Alan ToveyTue, 23 March 2021, 5:33 pm
British shipbuilding is set for a “renaissance” following a government U-turn on how it classifies warships.
Unveiling the the changes in the Commons on Tuesday, defence procurement minister Jeremy Quin said the new policy will make clear the option to “choose to procure warships of any description here in the UK”.
The statement was a reference to building a new class of “fleet solid support” (FSS) ships to provide the Royal Navy with supplies such as ammunition and food, allowing the fleet to stay at sea for longer.
Previously, EU procurement rules allowed the Government to restrict bids for warships to UK companies, but the Government had refused to class some Royal Navy support ships as warships.
Unions have argued that constructing the £1.5bn contract the three new 40,000-tonne vessels is vital to sustaining Britain’s shipbuilding industry until the next major round of naval contracts.
Mr Quin said the reforms marked a “step change” in the Government’s approach to the defence and security industrial sectors.
He said: “It will help retain onshore, critical industries for our national security and our future. It will help us develop advanced skills and capabilities.
“And with defence procurement benefitting every part of our Union it will help galvanise our levelling up agenda.”
Documents detailing the new Defence and Security Industrial Strategy said decisions on how the Ministry of Defence contracts work for new classes of ships will be made “on a case-by-case basis”.
Also taken into account will be that a “regular drumbeat of design and manufacturing work is needed to maintain the industrial capabilities”, along with “social impact”, such as how many jobs they create or how they reinforce the UK’s supply chain.
An all-British consortium dubbed “Team UK” comprising BAE Systems, Babcock, Cammell Laird and Rolls-Royce, is understood to be one of two parties bidding for contracts.
The other is “Team Resolute”, consisting of British maritime consultancy BMT, Harland & Wolff, which is owned by Infrastrata which recently acquired Appledore, along with Spanish state-owned shipbuilding company Navantia.
Shipbuilding unions warned that much of the value of the FSS contract could still go abroad if the MoD seeks the cheapest option without considering wider economic impacts.
Ian Waddell, head of the Confederation of Shipbuilding and Engineering Unions, said: “The MoD is completely keeping its options open on using competition, including internationally, as the procurement model for auxiliary ships and potentially now for warships, which is actually a step backwards.”
He claimed the approach will weaken Britain’s shipbuilding sector as it “increases, rather than removes uncertainty, as each procurement will be decided on a case-by-case basis”.