AUKUS

Debate between Lord Bilimoria and Earl of Minto

Thursday 29th February 2024 Grand Committee

[The Minister of State, Ministry of Defence (The Earl of Minto) (Con)]

My Lords, I too am grateful to my noble friend Lord Risby for initiating this debate and to all noble Lords for their constructive and extremely thoughtful contributions. It is fair to say that I have never been asked more questions in such a short period, so I will be doing quite a lot of writing. However, I hope to pick them all up either now or through answering some of the more specific ones.

It is indeed two and a half years since we launched the AUKUS defence and security partnership to bolster global security alongside our equal American and Australian allies. Since then, the challenges to address have become more acute. Putin has brought war to Europe, tensions have heightened in the Indo-Pacific, and terrorism and violence have been unleashed in the Middle East. Military coups have toppled Governments across the Sahel and the Houthis are holding global trade hostage in the Red Sea. Each of these global security setbacks magnifies the need to advance our military capabilities through partnerships such as AUKUS. This is about much more than building the next generation of submarines and other capabilities. It is also about establishing a more sustainable industrial base and developing the skills for the future. With that in mind, I will provide an update on the progress we have made on the various AUKUS workstreams and I will try to address the questions raised by the noble Lords.

First, AUKUS pillar 1 is our commitment to help Australia develop a conventionally armed nuclear-powered submarine capability. Last March, AUKUS leaders announced that this new platform would be based on designs for the UK’s next-generation submarine that will replace our current Astute class. They will incorporate cutting-edge US technologies and will be the largest, most advanced and most powerful attack submarines ever operated by the Royal Navy. They will enhance our capability to operate in the north Atlantic and will further our objectives around the world. They will be built in Australia and the UK and will enter service with the Royal Navy in the late 2030s, and with the Royal Australian Navy in the late 2040s. This phased delivery will enable us to work together to build up the facilities, skills and experience needed for all partners to operate the vessels both safely and securely.

I was delighted to see the Australian high commissioner and his deputy earlier this week. We had a very positive, enthusiastic conversation about precisely this point on skills, training and experience. The opportunity of working ever more closely together on this critical task, developing joint skills and sustainable employment for decades to come across all three nations should be rightly celebrated, and that work is well under way.

The Government have committed an additional £5 billion up to 2025 to modernise the UK’s nuclear enterprise and fund the next phase of the AUKUS submarine programme. It is obviously very difficult, as the noble Lord, Lord Browne, rightly knows, to budget very accurately when we are talking about 2030, which is years ahead. However, the determination is there to ensure that the procurement process is both accurate and timely.

AUKUS partners BAE, Babcock and Rolls-Royce have already been awarded contracts worth £4 billion to procure long-lead components for the submarines. This will support thousands of highly skilled jobs in the UK, particularly in Barrow, where the UK’s submarines will be constructed, and at the Rolls-Royce Raynesway site in Derby, which will double in size to manufacture all the reactors for the UK and Australian subs, creating around 1,100 new jobs. We have also accelerated nuclear co-operation and training between AUKUS partners, offering enhanced opportunities for Australian sailors to train in the UK and the US, including on non-nuclear submarines, and we have committed to more planned visits to the US and nuclear-powered submarines to Australia.

On pillar 2, although the media spotlight has shone brightest on our submarine collaborations under pillar 1, AUKUS has always been about a much broader range of defence and industrial collaboration under pillar 2. From better information and technology sharing to new cutting-edge joint capabilities and more seamless interoperability, as well as strengthening the resilience of our defence sectors, these objectives were centre stage at the AUKUS defence ministerial meeting in December, where Ministers announced new pillar 2 capability programmes on AI, autonomous systems, threat detection, undersea warfare, quantum technologies and cybersecurity, as well as a separate deep space advanced radar programme and a programme of industrial engagement. We are making steady progress with many of these capabilities and, wherever possible, we will continue to be transparent and provide updates as we reach important milestones or embark on new endeavours.

Our ambition to deliver nuclear-powered submarines for Australia will remain trilateral. However, as our work progresses on AUKUS advanced capabilities—pillar 2—and other critical defence and security capabilities, we are open to engaging with allies and close partners. Defence Ministers also announced new future combined exercises, including a joint exercise in the autumn of 2024 off the east coast of Australia to test new equipment to protect critical underwater infrastructure, including autonomous systems. Joint exercises such as this improve our ability to work together and enhance the development of new capabilities.

My noble friend Lord Risby is absolutely right to raise the important function of the AUKUS working groups, which continue to progress the ambition set out in December by Defence Ministers. I am also grateful to him for highlighting the pivotal role that Barrow will play as a home of UK submarine-building. The Government have committed £5 million to support the long-term delivery board for Barrow and are working in close co-operation with Westmorland and Furness Council and BAE Systems to develop that community. With the infrastructure to support this ambition, it should be a thriving place for people to work and live. That includes local transportation and other community projects.

Critical to the success of AUKUS and the strength of the partnership is our ability to forge deeper and more seamless ties between our nations right across the defence sector, so we were delighted that Congress recently passed legislation to establish an AUKUS nations exemption to the International Traffic in Arms Regulations—ITAR—for the UK and Australia. I understand some of the concerns about the small print of this, but the principle having been taken is a very significant step in the right direction.

Closer collaboration and exchanges between our businesses and experts will drive innovation, enable us to make the most of emerging technologies and provide an opportunity for UK defence companies to turbocharge exports. To further grease the wheels of innovation and trade, we have established the advanced capabilities industry forum and will shortly publish the first AUKUS innovation challenge, deepening those crucial links between our three systems to ensure we support the development of skills fit for the future workforce.

[Lord Bilimoria (CB)]

I thank the Minister for giving way. He just mentioned the AUKUS advanced capabilities industry forum and collaboration with trade and industry. That is absolutely spot on, but no one mentions working with universities. Is there not huge potential for the AUKUS programme, in the USA, Australia and here in the UK, to work with our world-class universities to turbocharge this programme? I am chancellor of the University of Birmingham, which last week won a Queen’s Anniversary Prize at Buckingham Palace for its work with Rolls-Royce on aero-engines. It is so powerful. Should we not be promoting this more?

[The Earl of Minto (Con)]

I could not agree more. Rolls-Royce is in the process of doubling its graduate intake between 2022 and 2025, and taking on an enormous number of apprentices over the next 10 years to ensure that we build up this capability of proper, genuine, well-paid and highly skilled jobs for life—exactly the sort of thing that the noble Lord refers to.

Alongside our AUKUS partners, we have also committed to co-operate on the deep space advanced radar capability programme. Although DARC is not part of AUKUS as a result of the particular nature of regulatory requirements covering space-related technologies, it is a clear benefit from the closer trilateral working relationship that we have forged through our AUKUS partnership. That shows the breadth of thinking that AUKUS is projecting.

A couple of noble Lords raised our non-proliferation obligations. As part of the AUKUS programme, we have engaged extensively with the International Atomic Energy Agency, as noble Lords would expect. The UK, the US and Australia are fully committed to an approach that protects classified information and strengthens the global regime.

On the question of other strategic allies in the Indo-Pacific, such as Canada, Japan or indeed South Korea, which was mentioned, we already enjoy close defence relationships.

On exchanges, we currently have three Australian officers embedded in the Royal Navy submarine officer nuclear training pipeline and two Royal Australian Navy personnel embedded in the Submarine Delivery Agency in the Defence Nuclear Organisation. An advanced verification team formed of experts from all three partner countries visited Pearl Harbour and Faslane last year to build our understanding of the maintenance and industrial skills required to maintain nuclear submarines.

I shall just go through some of the specific questions. The noble Lord, Lord Browne, asked about costs and contingencies. In addition to the £3 billion extra provided to our Defence Nuclear Organisation, I confirm that there will be sustained funding to support the AUKUS programme over the next decade. It will be a process of iteration but the commitment is absolutely there.

Can we really build submarines faster than ever before? We have a commitment from our industrial partners and confidence in that. Rolls-Royce is producing the reactors and we have invested billions of pounds in both Barrow and Derby. As I said, we have committed to more than 1,000 new jobs already.

It is better that I write to the noble Lord, Lord Browne, about our assessment of uncrewed submarines.

At this time, it is not for me to comment on President Trump and the presidential candidates’ views. At the moment, all three parties are confident of the longevity of the tripartite agreement.

On the question of jobs in Belfast, there is indeed a very proud tradition and industrial past of shipbuilding in Northern Ireland and across the UK. I take the point: Barrow-in-Furness has the licence and capability to build the submarines, but I am certain that there will be a lot of SME opportunity that includes Northern Ireland. In fact, we will ensure that it does.

In closing, I express my gratitude once again to my noble friend Lord Risby for initiating this important debate on AUKUS. Our national defences have always been dependent on the strength of our resolve, the quality of our people and capabilities, and the power of our alliances. In our more dangerous world, the AUKUS partnership is strengthening all three of these elements. Our adversaries may be aligning but, through AUKUS, the UK, the US and Australia have become ever more connected, prepared and lethal. AUKUS is a partnership building bridges across the Atlantic and the Pacific. It is a partnership for the future that, I hope, will keep us safe for generations to come.