Sheffield Forgemasters

Baroness Smith of Newnham Excerpts

Wednesday 8th September 2021 Lords Chamber

[Baroness Goldie (Con)]

Yes, I am happy to give my noble friend that assurance. It is demonstrated by our commitment to provide up to £400 million of funding to the company over the next 10 years. Some of the defence programmes that Sheffield Forgemasters is a unique supplier to will in fact stretch beyond that period, so we have acted to ensure that the company continues to be able to meet these long-term requirements.

[Baroness Smith of Newnham (LD)]

My Lords, the cost of Sheffield Forgemasters was £2.56 million and there is already an agreement to have another £400 million of expenditure. To what extent is that coming from existing defence budgets and to what extent is that additional expenditure? Is this because, yet again, a defence procurement has not been fully thought through?

[Baroness Goldie (Con)]

As I think is universally understood, this was really a stand-alone case and a matter for essential intervention to preserve critical national infrastructure. The financial undertakings to which the MoD has committed itself include the share capital purchase, as the noble Baroness has indicated. It also includes taking on and refinancing the current indebtedness, which is approximately £19 million, and the capital investment that we have just been discussing. I say to the noble Baroness, as I observed earlier to the noble Lord, Lord Walney, that this is a company with an exciting commercial future. This is an ongoing enterprise and defence’s role is to ensure, as my noble friend inquired about in the previous question, that this company has a secure future—a sufficiently secure future that we can return it to the private sector.