News from the UK Government

16 May 2019

Parliamentary report recommends building support ships in UK

The All Party Parliamentary Group for Shipbuilding and Ship Repair has launched a report on the National Shipbuilding Strategy.

The report states that the industry is already facing significant redundancies as the aircraft carrier programme runs down, with the subsequent loss of leading-edge skills. Once lost, these skills cannot be quickly regained and the UK’s sovereign capability to produce complex warships will suffer accordingly, as will the UK’s ability to project naval power.

The APPG states that:

“It is the responsibility of the Government to ensure the Royal Navy receives its equipment from a leading-edge supply chain and support structure and is therefore able to maintain its operational advantage.”

The report further calls on the Government to factor in revenue returned to the Treasury when scoring bids between domestic suppliers and foreign competitors and to acknowledge that many foreign shipyards receive both direct and indirect state subsidies.

The report also states:

“The Royal Navy depends on support ships operated by the Royal Fleet Auxiliary (RFA) during deployments. Royal Fleet Auxiliary Solid Support Ships are designed to carry a wide range of stores to support other ships in the fleet including munitions, fuel and supplies. To maintain a sovereign naval capability, consisting of all types of ships, building vessels operated by the RFA is crucial for the retention of skills needed for future warship production. Despite this, the National Shipbuilding Strategy states that only Royal Navy destroyers, frigates and aircraft carriers will continue to have a UK-owned design and be built and integrated in the UK".

The report continues:

"As such, the Government has decided to open the procurement process for three new Fleet Solid Support (FSS) ships out to international competition with Navantia, a Spanish state-owned shipbuilding company, considered the frontrunner. The MoD states that European Union protectionism rules prevent the FSS contract being run as a UK-only competition. The Government also believes that it can obtain lower costs and force higher levels of efficiency from domestic shipbuilders by tendering on the international market. Despite concerns raised in Parliament and by trade unions, the Government has no plans to issue any further definitions for the purposes of the National Shipbuilding Strategy. Research conducted by GMB shows that ‘warships of all kinds’ are not subject to compulsory competitive tendering".

Based on evidence from experts in the field, the report calls on the Government to ensure domestic yards receive the Fleet Solid Support Ship Contract in order to ‘retain the skills needed to construct, refit and upgrade complex warships in the future’.