SHIPBUILDING is returning to the North-East after Tyneside yard Swan Hunter landed a major Ministry of Defence order, bringing with it 2,000 new jobs.

North-East Labour MPs yesterday hailed Defence Secretary Geoff Hoon's decision, even though the Cammell Laird yard on South Tyneside lost out.

Swans has secured a £140m order for two alternative landing ships logistics (ALSL) vessels, but Cammell's bid for part of £300m roll-on roll-off (roro) ferry contract failed, with the order being shared between a German consortium and Belfast's Harland and Wolfe.

Tynemouth MP Alan Campbell, secretary of the Northern Group of Labour MPs, saluted the landing ships order.

He said: "It's excellent news for the North-East. It's a huge boost not only for the river, but for the whole of the region."

And Mr Campbell signalled this meant the return of warship building to the Tyne which last launched a Royal Navy warship in 1994 when HMS Richmond sailed away.

It also puts Swans in a good position to bid for a share of the 30 warship orders to be placed in the next 20 years, including the £2bn contract for two aircraft carriers to be awarded in 2004.

Mr Campbell paid tribute to the North-East campaign to win the work with effort being made by employers, employees, the unions and politicians.

Mr Campbell regretted that the Cammell Laird yard in South Tyneside had not won a share of the ro-ro order.

But he signalled that the landing ship order was the bigger prize. "That's not just an economic boost for the region it's a psychological boost for the region," he told MPs.

However, yesterday's share-out of defence came under furious attack from Frank Field, Labour MP for Birkenhead on Merseyside where Cammell Laird is based. He angrily claimed that Cammell Laird had not been awarded any work because it was successful.

"The whole of this announcement was propping up failures," he protested.

Long wait is over - Page 1