Military Aircraft Manufacturing

Stuart Andrew Excerpts

Wednesday 8th May 2019 Westminster Hall

[The Parliamentary Under-Secretary of State for Defence (Stuart Andrew)]

It is a pleasure to serve under your chairmanship for the first time, Mr Rosindell. I congratulate my hon. Friend the Member for Fylde (Mark Menzies) on securing the debate and on his work for many of his constituents. He often grabs me in the corridor to raise issues that are of concern to him and them. As he rightly said, his constituency has a proud tradition in military aviation. Over recent years, BAE Systems Military Air & Information at Warton has been the central assembly facility for the Eurofighter Typhoon. That was one of the first visits I made when I was appointed to this job, and the passion that goes through that company was clear, from the management to the workforce. We should be proud of what it has done.

The area has a strong heritage. Warton was originally the base of English Electric and the testing ground for the legendary Lightning fighter—the supersonic interceptor of the 1960s and 1970s, rather than today’s world-beating F-35 Lightning II stealth jet. It is doubly appropriate, therefore, that the debate has highlighted the proud history of the UK in the field.

Let us make no mistake that the UK remains a global leader in military aerospace for three reasons. The first reason, which my hon. Friend touched on, is innovation. We have a long heritage of leading the world in aerospace thinking—in taking cutting-edge industrial, technical and scientific know-how from the drawing board to cutting-edge military capability. The first purpose-built air-to-air combat fighter was designed and built in Britain, as was the first vertical take-off and landing aircraft. That heritage remains undiminished.

The second reason is our history of successful international collaboration in producing some of the best military aircraft in the world, such as Jaguar, Tornado and Typhoon, with our partners on the continent, and now the F-35 with the United States, as my hon. Friend pointed out. The third reason is the strength of our domestic combat air sector, which has created skilled jobs and prosperity not just in his constituency, but across the nation.

It is worth mentioning the recent successes for the UK industry in the sector. Programmes such as the F-35 are creating considerable industrial benefit, with 15% of the value of more than 3,000 airframes being built by British industry. The Government are also delighted with the UK’s recent success in securing another batch of F-35 avionic and aircraft component repair work, which will bring an additional £500 million of work to north Wales and secure hundreds of skilled jobs. Overall, the combat air sector has an annual turnover of more than £6 billion. It directly supports more than 18,000 skilled jobs across the UK and many more in the wider supply chain, which are equally important.

To maintain and strengthen the sector’s competitive international position, the Government established the £2 billion future combat air system technology initiative following the “Strategic Defence and Security Review 2015”. That initiative sustains investment in the sector to ensure that the UK remains at the forefront of developing the next generation of technological capability.

Last year, the Government further demonstrated their commitment to the sector by launching the combat air strategy at the Farnborough international airshow, as my hon. Friend said. The strategy defined a clear vision for the sector that preserves our long-standing national advantages in the field and our freedom of action in deciding how our combat air capability is delivered. All future combat air decisions will be based on a national value framework that takes full account of our armed forces’ requirements, the contribution to the nation’s industrial capacity and prosperity, and the significant benefits that military aviation provides to our international influence.

[Dr Julian Lewis (New Forest East) (Con)]

As the Minister knows, the Defence Committee is quite worried that not enough is being done to protect the defence industrial base. In advance of his appearance before us on 21 May, when we will look into some of these subjects, can he tell us how much consideration is given to the knock-on benefits of investing in production in the UK rather than buying off the shelf, given that the money spent is then channelled back into the British economy?

[Stuart Andrew]

I am grateful to my right hon. Friend for his intervention, and I say with some trepidation that I am looking forward to appearing before his Committee in a couple of weeks’ time. He is absolutely right to raise that important issue. We are doing a tremendous amount of work across the Department, and a lot of it is of course the focus of the fantastic report by our right hon. Friend the Member for Ludlow (Mr Dunne) on the important prosperity that the defence industry can bring. We are also engaging a lot with small and medium-sized enterprises around the country to encourage more of them to take part in many of the competitions, and to ensure that they do more business with defence. Wherever we build new platforms, we are encouraging wider prosperity among those in the supply chain in the United Kingdom.

I know there has been some controversy about some of the platforms we are buying from overseas, but we are working with these industries to ensure that they work closely with the UK supply chain, so that we can increase the prosperity that comes about because of the platforms we are buying. For example, Boeing recently took a lot of SMEs over to the United States to talk through how they can bid for business from that company. Of course, Boeing has made investments in this country, but we want to see even more of that happening, and I will be happy to develop a bit more of that when I come before the Committee chaired by the Member for New Forest East (Dr. Lewis) my right hon. Friend.

[Robert Courts (Witney) (Con)]

I am grateful to the Minister for taking an intervention on that point. I apologise to him for having been delayed in a Select Committee, and I refer to my entry in the Register of Members’ Financial Interests.

I was very interested in the answer the Minister gave to my right hon. Friend the Member for New Forest East (Dr Lewis) vis-à-vis investing in the defence base of this country, and, of course, I agree 100% with that. However, with regard to the combat air sector, I was encouraged by the Minister’s comments about Team Tempest. Could he update the House as to whether there has been any further discussion as regards international partners in that programme going forward?

[Stuart Andrew]

I will come on to those points in a minute. A number of points were raised in the debate that I will happily respond to when I have finished these remarks.

As part of the wider strategy programme, my Department has now launched its next-generation combat air acquisition programme. This will develop the capabilities that the RAF will need to replace Typhoon when it goes out of service in 2040. The programme’s two-year concept phase has now begun, following my approval of the strategic outline case.

Furthermore, new forums have now been established to explore the possibilities for collaboration with other military aerospace partners. Early discussions have gone well, and my Department will provide more detailed updates in the summer. However, I can assure my hon. Friend the Member for Witney (Robert Courts) that we are having very detailed conversations with a number of our partners around the world because we recognise that, for this process to be effective and, importantly, affordable when we deliver it, and, probably even more crucially, because of the importance of interoperability, it is vital that we have partner nations on board. However, as I say, those discussions are still ongoing. I hope I will be able to update the House on them later this year.

[Wayne David (Caerphilly) (Lab)]

Will the Minister acknowledge that, although the commitment the Government have shown towards the Tempest programme is to be welcomed, if the project is to come to fruition, that will require much more investment by the Government than they are presently committed to?

[Stuart Andrew]

We are in the early stages at the moment, and I will shortly talk about some of our engagement with industry, to respond to his point a bit further.

The other thing that is really important, and it is in parallel to this work, is that fact that my Department is actively identifying and monitoring the health of the sector’s skill base, which my hon. Friend the Member for Fylde mentioned. When I visited Samlesbury, I was very impressed by the BAE Systems training centre next door. That centre is helping not only the sector but a lot of businesses around the Lancashire area, and it really is a model that we should see from other businesses in the defence sector. The aim of our work is to inform crucial decisions on future skills investment in a fast-moving international environment, where technological practice changes continually.

I will just come on to some of the points that were raised in the debate. The first was the issue of exports. My hon. Friend the Member for Fylde was absolutely right to say that this is an incredibly important part of the work that we do. Personally, I have tried to invest a significant amount of my time in support of some of the export campaigns. We are working with Finland at the moment to see whether we can be successful in their competition, which is worth in the region of €6 billion to €10 billion. Finland has launched a competition for the acquisition of 64 fighter aircraft to replace its ageing fleet. That competition is a closely fought one, but I can assure my hon. Friend that we will do everything we can.

As for Saudi Arabia, we continue to make progress on the Typhoon batch 2 negotiations. The latest offer is a very strong package, and it would provide enduring industrial capability in the Kingdom of Saudi Arabia, which would also establish many of the industrial components needed to realise that country’s vision of 2030.

My hon. Friend was right to mention the export issues and the licensing issues, and we are working closely with the German Government to ensure that those are resolved. Equally, we are working together with Airbus on the campaign to supply Canada with a replacement for its F-18—it is currently running a competition to find that replacement.

Other points were raised in the debate. There was the issue that my hon. Friend mentioned to my right hon. Friend the Member for Ludlow and the prosperity agenda. We are working closely with four main businesses at the moment: BAE Systems, Rolls-Royce, Leonardo and MBDA. Recently, I was pleased to attend a Team Tempest industry day, which over 150 companies attended so that they could get the briefs they needed and the capabilities and skills that will be required to facilitate the next generation. The Tempest partners are now very actively engaged with about a hundred of those companies. So that engagement is happening and, as I have said, I hope we will be able to make more announcements in the coming weeks.

I have talked about the partner nations. The innovation side is obviously incredibly important. The innovation fund is helpful, and the whole aspect of this future combat air strategy will be incredibly important for that.

My hon. Friend also mentioned Hawk, which I know has been a challenging issue. I have visited Kuwait on two occasions now, trying to personally support the very active campaign that BAE Systems and the Government have pursued there. I pay tribute to the trade unions; they are very active in making their case. I also pay tribute to BAE Systems, which is trying to keep things going at Brough while we see whether we can make any announcements.

I hope I have demonstrated in this debate, which I again congratulate my hon. Friend the Member for Fylde on securing, that we are doing everything we can to maintain the necessary skills and knowledge, as well as to retain our ability to have the combat air sector that we really need. I assure the House that the Government will continue to work in full partnership with our world-leading military aviation sector, maintaining its position at the cutting edge of technological development, and supporting the jobs and prosperity that it brings right across the UK.

Question put and agreed to.

Resolved,

That this House has considered the future of military aircraft manufacturing in the UK.