Defence Industry and Shipbuilding

Roger Gale Excerpts

Wednesday 11th July 2018 Commons Chamber

[Mr Ellwood]

I suggest that the right hon. Gentleman reads the report by my hon. Friend the Member for Ludlow to understand the full picture. My hon. Friend is correct that EU regulations provide guidance on building those ships. The regulations do not apply to royal naval ships because, from a security perspective, every sovereign nation is allowed to bypass them, but the rules absolutely apply to non-royal naval ships—as in Royal Fleet Auxiliary ships—that employ civilians on board. I encourage hon. Members to read the report before judging what my hon. Friend has just said.

Moving back to what I was saying, we must have an honest debate about what is happening, which is why we need to develop a modern, efficient, productive and competitive marine sector that allows us to build on the work that has been done on the Clyde, in the north, in Belfast, in Barrow, in the north-east, in the north-west and in the south-west of England. We have incredible capability, and I am pleased to see so many hon. Members representing constituencies in those areas in the Chamber today.

Our new shipbuilding strategy sets out exactly how we can achieve such a marine sector. We will continue to build Royal Navy ships only in the UK while encouraging international collaboration in harnessing open competition for other naval ships. Our new framework will ensure that the impact of UK prosperity will be considered as part of our procurement decisions. The 2015 strategic defence and security review created a new security objective: promoting our prosperity. Competition and strategic choice remain at the heart of our approach, but we recognise that there are several different models for working successfully with the industry, and we need to take further steps to bolster that and make the right decisions to enable a strong partnership between the Government and industry.[Official Report, 23 July 2018, Vol. 645, c. 7MC.]

That is part of the whole Government approach, spearheaded by the national industrial strategy, with its mutually reinforcing focus on driving productivity and supporting innovation, which provides a strong and clear policy framework in which industry can invest and grow. Key to that is how defence procurement might build economic value by strengthening UK productivity and industrial capability, including at a local level, and boosting exports sustainably. We recognise that responsible exports are now widely accepted as having a part to play in our wider national defence and prosperity objective. They are considered to be an opportunity, not a burden.

Sir John Parker’s 2016 independent review made a series of recommendations about improvements we can make, and, as I said, I am pleased that we will be accepting all of them. He did place emphasis on the dysfunctional relationships between government and industry. Old ships were retained in service well beyond their service date, with all the attendant high costs, and it is important that that changes. So our new strategy is founded on three pillars. The first is better planning, giving industry greater certainty and predictability. We are providing a 30-year Royal Navy shipbuilding masterplan to guide all future naval shipbuilding decisions, and to document the number and types of ships in which we will invest over the next three decades.

The second pillar is a new approach to design and construction. We want to challenge naval standards and introduce new ones, forcing through advances in design, in new materials such as composites, and in manufacturing methods. Our new carriers are a prime example of that. They are built in blocks, with parts built in different parts of Britain, drawing on the expertise of 10,000 people, and being brought together from centres of excellence from across the country. Thirdly, we want to focus on building exports, where there is an opportunity, as the Type 31 will be the first frigate for export since the 1970s. We know that more sales can cut costs in procurement over time and give us the potential to buy even more cutting-edge ships.[Official Report, 24 July 2018, Vol. 645, c. 8MC.]

For now, for reasons of national security, the shipbuilding strategy sets out that warships will be built and integrated in the UK via competition between UK shipyards. However, for the purposes of shipbuilding only, the national shipbuilding strategy defines warships as destroyers, frigates and aircraft carriers. All other naval ships, including the Royal Fleet Auxiliary ships, as well as other Royal Navy manned ships, such as patrol, mine countermeasures, hydrographic and amphibious ships, will be subject to open competition—that means international competition. That remains where the difference lies between us and the Opposition, but it is the cornerstone of our defence procurement policy. I remind the hon. Member for Llanelli that she talked repeatedly about value for the taxpayer, and it is important we understand that. I hope that there is a compromise whereby where we want to and can, we will utilise British shipbuilding capability, but when it comes in at twice the cost of an overseas opportunity, we will have to be very careful about which decision we make.

[Sir Roger Gale (North Thanet) (Con)]

I may have misunderstood—

[Mr Deputy Speaker (Sir Lindsay Hoyle)]

Order. The Minister will have to sit down.

[Mr Deputy Speaker]

Order. I don’t care what the Minister thinks he is doing; I am just telling him what he has to do.

[Sir Roger Gale]

Thank you, Mr Deputy Speaker.

I may have misunderstood the Minister, and I know it is not the custom to ask a question to which one does not know the answer, but I think he said that royal naval ships were confined to aircraft carriers, frigates and destroyers. Would that not also apply to any replacement amphibious craft that we might need?[Official Report, 24 July 2018, Vol. 645, c. 8MC.]