National Shipbuilding Strategy

Chris Stephens Excerpts

Thursday 11th July 2019 Westminster Hall

[Dr Lewis]

That is true, because if we fall below what one might call critical mass, we will not be able to maintain the necessary footprint to support the construction and manning of vessels on a consistent basis. That is why the question of the fleet solid support ships is so important. Those vessels can be classified as warships or, if we choose not to, simply as auxiliaries. We have that choice, and it is a choice that we feel, on a cross-party basis, it is necessary to exercise.

The trouble that the Ministry of Defence runs into is that every time a long-term strategic view suggests to it that we ought to make an investment of this sort, it runs up against the short-term imperative that the defence budget is so small that cuts must be made at every opportunity, even where, as in this case, they are short-sighted and storing up problems for the future.

[Chris Stephens (Glasgow South West) (SNP)]

I thank the Chair of the Defence Committee for giving way. Is there not another priority for the MOD—the increased submarine activity we are seeing from Russia? The lack of Navy surface vessels could contribute to that. The modernising defence programme really needs to address that issue.

[Dr Lewis]

I entirely endorse what the hon. Gentleman said, and I am glad that he mentioned the modernising defence programme. I will take a moment to talk about that exercise. It was felt at the time that the programme was not a very substantial document, but it did rescue the armed forces from what I can only describe as a bureaucratic ambush laid out for it by something called the national security capability review.

Right hon. and hon. Members will remember that that mini-strategic defence review was an exercise that I believe began in 2017 and was conducted not by the Ministry of Defence but by the National Security Adviser, who is currently also the Cabinet Secretary. It was designed to consider security, intelligence, cyber-warfare and defence all in the round. I even heard Sir Mark Sedwill in front of a Committee on which I sat refer to a £56 billion defence and security budget, thus taking all the budgets and putting them together, as it were, in a single basket. There was only one snag with that. If the review decided, as it was minded to do, that much more money needed to be spent on what was called “21st century threats” such as cyber-warfare and ambiguous or hybrid warfare, as there was to be no extra money for anything, the already depleted conventional armed forces would have to be cut further.

The hon. Gentleman’s point is therefore particularly pertinent. Although we live in a world where we face new hybrid warfare, cyber-warfare and other highly technological threats we have not faced before, that does not mean that the traditional threats on the sea, under the sea, in the air and on land have gone away. It is a profound mistake to say that, just because we need to spend more money to meet novel threats, we can afford to spend less money to keep up the strength of our conventional armed forces.

I referred briefly to the Defence Committee’s original report from April 2016, entitled “Shifting the Goalposts?” that set out charts showing the decline in defence expenditure to barely 2%—and that figure was achieved only by including certain categories in the total, such as war pensions, that NATO guidelines allow us to include but we never previously chose to. We just scraped over the 2% line by doing that. I will not spoil the effect by revealing in advance what the new figures show, but believe me, they are not cause for great comfort.

We are now at a stage when we are expecting a change of Prime Minister. Every Prime Minister has a honeymoon period. Even the present one did—sadly, it did not last all that long. In this case, the person most likely to become the next Prime Minister projects an optimism, a sunny personality and a robust world view.

I suggest that all of us, from whichever party we are, should remain united on one thought—there will be a brief window of opportunity. There will be a moment when we will have a new occupant of No. 10 Downing Street who will be full of the joys of spring. This will be our chance to say that the great naval traditions, all those matters of history and all the events in which his great hero, Sir Winston Churchill, participated as First Lord of the Admiralty and later as Prime Minister will be laying, as another Prime Minister once said, the hand of history on his shoulder. What better way to shake the hand of history than to restore defence spending to its rightful place in the scale of our national priorities?

--- Later in debate ---

[Chris Stephens (Glasgow South West) (SNP)]

It is, as always, a pleasure to see you in the Chair, Mr Evans. It is also a pleasure to represent the Clyde shipyards and the shipyard workers of Govan in the Westminster Parliament. On Friday morning, I had the opportunity to see the work being carried out on the Type 26 frigate HMS Glasgow, which is being made in Govan. In a few weeks’ time, I look forward to going to the steel-cutting for the second Type 26, HMS Cardiff.

I thank my good friend, the right hon. Member for North Durham (Mr Jones), for securing this debate and for his fantastic work as chair of the all-party parliamentary group on shipbuilding and ship repair. I am delighted to serve on that APPG, which reflects the public affection and support for the shipbuilding industry across the UK. That affection and support crosses political boundaries, as we have seen today. Whether someone is a supporter of the Union or independence for Scotland, or indeed of Brexit or remaining in the European Union, right across the range people care deeply about the shipbuilding industry in Scotland and the United Kingdom. As the right hon. Gentleman said—I was delighted that he highlighted it—the export success of the Type 26 frigate shows the world-class design capability in the workforce on the Clyde.

I was not the only visitor to the Govan shipyards on Friday. I was there in the morning, but on Friday afternoon there was another curious visitor to the Clyde shipyards—but I will return to the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) shortly. I will first say that I agree with the points made by all those who have spoken so far in paying tribute to the trade union movement. I am clear that were it not for the pressure that the movement has placed on all political parties, we would not have a shipyard industry at all and, indeed, the CSEU—the Confederation of Shipbuilding and Engineering Unions, which is having its conference today—has written to the two contenders to be the next Prime Minister. It did so because in a couple of weeks—I say this with great affection and respect to the Procurement Minister—he may not be the Procurement Minister; we do not know. There are rumours of shredders in the Departments working overtime in preparation for the new regime. It might even be you, Mr Evans, who is called to become the Defence Procurement Minister.

[Mr Kevan Jones]

Scraping the barrel!

[Chris Stephens]

The right hon. Gentleman says that, but I can assure you, Mr Evans, that I could name a lot worse—but I will not.

The CSEU wrote to the two contenders asking them about support for the shipbuilding industry and specifically on the issue of the Royal Fleet Auxiliary fleet support ships. It has yet to receive a response from either contender. It was curious that the right hon. Member for Uxbridge and South Ruislip should appear in a shipyard in Scotland but not mention his support or the importance of the shipbuilding industry to the United Kingdom—curious indeed. Not only those who work in the shipyards but the general public are entitled to know what the direction of travel will be under the person with the sunny disposition referred to by the Chair of the Defence Committee, the right hon. Member for New Forest East (Dr Lewis).

The public are entitled to know what both of the two individuals contending to become Prime Minister will do for the shipbuilding industry, and in particular whether they believe that the Royal Fleet Auxiliary support ships should be built in the United Kingdom. As the CSEU clearly stated in the foreword to the all-party parliamentary group report on the importance of the Aircraft Carrier Alliance, which other hon. Members have mentioned,

“that work is now coming to an end and the CSEU believes that up to 20,000 skilled jobs in shipyards and 20,000 jobs in supply chains are now at risk. There is an urgent need for work to fill these yards.”

I totally agree with that proposition.

The excuses about fleet support ships not being warships are curious. We might think that they were some sort of cruise liner—that the next time we watched an episode of “The Love Boat”, we would see this fleet support ship that has been built and is somehow not a warship. I understand from parliamentary answers that those ships will take part in, for example, counter-piracy. I have never seen “The Love Boat” involved in counter-piracy, but I know that warships are involved in it. To suggest that ships that are armed with naval guns are not warships is curious.

[Mr Jones]

Does the hon. Gentleman agree that a ship that is equipped with Phalanx guns is a warship? They are not there to keep the pigeons off the deck.

[Chris Stephens]

That is an excellent analogy, perhaps better than the one I used. The right hon. Gentleman is absolutely correct: these are warships. If it looks like a warship and acts like a warship, it is reasonable to assume that it is, in fact, a warship and not a civilian ship.

The criterion should be changed to designate fleet solid support ships as warships. If I understood correctly the answers the Minister gave the right hon. Member for North Durham and others in Monday’s Defence questions, that will be the direction of travel. It is all very well saying that will be the future direction of travel, but it should be the immediate one for those contracts. The GMB trade union has said—a point emphasised by my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman)—that 6,500 jobs could be created by securing that; £285 million of the estimated cost of the order could be returned to taxpayers—money that would be lost should the order go overseas. That is an important criterion that the Ministry of Defence, and the Treasury, appear to overlook.

After four years in this place I am starting to believe that it is the Treasury that makes the defence decisions, not the Ministry of Defence.

[Dr Julian Lewis]

Definitely.

[Chris Stephens]

Apparently the Chair of the Defence Committee agrees. If the Treasury is making those calls, surely it has to take account of the fact that the workers who would build those ships would pay income tax and national insurance that would go back into the Treasury coffers, but that will not happen if the contracts are sent to other places. Unite has estimated that the Treasury would receive 36p in every pound from those defence projects. This is an excellent opportunity for the Minister—in the next two weeks, before his elevation—to demonstrate the Government’s commitment to taxpayer value by making sure that the ships are built in the UK. I have other constituency demands, which I have lobbied the Minister about, and I hope he will take my advice on those in the next couple of weeks, too.

There are plenty of examples of other countries—normal-sized nations or larger ones such as the UK—that better plan their sovereign naval defence capability, build their warships and keep their drumbeat going. As my hon. Friend the Member for Dunfermline and West Fife highlighted, and as shown in my exchange with the Chair of the Defence Committee, this issue is important in the context of current Russian activity. The excursions into Scottish waters are increasingly blatant but there are still no Navy surface vessels based in Scotland—they are all based on the southern coast of England. That seems a very curious way of organising defence when there is increased Russian submarine activity.

As others highlighted, promises have been made about the shipbuilding industry. We heard the classic one that there would be 13 Type 26 frigates; the Treasury then interfered and they became eight Type 26 frigates, and then five Type 31 frigates. Despite that announcement more than three years ago, I still do not know exactly where the Type 31 frigate sits within the Royal Navy and what its purpose will be. It may have a general purpose, but where does it fit in? It is just a smaller and cheaper ship, and that seems to be the only reason it exists. That ship was supposed to be exportable—one that would be easier for BAE Systems and others to sell abroad, so perhaps we might think about going back to 13 Type 26 frigates. In relation to the Type 31 frigate, the Minister should look at the benefits of the prosperity agenda across the UK; I hope he will give a commitment to that.

Now, there is the frigate factory. A former Defence Secretary still insists that the frigate factory exists in the Clyde, and has found himself arguing that twice in the House of Commons Chamber. On one occasion, the GMB trade union and a BBC journalist with a television camera went around the site of the proposed frigate factory and found ash. There is an important point here, which is contained in the all-party parliamentary group’s report, and I hope the Chair of the Defence Committee will pick it up: the Ministry of Defence needs to look at giving some support to shipyard investment. It is no use the Treasury and the Ministry of Defence insisting that they want the industry to build more efficiently and save costs if they do not help the industry to invest in its own shipyards. That shipyard investment can ensure that ships are built more efficiently and cheaper.

[Mr Kevan Jones]

It is about not just Government investment but private sector investment. Companies such as BAE Systems must make that private sector investment if there are long-term future orders for those yards. Does the hon. Gentleman agree that what we do in this country is in stark contrast to the Canadians’ investment in new shipyards at Halifax, and the Australians’ investment in Adelaide?

[Chris Stephens]

I absolutely agree. What Canada and Australia are doing seems light years ahead of what the current UK Government are doing. I am sure the right hon. Gentleman will agree that, for far too long, the shipbuilding industry has been experiencing feast and famine—a stop-start period in which there is no continuous drumbeat to build. He is right that the Government have to make a continuous commitment, with the private sector, to look at shipyard investment.

The APPG report—the Minister has a copy—lists 10 reasonable and excellent recommendations. As a member of the APPG, I am very proud of the report, which is about ensuring that we have a thriving shipbuilding industry. One of my frustrations when shipyards are shown on television is that there is always a clip from the 1970s, with the welder wearing the welder’s helmet. I have some sympathy for that because I have family members who were welders, but the industry is far more highly skilled than that. The design is far better. I recommend anyone to visit the visualisation suite of BAE Systems—I know the Minister has been there, as have I. It shows the highly skilled way in which warships are built.

I fully support the all-party parliamentary group’s report, and it has been a pleasure, as always, to take part in this debate.

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[Stuart Andrew]

The next time it comes to me, I will push it back, so that hon. Members can challenge that. We can make strategic decisions, but we are governed by the rules of the Treasury Green Book, which we obviously have to follow. The debate on that is a wider debate that we need to have.

I want to put to bed some questions on the FSS. Frankly, we are at a point in the competition at which to delay it and start again would not be helpful for our plans for the carrier groups, so I cannot say to right hon. and hon. Members that that competition will change. It is still an international competition and will continue to be. That said, we still have a UK consortium in there, which should we welcomed. I sincerely hope that that consortium submits a competitive bid that not only features the skills we have been discussing, which are highly valued around the world and have certainly provided success in areas such as Australia and Canada, but help it to become more internationally competitive. Again, that is part of the strategy. We hope that it may well win some more of that work.

There were a couple of comments about the frigate factory. I feel like I am repeating myself somewhat, but BAE Systems took this decision that, for commercial reasons, the value for money was not there; the MOD agreed, but it was a commercial decision. The hon. Member for Glasgow South West (Chris Stephens) talked about the exportability of the Type 26 and the Type 31, and how the Canadian and Australian examples should mean that we should forget about the Type 31 and concentrate on the Type 26. However, the vessels are for different markets, which again is part of the offer that our shipyards might be able to promote to other parts of the world. The Type 31 follows a modular approach, as my right hon. Friend the Member for New Forest East (Dr Lewis) rightly says, so it can be adapted to suit varying countries’ needs for whatever work they want the ship to do. We hope that the prosperity brought to the UK through exports of the Type 31 will be quite considerable.

[Chris Stephens]

The Minister is being very generous. Are he and the Ministry of Defence open to discussions on frigate factories and future shipyard investment with, for example, BAE Systems and other private sector organisations, to look at how we can improve shipyard construction?

[Stuart Andrew]

Yes, absolutely. Sir John Parker was commissioned to undertake a review, and he spoke to businesses, industry and all the stakeholders. He has written his recommendations, which we are considering. I have had extensive conversations and meetings with trade unions, industry and trade associations, and I assure right hon. and hon. Members that I have taken all their points on board. We are in the middle of assessing all that information, so it is quite difficult for me to say anything concrete at this point.

I assure the hon. Gentleman and other Members—I know that I speak on behalf of the Secretary of State—that, as long as I am in this role, which may only be for another 14 days or so, we will continue to ensure that all the points that have been made will be seriously considered. We will review and challenge, and we will make sure that all that helps us to formulate the Ministry of Defence’s response to that review, so that we can do what I actually believe we are all trying to achieve: to make our shipbuilding industry successful here in the UK and abroad, so that the skills and jobs that so many people have come to rely on, including our country and our armed forces, can be relied on for years to come.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 8th July 2019 Commons Chamber

[Stuart Andrew]

My right hon. Friend is right to highlight the issues with the A400M. I can assure him that I attended that ministerial meeting: it was an extremely robust meeting with industry. The performance has been totally unacceptable. We are now expecting EuroProp International, the engine manufacturer, to be more empowered to negotiate the support solutions that we need. Airbus Defence and Space has also been held to account, but, following the problems with the engines and gear boxes, those parts will be replaced on each of the aircraft by the middle of next year.

[Chris Stephens (Glasgow South West) (SNP)]

Coming back to the fleet support ships, will the Minister tell us whether the savings from tax and national insurance of workers building these ships will be one of the criteria used for a successful UK bid?

[Stuart Andrew]

As I have said on many occasions when answering these questions, we follow the Green Book rules with the Treasury, but we will continue to have those conversations with the Treasury about the wider prosperity agenda that our defence industry brings to the UK.

Armed Forces Day

Chris Stephens Excerpts

Wednesday 26th June 2019 Commons Chamber

[Mr Ellwood]

My hon. Friend makes a very important point. If any of us travel to the United States for business or otherwise, we will see—in any airport or high street—that if there is somebody in uniform, others will go up and simply thank them for their service. Those people are completely unknown to them but simply do that out of a sense of duty and pride. Perhaps we are a bit reserved in this country, but we should do that more, particularly with veterans. I am really pleased that one thing I have managed to do is enlarge the veterans badge. It was so small that someone had to invade that person’s body space to realise that it said “Veteran”. It is now twice the size, so it really jumps out at people. I hope that that will be the green light so that if anybody sees that badge, they go up to that person and say, “Thank you for what you have done for our country.”

[Chris Stephens (Glasgow South West) (SNP)]

Will the Minister also thank the many veterans charities around the UK who help and support veterans to adjust to civilian life? I am thinking particularly of the Coming Home Centre in Govan, which I regularly support with letters to ensure that they get adequate funding. Will he say something about that and encourage MPs to get involved in helping veterans charities to get the funding that they need and deserve so that they can help veterans?

[Mr Ellwood]

The hon. Gentleman is absolutely right to heap praise on our veterans charities. There are around 400 service-facing charities of different sizes. Some of the large ones that we know well, such as Combat Stress and Blesma, have been around for 100 years or so; others, which aim to keep the name of a loved one alive, are just starting up. They do incredible work, and it is so important that we honour and respect that, but we must also make sure that their work is co-ordinated, because resources are limited, and it is important that charities work together in synergy to ensure that we provide the best possible service for those who require it.

Defence Industry: Scotland

Chris Stephens Excerpts

Tuesday 30th April 2019 Westminster Hall

[Ged Killen]

I completely agree with my hon. Friend, and later in my speech I will make the point that making short-term decisions without looking at the whole picture is inherently flawed.

[Chris Stephens (Glasgow South West) (SNP)]

The hon. Gentleman is making an excellent speech. Does he agree that one of the UK Government’s strangest decisions is to tender internationally for fleet support ships? If it were decided that they should be built in the UK, that could benefit shipbuilding not just in Scotland, but across the UK.

[Ged Killen]

I absolutely agree with the hon. Gentleman. I will touch on that point later in my remarks.

Although we must continue to support shipbuilding, the UK and Scottish Governments must focus on diversifying and deepening the defence industry in Scotland to ensure that there will always be a base for the high-skill and high-value roles associated with the industry—that is eminently achievable. Scotland is well placed to be a home for a variety of new industries. With strong universities and a history of manufacturing and design excellence, we are ideally placed to take advantage of the large demands of the UK’s defence. This debate gives Members the opportunity to discuss future high-growth areas and draw attention to the advantages of increasing diversity in the defence industry. For my part, I will touch on two high-growth areas: space and land vehicles.

Glasgow in particular has become a pioneering centre for the deployment of microsatellites, producing more satellites than any other city outside the United States. As future defence concerns rely increasingly on the gathering and analysis of information, significant space assets will be vital to the day-to-day operations of the armed forces in both military and non-military operations.

The space sector has huge potential for future growth. Year-on-year growth in the sector has been five times greater than in the wider economy since 1999, and the sector has tripled in value since 2000. Each new job in the space sector adds £140,000 of added value per employee, and the overall sector receives 36% of turnover from exports.

--- Later in debate ---

[Ged Killen]

My right hon. Friend will not be surprised to know that we have different views on Britain’s membership of the European Union. I largely consider that we are kicking ourselves out of the EU and should accept the consequences of that, although I regret the impact that it will have on projects such as Galileo.

Further to the space sector, the construction of advanced land vehicles offers an excellent opportunity for the expansion of the defence industry in Scotland. Glasgow now hosts an armoured vehicle centre of excellence, which was set up by defence company Thales. The centre aims to provide the MOD with an excellent new resource for the development of armoured vehicles.

Thales is currently bidding for the MOD’s multi role vehicle-protected programme which, if successful, would see 50 highly skilled engineering design and manufacturing jobs brought to the Glasgow site, and the possibility of 30 additional jobs created over the programme’s lifetime. Thales has said that if it is selected for the MRV-P and as the UK design authority and integrator for the Boxer and its variants, 100 new jobs could be created directly, while 180 jobs could be created through supply chains and around 200 further jobs could be supported indirectly.

Such programmes are vital for expanding the diversity of the defence industry in Scotland and introducing new skills, as well as deepening the existing skills base. A great example is my constituent Stewart Macpherson, an employee at Thales Glasgow who has been chosen as one of the top 30 electronics engineers under 30 in the UK.

Encouraging and supporting new skills and professionals is a great benefit of defence investment, so I should be grateful for an update from the Minister on the progress towards reaching a decision on the MRV-P programme. I appreciate, however, that he may only be able to reveal certain information as some might be commercially sensitive.

[Chris Stephens]

I again thank the hon. Gentleman for mentioning Thales, which is based in my constituency. Does he agree that if Thales is successful in obtaining the contract, the economic benefits for the whole Glasgow area—including for my constituents and his—would be considerable?

[Ged Killen]

I absolutely agree. Recently, when I visited the site, I was pleased to see how many of my constituents are employed there.

I am disappointed about the previous actions of both the UK Government and, to a certain extent, the Scottish Government. The recent failure by the UK Government to support the construction of the fleet solid support vessels, as mentioned in this debate and many other times in this place, shows completely misplaced priorities. Ill thought-out changes to Government tendering rules redefined the vessels, meaning that the ships will not fall under article 346 of the treaty on the functioning of the European Union. That opens UK shipyards to subsidised international competition and puts jobs and the potential investment in shipyards such as Rosyth at risk.

What is more, that situation was wholly avoidable, with the decision being made completely unilaterally, yet possibly writing off highly skilled, highly paid jobs that could return £2.3 billion in revenue to the Treasury while providing sustainable employment and an increasing skills base. I therefore urge the Government to think again about that, and to follow the Labour party’s lead by advocating that such ships are built in the UK. The case of the fleet solid support ships signals a Government who are far more interested in achieving in-year cost reductions than in looking at the whole picture.

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[Stephen Kerr (Stirling) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate the hon. Member for Rutherglen and Hamilton West (Ged Killen). He spoke very well, with passion and conviction, and thoughtfully. I was delighted with the tone that he set for the debate.

I wish to take us in a slightly different direction with public policy in the defence industry and on diversification, because I wish to refer specifically to the Scottish Trades Union Congress campaign to set up—or to encourage the SNP Scottish Government to set up—a defence diversification agency. That approach to defence diversification, rather than the one in the hon. Gentleman’s thoughtful speech, is simplistic and frankly regrettable. Not only is the point of view that the Government are best placed to tell business how to operate mistaken and misguided, but the ideologically blinkered way in which the left approaches this vital area of public policy is lacking.

I would not often choose to quote from the Morning Star—frankly, I have not often even perused a copy of it—[Interruption.] I know that Opposition Members are disappointed to hear that I am not a regular subscriber. On 15 May, it ran a story on the vote at the STUC annual congress calling on the SNP Government

“to establish a Defence Diversification Agency to promote a ‘fair and sustainable shift’ away from nuclear weapons.”

Continuing to quote the Morning Star—the first and perhaps only occasion on which I will do so—the report went on:

“But professionals’ union Prospect and general union GMB opposed the motion, saying it sent the wrong message to defence workers.

GMB Scotland delegate John Dolan, a Scotstoun shipyard convener, said: ‘This motion is not in the real world of work.

‘These people have worked in these industries for years, keeping you, your children and your grandchildren safe.

‘How many jobs have been created by defence diversification?

‘This is a con. Where is the Saudi Arabia of renewables we were promised 10 years ago by Alex Salmond and the SNP government?’”

I do not know John Dolan—perhaps other Members present do—but I want to repeat a line of his, because it is important:

“These people have worked in these industries for years, keeping you, your children and your grandchildren safe.”

I agree with the statement made by the hon. Member for Rutherglen and Hamilton West in his opening speech that we should be proud of the defence sector in Scotland. As he mentioned, UK defence spends £1.6 billion with Scottish industry each year, supporting at least 10,000 high-value jobs in the Scottish economy.

[Chris Stephens]

The hon. Gentleman may be interested to know that if he buys the Morning Star today, he will find a column in the name of my good self on blacklisting, which I recommend to him. I suggest that if he is, as he claims, so concerned for the views of shipyard workers on the Clyde and what they are saying at the Scottish Trades Union Congress, he listen to them and support their argument that the fleet’s solid support ships should be built in the UK and not be put out to international competition.

[Stephen Kerr]

I am not at all surprised that the hon. Gentleman writes a column in the Morning Star. I would have been disappointed if he had said anything other than that. Of course I wish that all the defence contract work available should remain in the UK, support high-value UK jobs and advance our technical expertise in shipbuilding. I have no doubt that the Minister will address that issue when he responds.

I pay tribute to the people who work for businesses that have invested in Scotland such as Babcock, BAE Systems, Leonardo, Thales, Raytheon, Rolls-Royce and others. All those major contractors and others are operating in Scotland. I have heard Members of this House speak of those businesses in disparaging terms. I want to make it clear that if any Member of this House does not want those businesses and their workers in their constituency, I will be absolutely delighted to have them come to Stirling. Stirling has a long association with our armed forces, and a proud connection with our servicemen and women and those who support them in the supply chain that those industries represent. That connection is symbolised by Stirling castle.

I do not know John Dolan but he captured some of the pride of the people who work in those industries. I am proud of that workforce, such as those at Her Majesty’s Naval Base Clyde at Faslane, many of whom are my constituents. If I could, I would say to each of them, in the words of Mr Dolan, “Thank you for keeping me, my children and my grandchildren safe. Thank you for defending our country and our freedoms. Scotland is proud of you.” In my constituency, defence contracts support many jobs, especially at FES, which is a principal electrical contractor and works on the new Navy ships that are being built on the Clyde. Emerson also has significant defence contracts. FES has made a huge investment in its apprenticeship programmes and runs its own academy. Hundreds of skilled electricians have benefited from FES’s commitment to them and the Ministry of Defence’s commitment to Scotland.

Some on the left approach this issue from a pacifist viewpoint built on deeply held beliefs. I respect that. Others on the left, such as the hon. Member for Rutherglen and Hamilton West, are more pragmatic and see the high-value jobs that are done as a vital strategic part of the Scottish economy. The position of the SNP is far more craven. It knows that the defence sector would be destroyed in the event of independence, as the hon. Gentleman outlined. SNP Members use defence diversification as a way of distracting people, because the truth is that they do not care much about jobs or about defence; they just care about independence, as was seen in their conference in Edinburgh at the weekend. According to that separatist vision, Scotland’s workers, savers and pensioners would give up the pound for a valueless currency yet to be named, and no frigates would be built on the Clyde if they ever got their way.

[Chris Stephens]

I find it extraordinary that the hon. Gentleman accuses me and others in the SNP of not caring about defence jobs, given that I meet the shop stewards in the Clyde shipyards on a regular basis and they know my views. Would he care to withdraw or clarify what he suggests? He was pointing at me when he made those outrageous remarks.

[Stephen Kerr]

I am not sure I was specifically pointing at the hon. Gentleman. Let me be absolutely clear: those who espouse separatism in Scotland know that the consequences would be the loss of those jobs and the technology, know-how and added value that goes with them. They know only too well that Scotland would not have a Royal Navy.

Continuous At-Sea Deterrent

Chris Stephens Excerpts

Wednesday 10th April 2019 Commons Chamber

[Stewart Malcolm McDonald]

Well, I am glad that normal service has been resumed.

As well as the issue of recruitment, there is of course the other issue of retention, which is becoming a big problem in the armed forces. I know that the Secretary of State recognises that. Indeed, we now have a situation whereby members of the armed forces are staying in the armed forces until such a time as they get a decent skill and qualification, with the sole intention of leaving to go into private industry. That is what the last armed forces survey tells us—I do not know why some Members on the Tory Benches are shaking their heads.

As this Government press on with Trident renewal, we should cast our eyes back to a couple of promises on defence that they made to the people of Scotland in the 2014 referendum campaign. Of course, the promise was made of a frigate factory on the Clyde. That promise was broken—not by this Secretary of State, but by the speaker who I am sure is going to follow me, the former Secretary of State, the right hon. Member for Sevenoaks (Sir Michael Fallon). Yet he seemed to think that there was a frigate factory on the Clyde. In fact, he seems to be maintaining that there is. I recall him standing at the Dispatch Box declaring that there was a frigate factory on the Clyde, but no such thing exists.

Then we come to the order of frigates. The former Prime Minister, David Cameron, promised that 13 frigates were to be built on the Clyde; that number was then cut down to eight. Any time we get a promise on defence or shipbuilding from this Tory Government—a bit like the way in which the fleet solid support ship contract has been lined up at the minute—we can be guaranteed that it will be another sell-out from Westminster.

[Chris Stephens (Glasgow South West) (SNP)]

Does my hon. Friend recall that, when the former Secretary of State was at the Dispatch Box claiming that there was a frigate factory, BBC Scotland was with a GMB official at the piece of land where the frigate factory was supposed to be, which was of course a landfill of ash?

[Stewart Malcolm McDonald]

I do indeed recall that. My hon. Friend does a fine job in representing the shipbuilding workforce in his constituency.

Defence Spending in Scotland

Chris Stephens Excerpts

Wednesday 6th February 2019 Westminster Hall

[Chris Stephens (Glasgow South West) (SNP)]

I beg to move,

That this House has considered defence spending in Scotland.

It is a pleasure to see you in the Chair, Ms Ryan. As the Minister reminded us before we started, I think that the last time I secured a Westminster Hall debate, the House had adjourned early, and it has done so again now that I have secured another.

The title of the debate is “Defence spending in Scotland”, but it could be “Defence spending in Glasgow South West”, and I will make no apologies for that.

[Douglas Ross (Moray) (Con)]

Will the hon. Gentleman give way?

[Chris Stephens]

I will give way to the hon. Gentleman in a second. As I am sure the Minister with responsibility for defence procurement knows, I remain a strong advocate for the Clyde shipyards—the greatest shipbuilders in the world. It has been a pleasure to see that they have started building the HMS Glasgow—the first of three Type 26 frigates—and to see the fantastic design work being carried out on the Clyde. I hope that the Minister will be able to confirm that, although there are three ships currently in the contract, the eight that were promised by the UK Government will be built on the Clyde. As the hon. Member for Moray (Douglas Ross) is so anxious to intervene, I will give way.

[Douglas Ross]

I am very grateful to the hon. Gentleman for giving way. Although the title of the debate is “Defence spending in Scotland”, I think it is going to become “Defence spending in Glasgow South West” within 30 seconds. Could I therefore take this opportunity to ask him whether he agrees that there is considerable defence spending in Scotland, particularly in my constituency, with the imminent arrival of the P-8s and £400 million of investment from the UK Government and Boeing into RAF Lossiemouth? That is important to my area and to the whole of Scotland.

[Chris Stephens]

I support that investment in RAF Lossiemouth. It was argued for by the hon. Gentleman’s predecessor, as I am sure he would agree, and I think we both agree that we want defence spending in Scotland. Later on in the debate, we may come to the actual figures, which I look forward to discussing and debating with him.

I cannot allow the debate to go by without referring to the letter that the procurement Minister received yesterday from the Chair of the House of Commons Defence Committee, regarding the fleet solid support ships. Many Members across the House are concerned about the Government having advised them that those are not warships. In the light of the parliamentary answers that many of us—myself included—have received about the combatants and the weaponry on those ships, I really do not understand the argument that they are not warships. I take the view that if it looks like a warship and acts like a warship, it is fair to call it a warship.

I commend to Members a blog from the Save the Royal Navy website, which makes clear its support for the letter from Chair of the Defence Committee to the Minister, who may wish to remark on that. My view, which is well known, as I am sure he will agree, is that the fleet solid support ships should be built in the UK. There are enough shipyards across the UK, including in Scotland, that could block-build those ships. If the Aircraft Carrier Alliance can block-build, the fleet solid support ships should be block-built using the same model.

I have many family ties to the defence industry. One of the employers that I will mention today is Thales, which used to trade as Barr and Stroud. Today is the anniversary of my grandfather’s death; he was employed by Barr and Stroud, where he met my grandmother, and they were married for 61 and a half years, so there are clear family ties to that employer. It was based in Anniesland in the city, but has moved to Govan, the former site of the Stephen shipyard—that is a different spelling and no relation—which is famous because Billy Connolly is a former employee. I have family ties and a real connection to the defence industry in Glasgow.

It is important, as the hon. Member for Moray outlined, that Government spending helps to support and promote prosperity across these islands. Ministry of Defence spending has the potential both to have a positive impact on Scotland’s economy and employment, and to help to balance the export deficit. I want to see the Government give a vote of confidence to manufacturing and engineering skills in Scotland by investing the defence pound in Scotland, and by encouraging foreign companies that are looking to maximise UK content to do the same.

At present, the lion’s share of MOD industry spending on Scottish industry goes, quite rightly, to shipbuilding and repairs. As one of the vice-chairs of the all-party parliamentary group on shipbuilding and ship repair, I have no particular problem with that, although I hope that in future, the Ministry of Defence will look at how it can help the shipyards become more efficient. When BBC journalists looked for a frigate factory that a former Secretary of State for Defence insisted was on the Clyde, they found only rubble and ash.

While the shipbuilding industry must be supported—far be it from me to argue against that—I want to look at defence spending elsewhere. As the Minister knows, the Ministry of Defence is currently procuring key new land platforms, including the multi-role vehicle protected—MRVP—and the mechanised infantry vehicle, the MIV. That will be a significant spend, and the platforms will be vital to delivering the Army’s strike brigades, which are part of the backbone of its new structure.

The latest available figures on Ministry of Defence spending in Scotland show that in 2017-18, MOD expenditure in Scotland was £300 per capita. Scotland has had an increase in expenditure within UK industry, but of all the nations and regions of the UK, Scotland finds itself with the fourth-highest spend. As someone who watches Scottish football—the hon. Member for Moray will appreciate these comments—I know that a team who finish fourth are not currently guaranteed a UEFA place. I hope that the Minister will reflect on that figure.

In fact, spending in Scotland was less than half of the spending in the south-east and south-west of England—two regions that account for over half of MOD expenditure within UK industry. Approximately 10,000 jobs in Scotland were supported through MOD expenditure in 2017-18. A recent parliamentary question revealed that of the £1.59 billion that the MOD spent within Scottish industry, over £900 million was spent on shipbuilding and repair. It is important that no area becomes too reliant on a single industry.

[Kirstene Hair (Angus) (Con)]

Will the hon. Gentleman give way?

[Chris Stephens]

Before I mention Thales in my constituency, I will give way to the hon. Lady.

[Kirstene Hair]

I thank the hon. Gentleman for giving way. He is talking about spending in Scotland. As he will be well aware, the MOD recently confirmed its commitment to RM Condor in my constituency. Can he confirm to my constituents and to me that in an independent Scotland, the Royal Marines at RM Condor would be 100% safe, and that the Scottish National party would spend exactly the same amount that the UK Government have committed to the base’s long-term future?

[Chris Stephens]

I am more than happy to support the hon. Lady’s constituents and the Royal Marines in Angus and elsewhere. As she knows, her predecessor in Angus, Mike Weir, was supportive, too.

Thales has more than 700 employees in Scotland, the vast majority of whom are at our site in Govan, in Glasgow. Thales’s Glasgow links date back to 1888, which makes the Glasgow part of the company the oldest part in the United Kingdom. As the procurement Minister knows, an early-day motion recently celebrated the centenary of Thales providing optronic systems to submarines—indeed, optronic systems for land, sea and air—and I went to an event to celebrate that centenary. The work carried out by that employer in Glasgow is important. Thales is a major contributor to the Scottish economy, investing more than £850 million since 2000, and supporting a strong and diverse supply chain. Preliminary findings from a report by Oxford Economics found that Thales UK activity supports an additional 2,000 jobs in Scotland, and its total gross domestic product contribution in Scotland is more than £100 million.

On land platforms, the team at Thales in Glasgow established an armoured vehicle centre of excellence, with a view to nurturing the company’s rich engineering heritage and commitment to developing its capabilities well into the future. The centre builds on highly skilled engineers’ and manufacturing employees’ decades of experience in complex military vehicle integration. Thales Glasgow has the capacity and capabilities to support Scotland’s growth in the defence sector outside its traditional maritime contribution.

Combined, the two vehicles that have been contracted for so far could create and sustain 100 jobs in Thales UK, 180 jobs through the supply chain and up to 200 jobs indirectly throughout the UK. Thales’ offering to the MOD’s MRVP programme is the Bushmaster MR6—a military off-the-shelf product with reduced development costs that offers value for money and lower through-life costs. The fact that there are production lines in Australia for vehicle assembly, and in Glasgow for equipment and system integration, reinforce Thales’s ability to achieve cost and risk reduction. The Bushmaster would support 50 highly skilled engineering, design and manufacturing jobs in Glasgow, and there is the potential to create an additional 30 jobs over the lifetime of the programme. It could also support up to 100 jobs in the supply chain across the UK, as I say.

In the context of Brexit, the Government, we hope, are looking to strengthen trade ties with countries outside the EU. I would argue that Thales does that, particularly through its work in Australia. The MRVP programme offers the chance to help combat the trade imbalance with Australia, and supports the development of closer trade and defence equipment ties with that important ally.

On the MIV programme, Thales has supported the prime contractor over the past two years. It has all the expertise and resources to support the Boxer. Thales brings with it its recognised UK mission system integration, survivability and electronic architecture pedigree, developed over many years as a trusted partner of the Ministry of Defence.

I hope that the Minister is sympathetic to my representations on behalf of my local employer, Thales. I look forward to hearing what he has to say.

[The Parliamentary Under-Secretary of State for Defence (Stuart Andrew)]

It is a pleasure to serve under your chairmanship, Ms Ryan. I congratulate the hon. Member for Glasgow South West (Chris Stephens) on securing the debate. I do not know whether something about him means that the whole Chamber leaves when he has his debates—perhaps they should all have stayed to listen to his contribution—but I am glad that he is rightly standing up for his constituents and his constituency. I will come on to some of the specific points he made in more detail in a moment, but I will first provide some context for defence spending in Scotland.

Last year’s report on the contribution of defence to UK prosperity, which was produced by my right hon. Friend the Member for Ludlow (Mr Dunne), showed that defence benefits every single part of the United Kingdom. The sector has annual turnover of £22 billion and supports some 260,000 jobs. Scotland very much shares in that national success, benefiting directly from every pound that is spent on defence. To illustrate the point, it is worth looking at two of the key areas where defence spending in Scotland is concentrated. The first element relates to our spending with industry in Scotland. Last year, as the hon. Member for Glasgow South West said, that spending amounted to £1.65 billion, supporting 10,000 jobs. That is equivalent to £300 per capita, which is above the UK average. I know that he was complaining about some other regions, but I represent Yorkshire, and Scotland is doing a heck of a lot better than Yorkshire on defence spending.

We cannot talk about the defence industry in Scotland without recognising, as the hon. Gentleman did, the incredible expertise of the Scottish shipbuilding sector. With a history dating back more than 150 years, it has long been the envy of the world, and it remains a global leader. In the past few years, Scotland has played a major part in the building, assembly and successful delivery of HMS Queen Elizabeth, the most powerful surface vessel in British history, as we all know.

The MOD has already placed a £3.7 billion contract to build the first three state-of-the-art Type 26 global combat ships on the Clyde, in the place—I can now confirm—where all eight will eventually be built. The first of those City-class frigates has been named HMS Glasgow, which I am sure the hon. Gentleman is delighted about, and the last will be HMS Edinburgh, again recognising Scotland’s contribution. Coupled with our order for five offshore patrol vessels, that work will sustain some 4,000 jobs in the Scottish shipyards and throughout the supply chain until the 2030s.

[Chris Stephens]

I am grateful to the Minister for confirming that all eight of the Type 26 ships will be built in Glasgow. He might get representations from his colleagues in Scotland to name the other ships after different areas of Scotland, but I will leave that to them. Will the Minister kindly update us on the Type 31 frigates? He knows that there is interest in those being built in Glasgow and other places in Scotland.

[Stuart Andrew]

I was going to come to that, but I will touch on it now. The Type 31e is subject to an open competition at the moment, as the hon. Gentleman knows, so I cannot go into too many details, other than to say that we have three bidders in the competition, which is an exciting and challenging one as we try to change how we procure our frigates. I look forward to seeing the competition progress.

As I was saying, the fact that we have been able to secure those jobs in the Scottish shipyards, with work into the 2030s, is something that no other industry in the United Kingdom can boast or be assured of, so it is not surprising that many MOD prime contractors have sites in Scotland, including Babcock, BAE Systems, Rolls-Royce, Leonardo, Thales, Raytheon and QinetiQ. That goes to prove that the defence industry in Scotland is about more than just shipbuilding, as the hon. Gentleman rightly pointed out.

In the land sector, beneath the prime contract level, many companies across Scotland have provided high-technology sub-systems to the Army’s critical warfighting platforms, which include Challenger 2 main battle tanks, Warrior infantry fighting vehicles, Foxhound patrol vehicles and the new Ajax reconnaissance fleet. Such on-board technology ranges from world-beating, 24-hour, all-weather sensors and sighting systems to the integrational design of complex battlefield communication equipment.

Looking forward, the land sector also holds much near-term potential for the Army’s exciting fighting vehicle modernisation programmes. Scottish companies are already bidding competitively in the Challenger 2 life extension programme, the mechanised infantry vehicle programme and the multi-role vehicle protected programme package 2—that’s a bit of a mouthful! For example, as the hon. Member for Glasgow South West said, Thales—a company that I have visited on many occasions, even in the short time that I have been in my role—has a site in his constituency and is one of two finalists, bidding with its Bushmaster vehicle. Thales is also tendering for a range of smaller electro-optical sub-system upgrades for the existing armoured fleet to contribute to the British Army’s warfighting edge. I repeat, however, that the competition is open, so I cannot comment other than to say that I have heard him.

We should also not forget that small and medium-sized enterprises throughout the supply chain in Scotland benefit from our investment. I have really enjoyed seeing the innovation there is among SMEs not just in Scotland but right across the country. Innovative smaller companies such as Denchi Power in the town of Thurso in Caithness provide much of the essential very high capacity advanced battery and charging technology for the British Army’s combat radio systems. In the past financial year, our Defence Science and Technology Laboratory alone invested £4.84 million in research and development contracts with Scottish suppliers.

The second main element of our defence spending consists of investments in critical defence assets, stretching far beyond our submarine and RAF bases. Few are aware that Scotland has some 50 defence sites, including Benbecula in the Outer Hebrides, Buchan in Aberdeenshire and Saxa Vord in Shetland. Those are the locations of our military radars, which provide critical long-range coverage of the northern approaches to the UK and neighbouring NATO nations. As the threats from the likes of Russia rise, so too does the significance of those sites.

The hon. Member for Glasgow South West mentioned fleet solid support ships, an issue I have had to deal with on many occasions in this role. Those ships’ primary role is to replenish naval vessels with bulk stores. They are non-combative naval auxiliary support ships, which are manned by civilian Royal Fleet Auxiliary crews and fitted with weapons systems purely for self-defence, so they cannot be designated as warships. I will probably continue to have long correspondence about that with the members of the Defence Committee, and I look forward to replying to their letter.

The relationship between defence and Scotland is mutually beneficial. Scotland is as integral to the United Kingdom’s security as the rest of the United Kingdom is to Scotland’s. Yes, the UK depends on the deep commitment of our Scottish personnel and benefits enormously from the unparalleled expertise of the industries based there, but Scotland also benefits from being part of the United Kingdom as a whole. It benefits from the UK’s broad spectrum of capabilities, it benefits from the sheer scale of defence spending by the UK, which can call on the fifth biggest defence budget in the world, and it benefits from the influence the UK is able to wield on the world stage to make a genuine difference.

[Stuart Andrew]

My hon. Friend makes a very important point, which my hon. Friend the Member for Angus (Kirstene Hair), who is sitting next to him, raised at Scottish questions just a few weeks ago. Of course, we will have to analyse the latest situation. If we need to make that mitigation, we will do so. The fact is that armed forces are sent where they are needed—they do not choose where they live—so we will step in where necessary to ensure that they are not disadvantaged.

As the dangers to the United Kingdom increase, it is even more vital that Scotland remains a pivotal part of UK defence. That is why we are upping our defence spending there. When it comes to the military footprint in Scotland, force levels will continue to grow. A further 550 military personnel and their families will be based in Moray by 2024. Significantly, numbers on Her Majesty’s Naval Base Clyde will also increase, to 8,200, while the base benefits from further investment of £1.2 billion over the next decade. HMNB Clyde will also become the base port for all the Royal Navy’s submarines, including its fleet of attack submarines, and the UK’s submarine centre of excellence. That is only fitting, since by the 2030s it will welcome four next-generation Dreadnought-class nuclear deterrent submarines too.

Meanwhile, this year, RAF Lossiemouth, which is in the constituency of my hon. Friend the Member for Moray (Douglas Ross), will welcome its fourth Typhoon squadron, making Scotland home to half of the RAF’s Typhoon force. Thanks to its close proximity to the north Atlantic, where enemy submarines are most likely to operate, Lossiemouth will also be a base for our nine P-8A maritime patrol aircraft, with a £132 million operational support and training facility being built to support them. That will create a further 200 jobs and, once fully operational, bring some 550 additional RAF personnel on site. I know my hon. Friend has been a good advocate of that.

Since becoming Minister for Defence Procurement, I have been pleased to observe the truly unique relationship with Scotland at first hand, and I am determined to do everything in my power to ensure that it continues to go from strength to strength.

[Chris Stephens]

rose—

[Stuart Andrew]

I am coming to my last paragraph, but I can see that the hon. Gentleman wants to intervene, so I will give way.

--- Later in debate ---

[Chris Stephens]

I thank the Minister for a lot of what he has said, but I thought he would expand a bit more on the fleet solid support ships. Given the comments he rightly made about Scotland’s contribution to the Ministry of Defence, can he justify the fact that those ships might be built somewhere else in the world, rather than in Scotland or, indeed, anywhere else in the UK?

[Stuart Andrew]

I will happily answer that question. The whole point of the national shipbuilding strategy is to make our shipyards as competitive as possible. For far too long, our shipyards have depended too often on defence for their work. The whole point of the strategy is to try to make them as competitive as possible and to challenge them. The Type 31e frigate competition that the hon. Gentleman mentioned is one such challenge to industry to consider how it can become more competitive, so it can go out to the wider world and start winning competitions. That is why I am really pleased that there is a bid from the UK as part of the fleet solid support competition. We will see whether it is successful, but the point is that we want our shipyards to be competitive. That is the way to secure their future now and in the long term.

Next year, Scotland will be home to all the Royal Navy’s submarines at HMNB Clyde, to one of the British Army’s seven adaptable force brigades and to one of three RAF fast jet main operating bases. That is a mighty testament to a relationship that works—a relationship that makes Britain a global force for good. That is why I believe passionately that Scotland should remain an integral part of this United Kingdom, so we can all work for the good defence of our country and around the globe.

Question put and agreed to.

Veterans Strategy

Chris Stephens Excerpts

Thursday 15th November 2018 Commons Chamber

[Stewart Malcolm McDonald (Glasgow South) (SNP)]

It is always a pleasure to follow the right hon. Member for Rayleigh and Wickford (Mr Francois). Despite having done so on several occasions, I am never quite sure that I get it right. He always gives a forensic speech, and we are never in any doubt about where he stands on, well, pretty much anything actually. I always welcome his contributions.

I start on a somewhat sad note because the hon. Member for Berwick-upon-Tweed (Mrs Trevelyan) felt the need to resign from her position as Parliamentary Private Secretary in the Ministry of Defence. I think that is a loss to the defence team as she was very good to me and my colleagues when we tried to communicate with Ministers at the MOD. Who knows what lies ahead for her? I think that the consensus between us will perhaps end there for now, as the Brexit debate gets more intense.

I am glad this debate is taking place. I was slightly concerned, given the pressures on time and events this morning, that it would not happen. That would have been a great shame, given that we have just had a whole period of remembrance leading up to Remembrance Sunday at the beginning of the week. It was a pleasure to take part in the main centenary event in George Square in Glasgow city centre on Sunday, which was a very moving affair—the city council confirmed it as the largest remembrance event the city has held in the square for a number of years, which shows the desire there is among Glaswegians properly to remember and show thanks to the armed forces and veterans who have passed in previous wars.

[Chris Stephens (Glasgow South West) (SNP)]

As my hon. Friend will know, I was not at George Square in Glasgow because I was at the Nitshill war memorial service. It was the first time there has been a main service there, and there were 300 people in attendance and 34 wreaths laid by community groups. The Friends of Nitshill War Memorial committee should be thanked for all their work over the past five months.

[Stewart Malcolm McDonald]

I echo that entirely, and congratulate my hon. Friend on getting that point on the record.

I also had the pleasure of attending the Queen’s Park football club remembrance service. It will surprise anybody who knows me to hear that it was ever a pleasure for me to be at a football stadium, but this was a particularly noteworthy affair. As well as holding a remembrance service for football players who served in the first world war, some of whom did not return home, the club put together the Great War Project, which documented the lives of those who had played for Queen’s Park football club in my constituency, which is the oldest football club in Scotland. It had invited the families of the football players and soldiers from world war one. I even met a constituent of the now departed Secretary of State for Work and Pensions who was involved in the Scottish National party in 1945. Needless to say, he cannot support us any more from Tatton, but that goes to show the breadth of people that a remembrance event can bring together. I congratulate everybody at Queen’s Park football club on putting together the Great War Project, and I look forward to visiting the Great War Project at Langside church in my constituency tomorrow night.

Let me return to the veterans strategy. I genuinely welcome this document, which is a good starting point for a serious discussion. I particularly welcome the fact that on the veterans ministerial board we have Ministers from devolved Governments, in particular Graeme Dey, who is the Minister for Parliamentary Business and Veterans in the Scottish Government, and the only veterans Minister in a devolved Government anywhere in the UK—something that other devolved Governments could pick up on. I also welcome to his post the new Scottish Veterans Commissioner, Charles Wallace, who was appointed by the Scottish Government. I think he is the only veterans commissioner in the UK, and he will become a veteran on Tuesday. I had the pleasure of meeting him earlier this week—I think he was in front of the Defence Committee on Tuesday—and I am sure that all Scottish Members wish him well in his new role.

There are obviously many crossovers with devolved competencies as far as supporting veterans is concerned, just as there are with local government. I welcome the £1.3 million announced by the Scottish Government for the veterans fund to support veterans organisations across Scotland. I welcome the £10 million of additional funding for veterans with mental health needs. I also welcome the fact that the Scottish Government changed the rules to ensure that the war disablement pension was exempt from income assessments.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 22nd October 2018 Commons Chamber

[Douglas Chapman (Dunfermline and West Fife) (SNP)]

rose—

[Chris Stephens (Glasgow South West) (SNP)]

rose—

[Mr Speaker]

Gosh, there is something of an internal Scottish National party competition. It is an invidious choice between three celebrated individuals, one of whom is a member of the Select Committee. I call Martin Docherty-Hughes.

Defence Industry and Shipbuilding

Chris Stephens Excerpts

Wednesday 11th July 2018 Commons Chamber

[Nia Griffith]

My hon. Friend makes a very good point about the need for certainty and long-term planning, so we can give business the confidence to invest here.

As well as ensuring that our armed forces have the very best equipment, a core objective of our defence industrial strategy should be to promote our national prosperity. We can only do that properly if we factor in the true value of defence contracts to the UK economy. Buying British is not just about the basic fact that a UK-based company will pay UK tax; it is also about the broader economic and social benefits, and the value of the skills and apprenticeships that the industry creates.

[Chris Stephens (Glasgow South West) (SNP)]

Is it not the case that if the fleet solid support ships were built in the UK, 20% of that cost could be recovered by the workers working on those ships paying tax and national insurance?

[Nia Griffith]

Indeed—at least that amount.

Reports by Oxford Economics highlight that the UK defence industry has an output multiplier of 2.3, meaning that £100 million in UK industry generates some £230 million to the UK economy. Its reports also highlight that each additional job created in the manufacturing element of the defence industry results in a further 1.8 jobs being created in the wider economy.

At present, the Government do not routinely factor in these wider socioeconomic values when making a procurement decision. We on the Labour Benches believe that to be a serious mistake. It is particularly anomalous when companies that bid with the Ministry of Defence are quite used to having to set out the socioeconomic value of contracts when bidding with Governments of other countries. Labour is committed to expanding the definition of good value to include wider employment, industrial or economic factors when making procurement decisions.

--- Later in debate ---

[Mr Ellwood]

During my time as a Member of Parliament I have seen a change in the posture of the Royal Navy that we can all be proud of. What is the Type 45? It is the best in its class. What is the Type 26? It will be the best in its class. What is the Type 31? It is a change in approach to modular design, which will be exactly what we need for export. This is what Britain is doing. We invented the aircraft carrier; we were the ones who first put that concept together. That innovation that is inherent in our DNA is what is allowing us to do exactly what the hon. Gentleman says.

[Chris Stephens]

I thank the Minister for promoting modular build in the UK. If modular build is good enough for the Type 31 frigate, surely it is good enough for fleet support ships, which could be built in the UK on the same basis.

[Mr Ellwood]

I have hinted that I will come to that in a second, but there is a distinction between fleet support ships that employ civilians and Royal Navy ships that employ Royal Navy personnel. There is a distinction between the two from a security perspective.

Going back to the point about value for money for the taxpayer, the Defence Secretary, the Procurement Minister and I all want to ensure that we are able to utilise the advanced skill sets in our defence industry across the UK, but the bottom line has to be value for money. Let us take as an example the ships that were recently purchased in Korea. The price was half the British value. Is the hon. Member for Llanelli saying that she would pay double the price for the same auxiliary support ships?

--- Later in debate ---

[Mr Ellwood]

We are investing both in the Clyde and in Portsmouth. Looking back over the past few decades, let us be honest that although we have world-class shipbuilding capability, efficiency has not been what it could be. Successive Governments could have done better—we put up our hands up to that—which was why it was all the more important to create a shipbuilding strategy. We commissioned John Parker’s report so that we would be able to understand—

[Chris Stephens]

Will the Minister give way?

[Mr Ellwood]

I will make some progress, if the hon. Gentleman does not mind, because other Members wish to speak. Let me make some progress and I will give way shortly.

[Mr Ellwood]

I do not disagree. I try to be less partisan than others who jump up at the Dispatch Box, and I absolutely agree with the hon. Lady about the importance of that drumbeat of orders, but it should not come at any price. We need to make sure it blends with what is built for the Royal Navy and for the Royal Fleet Auxiliary. We have accepted every single recommendation made by John Parker, and we thank him for his very wise report.

[Chris Stephens]

Will the Minister give way?

[Mr Ellwood]

The hon. Gentleman is sitting on the edge of his seat. Obviously I cannot refuse to give way.

[Chris Stephens]

The Minister is very generous. What did John Parker’s report recommend for how the fleet support ships should be built? I am very curious. Can he tell us what the Parker report says about fleet support ships and the exact page on which it says that?

[Mr Ellwood]

The Parker report is about our approach to shipbuilding, and it has led to our shipbuilding strategy and our defence industrial strategy.

--- Later in debate ---

[Mr Ellwood]

rose—

[Chris Stephens]

rose—

[Stewart Malcolm McDonald]

The Minister has spoken quite a bit. I do not like not giving way to a Minister, but I would rather give way to a Back Bencher.

[Chris Stephens]

I thank my hon. Friend. Is he aware of recent press releases from the Ministry of Defence in relation to the MARS contract that the Minister talked about earlier? One says:

“The tanker is expected in Falmouth next spring when she will start military customisation.”

[Stewart Malcolm McDonald]

My hon. Friend makes an important point that I am sure he will expand on later. [Interruption.] The Minister is most unkind. I sat and listened to him for 40 minutes and here I am being heckled as though he had taken five minutes. In fact, I am trying to remove parts of my speech to allow other colleagues to get in.

I want to come to some of the broken promises that the Conservatives have made with regard to shipbuilding in Scotland. Let us cast our minds back four years, when they were desperate—desperate—to buy off Scottish shipbuilding in the face of a potential vote for Scottish independence. They promised 14 Type 26 frigates to be built on the Clyde: a state-of-the-art, world-class frigate factory, which, amazingly, the previous Defence Secretary used to stand at the Dispatch Box and insist was there. My hon. Friend the Member for Glasgow South West was getting phone calls from journalists in Glasgow asking if they could go to see it. Indeed, I believe that a Labour Member—the hon. Member for Glasgow North East (Mr Sweeney)—actually took part in the design of the frigate factory. We were utterly sold out again by the Conservatives.

The current Chancellor, who at that time was the Defence Secretary, repeatedly told people in Scotland that staying in the UK was necessary to secure the future of shipbuilding in Scotland, but that promise was slashed. The guarantee of 14 Type 26 frigates was cut to eight, but we were promised five Type 31e’s to make up for the shortfall in numbers. Shipbuilders in Scotland—and indeed, I suspect, across the UK after this debate finishes—will not be trusting the Tories any time soon.

Finally, I want to read out a quote from the assistant general secretary—

--- Later in debate ---

[Chris Stephens (Glasgow South West) (SNP)]

I will try my best to keep my remarks to four minutes, Mr Speaker. First, may I welcome the trade union representatives from the Clyde shipyards? Such is their passion for the industry that they have come down to London today to hear this debate.

The debate so far can be summed up by paraphrasing that great conservative icon Lord Vader because, “We want these ships, not excuses.” All we have heard from Government Members has been excuses, because—[Interruption.] If the hon. Member for Torbay (Kevin Foster) has ever watched the films, he would know that Lord Vader is far from a socialist.

What we have heard today is exactly what we heard at Defence questions on Monday, when Opposition Members were told that the reason why fleet support ships are going to international competition is that it is in the national shipbuilding strategy. Government Back Benchers have been told that the Government will make sure the weaponry for these ships will be UK-based.

The national shipbuilding strategy is based on Sir John Parker’s report, which says:

“There is the opportunity with the Fleet Solid Support ships for UK firms to make…bids, and hopefully secure the contract, thus contributing further regional economic benefits in the UK.”

The Parker report does not recommend international competition for the fleet support ships, so it is wrong for Ministers to say that the national shipbuilding strategy accepted all the recommendations of the Parker report. Frankly, we find ourselves in a position where the Government are saying there should be modular build for small frigates but not for fleet support ships, which is ludicrous.

The Government cannot have it both ways. I asked a written question on the range of the weaponry, sensors, arms and close-range guns, such as the Phalanx, and the answer, published on 27 April, has been mentioned. The Phalanx is a Gatling gun designed to shoot down fast anti-ship missiles, aircraft and fast attack craft. It is fitted only to high-value ships that are vital to naval operations, so it is ludicrous to say that these ships have limited weaponry.

The MARS vessels are fitted with cannons, mini-guns, machine guns and anti-submarine and anti-surface-warfare helicopters, yet we have been told by Ministers that they are not warships. I am sorry, but I strongly disagree. If it looks like a warship and acts like a warship, it is a warship.

Opening up shipbuilding contracts for international competition only makes sense if other countries are doing the same, so which other countries are putting auxiliary ships up for international competition? Is France, Germany, Italy, Spain or the United States of America doing so? The answer is no. No one treats auxiliary ships as a commercial commodity to be bought wherever, because the reality is that other countries see them as vital ships both for military and industrial reasons.

I support the Opposition motion, and the hon. Member for Llanelli (Nia Griffith) made important points about the economic benefits of these fleet support ships being built in the United Kingdom. It will keep people in work, and it will bring tax, national insurance and vital revenue into the country. Again, if it looks like a warship and acts like a warship, it is a warship, and it should be block built in this country.

[The Parliamentary Under-Secretary of State for Defence (Guto Bebb)]

Phalanx is a defensive weapon.

[Chris Stephens]

Again, the Minister is shouting from a sedentary position. The MOD website is full of the vital military components used by the Royal Fleet Auxiliary, which is why these ships should be built in the United Kingdom in a modular way—the same way as the Queen Elizabeth aircraft carrier.

--- Later in debate ---

[Ruth Smeeth]

Will the Minister give way?

[Chris Stephens]

rose—

[Mr Sweeney]

rose—

Oral Answers to Questions

Chris Stephens Excerpts

Monday 9th July 2018 Commons Chamber

[Gavin Williamson]

Yes, the hon. Gentleman can have that assurance.

[Chris Stephens (Glasgow South West) (SNP)]

3. What recent progress he has made on procuring fleet support ships for the Royal Fleet Auxiliary; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Defence (Guto Bebb)]

Since entering a four-year assessment phase in April 2016, the project has held three industry days. We have also undertaken a period of market engagement with UK and international shipbuilders. We formally launched the international competition on 5 June. Subject to normal approvals, our current intent is to award the contract in 2020.

[Chris Stephens]

Will the Minister finally give us a reason why the ships are being put out to international competition? Would it not be better if UK shipyards were block building the ships?

[Guto Bebb]

I am surprised by the hon. Gentleman’s question. I have explained several times at the Dispatch Box that we have adopted the shipbuilding strategy in full. The strategy is clear about defining warships as a capability that will be built in the UK and non-warships as a capability that will be subject to international competition.