Defence: Aircraft Carriers and UK Shipbuilding

Lord Reid of Cardowan Excerpts

Wednesday 6th November 2013 Lords Chamber

[Lord Astor of Hever]

My Lords, I cannot answer the noble Lord’s question about apprentices—it was not in my brief—but we have been assured by the company that it will do everything in its power to find alternative work for those made redundant, both on the Clyde and in Portsmouth. As the Statement said, we are investing a lot of money in Portsmouth and we hope that there will be jobs in the support bases for some of those being made redundant. This is an area that the Government, BAE Systems and the trade unions are all talking about very seriously.

[Lord Reid of Cardowan (Lab)]

My Lords, I welcome the three offshore patrol vessels. This is exactly what was envisaged when the carrier contract was first negotiated, in order to ensure the continuity of a strategic asset for this country. Thereafter, I cannot be so generous. May I correct the misapprehension that has been put about that the carrier cost doubled? The original cost was more than £4 billion when the contract was signed. There was an additional £1.8 billion because, quite correctly, the Government decided, when the recession hit us, that it should be delayed for two years. So when the coalition Government came in, the cost was actually £5.9 billion. That has now risen to £6.2 billion, part of which was due to the Government’s mistaken belief, under the last Secretary of State, that they could somehow fit “cats and traps” over the weekend by some welder doing a “homer” and getting it cheaply. Of course, it cost £60 million.

Secondly, and finally, the Statement is curiously bereft of any strategic sense of what this country needs. The contract was signed to give continuity and retention of skills so that this country would have not only jobs but a major industrial and defence strategic asset. All I have to say is, if the Government believe that they can constitute a future strategic basis purely on the basis of the intrinsic contractual cost of any given contract, I fear for the long term. If the Government continue in that way we may well end up sending our carriers—if they are built—to repair in Korea. You can win the minutes in all of these things and disastrously lose the hours. I hope that the tenor of this Statement is not one that permeates the whole of the Government’s thinking on strategic defence issues.

[Lord Astor of Hever]

My Lords, that is not the case at all. We have secured a great many jobs upon the Clyde, and the future of the British shipbuilding industry is very secure. As regards the costs, we could debate this all afternoon, but the delays added considerably to the cost of the carriers. The decision to have the “cats and traps” was not made over the weekend; we gave a great deal of consideration to it, but then made the decision to revert to the stowable version, which the previous Government had decided on.