New Defence contract blows hole in Better Together claims

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  By Martin Kelly
 
A defence contract worth £600m has been awarded to French defence contractor Thales in a move that has undermined one of the key arguments against Scottish independence.
 
The contract, announced by the Ministry of Defence, will see the French firm provide maintenance and repairs for Royal Navy submarines and ships.

The 10 year contract will see work carried out at facilities in England and Scotland and will sustain 230 Thales’ jobs at Glasgow, Manchester, Somerset and West Sussex with a further 300 gained in supply lines.

UK Defence Minister Philip Dunne said: “This contract is good news for the Ministry of Defence and UK industry.

“Not only will it secure a number of jobs across the UK whilst delivering savings but will also provide essential support for the combat equipment that helps give the Royal Navy’s fleet of ships and submarines a vital technological edge wherever they are based in the world.”

The MoD is looking at ways to make savings as it struggles with swingeing cutbacks from the UK coalition. 

Mr Dunne explained that the ministry was working to see if it could combine current civil and military capabilities across the UK to save money.

“We think that if we encourage companies to think in those terms when they bid for equipment that we’re looking to buy, that will enhance the prospects of that equipment also achieving sales in other countries which will help bring the cost down to us, keep the production line longer, make spares cheaper and sustain and build jobs in the UK.”

The news is a blow to pro-Union campaigners who have consistently argued that a post-independent Scotland would be barred from participating in any defence contracts from what remains of the UK.  However the skills possessed by Scottish workers and the facilities located in Scotland have been key to Thales success in winning the bid, which will run well beyond 2016 by which time Scotland may well be independent.

Thales UK will support the project from its sites in Templecombe, Cheadle Heath, Glasgow and Crawley, where ongoing development of these important systems will enable yet further improvements to be made in the levels of capability and availability.

Under the terms of deal, the in-service support contract has now been extended to include all of the Royal Navy’s submarine visual systems, including periscopes for the Vanguard and Trafalgar Class submarines and the non-hull-penetrating optronic masts for the Astute Class submarines, previously supported under separate contract arrangements with Thales main optronics business based in Glasgow.

The MoD has claimed that the deal will help save £140m over the coming decade.

Thales UK chief executive Victor Chavez said: “This contract recognises the value that can be achieved and the savings that can be delivered through a long-term services agreement.

“This project refines that approach to optimise performance over the next ten years, and reinforces our positive well-established relationship with the Royal Navy.”