Royal Navy: Type 31e Frigate

Lord Campbell of Pittenweem Excerpts

Thursday 6th September 2018 Lords Chamber

[Earl Howe]

My Lords, the Type 26 programme is proceeding at pace, on time and on budget so far. The point that the noble Lord makes, about ordering all Type 26 ships in one go, might not be the right way to get value for money. If we had done that in the first instance, it is arguable that we would have overpriced the contract, because Australia has since come in with a firm order for Type 26 frigates. We are sure that this will play very favourably into the price of our next order for the Type 26.

[Lord Campbell of Pittenweem (LD)]

My Lords, the noble Earl’s reply to the noble Lord a few moments ago was, to say the least, concise. He failed, however, to point out that the contract for the Type 31 has been restarted. Part of the problem, as the Government have indicated in their reason for restarting, is that the bids that were received were “not compliant”. I understand that to mean that the capability that the Government seek is not deliverable at the price of £250 million per ship. On that basis, the Government have a choice to make: either to reduce the capability or to increase the price. Unless they do one of those things, the exports on which the Government have set great store will not be achieved.

[Earl Howe]

I hope to reassure the noble Lord on those points. The contracts that were being competed for, and which have now been recommenced, were to pay for a series of design deliverables to support the main procurement contract; they were not the main assessment of industry’s ability to deliver the manufacture programme. We still believe that industry will be able to meet that challenge, and the procurement process, despite having been recommenced, is now proceeding at pace.