Aircraft Carriers and UK Shipbuilding

Mike Hancock Excerpts

Wednesday 6th November 2013 Commons Chamber

[Mr Hammond]

I am happy to report that relations in the shipbuilding industry between management and unions are good and constructive. The unions understand the challenge that the industry faces, and they have worked with the management to address it. That sometimes means that union officials must make tough decisions as well, because they know that the industry cannot be sustained at its current size.

The hon. Gentleman alluded to the diversity of the shipbuilding industry. We hear a great deal about how shipbuilding will be sustained through the commercial market and the third-nation market, including the market for warships, but I am afraid I have seen no evidence to suggest that we are able to compete in what is a very aggressive global market for commercial shipping. I think that the shipbuilding industry in this country will be primarily dependent on Royal Navy orders placed in the United Kingdom, because of the sovereign requirement for us to have warship building capability.

[Mr Mike Hancock (Portsmouth South) (Ind)]

Can the Secretary of State explain why it was decided to transfer the existing work that was commissioned in Portsmouth away from the yard, so that the employees there will have no opportunity to complete the construction of the aircraft carriers? Can he also assure us that the MOD will not seek to claw back any of the money that is made available to Portsmouth through the city deal?

[Mr Hammond]

Let me respond first to the question about the aircraft carriers. Today BAE Systems announced its plan for rationalising the industry, as it must do under the TOBA in order to sustain warship building capability in the future. The challenge for us is to bridge the gap between the completion of the carrier and the start of the Type 26 programme. By moving three carrier blocks to the Clyde, along with the manufacture of the OPVs, we shall be able to sustain warship building on the Clyde and to maintain its viability into the future.

I should be happy to discuss the city deal negotiations with the hon. Gentleman, who, I know, is well acquainted with the affairs of Portsmouth city council. I understand that the MOD is prepared to make land available as part of an overall scheme which would create investment and employment opportunities in the city.