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Ian King, chief executive of BAE, has indicated in a letter submitted to the Scottish Affairs Committee that shipyards on the Clyde would likely have to close if Scotland votes for independence. The future of the yards at Govan and Scotstoun is directly tied into the Type 26 frigates and Mr King has said BAE would build the ships at a location compatible with the contract awarding process of the Ministry of Defence.

CGI of BAE’s planned ‘Frigate Factory’ on the Clyde. Construction will not begin until after Scotlands independence referendum, presuming Scotland elects to remain within the union.

The indication comes from a letter submitted to the chairman of the Scottish Affairs Select Committee Ian Davidson, Mr King stated “the major investment decision known as Main Gate, will be made by MoD at the end of this year” after the referendum on 18 September. Mr King also said that “in the event of a Yes vote, and as we have made clear, we would be required to discuss the future of the Type 26 programme with our customer, the MoD. It would be for the MoD to determine how the vote affects the final decisions they have yet to make on the programme, including the future location of the build of the ships. We would take our customer’s lead in these circumstances. We cannot determine this outcome in advance, or without the direction of the MoD.”

Mr Davidson said: “This shows clearly that, as we have previously stated, the only guarantee for the future of shipbuilding on the Clyde is for Scotland to remain part of the United Kingdom.” A view shared by the industry and MoD itself.

Other than procurement activity undertaken during the World Wars, the UK has not had a complex warship built outside of the UK since the start of the 20th century at least. All the Royal Navy’s new complex warships are being built in UK shipyards and the UK Government remains committed to utilising the strengths of UK industry in this specialist and complex area. The MOD has a 15-year Terms of Business Agreement with BAE Systems MNS, giving the company certainty about the UK Government’s commitment to a minimum level of capacity in the areas of warship design and build work, including the Type 26 as mentioned above, and elements of support covering complex warships. The MOD has a similar 15-year agreement with Babcock Marine in respect of support work for surface warships and submarines.

Companies based in an independent Scottish state would no longer be eligible for contracts that the UK chose to place or compete domestically for national security reasons (due to Article 346, I’ll explain that later in the article). Where they could continue to compete, they would be pitching for business in an international market dominated by major economic powers.

There’s also the matter of contracts using US technology, defence contractors that work with items or technology of US origin are also covered by undertakings given in accordance with the US International Traffic in Arms Regulations (ITAR), under which any change to an existing US export licence requires US State Department approval. An independent Scottish state would be a third-party country, not covered by existing UK-US ITAR agreements. UK companies would not have authority to transfer items and information that is subject to ITAR licence to their subsidiaries or other companies in an independent Scottish state or to a Scottish national, without US approval, anymore than it could transfer such material to organisations or individuals in other foreign states. Every licence held by companies in Scotland working on ITAR-controlled items would have to be re-approved if Scotland became independent.

However, the claim was dismissed by a spokesman for SNP Deputy First Minister Nicola Sturgeon who insisted the new ships would be built in an independent Scotland while pointing out that under current plans one of the Clyde’s two yards – Govan – may close anyway.

He said, seemingly ignoring the shipyards dotted around England that aren’t Portsmouth: “The threat to Govan and its possible closure is happening now under Westminster rule, and the fact is there will be nowhere else on these shores but the Clyde to build these ships once Portsmouth closes its shipbuilding facilities.”

12 COMMENTS

  1. No doubt that this will be touted as bullying by Westminster when clearly it is simple pragmatism.

    Scottish Deputy First Minister Nicola Sturgeon said:

    “The threat to Govan and its possible closure is happening now under Westminster rule, and the fact is there will be nowhere else on these shores but the Clyde to build these ships once Portsmouth closes its shipbuilding facilities.”

    This is pure fantasy and if I might add conceit. Portsmouth hasn’t closed yet and I will bet a penny to a pound that thousands of shipyard workers in Portsmouth are baying for Scots to vote yes in September because if they do, my guess is that Portsmouth will not be closing at all.

  2. It’s quite obvious that rUK would not maintain a major warship building and maintenance facility outwith its own borders.

  3. I could not agree more, Alex Salmond and the dwarf have some weird ideas if anyone even the experts disagree with the SNP policy they are bulling Scotland.
    As I see it the only bully is the Great and glorious alex he blind to the truth, is only aim in live is to break up the U.K. for his glorification.
    I would dred to live in Alex Salmond land.

  4. Having read your replies to John morrisons response about the £ i feel you were/are not properly Qualified to do so as you claim we will be using it (£) in your own words illegitimately. i say this as you obviously do not know the meaning of the word.

  5. Personally I thought it was fairly obvious that Sturgeon meant a shipyard actually capable of delivering an order of that magnitude. The article itself seems pretty darn unbalanced too. The fact is that an independent Scotland would not be tied into the rUK political ideologies that all the main Westminster parties advocate where there is no alternative to unbridled free market capitalism. It’s the rUK London-centric policies that’s seen actual manufacturing all over the UK die off over years in favour of becoming a state of service providers. Who’s to say that independence might not lead to improved investment in manufacturing infrastructure and incentives? After all whoever is elected would have an extra £4.4bn per annul to spend based on existing figures of contributions to and expenditure from the UK purse each year. That could create a lot of jobs. Also Scotland would needs its own defence force (including ships). Also – Scotland would be due a proportionate share of ALL the UK army assets including orders already made. A settlement needs to be reached and these ships are just another bargaining chip.

  6. If the UK government decide to pull the plug on building our ships in Scotland then that is what will happen, what are the Scotts going to be able to do about it, go to war with us?? Only a fool would say that it couldn’t happen and there are plenty of people in the south that can build ships. I believe that Scotland will vote no. xx

  7. As far as I can make out, every one of the previous respondents is missing the central point about the vote on 18 September. No doubt for a variety of reasons.
    The vote is not about whether you prefer Alex Salmond over David Cameron or SNP over Labour over Tory or even whether shipbuilding will be impacted positively or negatively depending on the result.
    The vote is purely about whether you are happy with the current level of self-determination in ALL Scottish affairs or whether you think there should be full determination.
    If you vote purely on economic concerns, you will be wrong either way. If you are swayed either way by one Leader or one Party or another, you have missed the point.
    This vote is monumentous and the outcome will shape the country for many many generations. Its so much bigger than any single issue. It comes right down to – do you want to see yourself as British or Scottish.
    Answer that truthfully, vote accordingly and accept the majority. Not that difficult really.

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