Shipyards: Economic Growth

Greg Smith Excerpts

Tuesday 18th March 2025 Westminster Hall

[Greg Smith (Mid Buckinghamshire) (Con)]

It is a pleasure to serve under your chairmanship, Ms Jardine. I congratulate the hon. Member for Glenrothes and Mid Fife (Richard Baker) on securing this debate on the often overlooked but critical contribution of great shipyards to our nation’s economic strength, employment prospects and national security. Many hon. Members have spoken with great passion and knowledge about the sector and about yards in their constituencies. My own constituency is a stone’s throw from Leighton Buzzard, which is the furthest point in England from the sea, so I cannot speak with any local knowledge but I absolutely acknowledge the shipbuilding sector’s critical role.

For centuries, shipbuilding has been a cornerstone of British industry, sustaining local economies, providing skilled jobs and securing our place as a maritime power. As we have rightly heard during this debate, the UK’s shipyards have played a dual role—driving economic growth at national and local levels while ensuring our security at sea. Under the previous Conservative Government, decisive steps were taken to secure the future of British shipbuilding and maintenance, including supporting jobs, upskilling our workforce and reinforcing our defence infrastructure. Under the new Government so far, we have seen a more lacklustre set of steps taken towards supporting this sector.

Shipyards are more than just industrial sites; they are economic lifelines for the communities that surround them. For example, in Portsmouth and Govan, BAE Systems surface shipyards have been instrumental in building the Royal Navy’s cutting-edge fleet. The last Conservative Government’s commitment to the Type 26 and Type 31 frigate programmes guaranteed long-term employment and training opportunities for engineers and apprentices. Those contracts not only secured local jobs, but strengthened the wider economy.

In Cumbria, the BAE Systems submarine yard in Barrow-in-Furness has been at the heart of our nation’s defence. Thanks to strategic spending by the previous Conservative Government, Astute-class and Dreadnought-class submarines continue to provide thousands of highly skilled jobs while reinforcing Britain’s nuclear deterrent. That is a prime example of how economic security is directly linked to national security. Spending on our defence industry ensures that we remain prepared for the threats of the future.

In Birkenhead, Cammell Laird has been a stronghold for commercial and defence-related shipbuilding. Contracts secured under the previous Government provided much-needed stability, supporting jobs in the north-west and reinforcing the UK’s ability to maintain its naval and commercial fleets.

One of the most important aspects of shipbuilding is its role in training the next generation of workers. The previous Conservative Government recognised that, and supported and backed apprenticeship schemes that ensured that young people could gain the skills needed to drive innovation in the sector. The workforce at shipyards such as Govan and Barrow-in-Furness includes thousands of highly trained welders, engineers and naval architects. We ensured that their skills were passed down through new training programmes and partnerships with local colleges.

Without continued spending, there is a real risk of losing that expertise to foreign competitors, yet the current Labour Government have failed to provide the necessary assurances to sustain those initiatives. The lack of new contracts, clear strategic direction and industry support has left many shipyards facing an uncertain future.

[Richard Baker]

I share the hon. Member’s ambitions for our shipyard sector. I was recently at the Rosyth dockyard in the constituency of my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie), where the workforce were excited about the future. They were already looking forward to a long order list and now feel in a position for that to grow, given the prospect of increased defence spending. Does the hon. Member agree that the strategic aim set out by the Government provides great opportunities for our shipyards and shipbuilding sector?

[Greg Smith]

That is indeed good news. The Conservative party, as His Majesty’s loyal Opposition, has supported the Government’s increases in defence spending. We moderately disagree on the pace of that increase, because we want to go considerably faster, but I recognise the hon. Gentleman’s point about the good news for that particular shipyard.

I ask the Minister whether, following the defence uplift, the Government will commit to construct all our military vessels in the United Kingdom. The link between economic security and national security cannot be overstated. A strong shipbuilding industry means a strong Royal Navy, ensuring that the UK remains a global maritime power. It also means domestic manufacturing capabilities, reducing reliance on foreign suppliers and keeping critical national infrastructure under British control.

The Conservatives understand that reality. When we were in government, our national shipbuilding strategy was designed to create a steady pipeline of work to provide stability for our shipyards and to ensure that Britain could defend herself in an increasingly unpredictable world. That approach guaranteed not just warships but support vessels, reinforcing our ability to project power on the world stage.

However, the Government’s delay in awarding many new contracts and the absence of a clear vision for the future of UK shipbuilding weakens our defences and threatens those skilled jobs. That threat extends to virgin steel production—a critical component in the shipbuilding supply chain. The Government have failed to negotiate a deal with the United States, whereas we secured the 500,000-tonne tariff-free agreement when in government. The lack of a deal is a real threat to the industry.

Shipbuilding depends on steel production, which is already suffering from Labour’s failure to negotiate. Will the Minister provide the crucial update on talks with the United States that people whose jobs are on the line are desperate to hear? We need urgent action to safeguard our economic and national security interests. Does the Minister have any ongoing concerns, or is she confident in the future of those sites? The Government’s handling of Harland and Wolff when the company needed financial support—it was threatened with administration, and the Government did little or nothing to stop that—was hardly a boost of confidence for the thousands of jobs that depend on the supply chain.

[Patricia Ferguson]

I thank the hon. Member for taking an intervention. I am not sure whether he misheard or did not hear the earlier part of the discussions in Westminster Hall this afternoon when Members on this side of the House and Liberal Democrat Members talked about the fact that Harland and Wolff was saved in both Methil and Northern Ireland. That is surely something to be celebrated across the Chamber.

[Greg Smith]

I am grateful to the hon. Lady for that intervention, and it is absolutely good news that Harland and Wolff has survived, but throughout the entire summer, not long after the new Government were elected to office, there were constant asks for financial support that were not forthcoming. It took a very long time. This is fundamentally a debate, but I would gently suggest that the saving of Harland and Wolff—which I reiterate is good news—happened in many respects despite the early actions of the new Government and not because of them.

[Patricia Ferguson]

Would the hon. Member take another intervention on that point?

[Greg Smith]

It is a debate, so by all means.

[Patricia Ferguson]

I am grateful for that good-humoured response. Does he accept that the problems with Harland and Wolff did not just arise after a Labour Government were elected? Given that the Labour Government were able to announce that Harland and Wolff would continue and survive in December—fewer than six months after they came into office—it seems to me that the Government really care about the industry and worked really hard to make that happen.

[Greg Smith]

I am grateful for the points that the hon. Lady makes. The point from my earlier comment still stands—I was the shadow Minister over the summer; I survived my party’s reshuffle—that many asks were being made by Harland and Wolff much earlier, and that was something that was not initially forthcoming. I fully accept the timeline that the hon. Lady sets out. This was not something that suddenly happened on 4 July, but when a new Government come in they should be judged on the speed of their response and exactly what is done to save that sector. We must continue to back our shipyards, provide long-term certainty for workers and reinforce Britain’s position as a global leader in shipbuilding. By doing so, we will not only create a prosperous economy, but ensure that our nation remains safe and secure for generations to come.