a pattern. You could say the same about some of the lessons emerging from the covid inquiry—the risks were identified but the action to mitigate and deal with them was not taken. One of the things that the strategic defence review recognises is that there is a patchwork of different authorities with responsibility for undersea networks and cables. It recommends a greater lead role for the forces, in particular the Navy, in that. It also recommends a defence readiness Act—in other words, legislation that allows Government across the piece to have the default powers they may need if the level of attack or the level of crisis that we were facing escalated. Government are beginning to work on that as a result of the SDR and the national security strategy. Forgive me, Ms Baker, but in a way you are probing an area that is early work in progress, I think it is fair to say, for the Government generally, as well as a month after the SDR.

Sure. It is just useful for us to get our thoughts on your thinking, because it obviously is an incredibly important piece, and we are keen to understand the direction of travel.

If we circle round to where we started, one of the things that I think is so important about the new NATO pledge of 5% is that it provides a NATO-level focus for some of the things that you are clearly concerned about, and that we, as a nation, have not been sufficiently concerned about in recent years.

The SDR talks about the nature of the threats that we face at home and the whole-of-society approach that we need to take. Clearly, we have to have a really important conversation with the British public, and it is good to see a commitment to have that conversation, but we also have to not alarm them. How will you plan to have that conversation?

You have captured the challenge. You want the British public to be aware of what we are facing and sufficiently vigilant for themselves. People are becoming more aware, for instance, of cyber-attacks, some of the threats they personally face and the services they depend on being taken out of action. As Defence Secretary, I have a central concern that the British public understand, recognise and better support what our Armed Forces do. The SDR points to that but touches quite lightly on it. To double back to where we started, the continuous attitude survey published in May had for me one of the most searing and troubling statistics, which is that 12 or 13 years ago, the majority of those who served were confident and believed the British public supported them and valued what they did, but that has plummeted in recent years, so that now just one in four of those people in uniform believe the British public support them and value what they do. I am determined that we change that. We have to recognise that in part a shrinking proportion of the population has any personal family connection with the military, as we lose the national service generation. And the pool of full-time forces has shrunk in the last 14 or 15 years. Some of the moves that have had little attention, but for me are a high priority, include the recognition of the role of cadets and the recommendation, which we have accepted, that we look by 2030 to increase the cadets in this country by nearly a third—by 30%. That is part of building greater respect and understanding—and, I hope, support—for what our forces do.

If it is helpful, I was going to describe the practicalities of what we are doing from a defence perspective as part of the wider Government work on the home defence plan, and then I will come back to the whole-of-society piece. Practically, we are doing the review of what our plan is, noting that it is only a couple of years ago that we did that, recognising what the national security strategy and the SDR are telling us. We are actively doing that so we understand risk against resource, and have the plan. We love to have a campaign plan. The second piece is that we have a campaign that is looking at how we assure ourselves that we understand how we would protect the strategic base outload, which will be fundamental to any deployment—should we find ourselves in that position—and secondly, how we make sure that we have the right workforce in the right place to do some of the mobilisation. That is in a dialogue with the defence industry as well. We did a force testing exercise, which understood—probably for the first time in a while—where some of the risks sit nationally, which is much broader than critical national infrastructure or defence as we might recognise it. That is the second thing we are doing. The third part is where reserves fit into this. I think that is part of the whole-of-society conversation, where reserves come into not only warfighting but defending the nation. Looking at those three strands is part of our campaign plan. The intent is that, when we get to the NATO Steadfast Defender exercise in 2027—a NATO-wide exercise—we will test some of our ability to do that outload into Europe.

Thank you very much. Secretary of State, I know we are at the 4 o’clock mark, but given that there were votes, I have three quick areas still to cover. How much flexibility do you have?

I have the time that you require.

That is most kind of you; I know that other Members will be very relieved about that. More to the point, as Chair I am very relieved because I wanted to make sure that all the Members and areas are duly covered. Let us move on to defence transformation.

Perhaps we should have talked about this first; I am very passionate about it. We can talk about all the capabilities, readiness and everything else, but at the heart of this are our people—the people who serve, and those in the defence industry. That is very important. Last time you appeared before the Committee, in November last year, you and General Magowan told me that our Armed Forces would “lose good people” if the MOD did not make progress on the target of offering every new recruit a response within 30 days. Can you tell me what progress you have made on that to date?

I think General Nesmith can.

I can. There were two genuinely new and exciting things that we talked about on the back of the recruit and retention sprint at the start of the Secretary of State’s tenure; one of them is what we colloquially refer to as the 10-day/30-day piece. That is about making a conditional offer, in the first instance, within 10 days to applicants who have done very basic eligibility checks. It is really a behavioural thing—“We want you as part of our team; this is our commitment to you.” At the 30-day point, once we have done some more checks—or potentially not yet done them—we are able to say, in dialogue with them, “This is the date we think you should be able to start your basic training.” It is what they want, what we think we can do in the timeframe, and we commit to doing that within 30 days. We have already delivered about 9,000 of those sorts of commitment letters. We are under a remit, and I will need to report back to the Secretary of State in the middle of August, when we should be able to do that for all those eligible. We have excluded those living overseas; there are practicalities that mean that is just more difficult.

I look forward to getting some data from you—if you could tell us where you are on the statistics—so that when the Secretary of State is back in front of us in future, we have some metrics to work with.

Yes, absolutely. Measurements of effect.

We are making good progress, but we are not doing it with everyone yet. But we will.

The SDR says that people are the essential part and project of defence transformation. It talks about transformation in the SDR. What kinds of skills will the Armed Forces need more of in the decade to come—and what will they need less of?

It is almost a $64 million question. Very simply—we have talked about innovation in tech, and we have talked about threats now—we are going to need a wider range of young people with particular computing, tech and cyber skills that traditionally we have not necessarily been recruiting through the basic Army, RAF or Navy recruitment. That is one of the reasons why I announced, and we set up, the cyber direct entry recruitment. The first group of those recruits have now started training. Those recruits do not go through all the basics that the other services do, but it is an illustration of how we have had to recognise that we need different skills and talents, and that we have to draw from a different pool. We must do that in different ways. This Committee has always had an interest in the Haythornthwaite report. It formed part of the information on which the strategic defence review drew. It has also reflected some of the same conclusions about skills-based flexibility of recruitment and career development. General Nesmith, do you want to add anything? Mr Roome’s basic question is: what are the skills that we will need in the future that we do not have?

I will build on what you have already said, Secretary of State. I would say definitely some of the cyber skills—that is the cyber direct pathway. We recognise that we find some of our STEM-based trades, particularly around engineering, very difficult to recruit and retain. Some of the work we have done is about a better whole total approach offer for them. That is included as part of the financial retention incentive that we offered to engineers, which has had a very good uptake. The third area where we have more work to do is our healthcare. We are not alone there. We will need to do it in conjunction with the NHS to work out how we meet some of those gaps.

Does the Committee have the data on the two particular retention incentives that we introduced and their impact? If you do not, we will give you the emerging data.

It is engineers across the services, and then particularly an Army—

I was not going to ask you a question on that, Secretary of State, but you mentioned it. We offered the RAF engineers something like £15,000 one year and £15,000 the next year to retain them. That is a sticking plaster, isn’t it? Long term, what is the MOD doing so that we can actually retain those skills and attract people into the defence sector, when we are competing with private commercial entities?

When you see the data or if you speak to any of those who have accepted the retention bonus, you will see that they see it as more significant than a sticking plaster, with respect, but it is not the full solution.

I do not mean how they would see it. I am just asking how we are addressing it in the meantime so we will not be like that in two years’ time.

You have heard me talking about needing to renew the nation’s contract with those who serve. If you look through the continuous attitudes survey to find the things that demoralise people most, or the factors that are most likely to make them think about leaving service early, very often, housing is at the heart of it, as well as support for their partner, particularly if they are a working family. We are trying to deal with the latter. On housing, there is no one solution, but unless we can make decent housing part of the contract with those who serve, and, in my view, make it possible for them to sign up, serve in the forces for a significant amount of time and realise the aspiration that so many have to own their own home, we will not fundamentally deal with some of the retention challenges that have built up over the years.

Permanent secretary, when you came to speak to us in November, you said that over the course of this Parliament you were going to reduce the number of permanent civil servants by 10%. I wonder, seven months on, how you are getting on.

First, let me underline the really important contribution that civil servants across defence make in a range of roles—both to support Ministers in their responsibilities and, more generally, to support Armed Forces service personnel and their families. The SDR sets out an ambition to reduce workforce costs for the civil service by around 10% over the rest of this Parliament. That is consistent with the cross-Government target on reduction in administration costs for each Department, with actually a stretch to go further. The important thing in those targets is looking at pay bill—at workforce cost rather than headcount. That gives us more flexibility in those areas where we want to grow—for instance, cyber or digital skills. We are thinking about some areas where we may want to civilianise or bring in permanent civil servants, contingent labour or external assistance. The numbers as they currently stand are around 55,000 civil servants. We are working through, as part of the defence investment plan, a series of efficiency and productivity measures. The Secretary of State has talked about our assumptions about the kind of productivity gains—in financial terms, £6 billion over the period—that we will look to then invest in frontline capability. It is a work in progress. The numbers continue to be on a downward trend from a peak a few years ago of about 58,000. We have come down by about 3,000, but there is more to go. The intention is to either publish as part of the defence investment plan, or alongside it in the autumn, a defence reform and efficiency publication that will set out the detail there. It is a more flexible target around pay. My expectation remains that the civil service within defence will be smaller, but it will be more capable, better trained, more agile and more deployable. On civil service careers within defence, against the kind of ambition set out in the SDR and the investment we have—and as we make a success of defence reform—it remains a great place for civil servants to work.

I call Calvin Bailey to ask about the infamous E-7 Wedgetail programme.

We were going to buy five, and then three, E-7s. They are horrendously late and overpriced. We have got one in with a special clearance, meaning that there is something that we do not know about that means that it cannot have a normal clearance. The Americans have pulled their commitment to the programme, and Boeing appears ambivalent. Could you give us an update on where we are with the programme and the risks to it?

If you will accept this, Mr Bailey, if you have a series of questions about Wedgetail in particular, rather than try to deal with them in this oral session, supply them through the Clerk and I will answer them.

Can we come into the Department and have a discussion about this, because we have not had a follow-up on one of the things that was presented to us behind closed doors? There is a pretty major risk to the programme, on the basis that the US has pulled out.

If that is your preference, then I am happy to deal with it in that way.

Let us move on to more transparency at the MOD.

On the defence equipment programme, there is £300 billion of defence equipment that we have effectively not been able to scrutinise since the change in 2022, when that was not published. Obviously, there is the investment plan, which is due to be published around autumn, I think. Mr Williams, you were asked a question at the December meeting last year and then the PAC meeting about our inability to do this. To paraphrase your answer, you said, “We are looking to see how we can help the Committee.” Seven or eight months down the line, we are still looking to see how you are able to help the Committee. Can I ask you a specific question along with that? Can you tell us what the forecast equipment costs are over the next decade, and the value of the budgetary shortfall or surplus against this forecast? There are two parts to that question.

Let me answer the second one first, which is: today, no, I can’t, because we are about to take the conclusions from the SDR into the defence investment plan work, which we have set out will take place over the next few months.

Sorry—you are saying no, you can’t, to which question?

To your second question on the cost of the programme against the budgetary shortfall. Both sides of that equation have changed and are changing.

So you do not know what the shortfall or surplus is.

Across a 10-year period against the programme of record, I do not expect there will be shortfall, because—

So will there be a surplus?

It is because in comparison with the last equipment plan that the NAO reported on, we now have a commitment to 2.5% of GDP earlier in this decade, 3% in the next Parliament and 3.5% by 2035, so the budget has changed quite fundamentally.

I am sorry to interrupt, but I want to get this right. I get that things change, but you are saying, if I understand this correctly, that the MOD does not have a clue whether it has a surplus or shortfall in its equipment budget.

No, what I am saying is that the increase in the defence budget over the next 10 years is substantially larger than the shortfall that was identified in the equipment plan last publication. I think, with respect, there is not an awful lot of value in comparing that new budget against the programme from two years ago, which reflects the plans of the previous Government, and does not reflect the direction of travel in the strategic defence review or the choices that we are about to make in detail to decide how the new budget will be allocated. The Secretary of State has set out some of the firm spending commitments that we have made on publication of the SDR, which will clearly be inked in, but there are a range of other capability choices that we need to make. To segue to your first question, it is not that we have been sitting on some secret equipment plan that we have not been willing to share. The last equipment plan—

Well, you have, because you have not been willing to share it with us. You have been saying that you cannot share it with us, because it would affect national defence security.

The last fully ministerially endorsed equipment plan the Department had was in 2023. As we were working through the following year, it did not get finalised, because we were expecting the Government of the day to commit to an increase in the budget to 2.5% by 2030. We were not able to work that through. It was not, in the end, a funding commitment, and the election was called. We have then launched a strategic defence review that has been addressing these sorts of questions about where our priorities sit. Now, we are going to land those decisions against the increased defence budget that this Government have committed to.

But we know the forecast cost for Defence Nuclear Enterprise has risen by £10 billion up to 2033. That figure was announced at the PAC, so you can announce that figure, but not—

We have elements of cost growth or variation in individual programmes, but the content of the equipment programme overall, how much we want to invest on which capabilities, and the sequencing of that investment, not least against NATO targets, is a matter for the defence investment plan over the next few weeks. We have not only started that work—the Secretary of State may want to talk a bit about the defence investment plan in detail—but we have also started engaging the National Audit Office about how we might engage it in that work as it goes along, so that it can produce its assessment of our plan once it is published in the autumn.

So you cannot give us the figures. You have just said there is a shortfall, because of the extra money. You can calculate that at the moment—is that what you are saying?

No, what I am saying is that the shortfall we identified—

So what you are actually getting will be less, because you have to fund the shortfall as well, but we do not know what the shortfall is.

This is why I think it is, with respect, not a particularly productive argument. The shortfall we had in—

Sorry, mine is not a productive argument?

Both sides of this equation—the content of the programme and what we are spending—are changing. The shortfall that we previously identified was a programme that then existed against a budget that we had. The budget has changed, and the SDR says that we need to change the capabilities that we are investing in, so both sides of that equation will go. I am simply saying that the increase in the defence budget is higher than the shortfall that we had last time round, but we do not necessarily want to spend our money in the same way as the equipment plan set out in 2023. We very specifically want to spend it in different ways. I am afraid it is a kind of “watch this space”.

You say “watch this space”, but at what point will we possibly get this information?

The autumn.

Just “the autumn”?

The autumn.

What information will we be given as a Committee?

You have not had what you are used to: a comprehensive equipment plan of which the NAO can do a proper assessment, including of its affordability. The reason for that is simply that the last equipment plan—and you are right, Mr Twigg, the NAO judged it to be unaffordable, as it has judged five out of the last seven equipment plans—was a reflection of the programme of planned purchases derived from the last Government’s integrated review in 2023, and the defence Command Paper that followed. We are a different Government with a different ambition for defence, and a different set of commitments for defence in our manifesto. We had the election six months after the last equipment plan was published, and the NAO’s assessment published alongside it. Within three weeks of that election, we kicked off the strategic defence review that resets our vision for defence, and it reported a month ago. That becomes the way that we settle our own composition of that comprehensive set of decisions about how we invest for the future. In old money, that would be the equipment plan, but the defence investment plan will supersede that and will be different in a number of ways.

You said it will be in the autumn. What information will the Committee be able to have in the autumn that we have not been allowed to date? Compared with ’23, what will be different about the information that the Committee has access to in the autumn, in terms of transparency?

It is not information that you have not been allowed; it is just that there is no comprehensive equipment plan to be assessed and audited in the way there has been before, because we have had a general election. We have a different Government, making different and bigger commitments to defence spending. We will make different decisions about the capabilities that we think our forces need. We will make different decisions, in some cases, about the pace of those. There will be elements that will be consistent in all arrangements—you cite nuclear, and our commitment to the continuous at-sea deterrent. But this will be not just about the equipment that we set out to procure and when we procure it, but about some of the investments that we need to make to realise the strategic defence review, including some of the infrastructure that has never figured, and never been detailed and put in its proper place, for you and the National Audit Office to properly scrutinise and hold us to account on. You will be able to do that in the autumn.

Secretary of State, from one Yorkshireman to another—you know how we talk bold—can you be bold in your reply, and tell me the date that the defence industrial strategy will be published? Lots of people and businesses out there want it to say things that will improve the internal workings of the Ministry of Defence, around the procurement stuff—all the things that we pick up from industry when we are out there doing visits. Will you be bold and tell us that we are going to get it definitely before recess?

You are dead right, Mr Roome: there are a lot of defence businesses and investors out there that are making a really useful contribution to the work that we are doing on the industrial strategy. It is well advanced, and the answer to your question is “soon”.

Defence Secretary, you never said that when you were in Wakefield. I know you were born in Wakefield; what would your father have said to you if you came back and said that to him? He would have said, “Hang on, that is not an answer, son.” Would you say before recess or not? Will we get it before recess? Can you be bold?

If I was in the Travellers Inn in Parkgate—which you are familiar with because it is close to where you grew up—and I said “soon”, they would understand what I was talking about.

On that high note, I once again thank you, Secretary of State, and thank the permanent secretary, Mr Williams, and General Nesmith. Thank you for your time and flexibility, given the vote. We are very grateful, because we could get everybody in. You were not held fully to your word; we could have stayed on until midnight, because you said your time is fully flexible.

You’re losing your members, Mr Chairman.

Don’t worry; it’s quality, not quantity. Thank you so much for your time.