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.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 23rd April 2018 Commons Chamber

[Guto Bebb]

I would of course be more than delighted to meet my hon. Friend and a delegation from Plymouth. I was very pleased to visit Plymouth and was very impressed with what I saw—for example, the work on the refurbishment of the Type 23—so it would be a pleasure to meet that delegation from the great city of Plymouth.

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

Given that the Type 26s are currently being built by the greatest shipbuilders in the world, at the Govan shipyard, will the Minister also confirm the timetable for the Type 31 frigate and whether that will be built in Govan, too?

[Guto Bebb]

The Type 31 process is well under way. We are pleased with the number of consortia that have shown an interest in the Type 31, and I hope that the Clyde shipbuilders will be putting in a very good price, which will ensure that the Type 31 will be delivered on time and on schedule.

Shipbuilding Strategy

Chris Stephens Excerpts

Tuesday 23rd January 2018 Westminster Hall

[Luke Pollard]

My hon. Friend is spot on. The confusion about the role of this warship is at the heart of the problem with the shipbuilding strategy. It looks like we put the cart before the horse in defining a price tag but not a role. It is essential that in the next couple of months the Ministry of Defence comes forward with that, to provide all defence-leaning Members of Parliament, on both sides of the House, with a reason to celebrate this warship, not critique it, because I worry that the critique will not support it and help its attractiveness as an export product. We should turn those weaknesses of the Type 31 into its strengths and promote a corvette class, not a poorer frigate. That would give the Royal Navy two carriers, two amphibious assault ships retained and not cut, six destroyers, eight proper frigates, five corvettes and the new offshore patrol vessels. That is still too few ships, but a line we should not go below, or accept further cuts or reductions against.

The shipbuilding strategy suggests that UK yards will build five Type 31s as replacement for the Duke class, and pitch for competition for 40 to export. As Darth Vader warned Director Krennic in “Rogue One”—a film I am sure we have all watched:

“Be careful not to choke on your aspirations”.

I truly want to believe the MOD when it says that there is a market abroad for 40 Type 31s, built in Britain, but I cannot see where that might be.

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

Given that we do not know the capability, and given the comments made by the hon. Member for North Durham (Mr Jones), is there not a question as to who we would export these Type 31 frigates to? Does the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) agree that the view of many in the shipbuilding industry is—to quote his hero Darth Vader again—that we want these ships, not excuses?

[Luke Pollard]

As a Luke, I am not sure Darth Vader is quite my hero, but the point the hon. Gentleman makes is a good one. There are 14 other ship manufacturers globally providing a light frigate option of between 2,000 and 4,000 tonnes. That is an awful lot of competition when the customers are ill defined. Let us look at some of those competitors for the Type 31 frigate: there is the French and Italian FREMM class; the Spanish Navantia F-105; the Danish StanFlex; Germany’s F-125 Baden-Württemberg class; and South Korea’s Incheon class, let alone the myriad cheaper platforms built by China and other far-eastern nations.

--- Later in debate ---

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

Thank you for giving me the opportunity to speak in this debate, Ms McDonagh. I thank my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard) for his comprehensive contribution, in which he outlined the key concerns about the national shipbuilding strategy, and the right hon. Member for New Forest East (Dr Lewis) for outlining his longer term perspective on the attrition of the capability of the Royal Navy’s frigate and destroyer fleet, which the national shipbuilding strategy ought to aspire to address as an outcome.

I first encountered the man who wrote the report that spurred the creation of the national shipbuilding strategy, John Parker, about three years ago when he attended Glasgow University to deliver a speech on his history of working in the shipbuilding industry. He had a great reputation as a managing director at Harland and Wolff shipbuilders in the 1980s, where he started as an apprentice and grew up through the ranks. There was an international discussion about the long-term decline of British capability, from the global world leader in the shipbuilding industry that it once was to a marginal player now even in Europe, never mind the rest of the world.

I asked him three years ago when I was working at BAE Systems what his greatest regret was in his career. He stood up and said, “My greatest regret is that Europe is building 90% of the world’s cruise ships, and Britain, with such a great heritage of building world-beating ocean liners and passenger ships, is building none. There are high-wage, highly equipped shipyards in Europe building these vessels, and Britain isn’t building one of them.”

As managing director of Harland and Wolff when it was under the ownership of the British Shipbuilders Corporation—the industry was nationalised until the late 1980s—he recognised the emerging market for cruise ships, which were once again becoming a popular recreational pursuit. Harland and Wolff developed proposed designs for cutting-edge new cruise ships and went to the Government for funding to build them for Carnival, now the biggest cruise company in the world, but the Government said that they were not interested in the design. They wanted to hold a fire sale, get rid of the assets and remove shipbuilding from public ownership. They were not interested in any further investment in what they saw as a dying industry.

In the very same year—1987, the year before Harland and Wolff and Govan shipyard were sold off—Meyer Werft in Germany, a family-owned business, got funding from the German state investment bank to build a completely new, undercover shipyard and then the world’s first modern cruise ship. Today, that shipyard dominates the global market for cruise ship and complex shipbuilding in Europe, building about two 100,000-plus-tonne ships every year. That contrasting approach is symptomatic of a broader malaise that we face when it comes to industrial policy and planning in Britain.

[Chris Stephens]

Will the hon. Gentleman outline what the devastating economic consequences were of that decision on cities such as ours, Glasgow, as well as Belfast and elsewhere in the UK?

[Mr Sweeney]

The impact was absolutely devastating, and we saw the wider impact in Govan as well, which was a commercial shipyard up until 1999 when Kvaerner pulled out. That Norwegian oil company rebuilt the yard in the early 1990s for commercial oil tankers and gas carriers. The result of that collapse was disastrous. Sir John Parker said that just as we had got British shipbuilders match-fit, ready to compete, the rug was pulled from under them. Just as the industry was ready to re-enter the market and be a globally competitive player, it was wrecked. That is the sad legacy of the collapse of British merchant shipbuilding to the point where we are entirely reliant today upon the Ministry of Defence to sustain what is left of British shipbuilding capability. That is partly why I am concerned about the national shipbuilding strategy, if it is restricted in its entirety to naval shipbuilding and not the wider issue of how we re-establish a market foothold in commercial shipbuilding. The two are intrinsically linked.

If we are to achieve a competitive advantage we ought to broaden our horizons and re-establish how we deliver a resurgence in British commercial shipbuilding capability. That was Sir John Parker’s biggest regret. That is what drove his frustration at that time, and a lot of that is what underpins the recommendations in his report. He talks about a vicious cycle of changing requirements, which the right hon. Member for New Forest East mentioned, and a year-zero approach every time we have a new MOD shipbuilding programme which duplicates effort and introduces unnecessary costs. It is so bespoke in its approach to designing ships that it introduces unnecessary costs, which render British shipyards uncompetitive, even in the naval sphere, never mind the commercial sphere.

--- Later in debate ---

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

It is a pleasure to see you in the Chair, Ms McDonagh. I thank the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) for securing this debate. During the defence debate less than two weeks ago in the Chamber, every single Member of the all-party group on shipbuilding and ship repair complained that we had applied for debates since the publication of the national shipbuilding strategy. All of a sudden, at the very next ballot, the hon. Member for Plymouth, Sutton and Devonport secured one, so I thank him for that. I hope he will accept my apology to him in relation to Darth Vader. I actually misspoke. I did not mean to say “his hero”. What I meant to say was “their hero”, because Darth Vader is a Conservative icon and not of any other political party. I can see nods coming from the Conservative Benches.

The history of how we have got to this point is important, particularly for those of us who represent the best shipbuilders in the world: the shipyard workers on the Clyde, and those in the Govan shipyard in particular. In 2014 they were promised that 13 Type 26 frigates would be built there, plus a frigate factory. Ever since, there has been a real concern that there has been a row-back by the Ministry of Defence. The frigate factory was cancelled. Then, in November 2015, during the national strategic defence review, there were no longer 13 Type 26 frigates, but eight. We were told not to worry and remain happy because instead of five Type 26 frigates, there will be five Type 31 frigates, which the Clyde will build and will be exportable. I will come back to that later.

Sir John Parker’s report was an honest attempt to deal with the feast and famine that we have heard about from the hon. Member for Glasgow North East (Mr Sweeney), but it contained several historical inaccuracies that concern me because the national shipbuilding strategy seems to be based on those historical inaccuracies, which is that two different types of ships have never been built in the same shipyard. That is not the case. Anybody who had worked at Yarrow’s would tell us that that was not the case, because, while they were building ships for the Royal Navy, they were building a different type of ship for the Malaysian navy. If the Government are basing their decision on such an historical inaccuracy, it is up to us Members of Parliament to tell them that it is an historical inaccuracy, and perhaps they might want to comment on that and put that right.

[Mr Sweeney]

I thank the hon. Gentleman for his comments, particularly about the frigate factory. Does he agree that the major issue was the fact that financing could not be achieved, because of fragmentation of the programme? If that had been gripped in the same way as programmes such as HS2 or the London Olympics, and the budget had been assured through its whole life, there would have been a business case to finance, through commercial means, the investment necessary to build a world-class shipyard on the Clyde.

[Chris Stephens]

I agree entirely. My Glasgow comrade is absolutely correct. That was one of the significant reasons for the frigate factory being cancelled.

My concern about the national shipbuilding strategy has been expressed by others: it is that we are going back to 1980s thinking and introducing competition. One of two things can happen when we start to introduce competition on that basis. Shipyards will try to undercut. As we heard earlier from my Glasgow comrade, that meant the collapse of Swan Hunter. It would be inevitable if we went back to the days of competition. Alternatively, companies would get together and the prices of ships would increase.

I think I am being fair and moderate in my remarks when I say that we are now at a place where the announcement of the national shipbuilding strategy was a presentational dog’s breakfast. The then Secretary of State, the right hon. Member for Sevenoaks (Sir Michael Fallon), claimed six times in the Chamber that there was a frigate factory on the Clyde. While he was on his feet in the Chamber making that claim, GMB officials were taking Scottish journalists around the proposed site, which was rubble and ash. There is no frigate factory on the Clyde. It was a presentational disaster for the Government.

I add my support to that expressed already for the argument that there is no need for the Royal Fleet Auxiliary Service ships to go to international competition. The reason no British yard has yet asked to be considered is that they believe the work will be sent out internationally; that is inevitable. As has been said, there would be clear economic benefits from building those ships not just for the local economies of the places where they could be built, in a modular format, but from the tax and national insurance take.

I also want to add to concerns expressed about the Type 31 frigate. It seems to me that the price is setting the capability of that ship, vessel or whatever we call it. The suggestion that it could be built for £250 million has already been described as a conspiracy of optimism. We need to know its capability and its role and purpose within the Royal Navy. To put it more simply: is it a complex naval warship? If it is, it should be built on the Clyde, which has been designated by the Government as a specialist shipyard to build complex naval warships.

[Mr Sweeney]

The hon. Gentleman says that the Clyde has that designation, but in reality, under the terms of business agreement, it was extinguished in 2014, although that has not been explained. Why did the rationale change? It makes sense to build all the complex warships on one integrated site where all the learning curves, benefits and efficiencies are concentrated. Why has that changed?

[Chris Stephens]

I think that is a question for the Minister. We need to know the reason, and I shall explain why. I understand that the only country with more than one specialist shipyard is the United States of America. That is probably no surprise given the size of the US Navy. We need to know such things, because recently there was an accident at sea involving a US Navy ship. If it had been built to commercial standards rather than by a specialist yard the collision with another ship would have been a real disaster. The model elsewhere, especially in Europe, is that one specialist shipyard builds complex naval warships.

There is a contract for three Type 26 frigates on the Clyde and I ask the Minister to confirm that the other five will be built there. There is a feeling in the yards and the trade unions that represent the workers that there has been a roll-back on delivering on promises.

I echo the points that the hon. Member for Glasgow North East made about shipyard construction. If the Ministry of Defence is concerned about economies and efficiencies and similar issues, it has a role to play in investing in shipyards and speaking to companies. The Clyde should have a frigate factory, and there is a role for the MOD to play in that.

The national shipbuilding strategy needs a bit more work. This is the first opportunity that hon. Members have had since the statement to raise concerns, and I hope that the Minister has listened carefully and will be able to respond to many of the points we have made.

--- Later in debate ---

[Wayne David (Caerphilly) (Lab)]

It is a pleasure to serve under your chairpersonship, Ms McDonagh, and I congratulate my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard) on securing this important debate and delivering such a fine opening address.

We have had a good debate—I genuinely mean that. We heard an excellent and thought-provoking contribution from the Chair of the Defence Committee, the right hon. Member for New Forest East (Dr Lewis), and good contributions from my hon. Friend the Member for Glasgow North East (Mr Sweeney), the hon. Members for Strangford (Jim Shannon) and for Glasgow South West (Chris Stephens), and a particularly ambitious speech from the hon. Member for Dunfermline and West Fife (Douglas Chapman).

Last year the Government published the national shipbuilding strategy, and the importance of naval shipbuilding should not be underestimated. Approximately 15,000 people are directly employed in UK shipbuilding because of spending by the Ministry of Defence, and at least 10,000 additional jobs are in the wider British supply chain. Some months before the publication of the national shipbuilding strategy in November 2016, Sir John Parker published his independent report on the UK’s national strategy for shipbuilding. Many people thought that that would become the national shipbuilding strategy, but—for reasons that are unclear even to this day—the NSS was a response to Sir John Parker’s report.

Those two important publications gave a degree of coherence and a sense of direction to the industry. We were, however, disappointed by the lack of emphasis on many of the points on which Sir John Parker developed coherent arguments. In particular, we would have liked an explicit recognition of the significant contribution that shipbuilding can make to the development of regional economies, and for that to have been put at the heart of the national shipbuilding strategy. That important point in Sir John’s report is not really reflected in the Government’s national strategy.

Today we have heard about the multiplier effect and investment in shipbuilding—that point was coherently expressed by my hon. Friend the Member for Plymouth, Sutton and Devonport. My hon. Friend the Member for Glasgow North East pointed out that our shipbuilding strategy must be part of a broader strategy that goes beyond the defence sector, and that can happen if we have the right perspective to develop it in such a way.

As we have heard, the new Type 31e and Type 26 frigates—albeit eight rather than 13, as we were initially led to believe—will be replacing the Type 23 frigates as they leave service. I have a number of questions about that ongoing programme. Some of them have already been touched on by other Members, but other questions are new. First, the MOD has said that there should be a cap of £250 million per Type 31e frigate. Why has that cap been fixed, and why at that figure? We need to know, because we have been reassured by people in the Navy that that amount may well be sufficient, but there are also plenty of experts who say that this insufficient and arbitrary figure has been plucked from thin air. Nick Childs, a naval specialist for the International Institute for Strategic Studies, has raised specific concerns about the level of capability and stated that,

“the naval staff seems to think it can get a vessel of about 3,500 tonnes, with an adequate military capability, for the £250m target price. That will be a challenge”.

That is an understatement. It certainly will be a challenge, and many industry experts say that it is frankly impossible. If it is impossible, what contingency measures will the Government take?

[Chris Stephens]

Does the hon. Gentleman share my concerns, and those of others who have spoken in this debate, that the price is dictating the capability of this frigate, instead of the capability being sorted out first, followed by the price?

[Wayne David]

That is precisely the concern with including the arbitrary figure of £250 million. I hope that the Minister will be able to dispel those concerns and clarify the situation.

Secondly, the national shipbuilding strategy correctly states that there is a potential export market for light frigates—the Type 31e. Much of that is for the purchase of a light frigate designed for construction in the market, not by means of traditional production. How is the Government’s exporting enthusiasm for that going? How many orders have they received? How many do they now think are likely? That key question was also raised by my hon. Friend the Member for Plymouth, Sutton and Devonport.

My third point is that, sadly, less than half the steel in the new Type 26s will be British. That is a crying shame, and I hope the Government will ensure that as the shipbuilding strategy develops, it is increasingly seen as an integral part of industrial strategy in this country, and that there will be complementarity with other parts of British industry.

My fourth question is about delays to the Type 26 programme. There is a great deal of concern among the workforce. Apprentices have been laid off and have had to find training elsewhere. Can the Minister say anything about that?

We are all proud to have seen the launch of the Queen Elizabeth carrier, which was formally commissioned into the fleet in December. We now look forward to the launch of the Prince of Wales carrier. The construction and fitting of both vessels has taken a great deal of commitment and dedication from a well-skilled workforce.

It is important to ensure that those skills are not lost but continually put to good use, which is why we should focus on fleet solid support ships. The contract for three new FSS ships will be subject to international competition. The decision is due in early 2020. I am concerned that that stipulation may put off domestic competitors, as the hon. Member for Glasgow South West suggested. That follows the awarding of a contract for four tankers under the military afloat reach and sustainability—MARS—project to Daewoo, a South Korean company that is widely believed to have been given a tremendous amount of state aid that made its bidding far more attractive than it should have been.

We hope that those ships will be built in Britain because that would secure the maintenance of the skills that have been built up in the industry, and support local economies. It would also help to enhance the national shipbuilding strategy’s domestic capability and to make real the renaissance in shipbuilding that Sir John Parker refers to in his report.

On sovereign capability, I ask the Minister to comment on the report that appeared in yesterday’s Western Mail. It suggested that the Ministry of Defence will award a contract for mechanised infantry vehicles to the Germans without any competition. I give the Minister the opportunity to deny that story.

--- Later in debate ---

[Guto Bebb]

It is a pleasure to serve under your chairmanship, Mr Streeter.

As I was explaining, the strategy is about planning. We are talking about the purchase of eight Type 26 global combat ships, the new Type 31 frigates and the next generation of fleet solid support ships. There has been a discussion on the competitive tendering for the fleet solid support ships, but that is in accordance with the strategy, which looks to ensure that warship capability is built within the UK, but that we are also open to go out to competition.

[Chris Stephens]

Will the Minister confirm that the eight Type 26 frigates will be built on the Clyde? Will he also remove the ban on Royal Navy personnel addressing the all-party parliamentary group on shipbuilding and ship repair on the national shipbuilding strategy?

[Guto Bebb]

I regret that I did not hear the second part of the intervention, but the commitment on the purchase of the eight Type 26s was clear, and I will be on the Clyde on Thursday.

The second element of the strategy is design. It is about taking a new approach to design and construction. We want to challenge outdated naval standards and introduce new ones. In effect, I am repeating the comments of the Chairman of the Defence Committee, my right hon. Friend the Member for New Forest East, but it is about forcing through advances in design, identifying new materials and looking at new manufacturing methods to try to make our shipbuilding industry even more competitive, which is part and parcel of ensuring that we have export markets.

The issue of the export markets for the Type 31 has been touched on by many Members. The figure of 40 frigates is the potential market that was identified for this type of frigate in 14 countries. That was part of market research that was undertaken. We have never argued that there are 40 potential orders for the United Kingdom; what we are saying is that there are 40 potential orders for that type of ship that will be open to competition from the United Kingdom.

Defence

Chris Stephens Excerpts

Thursday 11th January 2018 Commons Chamber

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

I join others in thanking the hon. Member for Gedling (Vernon Coaker) for securing this debate. I found out a couple of minutes ago, to my astonishment, that he is not right honourable, but I am sure that will be rectified in good time. He was quite correct in what he said in his speech, and he struck a chord with me when he talked about the economic benefits to the country of maintaining defence spending. I will use the last part of my speech to talk about that, particularly as it relates to shipbuilding and the national shipbuilding strategy.

I have a great family history in that many members of my family have served in the armed forces, and when it comes to defence spending, Thales, a company in my constituency, is celebrating its centenary this year. As I noted in early-day motion 292, the company has now provided visual systems equipment for submarines—or, for the lay person, periscopes—for 100 years. That resonates with me because, when it was trading as Barr and Stroud, my grandfather and grandmother met there, fell in love and ended up married for 61 and a half years. They were very keen supporters of the Scottish National party, and if it was not for them I would not be here in the Chamber today.

I thank my hon. Friend the Member for Glasgow North West (Carol Monaghan) for mentioning the Coming Home centre, which is celebrated in early-day motion 499. It provides 1,000 hot meals a month to veterans in Glasgow, and it does fantastic work. I am a regular visitor to that centre, and am always keen to help with its funding.

The hon. Member for North Wiltshire (James Gray) made an important point that was backed up by other Members when he said that the Government should be allocating more time to discuss defence matters. For example, Sir John Parker’s report on shipbuilding was published on 3 November 2016, but the first opportunity for Members of the House to debate that report was 8 February 2017, when my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman) secured a debate in Westminster Hall.

We had a ministerial statement on the national shipbuilding strategy from the former Defence Secretary—it is fair to say that it was a presentational dog’s breakfast—but we have not yet had the opportunity to debate that strategy, despite the best efforts of many members of the all-party group on shipbuilding and ship repair, who are always applying for such debates. This is therefore an opportunity for Members such as me—and I am sure others—to debate the national shipbuilding strategy.

For me, the national shipbuilding strategy has flaws that should be explored by hon. Members across the House to see whether we can put them right. Our real fear is that the national shipbuilding strategy is going back to the thinking of the 1980s, which suggested that shipyards should be in competition with each other. Such thinking has only ever led to shipyards closing. Competition has not led to the cutting of costs; with shipbuilding it has led to higher costs and to some famous shipyards—such as Swan Hunter—no longer being around and trading.

We must consider whether we want specialist shipyards that build complex naval warships. That was the position of the former Labour Government who decided that the centre of excellence for building complex naval warships was on the Clyde. I am always grateful to the workforce at Govan on the Clyde, and particularly to the trade union representatives who do a magnificent job of representing their members in the shipbuilding industry.

The other flaw in the national shipbuilding strategy is the nonsensical position of ignoring Sir John Parker’s recommendations, and sending the building of Royal Fleet Auxiliary ships out to international competition. This country has just completed a process during which the Aircraft Carrier Alliance was built across shipyards in the UK. If that was good enough for the Alliance, surely it is good enough for Royal Fleet Auxiliary ships. I do not believe that sending Royal Fleet Auxiliary ships to international competition will save the Ministry of Defence money—far from it. Indeed, the Government would make greater savings if they built the ships in the United Kingdom, because the workers building those ships would pay income tax into Government coffers. There will be no savings in sending the building of Royal Fleet Auxiliary ships to international competition, and I hope that the new ministerial team in the MOD will look seriously at that issue. These ships should be built in the United Kingdom.

The hon. Member for Gedling mentioned price tags, and his speech resonated with me with regard to general purpose frigates. There is a flipside to what he said about price tags, and I have the impression that the price tag set for a general purpose frigate will determine its capabilities. We have yet to discover—either in a debate or during Defence questions—what will be the capability of the general purpose frigate. It seems to be a downsize from the Type-26 frigate, three of which are contracted to be built in my constituency. What is the role, purpose and function of the general purpose frigate for the Royal Navy? We do not yet know.

[Vernon Coaker]

I am sorry to interrupt, but this is such an important point about capability. If you have an equipment budget projected over the next number of years, it must be based on a certain price. So if you do not know the price of those frigates and the price goes up, the only way to pay for them without increasing resources is to cut a capability somewhere else. It is ridiculous.

[Chris Stephens]

I fully agree with that point. Francis Tusa, a defence analyst, said that if anyone believes it is possible to build a general purpose frigate for £250 million they are guilty of a conspiracy of optimism. There is no defence expert who thinks that that is an appropriate price for building the general purpose frigate.

[Mr Ellwood]

I want to provide a bit of clarity on this important point, which is part of our shipbuilding strategy. Yes, there is a tentative price tag of £250 million, but each ship will be tailor-made for the order that we actually get. As the number of orders that we get goes up, the unit cost of the ships will go down. Of course there are ways of criticising that, and if Opposition Members have another strategy in mind, I invite them to suggest it; but I want to make it clear that this is something that we are doing, in advance, to utilise our friendships across the world to provide a capable ship that can be utilised in a number of maritime capabilities, depending on the details of the individual order.

[Chris Stephens]

I thank the Minister, who has been constructive, but I would gently say to him that there was a promise that 13 Type 26 frigates would be built, and that was cut to eight Type 26 frigates and five general purpose frigates, the purpose of which we do not yet know. He mentions orders. It seems to me the argument is that these general purpose frigates could be exported, but who would they be exported to? If we do not know the purpose, the role and the function, why would anybody anywhere else in the world buy a general purpose frigate? It makes no sense. When the Minister sums up, he may want to consider those issues.

The Government have a role to play in shipyard investment. The Ministry of Defence has talked, not just on the Clyde but at other shipyards too, about being more efficient, and if those shipyards are to be more efficient it means a very real investment in shipyard reconstruction and construction. When the former Secretary of State made his statement on the national shipbuilding strategy, he insisted that there was a frigate factory on the Clyde. While he was at the Dispatch Box, insisting that there was a frigate factory on the Clyde, representatives of the GMB trade union were taking journalists round the Clyde, showing them the site where that proposed frigate factory was supposed to be built, and it was rubble and ash.

We really need to get this right. I support the construction of a frigate factory, but it will need investment, and the Ministry of Defence has a real role to play in providing finance and money for that, because if it is insisting that shipyards should be more efficient and that they should reconstruct, it has a role to play. I hope that it will consider investing in a shipyard construction.

--- Later in debate ---

[Luke Pollard]

Estonia, Latvia, Lithuania and then, importantly, Kaliningrad, a Russian enclave in the heart of Europe. We should all be studying this important defence context.

We need to invest more in our cyber and intelligence capabilities, but not at the expense of our conventional forces, as has been said. We need to invest not only in our equipment, but in our personnel. I know from conversations with off-duty service personnel in the pubs around Plymouth that morale is a concern, not only because of the poor state of armed forces accommodation, as has been mentioned, but because of the pay cap and the uncertainty of their role in the world. Key to our armed forces is their ability to get on and do. They do not question; they just deliver. It is up to us in this place, and to Ministers, to do our bit to ensure that they have the backup they need. At the moment there is much more that could be done.

I am grateful to the Armed Forces Minister for meeting me yesterday to talk about the base-porting of frigates, which is an important issue in Devonport. I welcome the decision to base-port the new Type 23s with tails and ASW—anti-submarine warfare—capabilities in Devonport, but I encourage Ministers to set out a timetable for when the base-porting arrangements for the Type 26s and Type 31s will be made so that we can provide certainty. Devonport has a 25-year order book for maintenance in our dockyard, but that is not the case for our naval base. That certainty is very important.

In my maiden speech I made the case for the Type 26s to be base-ported in Plymouth. At the time I was expecting 13 Type 26s, as Scottish National party colleagues have mentioned, but we now expect only eight of them plus the Type 31s. I am concerned about the debate on the Type 31s, because we must have confidence in these warships, to ensure that they and the crews who serve on them around the world are respected. I think that the debate on the Type 31 frigate could be resolved simply if Ministers renamed it a corvette rather than a frigate. The Type 26 frigate will be world-class and world-beating. Let us not spend our time in this place talking down the Type 31. We should be having 13 Type 26s, but for various reasons we will not, so let us have five world-class corvettes, not just cheap frigates, which would do us and the Royal Navy no favours. I think that could easily be rectified.

While I am making requests of the Minister, will he provide some clarity today on what is happening with HMS Ocean? Having returned from expert work supporting hurricane-hit communities in the Caribbean, to hear from the Brazilian Government that they have purchased HMS Ocean for £84 million, not from the UK Government, felt like a kick in the teeth for all those closely associated with this world-class ship. I would be grateful if the Minister provided clarity on what is happening to her.

I mentioned HMS Albion and HMS Bulwark at the start of my remarks. I expect Ministers to hold true to their promise that Plymouth will be a centre for amphibiosity. That means not only retaining the Royal Marines in Plymouth after the closure of its spiritual home at Stonehouse barracks with a new purpose-built facility in the Plymouth area, but also ensuring that we have amphibious ships that are capable. The Bay classes are brilliant ships but they cannot replace the capabilities of the Albion class ships, and neither can the carriers. Losing HMS Ocean’s unique littoral capabilities for a helicopter carrier cannot be replaced by the Prince of Wales.

So we know we are having a capabilities cut already, but we need to make sure that, in providing a world-class centre for amphibiosity, we retain Albion and Bulwark and the Royal Marines. I am pleased that there has been cross-party and cross-Chamber support for the retention of the Royal Marines and the amphibious warships, and I know that Ministers have listened carefully to this. I must tell the Minister that many Members on both sides of the House will join him in any contest he has with the Treasury to make sure that he gets the resources he needs to provide for our armed forces.

On four occasions to date since being elected, I have asked Ministers to rule out cuts to Albion and Bulwark, but on each occasion I have been told it is simply speculation and is untrue. I ask the Minister now to give some certainty to those who serve on those ships by ruling out the cuts once and for all so that we can focus on where we need to get to, and to rule out cuts to the Royal Marines. Plymouth already saw the loss of 300 Royal Marines from 42 Commando just before the general election, so we have recent history of knowing that cuts to the Royal Marines can, and indeed do, happen. They are a vital pipeline for our special forces; the 6,500 Royal Marines provide 40% of our special forces. We must preserve and embed this pipeline.



On submarine recycling, we have spoken about the importance of our hunter-killers and our ballistic missile submarines, but I also want to raise the issue of the 19 decommissioned defuelled or fuelled submarines lying at rest in Devonport or at the naval base in Rosyth. Valiant, Warspite, Conqueror, Courageous, Sovereign, Splendid, Spartan, Superb, Trafalgar, Sceptre, Turbulent and Tireless are waiting in Devonport dockyard for recycling. The demonstration project on Swiftsure in Scotland is, I believe, paused at present.

We need a long-term solution so that we can safely dispose of our nuclear legacy, ensuring that, when new submarines are brought on board, we as a nation deal with the legacy of previous ones. We must ensure that the people of Plymouth and Rosyth do not have an indeterminate uncertain legacy in their dockyards without knowing what will happen to them in the future. This topic is being raised on the doorsteps in Plymouth, and although it only affects two places across the country, it should affect all of us in how we deal responsibly with the legacy of our armed forces.

I agree with all the remarks that the hon. Member for Glasgow South West (Chris Stephens) made about our shipbuilding strategy. We must have clear investment in that strategy, and the House should be firmly opposed to building the solid support ships abroad. The tonnage of those ships would equal that of the carrier programme, and we have demonstrated that the carrier alliance model works. As the RFA ships might not be armed but will be carrying munitions, the Government should determine that there will be a restricted tender for security and defence reasons, so that the long-term contract is provided to a UK facility.

[Chris Stephens]

Does the hon. Gentleman agree that if these ships are procured internationally there will be serious consequences for the UK shipbuilding industry?

[Luke Pollard]

Yes. The protection of our sovereign defence capability to both build and design must be preserved not only in naval matters but, as my hon. Friend the Member for Stoke-on-Trent North (Ruth Smeeth) said, in the Air Force as well. We must make sure we have a clear strategy and a clear plan to deliver on protecting the vital, high-skilled jobs in the UK that will preserve our unique role in the future.

This debate was too important to miss. I would have liked to see more Members present, and I encourage the Minister to follow the suggestion of the hon. Member for North Wiltshire (James Gray) and hold defence debates in Government time. It is not only Members who have served or have a military establishment in their constituency who should voice their view on this; the whole House should understand the importance of the defence of the realm, how precarious the international situation is at present and how vital it is that Labour, SNP and Conservative Members speak with one voice—[Interruption]—as must Liberal Democrat Members and others. We must speak with one voice in backing our troops and armed forces. We need a long-term plan with long-term funding so that we can provide the certainty and clarity our armed forces, the civilian contractors who work with them and our veterans need.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 23rd October 2017 Commons Chamber

[Harriett Baldwin]

I am delighted to let the House know that UK steel was represented at the first of the industry days that we held for the Type 31e frigate at the end of September. Its involvement at that very early stage ensures that it has the best chance of winning these competitions.

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

How does the Minister respond to suggestions from trade unions on the Clyde that the promises made to them have been broken by the Ministry of Defence, and will the Government change their illogical decision to put three fleet support ships out to international competition? Should they not be built in the UK, too?

[Harriett Baldwin]

Well, honestly, every time I talk about our wonderful programme of shipbuilding in the UK, I hear nothing but doom and gloom from our friends on the Scottish nationalist Benches. In fact—and no one would believe this—there are currently 15 ships being built in Scotland, including the second of the two new aircraft carriers, two decades-worth of work on the frigate programme and five new offshore patrol vessels. Frankly, I do not know what I could do to keep these gentlemen and ladies happy.

National Shipbuilding Strategy

Chris Stephens Excerpts

Wednesday 6th September 2017 Commons Chamber

[Sir Michael Fallon]

Yes, and we want to make it easier for more SMEs to participate in the supply chains of the major yards. Portsmouth and the surrounding area are now enjoying the challenge of completing the final fitting out of the two carriers and making sure that they are properly maintained and serviced, but there may well be further opportunities in the Havant area. I remember that the sector report that was produced for that area as part of the Solent local enterprise partnership specifically drew attention to the maritime strengths of the region, and I hope that it, too, can get involved.

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

As the hunt goes on for the mystical frigate factory, which the Secretary of State cancelled in June 2015, may I ask him what shipyard reconstruction investment he is going to make on the Clyde? Also, does he accept the criticisms in the Parker report that some decisions were based on historical wrong assumptions about the ability to build different types of ships consecutively, as has happened on the Clyde? Will he confirm that the Type 31 frigate is a complex naval warship and that it should therefore be built at the centre of excellence on the Clyde, as he and the then Prime Minister promised in November 2015? Finally, why are the fleet support ships being procured internationally when the UK shipyards could be building them?

[Sir Michael Fallon]

The hon. Gentleman is doing his best to turn sunshine into a grievance. Govan will build eight enormous frigates over 20 years. That is a frigate factory by any definition, and I hope that he is clear about the sheer weight of work that Govan and Scotstoun are now going to enjoy. So far as investment in the yard itself is concerned, yes, part of the £3.7 billion that I announced when I came to cut steel in Glasgow at the end of July is indeed investment to enable BAE Systems to build the final five of the eight-ship batch. That money includes the price of the first three ships as well as investment to ensure that the next ones are built as well.

On the question of the support ships, it is only warships that have to be built inside the United Kingdom, for security reasons, but there is absolutely nothing to prevent yards in England or Scotland from bidding for the fleet solid support ships as well. Indeed, there is every reason to encourage them to do so.

National Shipbuilding Strategy

Chris Stephens Excerpts

Wednesday 8th February 2017 Westminster Hall

[Mr Jones]

Again, the hon. Gentleman makes a very good point. This is an international market and these skills are very sought after. This comes back to my point that if we want this capability in the UK, we have to nurture and protect it and the only way to do that is by having a throughput of work.

The hon. Member for Dunfermline and West Fife raised the issue of the Type 26. The delay is adding to that uncertainty. The wider piece really concerns me. To give the impression that we are going to have that drumbeat of work, we have had the Type 31 inserted into the programme. I have studied in detail to try to find out what the Type 31 actually is; no one has been able to tell me yet. It is a bit like the mythical unicorn—everybody thinks it exists, but no one has ever seen one. If the MOD can say that there is a budget line for it, it should please identify that—in the current procurement there is no budget line for it at all in the programme.

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

Was the hon. Gentleman concerned, as I was, to read in an article in The Daily Telegraph a suggestion from a Ministry of Defence source that there is no budget for Type 31s and that they might not even happen?

[Mr Jones]

As people know, I am a bit of an anorak on this subject and I actually study the MOD accounts, but I still cannot find where this budget line is. Another point that has never been answered is what this ship will actually be used for. I am not sure where it fits into any naval strategy. Will it be able to meet, for example, Britain’s NATO capabilities? Will it have capability to fulfil those roles? If it has not got the air defence capability, it will not. The other thing that people have completely missed is that this is about not just building the ship, but running it afterwards. We all know that there is a crisis in recruitment and manpower in the Royal Navy. Again, where is the budget line for not only building but running this generation of ships?

The hon. Member for Dunfermline and West Fife makes a very important point. The Government say that the great thing about the ships is that they are exportable; I am sorry, but we are bit behind the game on this. He rightly identifies at least two other nations that have product out there.

There is another point about strategy. This is about not only skills but the defence of our country, because if we have the gap between the Type 23s going out and the Type 26s coming in, there will also be a gap in the nation’s capability. I understand that there is an ongoing extension programme for some Type 23s, but we need clarity, because if there is a gap, we will not be able to protect the carrier groups or some of our other capabilities.

That leads me to the wider piece about the Government’s strategy in this area. The Prime Minister argues that she is batting for Britain and that Britain is the key market, but we have a situation in which the Ministry of Defence, obviously leant on heavily by the Treasury, is happy to have multimillion-pound contracts with the United States—the Apache and P-8 contracts, to name just two—with no commitment whatever that proportionate workshare will come back to the UK economy. I asked the Minister a written question about the Apaches, and I think Boeing said that 5% of the programme’s value will come back into our supply chain. That point is important not just for the number of jobs, but to keep the capability that we need in this country. I cannot imagine for one minute the United States doing something similar, even before President Trump took office, and things will get even worse now. Exporting highly paid jobs and capability from this country is inexcusable. I do not want to see the same thing happening in shipbuilding, so that we will perhaps just buy ships off the shelf from the United States or anywhere else.

A few weeks ago I asked the Minister in a parliamentary question what she was doing to monitor whether Boeing, for example, would put enough jobs into the economy. She fudged the answer, saying, “We don’t monitor this area.” I am sorry, but that is inexcusable. What really irritates me is that if a British company sold a piece of defence kit to the United States of America, there is no way that we would not have to give guarantees about workshare and jobs in the United States. My fear is that without joined-up thinking on shipbuilding, if we are not careful, a time will come when the Treasury says, “Isn’t it cheaper just to buy these from abroad—from the United States or somewhere else?” We would then lose not only the sovereign capability that is so important to this country, but the skill base and jobs that come with that.

I come to my final point. It is about time that the Ministry of Defence fessed up that it has a huge problem, which is only partly of the MOD’s making, because this is actually a Treasury issue. The National Audit Office report is clear about the procurement budget. The Ministry of Defence is falling into an old habit—as a former Minister in the Ministry of Defence, I know this is easy to do—of just pushing the budget sideways, which is what has happened with the defence budget. However, there are other pressures on the day-to-day in-service budgets. Ships are being laid up, for example, because the cash is not available to run in-service services. In addition, there is a huge black hole—it was highlighted in the NAO report—that the MOD has to deal with. We are not talking about separate money; it will have to find £8 billion over the next 10 years for the defence estate. All that falls within the defence budget, so if does not come out of one place, it will come out of another.

The Government need to be honest about where they are with the equipment budget. The Opposition got lectures from the incoming coalition Government about how frugal they would be, in terms of ensuring that they did not over-commit on defence, but they are clearly doing that now. The shipbuilding strategy needs to be published soon. If we are going to answer yes to the question, “Do we want a sovereign capability for shipbuilding in this country?”, we will have to put the money behind it and ensure that the work is of a nature that allows the industry to develop its skills and retain that capability.

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

It is a pleasure to follow the hon. Member for North Durham (Mr Jones) and to have listened to his technical expertise in this area. I very much appreciated his speech and particularly his support for the Clyde shipyards. I congratulate my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman) on securing the debate, and it is always a pleasure to see you in the Chair, Mr Evans.

I shall start, as the hon. Member for North Durham did, with the extraordinary process regarding the strategy. He is not the only one who thought that Sir John Parker’s report would be the national shipbuilding strategy; I and other hon. Members of the House did too, as did trade unions and the defence industry.

[Martin Docherty-Hughes]

The Minister said that a signed copy would be sent to my hon. Friend the Member for Argyll and Bute (Brendan O'Hara), but we are still waiting for it. Clearly that means that the actual statement has not been produced.

[Chris Stephens]

I remember that exchange, and there was clearly confusion about the report. I also find it extraordinary that although Sir John Parker’s report was sent to the Ministry of Defence on 3 November 2016, this is the first opportunity that hon. Members have had to discuss it in detail. In November or December, there should have been a debate, or a series of debates, on the report, so that hon. Members could give their views on it and feed into the process. I shall come to that later.

I was very concerned when it was pointed out to me that on 2 January in The Daily Telegraph—not necessarily a newspaper that I subscribe to—MOD sources were not only saying that there is no budget for the Type 31, but that it will not happen and the plan will not be realised. We need to go back to the former Prime Minister’s announcement on the Clyde in my constituency in 2014, when he promised that 13 Type 26 frigates would be built on the Clyde. We were then told that there would be eight Type 26 frigates and five general-purpose frigates. As the hon. Member for North Durham outlined, we do not know exactly what that capability is, but we were told, “It’s okay; relax, because eight plus five equals 13.” We are still awaiting the final sign-off, not only for the eight Type 26 frigates but for the five general-purpose frigates. I hope that the Minister will tell us, if there is indeed a budget for Type 31 frigates, what it is and what the procurement timetable is for Type 26 and Type 31 frigates.

[Douglas Chapman]

If what my hon. Friend is saying is anywhere near the truth and the Type 31s will not exist, what does that say about the drumbeat for Govan and Scotstoun?

[Chris Stephens]

I would be very concerned about that, and I will come to the effects of that later. Sir John Parker’s report is an honest attempt to end the “feast and famine” procurement processes by the Ministry of Defence that have often plagued the shipbuilding industry. If any other public services carried out procurement processes in the way that the Ministry of Defence does, there would be uproar in the streets—imagine if it was equipment for the health service or education, and so on.

I am pleased that Sir John Parker’s report also recognises the capability and skills of shipyard workers on the Clyde—in my constituency, in the Govan shipyard, and in Scotstoun, in the constituency of my hon. Friend the Member for Glasgow North West (Carol Monaghan)—working on digital technology adapted from the automotive sector and with new working practices that have increased productivity. It is an honour and a privilege to represent them in this Parliament. The shipyard workers are also supported by trade unions and are represented at shop-floor level by representatives who have campaigned tenaciously over the years to ensure that future work is secured. Any announcements that come from the Government are a victory for them more than anyone else. However, as someone who had family members in Yarrows who were made redundant under a Tory Government, I always view such commitments from this Government with suspicion when it comes to shipbuilding.

Sir John Parker’s report also recognises that the Royal Fleet Auxiliary ships should be assembled in the UK. It really is a nonsense that that work has been farmed out elsewhere. I would hope that Rosyth, to cite one example, would have that opportunity. Failure to ensure that Royal Fleet Auxiliary ships are built in the UK will make the report fall at the first hurdle. An award to a UK yard for Royal Fleet Auxiliary ships would demonstrate that the Government are serious about ensuring that an export model can be achieved and that investment in technology can be kept.

[Martin Docherty-Hughes]

My hon. Friend is talking about Type 31s, but given the fact that the Secretary of State and also the leader of the Conservative party in the Scottish Parliament have said that there will be work on the 13 Type 26s, where is that guarantee from the Government?

[Chris Stephens]

I hope we will get that today. I hope the Minister will give us that commitment.

There is one fatal flaw, however, in Sir John Parker’s report, which needs to be tackled. His assumption that there is no precedent for building different first-class naval ships concurrently is wrong. In the 1990s, Yarrow shipyards were building and constructing Royal Navy ships as well as exporting ships to Malaysia. This precedent was envisaged by the Clyde shipyard taskforce in 2002, chaired by the then Scottish Executive Minister, Wendy Alexander, and the former Scottish Office Minister, Brian Wilson, which ensured that the Govan shipyard was responsible for the steelworks and that Scotstoun was to become the centre for excellence.

There is therefore reason to argue that Govan could construct the Type 26 frigates and Scotstoun could develop the new Type 31 frigate, using the specialist design capability to ensure that it could be exported to other countries. Such technical expertise to carry out the work is already there on the Clyde, but it will require investment. MOD pressure not to invest in the frigate factory—promises that led to the demolition of the covered berth and module hall at Scotstoun—has meant that we still have a constrained capacity and that the full potential for shipbuilding on the Clyde has not yet been realised. I want to hear from the Government about progressive plans with respect to shipyard reconstruction to unlock significant long-term advances and savings for the industry so that it can win more orders, not only here but from overseas.

Sacrifices have been made by shipyard workers on the Clyde. Let us not forget that to get to where we are now, workers on the Clyde took redundancy to ensure that the rest would be kept and that they would be match-fit to build the 13 Type 26 frigates. I hope that today the Minister will confirm procurement processes for the Type 26 and Type 31 frigates. The trade unions have said that failure to ensure that the Clyde leads on the general-purpose frigates would be a betrayal.

--- Later in debate ---

[Wayne David (Caerphilly) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Evans. I congratulate the hon. Member for Dunfermline and West Fife (Douglas Chapman) on securing this debate; it is on a very important subject and, as has been said, it has given us a first opportunity to discuss Sir John Parker’s important report.

I welcome the contributions of Scottish National party colleagues, the hon. Member for Strangford (Jim Shannon) and my hon. Friend the Member for North Durham (Mr Jones), who showed his expertise in this area. However, it is a great shame—a crying shame—that there are no Conservative Members of Parliament present, apart from the Minister and, rather belatedly, somebody else who I think has come in for another debate. It is a great shame that we have not had a full Chamber and that we have not all been able to debate collectively what is a fundamentally important issue for this country.

I will focus my comments on the situation regarding the strategy from the Ministry of Defence. My starting point, of course, is what the Government themselves declared in 2015 in their strategic defence and security review. They said that they were committed to maintaining a fleet of 19 frigates and destroyers, and that they intended to complement that force with a new class of lighter and flexible general purpose frigates. At that time, they correctly made the link between the need to develop our national security and the promotion of our domestic prosperity. The Government proudly announced then that a new national shipbuilding strategy

“will lay the foundations for a modern and efficient sector capable of meeting the country’s future defence and security needs.”

In the Budget of 2016, the Government proudly announced that they had appointed the eminent Sir John Parker to lead and write a national shipbuilding strategy, and it was promised that a report would be prepared and presented to this House in 2016.

However, there has been genuine confusion and I hope that the Minister will take this opportunity to clarify the situation. On 29 November 2016, we had a report from Sir John Parker, but it was not, as we had been promised, the Government’s national shipbuilding strategy. Many people thought that it was—some Ministers thought that it was—but it was not. Instead, we had an “independent report” on the UK’s national shipbuilding strategy from Sir John Parker.

My questions are quite simple. How did that metamorphosis take place; why did it take place; why is there confusion; what contact was there between the different Departments; and who is taking the lead on this issue? Those are very important questions about something as fundamental as the strategy for our future warships, which is not an issue that can be lightly dismissed. I echo what other Members have said: we would all like answers from the Minister about what on earth has happened and what on earth is going on.

Of course, Sir John’s report is very radical and extremely scathing about how things work, or rather do not work, within the Ministry of Defence regarding Royal Navy programmes. The report has a very interesting, informative and worrying chart about the length of time it takes for projects to develop to fruition. For example, Sir John points out that it was in 1967 that the conceptual start of the Type 21 frigates began and they were delivered nine years later. As for the Type 23 frigates, the conceptual start date was in 1978, but it took 17 years for that project to come to fruition. Goodness knows how long it will take for the Type 26 frigates.

Sir John asks why there have been such long delays. Why has this process taken such a long period of time? In some ways, the demands upon the frigates have changed. The world has changed and defence requirements have changed, but there is still that laborious project time before us. Why has that happened?

[Chris Stephens]

Does the hon. Gentleman agree that these delays not only impact on the Royal Navy but on the local economy in Scotland? He may be aware of the GMB report on Scottish shipbuilding and the value of shipbuilding to the Scottish economy.

[Wayne David]

Indeed, I fully support those points. The situation is very worrying for all concerned, not least the people who are employed in the shipbuilding industry and the local communities from which they are drawn.

Sir John gives a number of reasons why the long delays have occurred. He makes 11 points. I will not go through all of them, but will just pick out some of the reasons he suggests. He says that there has been

“A lack of assured Capital budget per RN ship series, subject to annual arbitrary change, with accumulative negative impact on time and cost with accompanying increased risk of obsolescence”.

That is very worrying. He also says that there have been

“Poor linkages across the ‘Total Enterprise’ including industrial capability and capacity”.

He goes on to say:

“Senior decision-makers have, previously, been engaged too late in the process and not always with high quality information and costing data”.

He adds:

“The MOD has lost expertise in both design and project contract management”.

He says that there has been

“Inadequate evaluation of risk contingency in each project”.

Those are some of the damning reasons why Sir John says there have been delays. I suggest that they are an indictment of the MOD, which really must sort things out once and for all regarding its procurement and governance strategy for warships.

Once the strategy has been written by the Government, when will it be published? I will not ask for the exact day or week, but will it be published in March, April, May, or whenever? We would like some sort of indication. Once it is published, we would like to know what sort of consultation there will be and how long it will last. I ask that because we want to have a full debate on every dot and comma of that important policy document.

I recognise that the Minister will not say very much about what might or might not be in that report. Nevertheless, I have a number of questions for her. First, will the Government sort out, once and for all, their procurement and governance systems for warship construction in this country? There really ought to be a masterplan that should be reviewed at each SDSR, and as part of that approach there should be a partnership with both the industry and the trade unions. As Sir John has suggested, a shipyard trade union representative ought to be appointed to attend regular meetings, to enhance the transparency and efficiency of the processes that are under way.

Secondly, will the Government commit to working with their industry partners and trade unions to enhance the training and educational capabilities and facilities, so that there is the correct mix of skills and competence, particularly with regard to the new digital systems that are coming on stream?

Thirdly, will the Government commit to having a small but highly specialised virtual innovation centre to force through, among other things, advances in design, new materials and productivity improvements? As Sir John has argued, such an innovation centre is necessary if we are to oversee the new “global competitiveness plans”, which I believe the Government want to see being created.

Finally, will the Government commit to placing a greater emphasis on the exporting of British-built ships, as well as British project management, design, equipment and sub-systems? Will they not only engage in general rhetoric, but commit to specifics, as part of a great national effort to ensure not just that British-built ships are used for British defence, but that the expertise in this country is sold for the benefit of navies throughout the world?

I look forward to hearing the Minister’s response to my questions.

--- Later in debate ---

[Harriett Baldwin]

It is about the distinction between the report and the Government’s publication of the national shipbuilding strategy. A range of people raised this issue, so I make it clear that we are considering Sir John’s recommendations, and we will provide a full response, which will be what we can all call the national shipbuilding strategy. It will be published in spring 2017. I am sure Members will appreciate that I cannot be more precise than that in terms of a specific date.

[Chris Stephens]

rose—

[Gavin Robinson (Belfast East) (DUP)]

rose—

[Harriett Baldwin]

If Members want to take up my time, I will give way.

[Chris Stephens]

Will the Minister outline the process? A few Members have mentioned that, including the hon. Member for Caerphilly (Wayne David). Once the Government publish the national shipbuilding strategy and its response to Sir John Parker, what is the process? Who feeds into that response?

[Harriett Baldwin]

I will be talking a little more about that in my speech.

Type 26 Frigates: Clyde

Chris Stephens Excerpts

Tuesday 18th October 2016 Westminster Hall

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

It is always a pleasure to serve under your chairmanship, Mr Hollobone. As the Member who has the privilege of representing the Govan shipyards, it is a pleasure to speak in this debate, and I thank my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) for securing it.

There remain a number of questions to be asked this afternoon, but possibly the simplest one can best be described as: does eight plus five equal 13? That is important, in understanding the history of where we are. As my hon. Friend the Member for West Dunbartonshire highlighted, the history started before the independence referendum, with promises of 13 Type 26 frigates. Last November, at the strategic defence and security review, we were given the assurance: “It’s okay. There won’t be 13 Type 26 frigates; there’ll be eight Type 26 frigates and five light, general purpose ones.” There is nothing to worry about, was the message given to the workforce on the Clyde. I ask that simple question because I know that the workforce on the Clyde and the trade unions are frustrated by and worried about the delays in the timetable for the Type 26. The original date for cutting steel was May 2016; it would be useful if the Minister could give reasons for the delay in the procurement. Despite 15 written questions, I have received no meaningful answers.

[Bob Stewart]

I do not think we need the Minister to answer that. The answer is that we had no money; that is why we had to cut down the number of Type 26 ships. [Interruption.] We did not have the money, and we have to cut our coat to suit our cloth.

[Chris Stephens]

The hon. Gentleman may say that, and I may come on to that point, but the Government have never confirmed that that is the reason for the delay, and it would be useful if they were to say that today. If he is correct that there was a lack of money, I am sure that there are Committees and hon. Members in the House who would want to ask what happened with the money.

Lord West suggested to the Defence Committee that the defence budget for shipbuilding was spent. In answer to a question from my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman), he said:

“Shall I tell you what the problem is? Notwithstanding having said how much extra money there is for defence, in the near years there is not. There is almost no extra money available this year, and we are really strapped next year. The Government aren’t coming clean about that. I think if they did, people would understand.”

In answer to further questions, he outlined that delays can be costly in the long run. In response to the Chair of the Committee, he said:

“Every delay costs you money. These delays all cost money. You need a steady drumbeat of orders to keep high-tech industries going. Our complex surface warship building industry, like the submarine one, needs a steady drumbeat of orders.”

[Ian Murray (Edinburgh South) (Lab)]

My hon. Friend talks about the drumbeat and the starting point for the project. Is it not one of the key concerns that, even when the project starts, if the drumbeat is extended and the length of time for the completion of each ship is extended, by the nature of that equation, fewer workers will be needed?

[Chris Stephens]

That concern is felt not only by my hon. Friends, but by me and, crucially, the trade unions and workforce on the Clyde. What economic impact assessment has been carried out on delaying the Type 26 frigates? We know from an excellent report by the Fraser of Allander Institute, which was commissioned by GMB Scotland, that the two BAE yards at Govan and Scotstoun directly employ a total of 2,723 people. More than 1,000 of them, men and women, are skilled tradespersons. I am delighted that there has been an increase in women apprentices and women workers highly involved in high-tech industry. The report estimates that the two yards in Glasgow support a total of 5,943 jobs and, through that, £162.7 million of wages across Scotland as a whole. Returning to my original “eight plus five” question, will the Minister confirm whether the general purpose frigates will also be built on the Clyde, as confirmed by the former Prime Minister in the strategic defence and security review in November 2015?

We know that a national shipbuilding strategy will be announced soon. I am looking forward to that, when it comes, but I reiterate that we should not underestimate the frustrations of the workforce. They want to build ships. They want a long-term future for the Clyde that will begin with cutting steel for Type 26 frigates. I look forward to the Minister’s response to my questions.

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[Wayne David (Caerphilly) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. It has been said that confusion and muddle have been the hallmark of the Government’s approach towards naval shipbuilding in recent years. Nowhere is that lack of clarity more in evidence than when it comes to the construction of frigates.

The Navy has 13 Type 23 frigates. As we have heard, there was a strong suggestion in the 2010 strategic defence and security review that 13 Type 26 frigates should be constructed in place of those 13 Type 23 frigates. We were told that manufacturing of those new frigates would begin in 2015-16, but the 2015 SDSR cut the number from 13 to eight. At that time, the Government gave a weak commitment to building at least five new general purpose frigates, possibly more. They have yet to agree a manufacturing date with BAE Systems for the Type 26 frigates, and the demonstration phase on those frigates was extended in March 2016 by a further year. At the same time, BAE Systems has been building three offshore patrol vessels, and the Government plan to have two more of those. That general factual background leads to a number of key questions that have been touched on in the debate, and that I want to underline.

First, with regard to timescale, if the Government do not give the go-ahead and the date for the cutting of steel is not before summer next year, the production trades will have almost finished manufacturing work on those offshore patrol vessel programmes, and will have no work to carry on with. In other words, there will be a hiatus. The trade skills that are required for the construction of the offshore patrol vessels will be lost and will not be able to be deployed other than at significant cost, with more delays and more training. It is important that the Government come clean; they must have some idea of the start date, and I hope that the Minister will tell us when that will be.

The second question is again on the issue of skills and the dovetailing that will be necessary between the Type 26 programme and the programme for the general purpose frigates. The trade unions have pointed out that as the Type 26 programme design phase is decreasing, the ship designers will need another programme to work on, so we need specifics from the Government on the general purpose frigate programme as well. What is the Government’s intention in that regard?

Thirdly, we have already seen delay—hopefully there will not be more—but what does that mean for the existing Type 23 frigates? The Government have said that there is to be no extension of their lifespan. Is that still the case? I have been told that the Type 23 frigates have already exceeded their original design life. If they are kept in service, there are implications for the Navy, in terms of fulfilling the requirements that those frigates meet.

The final question is on cost, and clarity would be desirable here. As we have heard, there have been suggestions that because of the Government’s continuing austerity programme and the hardening of cuts, it is becoming increasingly expensive for them to make real their previous commitments. Admiral Sir Philip Jones, the First Sea Lord and head of the Navy, suggested that when he told MPs on the Select Committee that one problem is the cost of designing quiet ships; the technology is far more expensive than was originally envisaged. That may or may not be the case, but what is very important, on that and on the other issues raised this afternoon, is that we have clarity and certainty from the Government.

[Chris Stephens]

Does the hon. Gentleman agree that delays have an economic impact, and not just on Govan, Scotstoun or Scotland? There is a wider economic impact. If there is a delay, that will mean a more expensive programme in the long run.

[Wayne David]

Broadly speaking, that is correct. There will certainly be excessive costs if the Type 23 frigates are required to stay in service beyond their natural design life. Also, with most programmes, and certainly with defence procurement programmes, the longer the programmes, the more the delay and the greater the costs. There is also an impact on the workforce, with greater uncertainty and greater job insecurity. On all these issues, what is required is, at the very least, clarity from the Government. I thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) very much for bringing forward this issue today.

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[Harriett Baldwin]

I did not say that in updating the House there would necessarily be anything new, but I do want to reiterate the commitments that I have previously made.

The work will benefit suppliers across the country, injecting an estimated £200 million into the UK supply chain and sustaining 1,600 high-quality jobs, an estimated 600 of which—more than a third—are in Scotland. From Loanhead in Midlothian, where the helicopter handling equipment will be built, to Fleet in Hampshire, where communications equipment will be developed; from Dunfermline in Fife, where the steering gear will be built, to Huddersfield in West Yorkshire, as mentioned by my hon. Friend the Member for Colne Valley (Jason McCartney), where the gearboxes will be constructed—this investment is good news for UK industry. Furthermore, we announced in July the latest commitment of £183 million to buy the maritime indirect fires system—the five-inch gun—for the first three ships. That takes our total investment in the Type 26 programme so far to £1.8 billion, which is hard evidence not only of our commitment to the programme but of real progress in delivery.

[Chris Stephens]

Like the shadow Minister, the hon. Member for Caerphilly (Wayne David), I am guessing that we are not going to get a date for cutting steel this afternoon. Is it the Ministry of Defence’s intention to tell us the expected date for cutting steel on the Clyde before or after the autumn statement?

[Harriett Baldwin]

The hon. Gentleman is going to get a lot of interesting stuff from me this afternoon, so he will have to sit on the edge of his seat as I speak. I will give the hon. Member for West Dunbartonshire three minutes to sum up.

A key focus of this afternoon’s questions has been the timetable for the programme and the building of the ships. The timing of the award of the build contract and the build schedule itself are key components of the ongoing commercial negotiations between the Government and BAE Systems. We are negotiating a deal that aims to optimise the Royal Navy’s requirements, in terms of the capability that the ships will deliver; to achieve value for money for defence and the taxpayer; and to deliver a build schedule that drives performance by industry. Those negotiations are continuing, so I am not in a position to give a specific date for when an agreement will be reached. I am sure hon. Members will appreciate that, to protect the Ministry of Defence’s commercial interests, disclosing any such detail would be inappropriate at this time.

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[Harriett Baldwin]

I have given the hon. Gentleman a range of dates for some of the commitments we have already made and some of the contracts we have already placed as a result of this programme, which sustain jobs across the UK.

The need to ensure we have the skills required to deliver Type 26 also came up in the debate. That is an essential factor in the successful delivery of the programme and is crucial to our strategic aim of placing UK shipbuilding on a sustainable long-term footing.

In the interests of time, I will quickly skip through the issue of offshore patrol vessels. We are looking forward to the delivery of HMS Forth—a ship of that class—next year, and HMS Medway and HMS Trent remain on track.

It is important to put the Type 26 programme in its wider context. Overall, last year’s SDSR achieved a positive and balanced outcome. We are growing the defence budget in real terms for the first time in six years and delivering on our commitment to spend at least 2% of GDP on defence. The SDSR enables us to invest £178 billion in new equipment for our armed forces over the next decade, an increase of £12 billion on previous plans. In the maritime sector, we have set the trajectory for expansion of the Royal Navy’s frigate fleet as we spend about £8 billion on Royal Navy surface warships over the next decade.

As I have explained, we continue to progress the Type 26 global combat ship programme. Hon. Members with constituents who work at the shipyards on the Clyde rightly emphasised the importance of the Type 26 global combat ship programme to the workforce. In response to concerns expressed on their behalf, the Ministry of Defence has consistently restated its commitment to the programme and confirmed that all eight ships will be built on the Clyde. There should be no lingering doubt on that point or on the idea that Royal Navy vessels would be built on the Clyde had Scotland voted to leave the United Kingdom.

[Chris Stephens]

The Minister mentioned the national shipbuilding strategy, which has to report by the autumn statement. I am going to ask the question I asked earlier: does she expect an announcement on the procurement of Type 26 frigates by the autumn statement? That would be helpful for my constituents.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 12th September 2016 Commons Chamber

[Michael Fallon]

Let me reassure my right hon. Friend. We have already invested more than £1.8 billion in the Type 26 ship, and I announced a further £183 million in July for the guns to go on the ship. Much of the design work has been completed, but I am not prepared to sign a contract with BAE Systems until I am absolutely persuaded that it is in the best interests of the taxpayer and, indeed, the Navy, giving value for money to both.

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

The Secretary of State will be aware that the shipyards are in my constituency. The clear message from the workforce might best be conveyed by my paraphrasing Darth Vader: we want these ships, not excuses. Will the Secretary of State explain why, although the original timetable for the cutting of steel was May this year, it has not yet happened? May I ask him to speed up the process, so that ships can be built on the Clyde?

[Michael Fallon]

We would not be ordering any ships from the Clyde if Scotland had become independent last spring, because complex warships are only built in the United Kingdom. Let me be clear: this contract must be in the best interests of the taxpayer. I am aware of the need to sustain employment on the Clyde, which is why, last December, the strategic defence review announced the construction of two further offshore patrol vessels, in addition to the three that are currently being built on the Clyde.

Oral Answers to Questions

Chris Stephens Excerpts

Monday 27th June 2016 Commons Chamber

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

8. What progress has been made on his Department’s naval procurement plans.

[The Minister for Defence Procurement (Mr Philip Dunne)]

The Department continues to develop our naval force structure, as we set out in the defence review. That will include completion of two new Queen Elizabeth class aircraft carriers, eight Type 26 global combat ships, new solid support ships and two new offshore patrol vessels.

[Chris Stephens]

Can the Minister confirm press reports today that leaked correspondence shows that the Ministry of Defence is looking for savings of £500 million in the Type 26 programme, and has refused an offer from BAE Systems that would bring savings of £270 million while starting the programme on time?

[Mr Dunne]

As I said in answer to other questions on the Type 26 programme, we will enter into a contract once we have established best value for the taxpayer, and a delivery schedule that can be met by the contractor.