Will Socialist Politics & Ruthless Capitalism Overwhelm Strategic Logic?
Frustrated in its attempt to take over Rosyth Dockyard, defence giant BAE Systems (BAES) is now said to be considering a new strategy for dominating the UK warship support industry. However, well-placed defence sources are suggesting that the prime objective of BAES - to cut rival Devonport Management Limited (DML) out of future submarine refit work - runs the risk of discarding valuable skills at Devonport Dockyard, undermining the strategic defence of the UK, and costing British taxpayers hundreds of millions of pounds. One source went as far as to predict that if BAES succeeds in securing 'through-life' maintenance and refit for the Astute Class hunter-killer boats it will prove to be as big a disaster as the new SSN's construction programme was in its early days.
BAES have successfully revolutionised their Astute Class construction methods now, delivering what they feel is the most capable submarine of its kind in the world, at a far more economic price than other contractors might manage. However, the company has no experience at all in refitting and maintaining nuclear submarines and may experience a similarly steep learning curve if it enters that arena, replicating skills and facilities in Scotland that already exist in England.
The drive to monopolise naval support infrastructure is alleged to be what lay behind its (so far) unsuccessful strategy of taking over Rosyth Dockyard. BAES, which builds surface warships as well as submarines for the Royal Navy, joined forces with the Portsmouth-based VT Group, its partner in building Type 45 destroyers, to prepare a £700 million-plus joint take-over bid for Babcock International. This was abandoned on May 10, with a steep rise in Babcock's share price deterring BAES and VT from actually launching their bid. Babcock International runs Rosyth Dockyard, which is near Edinburgh, and also a maintenance and repair facility for nuclear submarines at HM Naval Base Clyde, Faslane, near Glasgow. It is believed by defence sources that Babcock would have been split up if the bid was successful, with BAES running a major surface warship and submarine refit centre, at Rosyth, as well as Faslane submarine maintenance.
With through-life support for new naval platforms preferred by the UK Ministry of Defence, and the MoD currently working on several initiatives to reform the manner in which it provides support for the Royal Navy, having the firm that builds submarines refitting them as well might seem to present unbeatable logic.
However, this is far from the case as has been pointed out by one UK defence industry insider: "lf Faslane is proposed to take on an increased focus for submarine maintenance, including work on the Trafalgar Class ahead of the A-Boats, a number of factors have to be considered. It has only one method for getting a submarine out of the water and the requirement for Long-Overhaul Periods (LOPs), or extended maintenance periods where LOP-type work has to be carried out will not disappear, making the use of the ship-lift for these purposes unfeasible."
It is also believed that the ship-lift at Faslane will need up-grading soon. "It is likely to face some significant authorisation and refurbishment challenges within the next five to ten years," said the defence source. There are also serious concerns about SSNs using the ship-lift preventing emergency work on the Faslane-based ballistic missile submarines. "The ship-lift is required to support the operational SSBNs at short notice. It is therefore unable to be used for protracted maintenance work, certainly not where holes have to be cut in the pressure hull. The Faslane site represents a highly constrained maintenance facility, and because of these reasons is likely to require some major investment to meet any expanded support role.
Devonport is required as long as the UK operates any nuclear-powered submarines because of its unique and expensive fuel handling facilities and its skill-base, even after the requirement for mid-life re-fuellings of UK nuclear submarines disappears. Devonport will need to retain a significant level of capability to ensure it can maintain its status as a Licensed Nuclear Site. Value for money is unlikely to result if Devonport is starved of all work other than the bare minimum - which, in any event, would require substantial investment in Faslane if this were to be achieved. This would add directly to the existing submarine affordability issues." Should BAES achieve its ambitions and secure nuclear submarine refit and maintenance work, especially if a later bid for Rosyth succeeds, then Devonport could become unviable not only for supporting the submarine flotilla, but also in providing key support for the surface fleet. In the view of another defence source "starving Devonport of significant quantities of the non-refit submarine maintenance workload will also make some aspects of support to the operational naval base expensive to provide and difficult to sustain. For these reasons Devonport must feature as part of the total UK infrastructure debate, to ensure the most efficient and appropriate long-term industrial construct is generated."
While the Ministry of Defence has been consulting DML on the way ahead for submarine refitting and maintenance, there are political considerations, which may ensure that value for money and strategic logic are ignored. It is no accident that the centre of gravity for the future Royal Navy is Scotland: The future Prime Minister (Gordon Brown), current Defence Secretary (Des Browne) and Armed Forces Minister (Adam Ingram) are all Scottish MPs, keen to ensure that the Labour Government's political powerbase remains strong. Lucrative defence work in an era when the UK Armed Forces are being starved of proper funding, is not easy to come by. However, major warship construction contracts have nearly all gone to BAES or its VT Group partner. Most of the work on the future carrier, auxiliary landing ships, and Type 45 destroyers is therefore being carried out at BAES facilities in Scotland. It is convenient for the Labour Party and Trade Unions that any job losses incurred outside Scotland can be blamed on market forces rather than a deliberate policy of using Defence as a means to shore up the socialist vote.
• For more reports and comment, see WARSHIPS IFR magazine.