Shipyard bids for warship orders

It was announced yesterday that the Government is planning to spend almost £5bn on new warships and maintenance between 2004 and 2008.

Junior defence minister Dr Lewis Moonie said the programme would include the construction of submarines.

Last night Norman Brownell, commercial director at Swan Hunter, said the news was of considerable interest to the North-East shipbuilding industry.

But he warned it was not just the shipbuilding industry which was going to have to pull together to ensure the region receives its fair share of the work the £5bn would bring.

Mr Brownell said: "It is good to hear that the Government is now committing this amount of money but everybody has to get behind the effort, not just those in the industry but also local MPs and local government.

"It is a regional thing. Nobody is just going to give us this work, we will have to fight for it.

"We are going to have to work together to optimise our share in this market."

He said some of the contracts would be "quite massive" and those involved in the industry, and those not, should "weld together" and act regionally to ensure some end up in the North-East.

Mr Brownell said: "It is good news and it is up to the region now to fight to get the share of these orders because nobody is going to give it away."

A sum of £735m is allocated for the year 2004-5, rising to £1.89bn in 2005-6.

This drops to £1.1bn in both in 2006-7 and 2007-8.

Refit and repair work will cost around £500m a year between 2004 and 2006.

Dr Moonie said: "We estimate that the cost of planned maintenance, including refits, and repair work on warships, including submarines, and Royal Fleet Auxiliary vessels, will be in the region of £500m in each of the years 2004-5 and 2005-6.

"These figures exclude the cost of upgraded equipment."

Dr Moonie was responding to a written question from Bernard Jenkin, shadow defence secretary.