Yahoo Finance Boris Johnson to hand £1.25bn contract for new frigates to Rosyth
Boris Johnson is expected to announce a £1.25bn contract to build five frigates at the Rosyth dockyard in Fife on Wednesday, helping secure 2,500 jobs as part of a pledge to restore “British influence and excellence across the world’s oceans”.
The announcement had been expected to be made by Ben Wallace, the defence secretary, at the DSEI arms fair this week, but it has been taken by Downing Street, desperate for positive news after days of negative headlines and controversy.
Downing Street’s overnight announcement does not name the preferred bidder, although the winner is expected to be announced on Thursday as a consortium led by the smaller of Britain’s two main shipbuilders, Babcock.
With a clear post-Brexit emphasis, Johnson said that he believes that building the frigates in the UK will prompt “a renaissance in this industry which is so much part of our island story” and added “so let’s bring shipbuilding home”.
Few, however, expected the new frigates – cut-price models intended to be attractive to the export markets – to be built overseas. Babcock’s principal competitor was BAE Systems, which owns the Scotstoun and Govan shipyards on the Clyde.
But the contract does help ensure a diversity of supply, safeguarding jobs at the Babcock-owned dockyard in Fife until 2028, when the last of the ships is due to be built. The yards are just completing the second of two £6.2bn aircraft carriers, with the Prince of Wales expected to set sail within days.
The prime minister is expected provide further details on Thursday, although he will not travel to Scotland and is instead expected to appear in London against a maritime backdrop, although the exact location is not yet known.
The Royal Navy has 19 warships, with the two aircraft carriers coming into service early in the next decade. Ministers want to increase that number in the 2030s after the navy was stretched trying to defend oil tankers under threat from Iran in the Persian Gulf.
Mike Clancy, general secretary of Prospect, which represents defence engineers, said the announcement was welcome after a period of “damaging delay” but said the UK needed to build up naval strength.
“Events in the Gulf this summer have shown that 19 frigates should be an absolute minimum for the Royal Navy. So this first order of five warships must be followed up by further orders.”
Johnson also said he would appoint Wallace as “shipbuilding tsar” with a broader responsibility for making the UK a leader in creating cruise ships, ferries and yachts – lifting its position from third worldwide.
Earlier on Wednesday, the defence secretary said China needed to modify its cyber-behaviour and adopt a code of “fair play” if Beijing wanted the British government to allow Huawei technology to be used in future 5G mobile networks.
Wallace said a long-awaited decision on Huawei was coming soon, although he could not give a firm date, and told the DSEI arms fair any conclusions about the company had to be “more than just technical”.
Spelling out an additional condition, the minister said: “This is also about behaviour. You know, it wasn’t that long ago that the United Kingdom and other nations called out China for some of its cyber-activity publicly.
“If we are going to allow countries access to our market, I think we should all expect a code of behaviour that is fair play – we are British, we believe in fair play. So I think that will also be reflected in those discussions.”
Wallace, however, conceded the Brexit crisis had delayed the timing of any announcement. The minister said he could not provide an exact timetable because “obviously there’s been some chop in the government, up and down”.
