MoD beneath hearth over £1bn assist vessels tender – Monetary Occasions

The Ministry of Defence has come under renewed pressure over its decision to put a £1bn contract to build support vessels for the Royal Navy out to international tender amid rising fears of job losses at British shipyards.

Julian Lewis, the Conservative MP who chairs the House of Commons defence select committee, has written to Stuart Andrew, the minister for defence procurement, asking why the government did not classify the three auxiliary ships as warships.

Unions and shipbuilders have repeatedly pushed for the vessels, known as fleet solid support (FSS) ships, to be considered as complex warships, which would exempt them from EU laws preventing protectionism.

In the letter, which was sent last week, Mr Lewis pointed out that both Italy and France classified their equivalent ships as warships and decided to follow a single-source procurement process.

“We should be grateful if you could explain what the potential benefits were that led to ministers’ apparently perverse decision, which is to the detriment of UK companies and workers,” Mr Lewis wrote in the letter.

At about 40,000 tonnes each, the three ships will support Britain’s aircraft carrier fleet with provisions and munitions. The £1bn contract would be a big boost to UK yards and could be a bridging programme between the end of the carrier programme and the first overhaul of the HMS Queen Elizabeth carrier.

On Monday Gavin Williamson, the defence secretary, is to confirm in a speech that the carrier will be deployed to the Pacific as part of a policy to stand up to those who “flout international law” and that “may lead us to intervene ourselves”.

He will also warn that the price of non-intervention in global crises has often been “unacceptably high” and western powers could not “walk on by when others are in need”.

“To talk but fail to act risks our nation being seen as little more than a paper tiger.”

The MoD has stuck by its decision to put the support ship contract out to international tender as a way of reducing costs. Four international shipbuilders, along with a British consortium comprising BAE Systems and Babcock International, were shortlisted in December to compete for the contract. The other companies are Italy’s Fincantieri, Spain’s Navantia, Japan Marine United Corporation, and Daewoo Shipbuilding and Marine Engineering of South Korea.

Unions have repeatedly called on the department to reconsider. Babcock announced last week it was cutting 150 jobs at its yard at Rosyth in Fife where about 1,700 people are employed as work on the aircraft carriers starts to wind down.

Unite, the union, described the news of the job losses as a “kick in the teeth for the Scottish economy”.

Steve Turner, Unite assistant general secretary for manufacturing, said it would be “a gross betrayal of a skilled workforce and British manufacturing if the government continued with its obsession to award such work to overseas shipyards and deny manufacturing and communities in the UK the economic benefits that building the Royal fleet auxiliary ships would bring”.

The MoD said: “We are required by law to procure the Fleet Solid Support ships through open international competition . . . The final decision regarding the winning bid will be made in 2020.”

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