Aircraft Carriers and UK Shipbuilding

Debate between Lord Hammond of Runnymede and Jim Sheridan

Wednesday 6th November 2013 Commons Chamber

[Mr Hammond]

My hon. Friend is, of course, right. As I acknowledged in my statement, the decision will be very hard for people in Portsmouth to accept. However, we should put this in context: 940 jobs will be lost, but 11,000 will remain in dockyards-related activity in Portsmouth, which will be the largest centre of surface maritime support in the United Kingdom—and that will continue into the future.

We are engaged in discussions with both Portsmouth and Southampton city councils about the city deal proposal, and I am advised that a statement is likely to be made very soon, as soon as those negotiations have concluded.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

As a former shipyard worker, let me say on behalf of the men and women in our British shipyards that, although they take pride in what they build, they do not necessarily care what they are building. Those at BAE Systems must learn to explore the commercial market, because they will not be able to sustain the company if it is wholly dependent on MOD contracts.

As for the question of industrial relations, we should contrast what is happening with the trade unions at BAE Systems with what has happened at Grangemouth. One employer respects its employees, and the other does not.

[Mr Hammond]

I am happy to report that relations in the shipbuilding industry between management and unions are good and constructive. The unions understand the challenge that the industry faces, and they have worked with the management to address it. That sometimes means that union officials must make tough decisions as well, because they know that the industry cannot be sustained at its current size.

The hon. Gentleman alluded to the diversity of the shipbuilding industry. We hear a great deal about how shipbuilding will be sustained through the commercial market and the third-nation market, including the market for warships, but I am afraid I have seen no evidence to suggest that we are able to compete in what is a very aggressive global market for commercial shipping. I think that the shipbuilding industry in this country will be primarily dependent on Royal Navy orders placed in the United Kingdom, because of the sovereign requirement for us to have warship building capability.