Defence Procurement and Supply Chains

Grahame Morris Excerpts

Tuesday 1st December 2020 Westminster Hall

[Grahame Morris (Easington) (Lab)]

Thank you, Sir Charles. I thank my good and hon. Friend the Member for Birkenhead (Mick Whitley) for securing this important debate, which is particularly timely given the extra £16 billion of defence funding that was announced in last week’s spending review.

Defence contracts represent an excellent opportunity for the UK economy and for job creation and retention in Britain. It is vital—I am addressing these remarks to the Minister in particular—that defence projects have a domestic focus, with a particular emphasis on maintaining jobs and the skills base in the UK.

Unite members at the Rolls-Royce site in Barnoldswick are currently being forced to take industrial action, because Rolls-Royce is cutting 350 highly-skilled jobs and offshoring them to Singapore. Workers at the plant fear that this latest round of job cuts will spell the end of the site itself, as it will likely become unviable as a result. The Barnoldswick workforce actually helped to set up the Singapore site, having been given promises that it would never put the home site at risk—a gross betrayal of loyal staff.

Unite the union understands that this work will remain at the site in Barnoldswick, at least for now, due to international arms trafficking regulations. However, the latest job cuts at Barnoldswick call into question the very viability of the site, and whether work on the joint strike fighter lift fan blade will transferred to Singapore.

While Singapore may be a safe and secure country at the moment, there are concerns that this technology needs to be protected. On the 80th anniversary of the battle of Britain, the striking workers rightly believe that it is a disgrace that the Barnoldswick site is under threat, given its heritage and the important role that it played in supplying the components for Merlin engines, which kept the Spitfires flying in the battle of Britain.

As part of its long-standing history in supporting British defence, Rolls-Royce has benefited from vast amounts of UK taxpayer money, not only in loans, grants, tax breaks and R&D, but in the form of defence contracts. Rolls-Royce will no doubt be keen to secure a large slice of the £16 billion extra defence funding budget announced by the Chancellor, but the situation at Rolls-Royce is one that must be avoided elsewhere. I still hope that the Government will intervene with Rolls-Royce. Workers at Barnoldswick are highly skilled. The jobs at Barnoldswick are exactly the type we need to create and retain in the United Kingdom. Defence projects must have a defence focus. It is vital for the short-term and long-term health of the UK economy.

I had the privilege of joining striking workers, Unite union reps, union officials and Labour colleagues on a virtual picket line last Friday. Striking workers are still there now, as I speak. I would like, once again, to express my unwavering solidarity with those workers, who are striking to save their jobs, not just for themselves and their families, but for future generations and for their community.

--- Later in debate ---

[The Minister for Defence Procurement (Jeremy Quin)]

I welcome this important debate, and congratulate the hon. Member for Birkenhead (Mick Whitley) on having secured it. This debate is particularly timely, as several hon. Members have reminded us, as it comes in the wake of an extremely positive bit of news. It is wonderful to see the Chamber united, with the hon. Member for Portsmouth South (Stephen Morgan) welcoming last week’s announcement. Even my friends from the Scottish National party have welcomed this investment in the defence of the United Kingdom, and I welcome the hon. Member for Lanark and Hamilton East (Angela Crawley) having done so. It is a £24 billion increase and, as has been suggested, that is a massive boost to the defence of the United Kingdom. It is the largest investment in 30 years—the largest since the end of the cold war—and I am so pleased that it has generated support in this Chamber this afternoon.

This is a timely debate not only because of that announcement, but because it comes at a point when “team defence” has done so much and performed so brilliantly in confronting the coronavirus pandemic. I begin by thanking the defence industry at every level for its positive and collaborative response to this once-in-a-hundred-years event.

At the heart of defence is a critical task of delivering equipment and support to our armed forces to enable them to continue their vital work. We were reminded of that by my hon. and gallant Friend the Member for Bracknell (James Sunderland) who served himself—it is the kit that our people need to do the job that they are called upon to do. Our partners in industry have risen to that challenge. They have done just that in providing support throughout the pandemic.

To assist them, the Department has actively supported the defence sector through the use of prepayments to maintain business continuity. Some £138 million has been paid on this basis to maintain that flow of cash right through the sector. That has been alongside our drumbeat of orders. I was grateful to hear the hon. Member for Neath (Christina Rees) mention the munitions contract with BAE. I hope that will benefit those employees. It is one of a number of contracts throughout Wales and the rest of the United Kingdom that have continued to be delivered through the course of this pandemic.

Just as we have been monitoring the health of 600 of our suppliers, we make clear to the clients their responsibility to actively engage and support the supply chain. We have engaged directly with ADS, which has been referred to, and with other trade bodies and it has been good to hear of the productive relationships that companies have enjoyed in supporting each other during this period.

As hon. Members have mentioned, the way in which the workforce has been throughout this has been particularly positive. I thank them for how they have adopted and adapted to necessarily different working practices to continue to supply our defence forces, pulling together in a common endeavour to support our forces. How everyone has stepped up to deliver this has been extremely welcome.

[Grahame Morris]

The Minister’s rhetoric is excellent, but in terms of the practicalities for fleet solid support ships, for Rolls-Royce, and the supply chain and the lift-fan blades for the STOL engines for the F-35 Lightning fighter, will the Minister recognise the important role of Government in giving direction to companies such as Rolls-Royce to ensure that that work is carried out here in the United Kingdom? It is part of our sovereign defence plan to ensure that we have security of supply over these vital components.

[Jeremy Quin]

I am grateful to the hon. Gentleman for his intervention. I recognise the passion with which he addresses the issue of the Rolls-Royce concerns at Barnoldswick and the current action there. I hope that can be brought to a conclusion. I know my colleagues have said much the same. I am not aware of any long-term plans to remove the F-35 components from outside the United Kingdom. I am not aware of them and I hope we can continue and maintain a productive relationship with Rolls-Royce.

We all know what a dreadful situation is confronted by the aerospace industry in general. In practice, in defence, we continue to invest and provide that lifeblood of support to our companies that I hope will enable them to remain and prosper inside the UK. I will come on to the FSS point made by the hon. Gentleman later in my remarks.

The proposer of this debate, the hon. Member for Birkenhead (Mick Whitley), mentioned Cammell Laird, which is in his constituency, and I congratulate the company on its work through the pandemic. It has done sterling work on the Type 45 power improvement programme, and it is great to see HMS Dauntless re-floated with key equipment installed and back on to trials. The company has also been working with the Royal Fleet Auxiliary—currently RFA Wave Knight and RFA Tidesurge. With them, and the work of other companies in the marine sector, Birkenhead continues to provide invaluable contributions to the defence and the UK’s wider prosperity.

More broadly, the north-west has one of the highest per capita defence equipment spends of any region in the country. These figures might upset the hon. Member for Strangford (Jim Shannon). The spend is £270 per head per year in the north-west, some way behind Scotland and indeed, Wales, but way ahead of Northern Ireland. The hon. Member for Strangford is absolutely right that we need to lift up and level up the economy.