by Iain Wright
A couple of weeks ago, the MoD announced that a £0.5bn contract for the next generation of Royal Navy tankers had been awarded to a South Korean company.
Ministers thought that they had got away with this because there had been no bids from a British firm.
Peter Luff, the defence procurement minister, was quoted as saying that: “There was no British bid. That does make it a tad difficult to award (the contract) to a British company if there is not a bid from a British company. We don’t build tankers in the UK.”
Excuse me? We don’t build tankers in the UK? I think the minister should try telling that to the Shipbuilders and Shiprepairers Association (SSA), whose membership comprises about 99 per cent of the UK ship production and supply chain, and whose director still insists that this contract could be built in the UK within the timeframe and to the quality required and awarded to a UK shipyard to help maintain jobs.
The government is hiding behind the excuse that no British firms applied. But this is sophistry.
There was a European bid on the table that offered a greater share of work for the UK than the South Korean winners. This would have meant 35 per cent of the contract being delivered in Britain.
But the MoD ignored the wider British economic interest.
This sorry episode raises two serious questions: – why wasn’t the broader economic context taken into account, and could the government have done more with British suppliers to help them bid?
In both cases, it is down to the departmental champion of business across government, the department for Business, Innovation and Skills, to make the Britain’s economic case to other departments and support British companies in engaging with government.
So I asked a parliamentary question as to what meetings the business secretary Vince Cable and his ministers had with MoD ministers and civil servants, UK businesses and trade associations to prioritise the British economic interest in such an important contract.
I got the answer back last week. No meetings had been held between BIS ministers and anybody on this matter.
I find this astonishing.
