Brian Monteith: Naval yards need foreign orders

Brian Monteith.
Brian Monteith.
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No sooner is that debacle of Grangemouth fading from the memory than another one arrives – and this time it straddles the United Kingdom, with jobs being lost at shipyards at Portsmouth and Clydeside. We are told by critics of the Government and BAE – the owner of all three yards – that jobs are being sacrificed at Portsmouth to save jobs at Govan and Scotstoun, all because there’s a referendum on Scotland staying or leaving the UK next September. But is that really the case?

Firstly, let’s remind ourselves what is actually happening – the Royal Navy is shrinking, it will soon have fewer ships than fought at Trafalgar in 1805.

Even though it is a Tory coalition government, the nation’s defence budget has taken a hammering so that the NHS could be protected. The Ministry of Defence is still building two aircraft carriers but the first will not have any aircraft when it’s commissioned and the second will be immediately mothballed. The contractors are now planning for the big gap between these ships being launched – and starting on the next ships needed, the Type 26 frigates. It is inevitable that workers will be laid off and that a yard or yards might have to close.

Sadly, some devoutly English newspapers wish us to believe Portsmouth’s 500-year history of building for the Royal Navy is being sacrificed to try and win a No vote, while nationalists argue that as the Type 26 frigate order does not need to be placed until after the referendum the order could still go to Portsmouth if we vote Yes.

That looks neat but it is as daft as saying George Bush ordered the attack on the Twin Towers to justify going to war with Iraq, and here’s why.

Firstly, Defence Secretary Philip Hammond has already made it clear that if Scotland were to leave the UK there is no way that the Royal Navy would be allowed to place future orders for such warships in a foreign country. So forget the secret conspiracy, the political approach has already been laid out in the open and this week’s decision does not change that – all it does is allow people to plan for redundancies that will be introduced at the end of next year.

Most reasonable people would think that’s a pretty decent thing to do.

Secondly, there is no guarantee that the announcement will deliver the expected political outcome in Clydeside that is claimed – and it has huge political downside for the Government that is quietly being ignored.

It is true that electorates tend to recognise where their economic interests lie, so the shipyard workers could be expected to vote No, but people can also see that many yards have closed over the years on Tyneside, Teesside, and Merseyside – and that politicians’ promises are often of little value. They will therefore consider other factors before they vote.

Back in the mid-1980s Rosyth naval dockyard was chosen as the location for the refitting of Royal Navy nuclear submarines and by 1986 construction work started to make this a reality. But by 1993 the Ministry of Defence had gone back on its word and the contract was given to Devonport. The argument was that it was cheaper but evidence that surfaced later contradicted this and the accusation that the decision was to save Tory marginal seats took hold.

The 1997 election came along and the Tories were wiped out in Scotland, and they still lost the marginals in Devonport. If politicians are to learn from history they will know that Tory seats in Portsmouth are now put at risk, so why then would the Government do that when it faces a general election in 2015?

The truth must be closer to the likelihood that this is a commercial decision that reflects the overcapacity of British naval yards and the economic sense of trying to consolidate the expertise on one yard. The Clyde has won while Portsmouth – which will remain the navy’s most important base – will continue as the main centre for refitting and maintenance. This all makes sense if we stop to step back from trying to see everything as a political fix or influenced by the referendum.

The problem for Clydeside and Portsmouth is a shared one, that BAE seems unable to win any orders for large vessels other than from the Royal Navy. This results in a state dependency that could be aptly described as corporate welfare. Even the latest Scottish ferry is being built in Germany. Whether in the UK or outside it, Clydeside needs to start winning orders from abroad – something that it has not been doing for probably 50 or so years.

Remaining in the UK or being in an independent Scotland does not alter this. Whether or not it is the fault of the BAE bosses, the unions or Government, our yards need to be more commercial and need to ask themselves why countries that do not have the capability to construct their own warships no longer come to British yards for them?