MOD highlights contribution of SMEs to Defence on Small Business Saturday
On 1 December, MOD paid tribute to the thousands of small businesses across the UK that support the UK Armed Forces. Highlighting their role in key projects such as F-35 Lightening and the Queen Elizabeth Class Carriers. Mr Williamson said that "Small businesses across the UK are a vital cog in the Defence supply chain, from fitting warship galleys in Newcastle to building circuit boards in the South West. They bring innovation, unique expertise and a competitive edge to Defence industry. And with startups run by former service personnel and manufacturers making the most of our veterans’ unique knowledge, our nation’s economy as a whole is feeling the benefit of our Armed Forces’ expertise and training.” Keen to highlight the £2.5 billion spend with SMEs, the occasion was used to mark a range of initiatives, including a new Defence Supplier portal and new, short-form contracts for less-complex procurements. NDI has been involved in advocating for many of these changes and we welcome efforts to make doing business in Defence easier.
Shipbuilders chosen for Fleet Solid Support competition
On 30 November, Defence Procurement Minister, Stuart Andrew announced the five bids that have been selected to compete for the Fleet Solid Support ships contract, selected from eight expressions of interest. The bids include a British consortium made up of Babcock, BAE Systems, Cammell Laird and Rolls-Royce. They join Italian firm Fincantieri, Spanish company Navantia, Japan Marine United Corporation, and Daewoo Shipbuilding and Marine Engineering of South Korea as the five firms who have been invited to submit a tender. The five competitors will now develop their bids before a final decision is made regarding the winning bidder in 2020. The ships are being procured through international competition as they are not classified as warships under the deifintion set out in the 2017 National Shipbuilding Strategy. However, regardless as to the outcome of the competition, they will be fitted with specialist and classified equipment at a British shipyard before entering service with the Royal Fleet Auxiliary from 2026. Shipyards across the United Kingdom will be able to bid for this work in 2022.
Defence Secretary announces £400m investment for nuclear-armed submarines
On 6th December, MOD announced a £400 million funding release for the building phase of the Dreadnought future submarine programme. According to MOD, the investment is required now to ensure the programme remains on track to deliver the first of class to the Royal Navy in the late 2020s. It follows the announcement in May that £960 million worth of contracts had been placed to ramp up the current phase of construction. This latest investment will safeguard more than 8,000 jobs at the build site in Barrow-in-Furness and within the supply chain across the UK. The announcement was made by Defence Secretary Gavin Williamson at BAE System’s Barrow-in-Furness site, where he unveiled a £25 million academy that will up-skill employees to work on Royal Navy submarines for the next two decades.
- DEFENCE EQUIPMENT PLAN: Asked what recent estimate he has made of the affordability gap in the Equipment Plan 2017-2027, Defence Procurement Minsiter Stuart Adrew answered that "The Equipment Plan financial summary 2017-2027 set out the Department's plans for spending on equipment procurement and support in the 10-years from 2017-18 as at April 2017. The Department successfully delivered the first year of this plan within budget, as presented in the Department's annual report and accounts 2017-18. We reported our latest estimate of the affordability of the Equipment Plan in the Defence Equipment Plan financial summary 2018, published on 5 November 2018. Our central estimate of the forecast cost variance to budget was £7.0 billion over the 10 years from 2018-19, on base cost of £193.3 billion, which includes the remaining nine years of the Equipment Plan 2017-2027 period.”
- DEFENCE PROCUREMENT OVERSEAS: Asked what estimate his Department has made of the total amount spent by his Department on military equipment manufactured in the (a) UK, (b) EU, (c) USA and (d) rest of the world since 2010, Mr Andrew replied - rather unsatisfactorily - that "The Ministry of Defence does not break down procurement expenditure by country of manufacture"
- GALILEO SATELLITE NAVIGATION SYSTEM: Asked for the reasons why Government has concluded that it would not be in the UK’s security interests to seek to use the secure aspects of the Galileo satellite system, Mr Andrew replied that "The UK remains absolutely committed to European security. However, security-critical military applications require the greatest level of assurance that they will work as needed. The stance taken by the EU does not meet our security needs, and since January 2018 they have excluded UK companies from participating in the security elements of the programme, pre-empting and prejudicing negotiations and limiting the possibility of retaining the necessary level of assurance. This leaves us no alternative but to rule out military and critical national infrastructure use of the secure aspects of Galileo. We have asked the UK’s world-leading space and cryptography industries to develop plans for a UK system which fully meets our security requirements."
- NATIONAL SHIPBUILDING STRATEGY: Asked what assessment, if any, MOD has made in the shipbuilding strategy of the optimum warship loading of UK shipyards to ensure (1) best value for money, (2) enhanced productivity, and (3) innovation, Defence Minster for the House of Lords, Earl Howe, replied that "The National Shipbuilding Strategy (NSbS) announced that warships would be built in the UK on the basis of a competitive tender between UK shipbuilders. Competition will help to ensure value for money and productivity. Companies can choose where they wish to undertake the work in the UK. The NSbS encouraged UK shipbuilders to make use of the support available to help innovation, including the High Value Manufacturing Catapults, Productivity Council Funding, and the Industrial Strategy Challenge Fund. The NSbS Master Plan provides a 30-year forecast of Royal Naval shipbuilding requirements, providing industry with greater certainty about the Royal Navy's procurement plans so it has the confidence to invest for the long term in its people and its assets. This will allow industry to raise productivity, innovation and improve its competitiveness in the domestic and overseas markets. The 30 Year Master Plan also allows the alignment of capability development and associated innovation with the plan in order to deliver the Maritime Strategy 2035 vision."