5 October 2016
The massive programme to build replacement nuclear submarines for the Royal Navy “cannot and must not slip” the Defence Secretary warned as he pushed the button to start work on the massive £41bn project.
Michael Fallon, speaking as he started the machine to cut the first steel for the 17,000-tonne “Successor” class of nuclear missile submarines at BAE Systems’ plant in Barrow-in-Furness, said he was “throwing down the gauntlet” to industry.
“Successor can’t be late because the Vanguard submarines [the current generation of Trident submarines] are coming to the end of their working life,” Mr Fallon said.
We will absolutely challenge BAE and other suppliers such as Rolls-Royce. They are going to be incentivised to keep the targets and they will suffer if they don’t.”
Speaking in the BAE plant’s huge Devonshire Dock Hall with the two of the troubled Astute-class attack submarines behind him, Mr Fallon said the country could not afford the delays or cost overruns previous submarines had suffered, as its security depended on the replacement Trident submarines.
The first of the Astute class attack submarines was four years late and the project was £2bn over budget. Troubles included issues with the nuclear reactor provided by Rolls and concerns about the quality of work and equipment overseen by BAE.
The plan to build four of the 153-metre Successor submarines has been costed at £31bn, with a £10bn contingency fund, with BAE, government and the Navy saying they had taken on board the lessons of the earlier project.
With Britain’s poor history of delivering major naval projects on budget –the new Queen Elizabeth class aircraft carriers doubled in price to more than £6bn – Mr Fallon said the contingency fund “was 'Plan B’”.
He faced the embarrassment of having to cut steel from the French supplier Industeel, having said no British firms were able to supply the material which will be used to create the new submarines’ outer pressure hull.
“Obviously we would have preferred to buy British,” he said, but 85pc of the between £8bn and £9bn of equipment being bought in for the project would come from the UK.
All the major technical parts, such as the nuclear reactor, propulsion equipment and weapons kit, would be from Britain, and eventually involve more than 350 sub contracting companies.
Tony Johns, director of BAE’s submarine division and a former Royal Navy submariner who reached the rank of commodore, played down the importance of the use of French steel.
“This is less than 0.5pc of the cost of the programme,” he said. “If we can buy British we will, if the capability is there.”
It is thought that Brexit could free up BAE from EU tendering rules and will let the UK government have more flexibility on how it sources materials for the project.
When the programme hits peak production in the early 2020s, with the first submarine being finished in the late 2020s, there are expected to be 7,000 people working on it, with 5,000 at BAE.