Scottish shipbuilding 'losing out' as Spanish firm wins MoD contract

Defence Secretary Ben Wallace announced in November a contract for three new military support ships had been won by a consortium called Team Resolute, involving Spanish government-owned Navantia, Harland & Wolff and Bath-based BMT.

But the decision has sparked a huge backlash, with questions over the amount of high-value work that will go to Spain under the arrangement, despite pledges the majority of the Royal Navy ships will be constructed in yards in Belfast and Devon.

There are also reports the intellectual property will go to Navantia, with concerns the company could then use the design to build vessels outside of the UK.

The UK Government initially said the fleet solid support ships (FSS), which carry supplies such as food, ammunition and equipment, would be classified as warships and therefore built in the UK.

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A consortium called Team UK - which included companies Babcock, BAE systems and A&P Birkenhead and would have seen work carried out in Rosyth, Glasgow and Merseyside – also bid but lost out.

Now MPs on the House of Commons Defence Committee have written to Wallace urging him to answer a series of questions over the awarding of the contract.

In the letter, committee chair and Tory MP Tobias Ellwood said the decision had raised a “number of concerns” and requested more details about how Team Resolute was selected as the preferred bidder and whether “social value” was included in the criteria.

It states: “Was the Team Resolute bid judged to provide more investment in the UK than the Team UK bid and, if so, how?

“The Government has announced that Team Resolute will invest £77 million in shipyard infrastructure, while the Team UK bid is reported to have offered investment of £90 million in shipyard infrastructure as well as £54 million in apprenticeships and training.”

At the time of the announcement of the deal, it was reported there would be a commitment to at least 60% of the work being carried out in the UK, with the majority of the blocks and modules for the ships being constructed in Belfast and Appledore in Devon.

The Harland & Wolff cranes in Belfast (Image: PA)

Components will be manufactured at the company’s centres in Methil in Fife and Arnish on the Isle of Lewis.

SNP MP Dave Doogan, the party’s defence spokesman and a member of the Commons Defence Committee, told The National there were questions over whether the Team Resolute UK yards would have the necessary skills and workforce to handle the work.

“My concern is this work will notionally go to Belfast and Devon, but in reality it will go to Spain - I would have been much happier seeing the work come to Rosyth and Govan and Birkenhead on the Mersey,” he said.

“A&P at Birkenhead are an existing shipyard, manufacturing and servicing and repairing and upgrading complex systems as we speak.

“Of course Babcock are busy manufacturing Type 31 frigates and BAE at Govan and Scotstoun are busy manufacturing Type 26 frigates.”

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Doogan said Navantia was a capable ship manufacturing business, but he believed the decision to back its bid would “come back to haunt the MoD”.

He added: “Meanwhile Scotland is losing work – this work wherever it is going, wherever it is getting done, it won’t be in Scotland.

“Scotland is a player in the supply chain and there might be small elements of the work delivered in Scotland.

“But the centres for excellent warship building in the United Kingdom are in Scotland.

“So it should be a salutary lesson for anyone who is still making up their minds about the constitutional future of Scotland, that the United Kingdom government has placed warships with a foreign company rather than placing them with Scottish yards.”

Doogan also raised concerns over the contract in the House of Commons on Monday.

He said: “We hear all the time about the strength of the Union for orders into Scottish yards, but Scotland, still stuck in this necrotic Union, loses out no matter what happens, when this Secretary of State awards work to Cádiz that should have gone to the UK — it’s heads, the UK wins; tails, Scotland loses.

“I wish Appledore in Devon and Harland & Wolff in Belfast all the best, but without the requisite workforce or skills, they are simply the Union flag gift-wrapping that this Defence Secretary has given to the Spanish shipbuilding industry.”

In response, Minister for Defence Procurement Alex Chalk said: “It is not the case that the bulk will be built in Spain. Quite the opposite: the majority will be built in the United Kingdom.

“All the assembly and all the integration will happen here in the United Kingdom.”

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He added: “Govan, Rosyth, Scotstoun—all those yards are being nurtured and supported by the power and might of the UK Union. That means that Scotland’s place is better in the Union, and the British Union is advantaged as well.”

Giving evidence to the Scottish Affairs Committee last week, Wallace also said the vessels would be “entirely built as one ship” in Harland & Wolff in the UK.

He added: “It depends [on] what you define as the components and blocks.

"If we want to go to a point at which you can only describe it as entirely built in the United Kingdom, then no car in this country is built in the United Kingdom and no aeroplane is built in this United Kingdom, because modern technology doesn’t work that way.”

Wallace also said he did not currently have details of the breakdown in spend between the UK and Spain.