Paul Sweeney, MP for Glasgow North East, discussed issues surrounding the National Shipbuilding Strategy during a debate on UK sovereign capability in Parliament.
Paul Sweeney is a Scottish Labour politician and has been the Member of Parliament for Glasgow North East since 2017. More importantly in this context, he was formerly employed by BAE in Glasgow. Paul has worked with the APPG for Shipbuilding which has begun an inquiry into the Government’s National Shipbuilding Strategy, taking evidence from a range of maritime security stakeholders and industry.
Sweeney stated that the strategy has been “used as cover to reduce the scope of ships that are qualified to built in the UK”. The MP said it reduced the types of ships that must be built in the UK to frigates, destroyers and aircraft carriers, saying that the NSS was “restricting the scope of orders that can go through UK shipyards”.
Paul pointed out that the previous Terms of Business Agreement had provisions for most Royal Navy and RFA vessel types to be UK built and added that the new strategy “falls short on how it’s going to deliver” industrial benefits due to lack of investment caused by a lack of certainty over future orders, driving up costs of the vessels that are actually ordered meaning of course, less are eventually ordered.
I messaged Paul earlier in the year to discuss the prospect of yards around the UK beginning steady and sustainable production of new vessels using future programmes as a basis.
“The greatest flaw to have plagued British naval shipbuilding since the 1980s is the issue of small batch classes of escort vessels, especially when subject to competitive tendering. Contrast that with the United States, which has been building the Arleigh Burke class since the 1980s.
In the UK small batch numbers and a lack of certainty over production locations have militated against efficiency curves from long production runs and created feast and famine dead weights on shipyards which bleed skills and knowledge.”
Referring to the current issues around the tendering of the Fleet Solid Support ships internationally, he said during the debate:
“We’re seeing the government happy to tender contracts overseas in international open competition which quite easily under the Treaty on the Functioning of the European Union (article 346) could be designated as UK protected builds. It’s entirely at their discretion to do that. Any notion that their hands are tied is bogus.”
What is Article 346?
EU law requires most government contracts to be procured via an open, competitive process. The main EU legislation in the defence domain is the Defence and Security Directive 2009/81/EC, transposed into UK law by Defence and Security Public Contracts Regulations 2011.13
However, Article 346 of the Treaty on the Functioning of the European Union (TFEU) provides for an exemption to the procurement rules where a country considers it to be necessary for national security reasons: “any Member State may take such measures as it considers necessary for the protection of the essential interests of its security which are connected with the production of or trade in arms, munitions and war material”. Article 346 refers to a list drawn up in 1958 by the Council of Ministers of products to which the provisions
The Government’s procurement plans for up to three new support ships for the Royal Fleet Auxiliary are facing opposition from defence analysts, Labour, the SNP trade unions and many others.
“This model should be further extended to maintaining big ship construction of vessels with a beam larger than 20m at Rosyth dockyard, by ensuring a continuous production run after the Queen Elizabeth class is complete by building the new Royal Fleet Auxiliary Fleet Solid Support ships and then the successor to the Albion class there”, Sweeney advised.
According to a briefing paper in the House of Commons library released earlier, the programme is currently in the Assessment Phase with the competition expected to be formally launched towards the end of 2018 and a contract signed in 2020. The MoD says the contract will be for two ships with an option for a third.
The briefing paper states:
“The Government intends to compete the contract internationally. Labour, the SNP and the shipbuilding trade unions argue the contract should be restricted to UK shipyards to support the shipbuilding industry, secure jobs and retain skills. They argue the proposed ships are ‘warships’ and as such, the Government can use the Article 346 exemption to exclude the contract from EU procurement rules on national security grounds.”
The TUC has also assessed the Article 346 exemption argument and argues the Government “has the sole right to determine” what its essential national security interests are. The TUC claims “other European nations have used the exemption to place orders for similar support ships with their own shipyards since the Directive was introduced.”
December this year will see the formal issue of documentation inviting bids for the design and build contract and in 2020, the contract for design and build is to be awarded.
Paul also explained that building the new Royal Fleet Auxiliary Fleet Solid Support ships and then the successor to the Albion class in Rosyth would be of huge benefit to UK shipbuilding and allow for at least four primary shipbuilding sites.
Towards the end of the debate Sweeney responded to remarks that only ‘complex warships’ should be built in the UK by pointing out that the construction of auxiliary vessels has allowed the UK to retain the skills to build complex warships and after citing the example of RFA Wave Ruler and more recently the five River class ships being built on the Clyde to sustain the workforce at the yard, he said:
“By utilising those less complex nut nonetheless complex warships, by smoothing that build cycle, we retain the skills, we maintain the infrastructure, we retain the critical mass to build to build the complex warships which includes frigates, destroyers and aircraft carriers.
We have to look beyond that arbitrary restriction and maximise the purchasing power of the Ministry of Defence to deliver UK sovereign capability.”
This would also allow for industry that would become sustainable, ships to become cheaper and hopefully, the Royal Navy to afford more hulls.