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No Compensation if £1billion Shipbuilding Deal Stays In UK

Wednesday, July 11, 2018

MoD WOULD NOT HAVE TO PAY COMPENSATION IF CRUCIAL £1BILLION SHIPBUILDING CONTRACT KEPT IN UK, GMB REVEALS

By contrast, putting order out to international tender could cost shipbuilding jobs and prosperity, warns union

GMB, the shipbuilding union, has revealed that the Ministry of Defence would not be liable to pay any compensation if Ministers changed their policy and kept a £1 billion order for up to three new military support ships in the UK.

GMB research shows if the much-needed new Fleet Solid Support ships were built in British shipyards around 6,700 jobs would be created, and £285 million pumped back to the exchequer through income tax, national insurance contributions and lower welfare payments. [1]

A new written answer from the Defence Procurement Minister, Guto Bebb, has revealed there is no threat of any compensation payments to non-UK companies if Ministers changed their policy. [2]

The House of Commons is today set to debate a Labour motion which 'calls on the Government to make the competition for the Fleet Solid Support ships contract a UK-only competition to maximise the return on that contract.’

Ross Murdoch, GMB National Officer, said:

“This written statement proves what GMB has been saying for some time – there is no reason for the Government to punt this lucrative contract overseas.

“Keeping this contract in the UK would cost Ministers nothing – but putting it out to international tender could impose a severe cost on shipbuilding workers and their communities - particularly as we are already witnessing significant job losses at UK shipyards as the Carrier programme runs down.

“GMB’s campaign is for this £1billion contact to stay in the UK, creating jobs and wealth for our county, including in the steel industry.

“Parliament should back and respect Labour’s motion today to keep this crucial order in the UK.”

ENDS

GMB Press Office on 07958 156846 or at press.office@gmb.org.uk

Notes to Editors:

[1] GMB research report, Turning the Tide: Rebuilding the defence shipbuilding industry and the Fleet Solid Support order, April 2018: http://www.gmb.org.uk/turning-the-tide.pdf

[2] Parliamentary Written Answer to Kevan Jones MP, answered on 09 July 2018, on Royal Fleet Auxiliary:

“The Fleet Solid Support ships market engagement process was conducted on a 'without commitment' basis, so there are no grounds on which a party could claim compensation.”  

https://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2018-07-04/160711/

 

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