§ 4.51 p.m.
§ Lord Campbell of Alloway rose to ask Her Majesty's Government what are their plans and proposals for the future of Rosyth Dockyard.
§ The noble Lord said: My Lords, as your Lordships know, when Chatham was closed the management of the Royal dockyards at Rosyth and Devonport was handed over to commercial operators. I hold no brief, and I have no interest whatever to declare, in either of those undertakings. My interest lies in the proper provision for the defence of the realm, which will always include Scotland, and in the support and protection by the Royal Navy of all those serving in our Armed Forces in an unpredictable situation; the traditional defence commitments being now supplemented by new roles and tasks undertaken under the aegis of the United Nations.
§ My interest also lies in the severe economic consequences of the closure of either of those dockyards when unemployment is set to rise above the 3 million mark and we are at a time of fragile recovery in the heavy industries. My interest also lies in the closure of either dockyard and in particular Rosyth, as affecting Scotland and Scottish affairs.
§ Your Lordships may well think that neither of those Royal dockyards under commercial management rank to be rated, as the modern saying seems to 37 go, as dead duck industries and that if needs must be, although such is much to be doubted, that they warrant a bridging package. Your Lordships may also think that no decision should ever be made in this context on political grounds or solely on purely financial considerations as may appear in an accountant's report, welcome as that report will be and however eminent such an accountant may be.
§ As yet there has been no debate in Parliament on this question as to whether to keep both dockyards or one or other of them. It is understood that a decision will soon be made and hence this debate. In introducing it I wish to thank all noble Lords whose names appear on the list of speakers and in particular the noble Lord, Lord Cooke of Islandreagh, who is to make his maiden speech. I crave leave to do this now as there will be no subsequent opportunity.
§ As no decision has yet been made, your Lordships' speeches shall surely serve as a constructive aid to government in the decision-making process. The object of tabling this Unstarred Question is to seek an assurance from my noble friend the Minister that before any proposals are implemented—indeed, before any decisions of such importance are made—debate on such proposals shall first ensue in both Houses of Parliament.
§ In the course of this short introduction it is proposed to consider the causes of concern and anxiety; namely, the case for the dual site option which, on objective analysis and in the opinion of many noble Lords, is the only appropriate and acceptable resolution; and then the consequences of the closure of Rosyth and aspects of financial viability. As to the causes of concern, there is no doubt whatever that prior to the general election the decision was taken by government to reject any form of the dual site option. By whom it was taken, on what material and when it was taken, we simply do not know.
§ But the briefing notes to candidates entitled "Royal Dockyards" under the sub-title "Defensive Lines to Take" make that totally plain. It is also evident that that decision, taken before the last election, has now been rescinded as a Cabinet Committee has been set up, chaired by my noble friend the Leader of the House, to re-examine the whole question.
The day after this Unstarred Question was tabled, on 19th January, the Herald reported that my noble friend Lord Younger was said to be,
unhappy about the manner in which the Government was handling this matter".
§ The pit closures fiasco, and the manner in which that decision was taken without debate in Parliament, still casts its shifting shadow of anxiety and concern. The good offices of the Select Committee of another place are acknowledged with gratitude; also those of my noble friend the Leader of this House and those of the Government Chief Whip who strove to secure a moratorium and an immediate reappraisal. There were also the good offices of Mr. Norman Willis who at that time gave restrained and responsible advice.
§ But are we again, when closure of the Royal dockyards is at stake, to be asked to accept a ministerial decision taken on the grounds that there 38 was no alternative, without the approval of Parliament and a decision which, as regards pit closures, was in the event unnecessary, unwise, unlawful and unacceptable to the electorate and the Select Committee of another place? There is no state funeral laid on as yet for great aunt Tina. The cause for concern and anxiety over the resolution of this question on the Order Paper remains.
§ Now as to the case for the dual site option, I have spoken at length on this subject with the noble and gallant Lord, Lord Hill-Norton, who unfortunately is unable to attend today although he would have wished to do so. Subject to your Lordships' leave, may I say that he firmly supports the dual site option as wholly requisite to safeguard and sustain the defence of the realm and using, not wasting, the substantial investment made at Rosyth—£120 million so far spent on the new Trident dockyard; £15 million on the new emergency docking facility. He also supports the dual site option as a way of avoiding massive unemployment and hardship at this time.
§ As your Lordships know, the dual site option, put shortly, is that Rosyth Dockyard, as the only fitter of ballistic nuclear submarines, with its years of experience—it also refits the older and more difficult types of submarine and has completed more major refits than Chatham and Devonport put together—should retain all submarine fitting and that Devonport should retain all surface ship fitting. That is putting it very simply, but that is the essence of the proposal.
§ That would, first of all, safeguard the defence of the realm. It would provide some 2,000 extra jobs; it would provide spare capacity for commercial work, which could generate profit; it would avoid the substantial write-off of investment to which I have referred, and it would avoid redundancy, unemployment and closure costs estimated to be of the order of £250 million. And it would avoid the closure of Rosyth.
§ As to the closure of Rosyth, whether that be done by sentence of execution having immediate effect or suspended effect by some phased process of strangulation matters not. The effect would be to remove the benefits of the dual site option to which I have referred. It would put the defence of the realm to unwarranted risk. It would cause serious environmental problems at Devonport and it would devastate the regional economy of West Fife and desolate the West Fife economy. A skilled workforce of some 240 men, the seedcorn of our hope for recovery, would be scattered to the wind, just to become a set of ciphers in the unemployment statistics. Once disbanded, the workforce may never be gathered together again. And there is the knock-on effect: some people put the number of jobs at stake at 14,000 while others put it at 18,000. Furthermore, it would nurture intense and indelible resentment. It would have calamitous consequences for Scotland, which could not be concealed, in an ill-assorted ragbag of Whitehall jetsam, and then be relegated to oblivion.
§ As to financial viability, your Lordships will of course wish to examine whether, as suggested, the dual site option (compared with the single site option) would save about £500 million and avoid an estimated 39 £250 million closure costs, including redundancy and unemployment benefit. Your Lordships may also wish to consider whether, if needs must be, a bridging package should be arranged until the dual option runs into commercial profitability on the spare capacity, and indeed whether derogation should be granted from short-term Treasury policies of strict financial constraint to avoid a closure which could only fuel and aggravate recession, there being already an over-capacity of ports in Scotland.
§ To conclude—and I apologise for the length of this speech —the resolution of this Question on the Order Paper lies within the remit of at least six departments of state: the Scottish Office, Employment, Trade, Environment, Treasury and Defence. Of course, my noble friend the Minister may not pre-empt inter-departmental consultations or the deliberations of a Cabinet committee, or the findings of an accountant's report. It is, however, most respectfully suggested to him that the assurance which I seek may be given without any hint of pre-emption.
§ 5.7 p.m.
§ Lord Ewing of Kirkford
My Lords, I am sure that your Lordships on all sides of the House are very grateful to the noble Lord, Lord Campbell of Alloway, for facilitating this very important debate. I am certain that I speak for the whole House when I say that he had no need to apologise for the length of his speech. In my view, it demonstrated the importance of the subject. I share with the noble Lord, Lord Campbell of Alloway, keen anticipation of the maiden speech of the noble Lord, Lord Cooke of Islandreagh. I look forward very much to hearing the noble Lord's contribution.
Unlike the noble Lord, Lord Campbell of Alloway, I have to declare an interest: it is a personal interest rather than a pecuniary one. It is said to be a sign of old age when one begins to reminisce but if the House will forgive me I should like to say that I remember well in my native Cowdenbeath, where I was born and brought up, at the outbreak of the Second World War the great rush to build the mass of timber housing —some of it is still there—in order to bring workers from the south of England to man the Rosyth Dockyard. During all my time residing in West Fife, as I did then, local authorities were by and large Labour controlled. The only reason I make the point to your Lordships is that I have noticed a tendency in recent weeks to argue that the Labour Party and Labour politicians have no right to argue for the retention of the Rosyth Dockyard because of the political position of the Labour Party on defence in former years.
The point that I am making is that all those Labour-controlled local authorities down through the years have been firm and enthusiastic supporters of Rosyth Dockyard. My late father was the Provost of Cowdenbeath, a council which gave 110 per cent. support to Rosyth Dockyard. That was true of all local authorities in the area. And it explains why the present offer from Fife Regional Council—that, in conjunction with the retention of the Rosyth Naval 40 Dockyard to refit the nuclear submarine fleet and Trident, Fife Regional Council and the people of Fife are also prepared to accept the decommissioning of nuclear submarines—is so important. Indeed, there are presently three hulls from decommissioned nuclear submarines at Rosyth Dockyard. There has been no outcry in Fife (or in the Lothian region or in Stirlingshire, which are also affected) about the fact that nuclear submarines are being decommissioned at Rosyth and their hulls stored at the naval dockyard. That is an important point which I hope that your Lordships will note.
I perfectly understand and support those who say to the Ministry of Defence on the one hand or to the Royal Navy on the other, "If you don't want our skills, we don't want your scrap." The matter will have to be considered seriously in the run-up to the crucial final weeks before the decision is made.
I have referred to my personal interest. I have sought to stand aside from my family interest in Rosyth. My son has worked there since leaving school; my twin brother, who has just retired, spent all his working life either in Rosyth Dockyard or at Admiralty headquarters at Bath; my younger brother spent his entire working life at Rosyth Naval Dockyard, and I have three nephews there at present. So, I must declare a family interest in Rosyth, rather than a pecuniary interest.
In the few minutes that are available to me, I want to point out that we do not come here today on behalf of Rosyth Naval Dockyard holding out a begging bowl and asking for the retention of Rosyth. We come here, as we have done since the onset of the campaign, arguing both a reasonable—that is not unimportant —and a justifiable case not only for the retention of Rosyth but also for the retention of the naval dockyard at Devonport, and favouring the dual site option.
Perhaps I may enter one unpleasant note although I regret having to do so. One of the things that has disturbed and distressed me in recent weeks is the way in which Devonport appears to have argued—my perception of its argument may be wrong—that Rosyth should be closed and all the work transferred to Devonport. I regret that the political leaders of all parties—and I single out no one in particular—also seem to be guilty of that offence. It is much to be regretted.
I much prefer the constructive approach that is taken by your Lordships' House to the dual site option, which can be justified on three specific points. It is certainly justified on defence grounds. When he replies to the debate perhaps the Minister will advise the House on the point that I am about to raise, which I have never yet heard addressed. There is only one European nuclear power in the North Atlantic Treaty Organisation—I stress the word "European". Although France is a European nuclear power, as is well known, France is not a member of NATO. So, there is only one European nuclear power in NATO—the United Kingdom. I wish to ascertain whether any consultation has taken place on this important issue between the Ministry of Defence and NATO. I would have assumed that there would be some kind of 41 opinion in NATO about the possibility—and for a time it seemed more than a possibility—that Britain would be left with only one naval dockyard. Therefore, in defence terms, there is a strong (almost unanswerable) case for the retention of Rosyth and Devonport, with Rosyth doing what it is best equipped to do, the refitting of the Trident and nuclear submarine fleet, while Devonport refits vessels of the surface fleet.
I believe that the case for Rosyth is unanswerable on economic grounds also. It seems strange to me that when Devonport was informed that its bid could relate to the strengthening and refurbishment of existing dock facilities, that information was not passed to Rosyth Dockyard. The result was that Rosyth's bid was submitted on a different basis from that entered by Devonport. The position has now been corrected. I am pleased to note that Coopers & Lybrand Deloitte, the financial consultants, have now been retained to examine both bids on, to use that old euphemism, the level playing field approach. I caution your Lordships on the subject of consultants. It is a very good definition of consultants that their first job is usually to look for their next job. Therefore, I should not like the workers at either Devonport or Rosyth to put a great deal of emphasis on the fact that this matter has now been referred to consultants. In economic terms, it has, in my view, been proved beyond doubt and without question that the dual site option would create savings on the one hand and retain both naval dockyards on the other.
My next point is employment. I wish things were different. I say to your Lordships that I do not now —nor have I ever in my political life—taken any pleasure from seeing any Conservative Government in trouble over unemployment. I have always taken the view that where political argument has to take place against a background of high unemployment, it is often a negative and unproductive argument. So, I say honestly that I wish things were different. Having said that, however, I must advise your Lordships that one of the ways of ensuring that the unemployment situation does not deteriorate further is to ensure that the dual site option is accepted, that both naval dockyards are retained, and that employment in the respective areas is not damaged by a decision to close one or the other. I hope and trust that the Government are looking especially at the unemployment consequences—in this case, for Rosyth—if it is decided to close Rosyth Dockyard.
The decision about whether Rosyth has a future will depend upon whether the bid is considered on a basis equal to that of the bid from Devonport on the one hand, and the future of the Trident nuclear refit facility, upon which £150 million has already been spent, on the other.
I hope also that the Minister will say something about the lack of a nuclear safety certificate in relation to Devonport. What would happen if, between a decision, tragically, to close Rosyth—although I hope that that is not the outcome—and Devonport being ready to accept Trident, Trident required to be re-docked? Where on earth —perhaps it should be where on sea—would Trident be re-docked? It cannot 42 be docked at Vickers at Barrow: it does not have a nuclear site safety certificate. It cannot be docked there carrying active warheads. It could not be docked at Devonport. The problem at Devonport is that the port is largely in the middle of a densely populated community. Where would it be docked?
We face the humiliating situation of Britain's nuclear fleet having to be serviced in foreign ports. That is not acceptable. I do not believe that it is acceptable to the Ministry of Defence. It seems to me, and to a great many other people, that from all that has been said over the past months, we should now have convinced Her Majesty's Government, the Ministry of Defence and the Royal Navy that the sensible way forward is to go for the dual site option and retain both Rosyth and Devonport.
§ 5.22 p.m.
§ Lord Cooke of Islandreagh
My Lords, I thank the noble Lord, Lord Campbell of Alloway, for putting down this Question on a subject in which I am deeply interested. Like most new Peers, I wish to get my maiden speech behind me as soon as possible, but in the short time since my introduction in November, I have been disconcerted to find that much of the work of the House relates to matters of which I know little and certainly on which I could make no contribution.
Shipyards, dockyards and ship repair have been part of my life. I was first taken to see a launch at about the age of six, and as soon as I could handle a rowing boat I was allowed to row out from our home on the shores of Belfast Lough to pick up the timber that was always floating about after a launch at Belfast. Before and during my time at university, I served as a fitter's apprentice at Harland and Wolff in Belfast and later at Fairfields in Glasgow. As an engineer officer in the Royal Navy, I had experience of dockyards from Rosyth in the north to Auckland, New Zealand in the south, and many in between. After the war I returned to Northern Ireland and my engineering and other work has kept me closely in touch to this day with shipyards, dockyards and ship repair. My excuse for telling your Lordships that is to explain why I wish to contribute to a debate in which I might not appear to have much interest.
The case for or against Rosyth, and the single or two-yard option, falls into two parts. The first relates to the correct place to put the new service facility for Trident. Initially, obviously the decision taken was that Rosyth was the proper place, because £150 million has been spent on a hole in the ground. Rosyth's estimate of the cost of completion of new facilities purpose-made for Trident is, as I understand it, £260 million.
Devonport and its contractors, DML, have estimated that it would cost only £160 million to refurbish existing facilities. Therefore £100 million would be saved. No doubt that is attractive to the Treasury and has held up the completion of the purpose-made facility at Rosyth. I understand that Rosyth has now made a counter offer to upgrade its existing facilities for £147 million. First, to proceed with either of those options would be foolish. The cost of refurbishing existing facilities almost always 43 overruns the estimate, because it is not until the work has started that its true cost is discovered. Secondly, on safety, any nuclear facility must be inspected and approved by the Nuclear Installations Inspectorate. It will not answer hypothetical questions. It looks at jobs only as they proceed and treats them on their merits. There is no way that either refurbishment option could obtain clearance before it starts.
A recent requirement of the inspectorate is a seismic study of new facilities. It insists that the structure of a building and equipment should be able to withstand a certain acceleration so as to contend with any possible earth tremors. The new dock at Rosyth has taken that into account. The new plan for the facilities includes that requirement. Even supposing the saving of £100 million were correct—I do not for a moment believe that it is—Trident submarines should have a service life of about 20 years. The whole-life cost of servicing the submarines should be considered. Account should be taken of the effectiveness of the new facilities and the cost of working them. I am sure that new, purpose-built facilities for Trident would be more effective than any refurbishment.
I can understand that the Government have been slow to continue with Rosyth because of the possible £100 million saving, but I am confident that a further look at the true costs, plus the safety requirement, will make it clear that the only solution is a new purpose-built facility for Trident which will last 20 years. That element is important because, if it were decided that the correct place to site the new facilities was to be Devonport, Rosyth would inevitably have to close. There can be no doubt about that. On the other hand, if Rosyth is the proper place for the new facilities, as I believe it is, we then have the two-dockyard option, because it makes good sense to retain the work on surface vessels at Devonport.
If for some strange reason it were thought that Devonport was the proper place for the new facility, all the servicing facilities for the entire fleet—submarines and surface vessels—would be concentrated in the South of England. Surely it would be unwise to have all the facilities in one place.
Another point occurs to me that has already been mentioned by the noble Lord, Lord Ewing; namely, that no nuclear work is without some element of risk. That is inevitable and inherent in the nature of it. The Royal Navy has a splendid safety record and the Nuclear Installations Inspectorate also has a good record. However, if the risk remains, no matter how small, what would be the sense of using a dock adjacent to a large city rather than a dock in the almost rural area surrounding Rosyth?
Another interesting element is that a new pier has been built adjacent to Rosyth at Crumbae to work the new generation of fleet support vessels, the first of which will soon be in service. That pier has been financed largely by NATO funds. If the whole dockyard system moves south, that pier will be unused. What would NATO think about that?
I shall not mention the question of employment because I do not believe that is necessary. When 44 looked at sensibly, the case is made for purpose built facilities to be built at Rosyth, and the Devonport yard should continue to service all the service vessels.
§ 5.31 p.m.
The Earl of Selkirk
My Lords, it is my special privilege to congratulate the noble Lord, Lord Cooke, on a penetrating speech which was spoken from deep knowledge. It went right to the heart of what we are discussing today. We are grateful to the noble Lord for speaking as he has. May he come and see us again. We shall not be discussing the same subject, but I am sure that his range of experience gives him much knowledge of a wide range of subjects.
I am also grateful to my noble friend Lord Campbell of Alloway for raising this matter. Let us be quite frank about it. It is one of the most difficult matters which has been put squarely before this House at present. There are great difficulties attached to it. I was involved in it from the very beginning in some ways because one day the American, Admiral Rickover, said that he had produced plans of a nuclear submarine and asked me if I would like to have them. Of course, we said that we would like them. We took away those plans and they went straight to Rosyth. The nuclear submarines have been a great success and a second version of those submarines will be coming along in six years or so.
I am sure that that was the right decision. The navy was having problems with its yards at that time and had closed a number of them. It did not quite know where to build its submarines and Rosyth was chosen. It must be kept. It is a safe place with a high degree of engineering expertise, perhaps the highest in the country. I must say, however, that the yard at Devonport is not a second-rate organisation. By any standards it is a first-class organisation. I shall not make comparisons between the two yards but they are both extremely fine.
Today, there are two problems: unemployment and a shortage of high grade engineers. Those problems must be solved. To try merely to ignore the problem is no answer at all.
I hope that what has been said this evening will be reported to the Government. It is not an easy decision to make. This is a very difficult problem. However, we —I say that in the broadest sense—have the responsibility of defending the welfare of some 60 million people living on this island. That is our duty. If we do not do it right, we may encounter a great deal of grief. I believe that the correct decision can be made but a great deal of thought and consideration must be given to it. No quick decisions should be made.
What has been said this evening has given us cause for thought. I hope that we can persuade the Government that this matter cannot be passed over quickly. I believe that the main site should be at Rosyth. We must remember the floating navy because its ships must be repaired and looked after. Devonport is just the place for that and it need not compete with Rosyth at all. I believe that both yards should be kept open. However, Rosyth should be the place where 45 nuclear maintenance is carried out. If we do not keep Rosyth, we shall lose a great advantage which we now hold.
§ 5.35 p.m.
§ Lord Sanderson of Bowden
My Lords, I join in congratulating the noble Lord, Lord Cooke, on an incisive maiden speech. We look forward very much to hearing more contributions from him in your Lordships' House during the years ahead.
Last week the noble Earl, Lord Perth, initiated a very useful debate on the problems of an act of God —the flooding on Tayside. That was a reaction to a situation. This evening we are grateful to my noble friend Lord Campbell of Alloway for initiating what I would call a "proactive" debate to make sure that the Government are in no doubt at all about the extreme importance of this matter, particularly in Scotland.
I make it clear that I speak on my own behalf, but I have a great deal of interest in the state of the health of Her Majesty's Government, particularly north of the Border.I make the point immediately that I support the dual-site option, but I wish to ensure that Rosyth retains the nuclear refitting work.
In the past decade our Government gave the go-ahead for a new purpose-built refitting facility for Trident nuclear submarines at Rosyth Dockyard. There was no doubt as to the purpose. At that time the Secretary of State—now my noble friend Lord Younger of Prestwick—on 27th January 1987 said that the only threat to jobs there would be if the Trident programme were destroyed by the Opposition. That has not happened. So what has occurred since to change the Government's mind? After all, at that time the Ministry of Defence agreed that Rosyth had operational safety factors in its favour and "long-term advantages".
If that be so, surely one must assume that the capital cost of completing the project, on which many millions of pounds have been spent in the intervening period, must be the cause of the current discussion. I agree with the noble Lord, Lord Cooke, that in the mid-1980s it was right to opt for a purpose-built facility for Trident. However, if the Government need to look again at the matter, I maintain that a serious — and I mean serious—and thorough appraisal of the upgrading of Rosyth Docks Nos. 1 and 2 is only fair and reasonable. It is essential not just for the workforce in Rosyth or, as the noble Lord, Lord Ewing said, for the people of Fife; but it is to ensure fair play so that a like-for-like comparison is made. I believe that at present that has not been made clear.
I understand that the Ministry of Defence considered and rejected the upgrading proposal in the 1980s in favour of the new facility. That was its privilege and its decision. I am led to believe that that decision was made partly because of anxieties about insufficient time being made available within the refitting programme to carry out the construction programme. Perhaps my noble friend will tell me whether that is the case.
I suggest now that a smaller fleet, longer intervals between refits, the ability to double dock at Rosyth and the ability always to maintain two Rosyth docks 46 in commission for refitting, make the upgrading option viable. I expect the Minister to confirm that Ministers and the department will make those decisions in due course, and that consultants' reports are not relied upon.
I wish to point out some factors which in my view make the Rosyth option well worth looking at. After all, the Rosyth upgrade proposals incorporate design features and draw on the experience gained from the new docks proposal. That could save a tremendous amount of time in the preparation of the design and safety case.
Further, the new docks proposal experience has identified difficulties which lie within the process of securing the safety case. The safety case now needs scrupulous approval under the latest procedures. The scheme gives a compact layout with a minimum of major construction. The fuel routes are short and the proposed new buildings are founded on bedrock.
The Government must realise and understand the extreme importance of the environmental and safety factors which persuaded them to go ahead there in the first place. I shall not dwell on the employment situation but I would expect the Secretary of State for Employment to be involved in the long-term planning and to look at the decisions made in the light of what could happen should one or other of the dockyard facilities be closed.
If at this juncture the Government seek to change their mind —that is what they would be doing—and award refitting of the Trident submarines elsewhere (that was not their original intention), it will not be good enough for them to reverse their previous decision by stating a purely economic case. Rosyth was promised refitting of the Tridents by the Government and by my noble friend Lord Younger of Prestwick when he was Secretary of State for Defence. That has not changed. The Labour Party sought to scrap the plans for nuclear submarines. If the upgrading of Docks Nos. 1 and 2 is economically viable, I see no reason at all why the workforce should lose out. Now that efficient management is in place in both dockyards, public companies that are concerned in this matter will not look for short-term palliatives but rather for long-term, sustainable business.
I hope and trust that this tenet of free and fair competition, where like is compared with like, will result in the Government's decision to carry out the work at Rosyth. We owe it to the workforce at Rosyth to be absolutely clear about that. The workers have said they will perform this work and they deserve that work for the future.
§ 5.43 p.m.
§ Lord Mackay of Ardbrecknish
My Lords, like other noble Lords, I am extremely grateful to my noble friend Lord Campbell of Alloway for giving us this opportunity to discuss the future of the two naval dockyards, and in particular the threat which hangs over Rosyth. I intend to devote my speech largely to the wider political issues in the past, present and indeed future, which I think the Government ought to bear in mind when they consider this matter.
47 I shall make three quick preliminary points. First, I agree with the noble Lord, Lord Ewing, that it is important that any decisions made here are made clearly and openly in public so that the Government have an unanswerable case to the public for the decision they make. That will be particularly important if the decision is to close, either quickly or slowly, the dockyard at Rosyth.
Secondly, it is no part of my argument that Devonport should lose out. Indeed I can see no argument against Devonport continuing its major role regarding servicing. My third point directly follows that. I think the twin-option approach is the right one. I certainly could not put that any better than the noble Lord, Lord Cooke, did in his outstanding maiden speech in which, from his experience as an engineer, he showed your Lordships the clear case for both dockyards playing their respective important roles as regards our submarine fleet, our nuclear fleet and our surface fleet.
I wish to consider the wider political issues here and I have some qualification for doing that. During the early and mid-1980s there was considerable debate about whether we should have nuclear defence in this country or whether we should have the nuclear defence of NATO. There was considerable debate about whether we should base Polaris submarines in the Clyde and whether we should base Trident in the Clyde. I played a not inconsiderable part in that debate. I was forced into doing so, even if I had not wanted to, because my then constituency had within its bounds the American nuclear base at Holy Loch. Part of my constituency faced Coulport, where the nuclear weapons for our own nuclear fleet are stored. Just around the corner was Faslane. The noble Lord, Lord Younger of Prestwick, ironically left the Scottish Office to become Secretary of State for Defence. I was a junior Minister under the noble Lord and then subsequently I served under Malcolm Rifkind, who is now the Secretary of State for Defence. Up and down Scotland we had to argue the case for nuclear defence, the case for siting Trident on the Clyde and the case for Rosyth.
I argued that case in front of many microphones, television cameras and in some cold and windy halls. However, we won the argument. Interestingly enough, some of the people who today are in the forefront of defending Rosyth and proclaiming its virtues were in the mid-1980s doing their best to undermine it and our nuclear defences. As a Minister responsible for health at the time I had to spend a great deal of my time reassuring people that scare stories about leukaemia clusters round Rosyth and about nuclear hotspots were not true and were being put forward only to advance the anti-nuclear case of those people who at that time wished us to disarm unilaterally as regards nuclear defence.
We won that argument. By the end of the 1980s the same people who had fought against us were with us. They said we must have a nuclear defence both within NATO and in the United Kingdom. The party opposite is now with us on the need for the Trident submarine and on the case for Rosyth. They are with 48 us as regards Faslane and Coulport being the base of the Trident fleet. I thought the case had been won politically and that I could relax. However, then the Lords of the Admiralty threatened at one fell swoop to torpedo the whole argument. We must be in no doubt that when we argued in the mid-1980s the case for nuclear bases in Scotland we argued for them as a package. We argued for building the storage and facilities for the missiles at Coulport. We argued for building at Faslane the facilities for the active base of the fleet and at Rosyth we argued for building—indeed we were building, although I do not know whether that is continuing—the hole in the ground which would become the dock in which the submarines would be refitted.
I do not want to exaggerate the arguments. However, one of the minor arguments was that in exchange for having the nuclear deterrent based on the Clyde jobs would be based not only on the Clyde but also on the Forth at Rosyth. That was the package that I, my noble friend Lord Younger and the current Secretary of State for Defence argued up and down Scotland in the 1980s. Our colleagues in other parts of the Government helped us in that argument. We made the case for Rosyth clearly and it was stated again and again. Thanks to the facilities of the Library I reminded myself of some of the commitments that were given in the 1980s and in the mid-1980s when the debate was being waged not just in Scotland but throughout the United Kingdom on nuclear defence and the coming of the Trident missiles.
In his Statement on the Royal Dockyards on 17th April 1985 Michael Heseltine, the then Secretary of State for Defence, said:These two dockyards have served the Royal Navy and the nation loyally for many generations. I wish to stress that under this Government their long-term future is assured.—[Official Report, Commons, 17/4/85; col. 262.]He continued (at col. 266), in response to an intervention from the Labour Party, whose position at that time was not to have Trident:the people of Rosyth must clearly understand that I am offering to them a long-term, secure future".He concluded (at col. 269):the central issue is not whether the dockyards have a future, because I have assured them that they have one under this Government. Rosyth cannot stay the same under a Labour Government because a significant part of its capability would then be cancelled and destroyed".I would hate the said gentleman to have to eat his words of 1985.
Later in the year, on 2nd December 1985, during the Second Reading of the Dockyard Services Bill, which introduced the private sector to those two dockyards, and which I believe has done so much to make them both efficient and effective, Mr. Norman Lamont, then the Minister of State for Defence Procurement, said:The Government's commitment to Rosyth is clear from the massive investment that they are making in the dockyard to carry out Trident refits … Devonport and Rosyth have served the Royal Navy and the country loyally for many generations and their long-term future is assured under the Government's proposals". [Official Report, Commons, 2/12/85; cols. 37 and 38.]I am sure your Lordships can see that, against the background of such assurances and against the background of the years during which we spent 49 arguing the nuclear case, I for one would be extremely disappointed if today the Government were to change their mind and pull the plug on Rosyth, even if that were to save a few million pounds, and I am not in the least convinced that it would. That would cause extreme embarrassment, to put it mildly, to those of us who fought the case for the nuclear defences to be based on the Clyde and at Rosyth.
I believe that if that were to happen to Rosyth, many people in Scotland who perhaps had only a skin deep conversion to nuclear defence would suddenly find themselves placed in a difficult position, especially if the issue was driven by the Scottish National Party, which has never had any commitment to nuclear defence. They would be tempted to go back into the anti-nuclear argument and to say that if they cannot have the jobs, skilled jobs at Rosyth—as the noble Lord, Lord Ewing, rightly pointed out—they do not want the risk associated with having the submarines at Rosyth.
Another point which the Ministry of Defence has to bear in mind and which the noble Lord, Lord Ewing, also mentioned, is the fact that there are three decommissioned nuclear submarines lying at Rosyth. I tell your Lordships and the Government that one does not have to get up early in the morning to realise that the anti-nuclear campaigners will quickly have a slogan: "If we cannot have your living submarines we do not wish your dead ones".
On all those grounds—the Government's commitment through the 1980s, the importance of the defence industry to employment in Scotland, and winning and continuing to win the argument in favour of our nuclear defence—I hope and trust that the Government will see the sense that they saw each and every year during the 1980s and will retain and develop Rosyth as the refit base for our Trident submarines.
§ 5.54 p.m.
§ The Earl of Perth
My Lords, we are grateful to the noble Lord, Lord Campbell of Alloway, for raising the matter. Having heard all the preceding speakers I ask myself what the argument is about. There cannot be an argument because the facts are so overwhelmingly in favour of keeping both Rosyth and Devonport. I shall find it difficult not to repeat some arguments.
It is clear to me that the economic arguments are fairly equal. Therefore, we have to consider the other factors. First, there is the past, in terms of the undertakings given and the value of the skills developed at Rosyth. What has taken place there over the years is very important and special and cannot be duplicated easily, if at all. The only possibility would be that unfortunate Scots, who believed in the undertakings that they would have jobs for life, would have to go south. That is not a happy solution.
There has been mention of what has already been done and the £120 million which has been spent. I agree with the noble Lord, Lord Ewing, that one cannot make do and mend. Work has been carried out for some time, and when one has built something for a special purpose it is unlikely that the same object can 50 be achieved by patching up here and there. What happens if there is a disaster? Devonport and Plymouth would suffer far more than the Rosyth area. People have a right to say what they feel on the subject.
One argument seems to me unanswerable. We have been, and are still, a considerable maritime nation. We are the only nation in NATO which has a nuclear facility. What are we proposing to do? To put all our fragile eggs in one basket. That seems crazy. There ought to be no grounds for argument. It is not an economic matter; it concerns the livelihood of the nation. One cannot centralise all the facilities in one place. I wonder what the argument is about. It is said that there is an economic argument and that it might save money to place the matter in one administrative centre. That is a poor argument. The great companies in this country have works in different parts of the country. In the age of computers and communications I do not believe that that argument bears examination.
It is all very well to offer other scraps of comfort and say that there will be other ships to repair. That would be for only a short time. I am no expert on these matters, but I believe that to centralise facilities is absurd.
One must also consider the geographical aspect. Devonport is narrow and access is difficult. We ought to remember the lesson of the last war and of Scapa. One single event could hinder us and damage the fleet. We cannot afford to allow that to happen. We cannot afford a disaster. It must be remembered that there could be a disaster. There might be a nuclear disaster, although I hope not, and one has to consider the effect that that would have on the Plymouth area. Alternatively our enemy—because presumably we have an enemy, which is the reason for all this defence work—might succeed in blocking Devonport. In that case there would be nowhere else to go. To me the matter is so obvious that I cannot understand what the argument is all about.
I have spoken for two reasons. First, I am a Scot, although I am also a keen believer in Great Britain. The second reason is purely personal. During the last war my uncle, Vice-Admiral Rupert Drummond, was Chief of Staff at Rosyth. I do not know what he would say if he were alive.
We have had too many hard blows in Scotland; I do not know why. The last one was the closure of Ravenscraig. Perhaps there was good reason for that, but it was a great blow. When one considers the position with Rosyth, I do not know what one would consider about the wisdom or value of continuing with an Act of Union in Scotland. Do not let us get into such a situation. For heaven's sake do not let us put all our eggs in one basket.
§ 6 p.m.
§ Viscount Weir
My Lords, I must declare a strong personal interest in the subject of Rosyth because I am a Scot and chairman of a large Scottish engineering company which is a partner in Devonport Dockyard. I shall not therefore trouble your Lordships with presenting any case for Devonport, because my interest is too direct and your Lordships would rightly 51 discount what I said; and I would not like to see good arguments discounted—even arguments which might cast some clearer and informed light on the detailed costs of the many and varied versions of the dual option. However, I wish to comment strongly on the manner in which the issue has been debated in public.
If, as I do, one lives in Scotland one hears endlessly that it is not simply 4,500 jobs at Rosyth that are at risk but a total of 18,000 jobs in Scotland generally. The equivalent figures for Devonport are respectively about 5,000 dockyard jobs and 23,000 jobs in total. In Scotland we are correctly told that those losses would be superimposed on an already high level of unemployment. It is not often mentioned in Scotland that the rate of unemployment in the South West of England is just as high.
In the same vein, supporters of Devonport will correctly tell you that it is the largest single employer in the South West of England. The Rosyth faction will tell you that it is the largest employer on a single site in Scotland. With regard to job losses since privatisation, over 1,000 jobs have been lost at Rosyth and over 5,000 at Devonport. However, I simply ask this. When an issue which has major implications for defence and involves large costs at a time of great crisis in public finance is being decided, is any useful purpose served by exercises which compare relative levels of potential misery? I do not believe so. Doubtless, however, that part of the competition which involves two sides chucking numbers at one another will continue.
I am worried a great deal more by two other aspects of the way in which the public debate is being conducted. The first is the whole issue of the fairness of the decision-making process. There is much noise in Scotland from the media, politicians and others to the effect that the evaluation of the bids has been unfair. The background to that assertion is as follows. Rosyth originally chose to put forward in December 1991 a modified version of the original RD57 proposals. It was estimated to cost £267 million. At the same time, Devonport put forward a quite different solution based on modifying existing docks. That approach was £100 million cheaper and involved a fixed price. Both rival sets of submissions, it should be firmly emphasised, were in response to a request by the MoD in the summer of 1991 for proposals from both dockyards to cover the refit of the whole fleet of nuclear-powered submarines. I have no doubt that that request was driven by pressure on the MoD's budget.
Thereafter, for several months, the Rosyth management and Scottish pressure groups rubbished the concept behind the Devonport proposals on every ground. I could give much documentary evidence. More recently, and, given its criticisms of the Devonport concept, most surprisingly, Rosyth came back with a proposal on a similar basis to Devonport, using existing docks at Rosyth. Devonport then clarified its proposals so that direct comparisons could be made on the same scope and basis as those for Rosyth; and there I understand the matter rests at present.
52 The complaint of unfairness levied against the Ministry of Defence is that fair and adequate consideration has not been given to the Rosyth proposals. Although I believe that I have described the background to the proposals accurately and dispassionately, obviously I have no knowledge of any evaluation of the final Rosyth proposal carried out by the Ministry of Defence, although it would be astonishing if it had not been carefully examined.
I object to the continuous assertion that the process has somehow been unfair. Naturally, much of that assertion comes from the Scottish media which by now have become expert at egging on the Scottish public to believe that when an important national issue is being decided—and it is an important national issue—then, if it does not automatically go Scotland's way, that is plain evidence that Scotland is being cheated or that Whitehall is biased against Scotland, and all the rest of such stuff. When the public are encouraged, either by the media or politicians, to approach complex issues from a strategic, technical and cost point of view as though they were a version of the Calcutta Cup, played with a biased and unfair referee, I do not believe that anything creditable or sensible is being achieved. Some people might find criticism from the SNP and some parts of the Labour Party, both of which were opposed to nuclear weapons in the first place, a little hypocritical.
Other issues have recently been introduced into the public debate. Last week, in an item in one of the more serious Scottish papers, the Scottish Council Development and Industry referred to the Devonport proposals as a "patch and mend" solution and raised questions about whether they would ultimately meet nuclear safety standards. I am sure that noble Lords will be happier if I can assure you that the starting point for the whole design of the Devonport project was to establish whether a concept could be developed which would meet just such standards, and moreover that the three partners in Devonport are all companies with deep professional involvement in the nuclear field. The effect of such comments in the press is simply to exploit the public's natural concern about nuclear safety matters. It is perfectly deplorable to deploy such argument.
Finally, in another serious Scottish paper, there was an attack by innuendo this week on the integrity of a senior civil servant involved in the issue. So much public debate seems to me to have been carried out in a way which ranges from the unhelpful to the downright nasty. But perhaps I am too thin skinned and over sensitive.
For my part I do not believe that further studies on the alternative choices are needed. I am perfectly content to leave the decision to the Ministry of Defence which will doubtless decide on the basis of strategic, operational and cost considerations, tempered with the implications for employment which are serious, and of which it is well aware.
There are many stories that, with the latter considerations in mind the ministry may put the nuclear fleet at Devonport and soften the decision by putting additional surface ship work in Rosyth. Provided, in doing so, it can live with the considerable 53 extra costs involved and perhaps some additional operational difficulties for the navy, that is its prerogative. But if it decides that nuclear submarines will go to Rosyth in the future—and that is the only issue we are discussing today—I believe that that decision would be wrong, but I shall not waste time complaining about it. If, however, the decision goes in the other direction, it is my hope, although I have some doubt about it, that the supporters of Rosyth would accept it in the same way.
§ 6.11 p.m.
§ Baroness Carnegy of Lour
My Lords, my noble friend Lord Weir has brought balance to the debate. He brought to our discussion another angle upon the scene. He is concerned at the way the discussion has been taking place. I understand that and I am sure that noble Lords understand it very well. The concern is expressed from the point of view of a great Scottish industrialist who has great interest in the work that goes on at Devonport.
My noble friend said that he would he quite happy to leave the decision to the Ministry of Defence. My understanding is that the decision does not lie just with the Ministry of Defence. It is a matter, as has already been said, for a number of departments and ultimately for the Cabinet. If, as press reports suggest, the Cabinet is at the moment split upon the issue and my right honourable friend the Prime Minister is as yet undecided, I suggest to my noble friend the Minister that there are two particular issues which the Prime Minister and the Cabinet have to confront. Both have already been mentioned.
First, it is absolutely essential that the decision on this issue, when it comes, is based upon a proper assessment of correct facts and figures—the full facts and figures—if possible independently assessed outside government so that the Cabinet has an independent view in front of it.
From what I have been told by those closely involved, I have no reason to question the story and the comparative facts and figures that are so far available in the various briefs that we have received and as outlined by my noble friend Lord Campbell of Alloway. There will be many more salient points of which the Cabinet may or may not have been made aware so far. As I understand it, the figures are not yet complete. The original ceiling figure tendered by Babcock for work comparative to the projected Devonport port work is yet to be succeeded by the definitive and detailed price due at the end of this month. That will have to be examined and compared, like for like, with the Devonport definitive price already in the Government's hands.
With so much at stake at both ends of the decision, and with the navy doubtless taking its own view on what it perceives to be its own interest, emotion is naturally running high. Politics with a large "P" and politics with a small "p" are rife. Correctly or incorrectly, it is reported that there may be some conflict of interest here and there. Yet the Government have the responsibility and the need to make a decision which they can justify afterwards point by point when they are cross-examined, as they 54 certainly will be, in Parliament and elsewhere. The first question that the Government have to address is: how can they make sure that they have before them all the facts and figures correctly set out in an unbiased way?
The second question was very ably expressed by my noble friend Lord Mackay of Ardbrecknish. It is about the Government's integrity. If the Government are as good as their word, can they go back on the bargain, implicit in the early 1980s, when planning permission was given in Scotland for the unpopular nuclear submarine base on the west coast on the understanding that the repair and refitting work, and all the jobs that that represented, would be done on the east coast at Rosyth?
For the sake of those jobs, people in Scotland through the years—the noble Lord, Lord Ewing, illustrated that very graphically from the experience of his own family—have accepted the nuclear risks involved and committed themselves to continue to accept those risks; including, as the noble Lord said, the difficult work of decommissioning nuclear submarines and the skilled handling of the radioactive material involved.
We all recognise that the people of Devonport are skilled people too. They are also willing to accept the same nuclear risk, even in their urban environment. The Government are rightly anxious to help them with jobs. We are all anxious to help them with jobs. But can the Government with integrity bring jobs to Devonport by going back on their understanding with Scotland?
The independent miners feel that they have been let down. We do not know whether, in the end, they will have been let down, but they have that feeling. Surely the Government do not want to have another problem like that.
We read in the press that the problem may be addressed by the offer by the Government of 10 years' subsidised surface ship work at Rosyth—work, it is said, that might save two-thirds of the Rosyth jobs which would otherwise disappear for Devonport. At the present time, that would be better than nothing. But eventually, like most subsidised enterprises, it would probably be the death knell of Rosyth. In the meantime, it seems to me, the people of Scotland would have the agony of another Ravenscraig.
Likewise, there is talk that Rosyth might incorporate civilian port facilities. Some noble Lords may, like me, have heard from the chairman of Clydeport commenting on that idea. He points out that existing Scottish ports are only now coming to terms with the recent Ports Act and beginning to compete successfully with ports in the south of the United Kingdom for extra European Community work coming their way. Existing Scottish ports still have more than enough spare capacity. Clydeport tells us that the last thing it needs is another port imposed by the Government and not required by the market. In addition, Clydeport suggests, the alterations required at Rosyth would cost a very great deal in public expenditure and produce comparatively few jobs in return. I am in no position to assess those 55 representations, but I hope that the Scottish Office is doing so. Should they be valid, I hope that it is fighting that compromise.
I ask my noble friend the Minster, when he replies, to undertake to convey two specific suggestions to my right honourable friend the Prime Minister: first, that before it makes its decision the Cabinet should make absolutely certain that it has a proper, unbiased assessment of all the facts and figures and, secondly, that it considers carefully what the understanding was in the 1980s when planning permission was finally granted to the West of Scotland nuclear submarine base so that in no circumstances can the Government be proved to have broken their word.
§ 6.20 p.m.
§ Lord Ironside
My Lords, with a Question like the one on the Order Paper, what could be more appropriate than it being tabled in the name of my noble friend Lord Campbell of Alloway. Most of the defence interests in Scotland are connected with Campbell country, such as the Clyde naval base, the Clyde aircraft repair organisation at Perth, and I venture to include Rosyth in the east because it is reasonably close to Tayside. But the future of Rosyth is not only linked with such local clannish issues; it has been seen as one of the growth points in the network of fleet support for the Royal Navy of the 1990s and beyond. That point has already been made by many noble Lords.
First, I express my thanks to Admiral Sir Julian Oswald, the First Sea Lord, and the RN presentation team for their excellent presentation last week in the Grand Committee Room. The case for a balanced fleet capable of meeting the intense warfare threat was well made, and the case for protecting our maritime interests worldwide was not forgotten. But many of us came away with worries in regard to the infrastructure that will survive. If we really are strapped for money in defence, then what is it that can give? In that respect, besides the Royal Naval Dockyards, we have to think of the naval bases, armament depots, the Royal Fleet Auxiliaries, stores depots and beyond that to the training schools—the colleges such as the Royal Naval College, Dartmouth and the Royal Naval Engineering College at Manadon (I gather that may also be at risk)—and more, to the MOD staff, controllerates, shipbuilders and all the elements of the defence industrial base. The Royal Navy point of view is that the fleet train must not be financed at the expense of the fleet. In other words, any sacrifices should be made at the tail and not in the teeth. That needs careful consideration as our base assets are crucial to the Royal Navy and the well-being of the nation. We cannot ignore them if we want to maintain the fighting efficiency of the fleet.
In scrutinising defence, Parliament has had to rely on Adjournment Debates in another place and Unstarred Questions here to cover what are major issues. That is not ideal, as my noble friend Lord Cranborne knows. I believe that there is a necessity for a defence debate to look at the manpower, equipment needs and support services required to sustain them.
56 Before going any further I will, as I have always done, declare my interest in many of the projects connected with equipment supply and services to the fleet and the fleet train, including the Royal Dockyards and naval bases, and particularly Trident. In addition, as the House knows, I am an officer of the All-Party Defence Study Group.
In the course of the Adjournment Debate in another place on the closure of Portland Naval Base announced in November last, the Minister concluded that it was an accident of history that the Royal Navy cuts fall heaviest on those in the South, as most activities have been located there. I would say that that is more like an accident of geography than history. It is an accident of geography that Devonport, Plymouth Hoe and Drake's Island are where they are; it is an accident of geography that Portsmouth has Spithead at its approaches. But if there is to be an accident of history it looks as though, in government eyes, they want it to be Rosyth.
The Ministry of Defence is now pushing its units down (if it is not closing them down) into the South West as far as they can go. Operational sea training at Portland is to merge with work-up training at Devonport. The second submarine squadron is to move from Gosport to Devonport. The MoD procurement executive is to be centred near Bristol. The controllerates, including sea systems, are being put at Stoke Gifford nearby; 180 of the key staff at Eaglescliffe store depot in the North are being centred at Bath.
By giving the impression that everything is being crowded into the South West, the Government seem to be signalling to the country that Rosyth is an accident waiting to happen. I believe that the reality is quite different, bearing in mind the industrial strength that exists there, to which my noble friend Lord Campbell of Alloway and many other noble Lords have drawn attention.
If the support structures are being sucked into the South West—we are told that a lot of new expenditure is being incurred in the process—then we must consider carefully the wisdom of doing that. Pulling the naval resources of defence into one corner of England does not make much sense to me and it does not make much sense to my noble friend Lord Selkirk either. British Aerospace may be in Bristol, but Tornados are made in Warton and so is the EFA—the Eurofighter 2000 is being designed there, prototypes are being made there, and production will take place there. I am concerned that our naval resources should be sufficiently spread to take account of the needs of the fleet for bases and yards within a secure framework of supply, skills, manpower, stores and industrial services. The through-life support for platforms, weapons and personnel in the Royal Navy must be strategically spread.
Each warship is many times more powerful than its predecessor. The same can be said of submarines. There are to be 12 nuclear submarines in the future fleet but they need their own refit complexes. The RD 57 project at Rosyth is earmarked for Trident and always has been. If plans for refitting Trident at 57 Rosyth are abandoned it will mean that the Royal Rosyth Dockyard will be sentenced to a lingering death.
The Minister of State for Defence Procurement says that the Trident decision will be influenced only by hard facts. My noble friend Lady Carnegy of Lour takes the same point of view. But, as we all know, it can also be influenced by Parliament and public opinion. I sincerely hope that it will be influenced by what is being said here this afternoon.
The commercial management of the two Royal Dockyards has worked well and they are falling victims to their own successes. There is spare capacity at Rosyth and Devonport. But the issues that really matter and the ones about which we must think are how to provide Trident support to 2030 at least—and of course the through-life costs of doing that matter greatly, as the noble Lord, Lord Cooke of Islandreagh, said in his maiden speech; how to preserve the viability of the two Royal Dockyards; how to meet their operational requirements; and how to maintain the pool of technical skills and resources.
The RD 57 project at Rosyth was planned for Trident support. It was a new facility specifically designed for the purpose and to last the course. The modified proposal will fulfil the same purpose at lower cost. But the population density of Rosyth is less than that of Devonport, and I believe that a much more convincing safety case can he made. The noble Lord, Lord Sanderson of Bowden, drew particular attention to this issue. I am sorry that the Government have taken a decision—and have made a Statement about it in another place—that they will look at the safety case of Devonport or Rosyth, or both, after the decision has been made. Surely, they should be looking at it before the decision is made.
The viability of the Royal Dockyard structure is at stake if Rosyth loses Trident. Both dockyards have to compete on single source contracts for core programme refits of surface combatants. Rosyth is unlikely to survive on its own without the skill base for nuclear submarines—hence, the proposition to run both Royal Dockyards under one management; that is, the dual-site option. I believe it makes a lot of sense to spread risks and skills, preserve the competitive element in refitting and in defence as a whole and enhance the safety factor. If Rosyth Royal Dockyard vanishes there will be no North Sea coast-based installation for the Navy while we have offshore installations to safeguard, fishing rights to protect and the threat to the Northern Approaches still remains. There is also a need to co-ordinate all offshore maritime defence efforts (as the Canadians do), and Rosyth offers excellent base facilities for achieving that with involvement of the Royal Navy, Customs and Excise, the police, air and sea rescue, fishery protection and, last but not least, amphibious warfare activities. I understand that, jointly with the Dutch, we look to that for the protection of the Northern Approaches. Obviously, that involves the North Sea. I hope that the Government will listen very carefully to what has been said in the debate this afternoon and decide to keep Rosyth alive with the Trident banner flying.
§ 6.32 p.m.
§ Lady Saltoun of Abernethy
My Lords, I too am most grateful to the noble Lord, Lord Campbell of Alloway, for asking this Question. The argument for the retention of Rosyth Royal Dockyard for the servicing and refitting of all nuclear submarines and of Devonport for the repair of all surface ships falls broadly into four categories: defence, safety, cost and social.
The defence aspect should transcend all others for the defence of the realm is the first duty of all governments. As a mere ignorant member of the public, I ask the Government whether they think it is sensible to concentrate the facilities for all naval repair work to both surface vessels and nuclear submarines in one place that is some 400 miles nearer to the most probable source of ballistic missile attack than Rosyth. It is not only attack from without the United Kingdom that we have to be aware of; it is terrorist attack from within, or perhaps just an accident. Surely, from that point of view alone the Ministry of Defence should do all in its power to retain both Devonport and Rosyth. My noble friend Lord Perth spoke eloquently on that aspect, which is of the greatest importance.
I have been told, although I cannot remember by whom, that the Admiralty has backed the closure of Rosyth because it believes that financial savings thus made will pay for more surface ships. I do not believe that there will be any savings, but I shall come to that later. Certainly, if we need more ships we shall need both Devonport and Rosyth to build and service them. In this uncertain world who is to say that we shall not need more ships?
I too should like to congratulate my noble friend Lord Cooke of Islandreagh on his maiden speech. I will fatten up the picture that he painted for us. I begin with safety, which is paramount as far as nuclear submarines are concerned. At Rosyth under 2,000 people live within two kilometres of the proposed upgraded docks, as opposed to 30,000 at Devonport. At Rosyth the nearest habitation is farther from the nuclear trials berth and in the unlikely event of an accident evacuation will be much quicker and easier than at Devonport where it will have to be through the streets of Plymouth. Rosyth already has a purpose-built to latest standards dry dock "hole" built under the fullest Nuclear Installations Inspectorate consent and known to be licensable. Rosyth has discussed its upgrade proposals with the Nuclear Installations Inspectorate which has confirmed that continued refitting of submarines in No. 2 dock using existing facilities will be acceptable after phase one of the construction work has been completed. No. 3 dock will be available throughout the upgrade period.
Further, at Rosyth the Ministry of Defence has already spent £80 million over five years creating a dry basin, exposing the rock foundation over the full plan area of the docks, minutely investigating the rock, proving it to be solid and protecting the rock surface with concrete. At the same time, at Rosyth the Ministry of Defence has spent over £40 million creating a design of the new docks, analysing its nuclear safety case, issuing a preliminary safety report 59 to satisfy the Nuclear Installations Inspectorate and submitting to it a pre-construction safety report. Because of that there is every reason to believe that Nuclear Installations Inspectorate approval will be forthcoming for Rosyth's rugged design, built to modern quality standards, on proven solid rock foundation, without further cost escalation and with a lifetime of at least 50 years.
The same cannot be said of Devonport where the existing docks are already 80 years old, the underlying rock is of doubtful quality, the concrete is weak—it is jointed and not reinforced—the mechanical and electrical systems require replacement and duplication and the whole site is surrounded closely by a public road, with 3,500 private houses and a school within one kilometre.
I turn to cost. With great respect, I do not agree with my noble friend Lord Perth that as regards cost there is not much to choose between Devonport and Rosyth. I understand that the cost of upgrading the facilities at Devonport to enable it to undertake all nuclear submarine refitting has been estimated at £170 million. But, in view of the problems I have just mentioned, that estimate may very well increase by up to £230 million due to the costs of design, safety case analysis, investigation of the existing structures and underlying rock, structural strengthening, the possible replacement of the western promontory presently supported on timber piles of doubtful foundation, the replacement and duplication of mechanical and electrical services between the two docks and the possible replacement of existing fixed plant, such as cranes and dock gates, should it prove incapable of seismic qualification. The Ministry of Defence has already spent £120 million on Rosyth—money which will be wasted if the refitting of nuclear submarines is removed to Devonport.
On 10th December Babcock Thorn Limited quoted a ceiling price of £147.2 million for upgrading all the facilities and plant and equipment required to refit and refuel all nuclear submarines at Rosyth, with an undertaking that that price will not be exceeded by the fixed price which will be quoted by the 28th of this month at the latest.
Thus the saving to the taxpayer of retaining the nuclear submarine refitting at Rosyth would be a minimum of £22.8 million and could rise to £258.8 million, although the most likely figure would be somewhere in between the two. Like other noble Lords, I heard this morning that the Ministry of Defence has commissioned Coopers & Lybrand to do a fresh evaluation of the bids for the upgrading of Devonport and Rosyth. Perhaps when he winds up the Minister will comment on that.
These figures take no account of the cost to the taxpayer of redundancy payments and social security benefits if either Rosyth or Devonport were to close, nor of the loss to the Treasury of taxation revenue from those employed at present. It is also worth considering the beneficial effect of the rivalry and competition which would result from retaining both dockyards instead of having only one giant; and the fact that Rosyth has a history of good labour relations 60 and co-operation with the local council, as the noble Lord, Lord Ewing of Kirkford, so eloquently told us, should also be taken into consideration.
I now turn to the social argument. The majority of surface ships are based on the south coast and it is much more convenient for them to refit at Devonport. That is why, if submarine refitting were taken away from Rosyth, it could not possibly survive for long with just surface ship refitting and commercial work. Many crew members have made their permanent homes in the Devonport area. They have no wish to go to Rosyth for repairs. Much of the expertise in refitting surface ships is at Devonport, where about 85 per cent. of the surface ships are refitted at present. The people with that expertise have also made their homes in the surrounding area and have no wish to move to Scotland.
The nuclear submarine fleet is to be based at Faslane. Many crew members have made their permanent homes in that area. About half of the submarine refitting done at present is done at Rosyth, where the workforce is highly skilled and has no wish to move to the south of England. Although Faslane is on the west coast and Rosyth on the east coast, Scotland is very narrow at that point and it is not much more than an hour-and-a-halfs journey from one to the other, so that if your ship is being refitted and your home is near Faslane, you can still get home quite frequently.
We are talking about people who have put down roots, made friends have children at school who have also made friends and who do not want to move, either from the south of England to Scotland or vice versa. Rosyth employs 4,100 people directly and another 4,000 to 5,000 indirectly in Fife. It has been estimated in a study produced by the Fraser of Allander Institute and St. Andrew Economic Services that if Rosyth were to close, or die a slow death, which it would certainly do if the nuclear submarine refitting were removed to Devonport, overall job losses throughout Scotland could be between 14,000 and 18,000. Sub-contractors would collapse and also many small businesses. In addition, Rosyth still trains 65 per cent. of all Scottish engineering apprentices. If it closes there will be no future for them. I do not know how many jobs would go if Devonport were to close. I think it was the noble Viscount, Lord Weir, who said that around 30,000 jobs would go.
§ Lady Saltoun of Abernethy
My Lords, I thank the noble Viscount.
Those are my arguments for supporting the retention of both dockyards under one management. I understand that all the facts I have given your Lordships are known to the Admiralty.
It has been said that the pressure to close Rosyth comes from the Treasury. The figures I have given make that seem rather improbable. The noble Lord, Lord Mackay of Ardbrecknish, and the noble Baroness, Lady Carnegy of Lour, have spoken of the package of nuclear submarines plus refitting at Rosyth which was agreed in the 1980s. I have no hesitation in saying that were Rosyth to close or die a lingering 61 death at the hands of this Government—the same Government who made promises as to its future a decade ago — there would be scarcely a Tory MP left in Scotland after the next election, with consequences for the United Kingdom which I do not care to contemplate.
I cannot believe that the Prime Minister and the Secretary of State for Defence are not well aware of that. How could they not be? They are intelligent men. I am therefore forced to the conclusion that the Government, pledged in their election manifesto to uphold the unity of the United Kingdom, are under pressure to ditch Scotland in order to ensure the return of a Tory Government in England at the next election.
§ 6.45 p.m.
§ Lord Mottistone
My Lords, I too thank my noble friend Lord Campbell of Alloway very much for introducing this most important debate on the future of Rosyth Dockyard. It was my good fortune about five years ago, as mentioned by my noble friend Lord Sanderson, to argue for the retention of Rosyth Naval Base at a time when we still had a Soviet threat, and happily at the time that I was successful. I hope very much that this argument will also be successful.
My noble friend the Minister might like to think that, almost without exception, the speeches in the debate have put the point that we must have Rosyth Dockyard and indeed that we must have two dockyards. That is what I shall concentrate on. The argument has come very much from this side of the House as well as from the other side of the House. It is an argument which is well supported by people who know what they are talking about. My noble friend needs to give great care to that when he comes to reply. I hope that he will be able to give us an encouraging reply and that in so doing he will be able to go as far as he possibly can to give us the feeling that he fully understands the points that have been made this afternoon and this evening.
Many special points have been made. The noble Lord, Lord Ewing, whom I heard for the first time and was delighted so to do, mentioned Trident retention, which I support very strongly. It was also mentioned in the splendid maiden speech of the noble Lord, Lord Cooke. The political arguments were put by my noble friends Lord Sanderson and Lord Mackay of Ardbrecknish. I hope I have the pronunciation correct. I have to say that in order to differentiate him from my noble and learned friend on the Woolsack, even if he is not present. The political arguments seem to be particularly strong. The words of the noble Lady, Lady Saltoun, would surely underpin what was said by my noble friend from these Benches.
My argument, which was also well put by my noble friend Lord Ironside, is that we must have at least two naval dockyards in this country for the long-term future. Not much has been said about the long-term future. It takes about 10 years to design and launch a ship. The ship then has a life of 20 to 25 years, depending on its type. Some have an even longer life. If a dockyard is wound up and loses the skills of the people living locally it cannot be reconstructed at the drop of a hat. It was possible in Nelson's time to do 62 that when ships were made of wood, but these days we must realise that if we wind up either of the two dockyards it is extremely unlikely that they will ever be reconstructed.
We want to look not just five or 10 years hence, which I believe is the period everyone has been looking at, but 50 or 100 years hence. In that time a pattern of what we require from our defence forces will change dramatically. Of one thing we can be quite certain: it will change in a way that nobody at the moment can possibly foresee. We must have the strength to be able to have at least two dockyards in this country because, under varied circumstances which might arise in the middle of the next century, one of the dockyards might be disposed of very quickly and the other may not be available at all.
The arguments about money are extraordinarily short term. I have an awful feeling that naval officers today are being ground into the dust by officials who advise them on how to argue against money. If you say to anyone who knows about these matters that it is necessary to have two bases, that it is also necessary to have so many ships, aircraft and submarines, and that that means that we require extra money, then extra money there must be. From my experience in past years, there have been occasions when one has had to say that kind of thing, even in running one's own house. It is not a good argument to say "If we keep only one dockyard and get rid of the other, then we shall be able to have X more frigates or Y more submarines". It is not like that.
We must have two bases, one at each end of the country. That is the root of the argument. We need that not now, but in the year 2100 as much as we shall in the year 2000. That must be a main factor. Having said that we need two bases, as the noble Lady, Lady Saltoun, said, they have to compete with each other, which is a very important point. Ships in the Royal Navy are only efficient because they compete with other ships of the same type and in the same squadron. It is all a matter of competition. If there is only one soggy little dockyard, it is going to be soggy. What is more, the dockyards have to be competitive world-wide. It has to be said that if the dockyards do not have enough naval tasks to carry out, they must be developed and made semi-independent for that purpose. We have to get custom from around the world. If the dockyards have the facilities—and they have to think about getting them if they do not have them—we must not let the QE2 go to Germany to be refitted; it must be done in Britain. We must have people who want to do that, who have the energy to do it, and who can raise the money. It is very important for both dockyards, whatever happens to them, that they are properly competitive in the world market and that they have enough work to keep going all the time.
There is one other factor. I am just coming to the end of a three-year happy stint as president of the East Wessex Territorial Association. I learnt a lot about the Army, the Territorials, the Air Force and its reserves. I have learnt a little about the Navy and its reserves. I have learnt of the importance which the other services attach to being spread around the country, 63 not only through their reserves but through their regular forces as well. In that way the ordinary citizen (the voter) and the chap who answers questions in the newspapers are the kind of people who need to have a real wish to support and understand the Navy. The Navy is getting squashed into corners. It is too long ago that Nelson was the country's hero. It is too long ago when the last world war took place and there were ships which escorted convoys and which got great names for themselves. I expect that very few people in the country remember some of the great names. But those matters are of the past. The Navy needs to be spread around the country in order to have support and understanding.
Your Lordships, the Government and ordinary people do not go abroad in ships any more, although they used to 60 years ago. We go in aeroplanes. We have forgotten how important it is to have ships. We have forgotten that 90 per cent. of this country's trade is carried by sea. We do not care; we do not know; and we are not accustomed to it. Quite soon everybody will be funnelling themselves through the tunnel and not even going by air. We will have completely forgotten about the kind of things which 60 years ago made people think that the Navy was important. I plead that we keep our two bases for the foreseeable future, and well beyond the lifetime of anybody here and of our great grandchildren.
§ 6.56 p.m.
The Viscount of Oxfuird
My Lords, we must thank my noble friend Lord Campbell of Alloway for having given us the opportunity to debate this subject. I would also like to thank and draw comfort from the expertise of the noble Lord, Lord Cooke. His experience is something we cannot discount. I have a sense of déjà vu as regards his trip to Auckland; I can imagine him visiting the Royal New Zealand naval base at Devonport. As a boy I spent, not all, but most of, my time sitting nearby fishing.
The question that we face surely is one of expertise. The noble Lord, Lord Ewing, brought that to the forefront. I have spent a considerable period of my life involved in technical and safety matters overseas. One factor to emerge from our study of these matters is that 99 per cent. of all accidents or incidents are due to something which someone does or does not do. In my experience attempts to manage safety with electronics or mechanics, locks, interlocks or whatever they may be, cannot compare with the level of safety which attends that achieved by highly trained and high quality working people, managers and responsible directors of workforces.
Thus it must be at Rosyth. Apart from the proposed figures of investment quoted, which many have discounted, I wonder whether the real cost of moving that expertise from where it is today to any other place has been considered. Perhaps it would be best if it were left alone.
Another point I wish to bring before your Lordships is that of the consequences of the closure of Rosyth. I must declare an interest inasmuch as I supported the Government in the privatisation Bills 64 associated with the Scottish ports. Initially, they were taken as Private Bills and then became government Bills. Can my noble friend the Minister see a future for Rosyth trading in the guise of a privatised port? If so, where is the market to come from? We have a marked over-capacity within the main Scottish ports of Dundee, Clyde, Aberdeen and Perth. Dundee started a roll-on roll-off service not so long ago with the support of the port itself—I presume financial. However, it failed. The Government's levy on privatised ports has been considerable. Are the Government going to be placed in a position whereby they have to re-invest in their own decision making? I hope not. I hope that the case for Rosyth is made.
§ 7.1 p.m.
§ Lord Cochrane of Cults
My Lords, I must thank my noble friend Lord Campbell for introducing this subject in such a wide-ranging and valuable way. I am also grateful to have heard the magnificent maiden speech of the noble Lord, Lord Cooke of Islandreagh, whose knowledge has been of great assistance to me and, I am sure, to many others of your Lordships.
The Rosyth question is really the visible part of a much bigger question: the complete mess which defence policy has got into at the end of, and following, the cold war. That is not to say it is anybody's fault that it has got there: it is probably all very well intentioned, but it is rather unfortunate. At the end of the cold war people spoke enthusiastically about a regime of stability and peace lasting, one would almost have thought, however improbable history makes that sound, for ever more. And so the peace dividend was invented, whereupon the Treasury, I understand, asked for a defence review. That was duly produced and called Options for Change.
Since Options for Change, the world has not been stable: it has become much less stable. I read in The Times today that something like 26 wars are going on, of different sorts, with another couple of dozen festering quietly. We all know what is happening in the Balkans. The United Nations is involved but appears to be powerless to overcome the hatred of generations. After Options for Change which, as far as I can make out, was entirely Treasury led and paid very little heed to task analysis, it was decided, rather in the manner of Procrustes, that the forces would have to fit the bed which had been made for them. So they laid down: they are all professionals and big men and so they started chopping off an awful lot of bits. That has resulted, as my noble friend Lord Brookeborough said in this very House about a year ago, in dramatic overstretch in the Army.
A lot of people, because of the effectiveness of the regimental lobby, tend to assume that all the cuts are concentrated on the Army. That is far from true. In fact overstretch is endemic throughout the armed forces and even now further cuts are rumoured or threatened. We have heard of the possibility that amphibious forces will be axed in the interests of some other, as yet unstated, gain. All this causes great uncertainty, which is bad for morale and bad for recruiting. For example, only something like 45 per 65 cent. of the current intake at Sandhurst has been recruited —this at a time of great unemployment facing people in all walks of life.
Rosyth is the product of enormous muddle. The only way it can be settled with any degree of certainty and good is along the lines suggested by my noble friend Lord Mottistone. The first option is to ask what is strategically correct. The answer is that we must have two main bases situated fairly far apart. Devonport and Rosyth fill that need. Rosyth also looks to valuable oil installations in the North Sea and our other interests there. It can also protect our northern flank which, in spite of the collapse of the Russian empire, can still be endangered. That is the strategic argument. I gave it previously in speaking to an Unstarred Question put by the noble Lord, Lord Carmichael of Kelvingrove. The strategic aspect is very important.
If Rosyth is closed or if it is run down, it is perfectly clear that the naval base alongside will wither and eventually die. It will have less and less to do and will then be declared redundant. Halving our dockyards and so halving our repair capacity is not something that can be done on the present basis of discussion. Not only has discussion been strangled but rumour and innuendo, as my noble friend Lord Weir said, are rife. The thing has had all the appearance of being badly handled. Nonetheless, it is wrong to put all our eggs into one dockyard basket. That is what would happen if Rosyth does not get the submarine refitting.
The noble Lady, Lady Saltoun, remarked on the political effects in Scotland, as did my noble friend Lord Mackay of Ardbrecknish. No matter what is said and done, there is no doubt that if Rosyth does not get the submarine refitting the dice will be seen to have been loaded: that is the trouble. If Rosyth does get the submarine refitting the work will be shared roughly 50–50. If it does not get it the work will be given 100 per cent. to Devonport, with virtually nothing to Rosyth. That is not a fair arrangement. I do not want anybody to think that I have not considered this carefully; I have. I probably live the nearest of your Lordships to Rosyth apart from the noble Lord, Lord Ewing of Kirkford, and in passing perhaps I ought to declare a sort of interest. It is perhaps a record of a great Scottish seafarer—my great great grandfather—that the naval base at Rosyth is called Cochrane.
Now the original assessment was over-optimistic and the expected peace dividend has not appeared. Our forces are volunteers, all of them. Other nations find their forces expensive too, although they have a substantial body of conscripts. However, in the interests of the economy we must not wreck our strategic dispositions. In fact it is positively to our benefit to have strong forces, because of the influence which we can be seen to exert in the world. The rundown and closing of the dockyard would be followed inevitably, as I have said, by the closure of the naval base. That would leave our defences for the northern Atlantic and the North Sea in ruins. It is Her Majesty's Government's duty to see that that does not happen.
§ 7.8 p.m.
§ Lord Milverton
My Lords, we are all very grateful to my noble friend Lord Campbell of Alloway for bringing up this matter and also for the excellent maiden speech given by the noble Lord, Lord Cooke. The reason I am saying a few words is that I have a Scottish son-in-law who lives at Helensburgh. He and his family have lived there for very many years. They have told me many things about Rosyth and the naval facilities in Scotland. It is for that reason that I am speaking tonight.
I emphasise one or two points which have already been made. First, strategically for this nation of Great Britain it is vital to have submarines based at Rosyth as they are now—not just for purely sentimental reasons (shall we say?) but because they have been there for so many years that they have become established and have a very important place, not only militarily but socially too in those areas.
It would be sensible to have one place catering for submarines and another place catering for the surface vessels because each needs its own expertise and skills. Therefore, it seems extraordinary to me that it should be thought that the skills, expertise and facilities at Rosyth and in other parts of Scotland could possibly be dispensed with or run down. When those facilities are already in place, we should build on them and increase their effectiveness and their excellence rather than saying, "We'll go somewhere else".
Babcock Thorn have, apparently, quoted a fair price in competition at Devonport. However, as has been said, it is absurd to leave Great Britain with only one yard with naval repair facilities. If we were to find ourselves at war, an enemy would naturally try to demolish that one yard. It is therefore sensible that we should have at least two such facilities, one for submarines and the other for the surface fleet.
What are we saying to those Scottish people who have given their skills, expertise, knowledge and work not only for Scotland, but also for the rest of Britain —for England, Wales and Ulster? It is no good saying to people, "We shall compensate you and find you something else". We should be leaving ourselves in a most vulnerable position if we had only one such yard whether at Devonport or Rosyth. We need at least two yards. Would we not, in a way, be committing possible suicide if having just one yard were not only to be contemplated, but actually brought about? Finance and the Treasury have already been mentioned. But should the Treasury be allowed to have such a heavy hand in these matters? The dual option seems sensible. It would be fair both to the people of Scotland as well as to those of England.
In political terms also, Her Majesty's Government would be showing how much they care for the people of Scotland if they were to save Rosyth. Yes, my Lords, we in England have had a hammering; but as has been said, and as I believe, the people of Scotland have had a very heavy hammering in recent years when compared to anywhere else in England and Wales. But what are Her Majesty's Government saying to the people of Scotland at this time? How much is their anxiety for the people of Scotland being shown? This is very relevant to a decision on this issue, 67 especially for the people of Rosyth and Fife and for those near Helensburgh where there is the other submarine base. As my son-in-law and others have said, speaking purely politically, if the Conservative Party wants to have any representation in Scotland, and if the Conservative Government want to give real support to Conservatives in Scotland, they are not going about it in the right way if they allow Rosyth to be run down.
I appeal to Her Majesty's Government to think very carefully before they make their decision, and to have regard to what has been said by people who have real and great knowledge of this matter. As someone who has naturally become even more interested in Scotland recently as a result of gaining a Scottish son-in-law, I appeal to Her Majesty's Government. They must realise and hear the deep concern not only of Labour supporters and Scottish Nationalists, but of Conservatives in Scotland on this matter. I advise them to listen and not to rush into something that they will regret. I say: please think of the people of Scotland, of Rosyth, Fife and of Helensburgh with its other submarine base.
§ 7.15 p.m.
§ Lord Thomson of Monifieth
My Lords, the House owes a debt of gratitude to the noble Lord, Lord Campbell of Alloway, for initiating what has turned out to be an impressive debate with a number of authoritative speeches which, I confess immediately, I cannot hope to match. I listened with particular interest to the moving speech made by the noble Lord, Lord Ewing of Kirkford, who combined a deep feeling on these issues—indeed, a family feeling—with characteristic fairmindedness in putting the case for Rosyth.
Like other noble Lords, I pay tribute to the remarkable maiden speech of the noble Lord, Lord Cooke of Islandreagh, who apologised to the House disarmingly, saying that he did not feel that he should be making his maiden speech on this occasion because he did not have a direct interest in the issues. However, he had something a great deal better than that—he was totally disinterested. He is a disinterested expert on these issues. Perhaps I may advise the noble Lord (whom we hope to hear speak on many occasions on other subjects) that it is not given to many maiden speakers to make the kind of impact that I suspect that he made on the Government Bench, and to have the kind of influence that I hope that he will have on the Government's thinking.
One cannot say with equal certainty that the noble Viscount, Lord Weir, spoke as a disinterested witness. However, the noble Baroness, Lady Carnegy of Lour, was right in saying that he gave a very necessary balance to the debate. He was entitled to speak as he did. He underlined the dilemma—the real difficulty of choice—that we should recognise that the Government face between Rosyth and Devonport in terms of the pressures on the defence budget. I thought that the remarks of the noble Viscount, Lord Weir, came with all the more force since the solitary 68 case for Devonport came from a Scottish industrialist who happened to know about and to be involved in the Devonport operation.
As a Scottish parliamentarian, I cannot make any claim to be free from bias in this matter. I am no expert, but I have listened extremely carefully to all the speeches that have been made and have greatly improved my education on these issues by so doing. It seems to me that a powerful case has been made for the dual option, with submarine refitting being retained at Rosyth, and a surface shipyard for naval building being kept at Devonport. We are all conscious that —for both Rosyth and Devonport—there are acute human problems in terms of the suffering caused by unemployment and redundancy, as well as in terms of the dispersal of skills. One of the strong arguments for the dual option is the human one.
On defence matters, apart from cost, strategic considerations are of overriding importance, as a number of noble Lords have said. An additional powerful argument in favour of the dual option is the danger of concentrating naval resources in one crowded corner of the south coast. As the noble Lord, Lord Ironside, said, it is important for strategic reasons to seek to spread the risks and skills as far as possible.
I shall say a word about the politics of the matter. High politics are involved. I hope that they are not regarded as petty electoral politics either in Scotland or in the South West of England. The noble Lord, Lord Mackay of Ardbrecknish, was right to remind his Front Bench of the string of commitments made in the mid-1980s which will come home to roost if the Government make an adverse decision. The real political issue is more important than electoral considerations in the North or the South. As the noble Lady, Lady Saltoun of Abernethy, said, it is the continued cohesion of the United Kingdom itself. A decision that went wholly against Rosyth would have a damaging effect on the unity of the United Kingdom. It would have grave political consequences which would go beyond purely party political considerations.
I wish to echo what was said by a number of noble Lords, and especially by the noble Baroness, Lady Carnegy of Lour. There has been a report that the Government will set up an inquiry into the matter under the auspices of Coopers & Lybrand. It is vital for everyone involved, not least the Government, that if that is so it should not be a cosmetic operation. All the facts should be brought out in the most open and transparent way so that when the final difficult decision is taken the public will recognise that the Government have been frank.
§ 7.22 p.m.
§ Lord Carmichael of Kelvingrove
My Lords, this, like many debates in your Lordships' House, has been an interesting debate. I too thank the noble Lord, Lord Campbell of Alloway, for having raised the matter. We do not have many Scots to take part in debates, but it is interesting to note the surprising number taking part on the other side of the House. We 69 all listened to the maiden speech of the noble Lord, Lord Cooke, with great interest. I did especially because he served his apprenticeship in Belfast and Glasgow. There is nowhere better suited to rub the rough edges off someone than those two places. He had a modesty and due to his experience he knew, perhaps more than others, what he was talking about. He promised to speak on other subjects about which he knows more, and we shall listen to him with great interest.
The noble Lord, Lord Thomson of Monifieth, remarked that the only person who spoke in favour of Devonport alone was the noble Viscount, Lord Weir. He made an important speech. Everyone else spoke in favour of the dual option. The noble Viscount obviously knows a great deal more than most of us because of his privileged position.
Another of our grumbles at the Government is that we have not been given all the figures. I have been through most of the figures and checked them. They have been repeated today, but we have little information of the kind that the noble Viscount had. We cannot blame the Scottish press and suggest that something is being withheld. There are always some mavericks in the press who will bring out all points of view. The Government must answer the points made by the noble Viscount.
The last debate on Rosyth in which I took part was on 13th May 1991. It was a short debate which started at 10.20 p.m. and lasted a little over an hour. Nine noble Lords took part. We were then discussing Rosyth as a naval base. The noble Lord, Lord Mayhew, who keeps himself well informed on defence, in particular on naval matters, made clear what we were debating. He said:We are discussing the naval base and not the dockyard. I shall be very surprised to hear that there are plans to abandon the dockyard, with its vital, huge and expensive facilities for refitting Tridents".—(Official Report, 13/5/91; col. 1464.)That was less than two years ago.
We are having the debate tonight because less than two years after that debate and after many more millions of pounds of public money have been spent, there is great unease that the Government are going to close the dockyard in favour of Devonport, with perhaps the offer of a few palliatives, as has been said, to keep the natives in Scotland, especially Fife, quiet. Will the Minister confirm that the Government still stand by the Chancellor when he said—this was mentioned by the noble Lord, Lord Mackay—that the Government would complete the building of the massive facilities required to support the Trident submarines which would be refitted at Rosyth. When did the Government change their mind and decide to obtain tenders for the facilities at Devonport? Did they commission Coopers & Lybrand to do the study and then decide, or did they decide with public opinion then forcing them to have the study done? Which came first? That answer will be interesting.
The Devonport bid is said to be for £130 million which would undercut the Babcock Thorn price. That is the figure that I have and I have checked it. The bid of £130 million made by Devonport is challenged by common sense and accountancy experts. The 70 Devonport bid does not include the emergency docking facilities which will be essential and will cost about £25 million. I understand that running costs at Rosyth will be about £20 million. Again I have no other figures, and no one has given us any this evening. Running costs at Rosyth will be far cheaper because it could take up its role as sole submarine base a year earlier than Devonport. That would save about £50 million. Surely running costs must form part of the long-term tender price.
Those additional costs would put the Devonport bid way beyond that of the Babcock Thorn consortium. However, there are also other costs. The noble Baroness, Lady Carnegy, and the noble Lady, Lady Saltoun, mentioned the Nuclear Installations Inspectorate. I understand that the inspectorate has been satisfied with the standards at Rosyth. It would be extremely costly, if it were possible at all, to bring Devonport up to the required standard which would involve—and I use the words of the noble Viscount, Lord Weir—the use of a patched up system.
According to the Scotsman on 26th January of this year, a spokesman for the Ministry of Defence said that no approach would be made to the Nuclear Installations Inspectorate until the dockyard had been selected. It seems to me to be crazy that the inspectorate, with all its expertise and knowledge, is not asked to come along to say whether or not something is feasible and to give some sort of estimate of cost, when apparently it does have some understanding of the costs involved at Rosyth.
Is it any wonder that in Scotland we seem to be showing signs of paranoia as regards this matter? It cannot be paranoia because paranoia is a fear of the unknown. However, we are getting information which makes us fear that the Government have already made up their mind. Perhaps the Minister will tell us whether or not that is true. The Nationalist Party in Scotland has said that it is pork barrel politics for the sake of the South West of England. The Government will win no seats in Fife, but they may hold on to a few seats in the South West of England if the base is sited there. I hope that the Government will not bear that in mind at all.
I hope that the Minister can help the many noble Lords who have spoken this evening, most of whom were from his own party. Many responsible experts believe that there is not only room for both Rosyth and Devonport to continue as originally conceived but that that is the best, most economic and sensible solution. Rosyth should be the base to deal with submarines and Devonport should deal with surface vessels. It may be possible to do that under one management or under a joint management of some kind, although, again, the noble Viscount, Lord Weir, may disagree with me about that.
Surely all the facts must now be available to enable us to make a decision. When he replies I hope that the Minister will correct some of the factual mistakes that either we or the noble Viscount, Lord Weir, have made, because that is extremely important.
I should like to make a statement that the noble Lord, Lord Mackay of Ardbrecknish, will appreciate, and it is a matter to which he referred. I was never 71 enthusiastic about the nuclear deterrent, even when my own party supported it. Your Lordships may remember that when the Russian Kosygin came to Scotland he was met in Glasgow by banners which said, "Welcome to your No. 1 Target", which was the west of Scotland. I lost out in those arguments so we have the Faslane base. Surely it would be adding insult to injury if we were to leave central Scotland with all its nuclear bases with their inherent dangers, while, at the same time, leaving Rosyth as a dead place. The big hole which has already been made would be used for scrap from Polaris submarines. The steel would be sold off and the units would be left encased in concrete as a menace in Scotland for many years ahead. The jobs, training and opportunities which Rosyth offer are, even at the lowest level, the least price that the Government should be prepared to pay for giving Scotland such a large concentration of nuclear weapons and fuel as it has at present.
§ 7.35 p.m.
The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne)
My Lords, before I address the anxieties which have been expressed during the course of this extraordinary interesting and—from the Government's point of view —valuable debate, perhaps I may join with other noble Lords in congratulating the noble Lord, Lord Cooke of Islandreagh. During my brief sojourn in your Lordships' House I have learnt that there are gathered under this roof an ever-increasing collection of experts on abstruse and not so abstruse subjects. Your Lordships have been treated to yet another example of that and I should like to say to the noble Lord that I listened to him with admiration for his knowledge and the conciseness with which he delivered his speech. I too hope that we shall be privileged to listen to the noble Lord many times during the course of our coming debates.
Also, I thank my noble friend, Lord Campbell of Alloway. We all know what a sensitive and difficult subject nuclear refitting is for all the reasons which your Lordships have so eloquently described this evening.
I should like to take issue with the noble Lord, Lord Carmichael of Kelvingrove, who accused the Government of harbouring rather low-down motives. He said that the Government were merely interested in keeping the natives quiet. I have been married extremely happily for 23 years to a Scottish wife. I have never even presumed to suppose that I could keep that particular native quiet. I would never presume to suppose, from my lengthy if foreign experience of the Scottish nation, that it is possible to keep them quiet, let alone by Her Majesty's Government in your Lordships' House. That is an unworthy slur on the capacities of his own people which I reject on their behalf.
We know of the depth of feeling which has prompted your Lordships to express yourselves so forcefully this afternoon and this evening. The anxieties expressed are well known to Her Majesty's Government in general and to the Ministry of Defence 72 in particular. I and my colleagues in the Government are deeply conscious of the great importance of the Royal Dockyards at Devonport and Rosyth to the economies of their respective areas. Many noble Lords have pointed out that they each employ several thousand people, that they sustain employment for thousands more in companies and other enterprises across their respective regions. The companies both at Devonport and Rosyth are among the largest trainers of apprentices in their areas. The noble Lady, Lady Saltoun of Abernethy, referred to that, as did other noble Lords. Therefore, we recognise fully the great significance for Fife and for Scotland of the issues raised today. We recognise them in particular when, with his usual eloquence which I well remember from another place, the noble Lord, Lord Ewing of Kirk ford, not only gave us the benefit of his knowledge of his native heath but also of the strong family interests which he has in the dockyard of Rosyth.
As an inhabitant of the west country I feel that I must try to be as fair as possible—my noble friend, Lady Carnegy of Lour adjured me to do just that—and as my noble friend Lord Weir made clear, Devonport is at least as important to the south west as Rosyth is to Scotland. We have to bear in mind that what we are talking about here is a decision, like all difficult decisions, to which there is no golden or happy solution which suits all parties. The workforces in particular at both dockyards have given long and devoted service to the Crown over many years, and latterly to the companies concerned with their management. I wish in particular to pay tribute to the way in which those workforces reacted positively and enthusiastically to the requirement to complete warship refits ahead of time and to convert the vessels of the Royal Fleet Auxiliary to war-time use in preparation for Operation GRANBY. The whole country has good reason to be grateful to all those who work at both Royal dockyards for their skill and dedication.
I shall try to deal with the detailed points that have been raised as swiftly and as concisely as I can. It might be helpful if I try to set out some of the background to the present situation. I hope that will enable your Lordships to set in context some of the more, (dare I say it?) rhetorical speculation to which the newspapers and others have treated us in recent weeks. I suggest to your Lordships that the issues we have to resolve are twofold. They are: where to invest in the expensive facilities which we shall need for refitting Trident and other nuclear-powered submarines by the turn of the century, and how to secure best value for money in the refitting programme as a whole in the long term. My noble friend Lord Mackay of Ardbrecknish conjured me—that is possibly the best way I can put it—to have at least some regard to the political issues involved. However, I must stress to your Lordships and to the noble Earl, Lord Perth, my noble friends Lord Campbell of Alloway and Lord Ironside in particular that a failure to achieve best value for money in support activities such as refitting must, contrary to what a number of your Lordships have suggested—I say this with due diffidence— 73 inevitably increase the pressure on the resources that can be found for the front line. The inevitable result of that would be that further reductions in the front line would ensue and an exacerbated imbalance between the front line and the support area would also ensue.
We have to realise that the balance between support and the front line is crucial. The purpose of defence spending is, as my noble friend Lord Campbell of Alloway reminded us in his opening remarks, the defence of the realm. That is an objective which both he and I hold as top of our priorities. It is true that with a smaller navy we have to make sure that the support which is necessary to ensure that smaller navy remains effective, afloat and in fighting trim is commensurate to the size and capabilities of that navy. Merely to keep excess capacity in the support area for the sake of uneconomic but necessary social considerations would, I suggest, not be a right use for the defence budget, although clearly other government departments have other objectives on which they might wish to spend the taxpayers' money.
Your Lordships will know that at present nuclear-powered submarines are refitted, refuelled and decommissioned at both Devonport and Rosyth. I must tell my noble friend Lord Milverton that both yards have an excellent record in technical and safety terms in this work. As your Lordships will be aware, the reductions in the armed forces announced in July 1990 mean that there will in future be significantly fewer nuclear-powered submarines in the fleet than we had at one time planned. This reduction, from over 20 to 16, has opened up the possibility that all refitting work could be carried out at one site. I know a number of your Lordships have made great play of the issue of two sites. I shall mention that in a moment.
A comprehensive study by the Ministry of Defence which drew on a wide range of skill and knowledge in nuclear and construction matters, including the companies who manage the yards on the Government's behalf, has shown that it would be feasible, safe and very cost effective to concentrate nuclear work at either Devonport or Rosyth as opposed to continuing with previous plans to maintain two nuclear refitting yards. I emphasise the word "nuclear" because I noticed, perhaps wrongly, during the course of the debate that there was some confusion about how what has come to be known as the dual option is defined. I felt some of your Lordships regarded it as important that there should be two nuclear refitting yards. Other noble Lords—perhaps, if I understood him right, the noble Lord, Lord Thomson of Monifieth, was one of them—suggested that the dual option should encompass one nuclear refitting yard and one surface fleet refitting yard. I rather suspect the noble Lord, Lord Carmichael, would count himself among the number expressing that view. I would not discount that possibility. My noble friend Lord Selkirk was one of those who felt it was important to have two nuclear refitting yards. I am sorry to have to disagree with so many of my noble friends, but we can see no overwhelming strategic reason to keep two nuclear dockyards and we have therefore concluded that we should in future concentrate nuclear work at one site.
§ Lord Campbell of Alloway
My Lords, I speak simply to clarify the issue. I opened the debate on the clear basis that nuclear submarine refitting should take place at Rosyth and that surface ship refitting should take place at Devonport. I never argued the other type of dual option.
My Lords, I am extremely grateful to my noble friend for his remarks. I hope he was not implying that he was one of those with whom I necessarily disagree. We are therefore faced with two choices, the answers to which are, I know, eagerly awaited in both parts of the country; namely, where the nuclear work should be placed, and what should happen to the other, non-nuclear yard. We recognise that the continuing uncertainty about these issues is worrying to all concerned. That uncertainty is current throughout all Ministry of Defence establishments during the course of the draw-down. Defence Ministers are anxious to reduce that uncertainty. However, I am sure your Lordships will agree with me that for this decision above all others it is vital —I look at my noble friend Lord Selkirk and my noble friend Lady Carnegy of Lour in particular when saying this —that we should get the answers right and that they should be perceived by the public, and of course by your Lordships to be right.
While we are convinced that concentrating nuclear refit work at one site is the most cost effective course, unlike my noble friend Lord Oxfuird—if I understood him right—we do not accept that bringing all nuclear work into one of the Royal dockyards need necessarily prejudice the long-term future of the other dockyard, or its ability to compete for the rest of the ship refitting programme, and indeed to compete with great vigour or even to diversify further. I am heartened in that belief by the successful efforts which both dockyard companies have already made to widen the range of customers they serve and the range of the work that they do.
I shall address myself as rapidly as I can to a few other points which ran like a thread through many of the speeches. I shall first consider the question of safety. Many noble Lords referred to this including the noble Lord, Lord Ewing, my noble friend Lord Sanderson and the noble Lady, Lady Saltoun of Abernethy, in particular. They are right to say that the Nuclear Installations Inspectorate does not give certificates in advance. However, we are confident that, as my noble friend Lord Weir said, the NII will give us the certificate that is necessary whichever way the nuclear refitting decision goes. Indeed, the Ministry of Defence has already held some preliminary discussions to make sure that that confidence is not misplaced.
It is also important that we should understand the whole question of the handling of what has come to be known as the Babcock Thorn Limited upgrade proposal. The noble Lord, Lord Ewing of Kirkford, the noble Lord, Lord Cooke, and my noble friends Lord Sanderson and Lord Weir, and many other noble Lords mentioned that point in passing. I should make it clear that the Ministry of Defence has a very clear indication that the new docks proposal has 75 always been BTL's preferred proposal. That is a preference to which the Ministry of Defence correctly attaches weight.
BTL has previously produced studies on the possibilities of upgrading a pair of docks at Rosyth. In November 1991 the company presented an analysis of upgrading Nos. 2 and 3 docks at Rosyth making clear its doubts about the viability of that approach. In March 1992 it again presented an analysis of a proposal to upgrade Nos. 2 and 3 docks. This time it included an upgrade of No. 1 dock as an interim measure to ensure that the refit programme could be sustained during the construction period.
Not least because of Babcock Thorn Limited's own continued strong preference for RD 57 as a method of meeting the ministry's requirements, ministry officials indicated that the Ministry of Defence did not require further work to be done on upgrade proposals. The fact that BTL carried out further work at its own expense is entirely a matter for the company. BTL's offer in late November last year, of which I was personally made aware by my noble friend Lord Trefgarne at a private meeting—I am very pleased to see him in his place this evening—was entirely unsolicited. We were already aware of the broad outlines of such a proposal. I assure your Lordships that it is receiving careful scrutiny against exactly the same criteria used to assess the other proposals put to us. I also assure your Lordships that no decision has yet been taken on the way ahead.
I understood the noble Lord, Lord Carmichael, to suggest that the Devonport bid does not include an emergency dock. I am informed, and I believe it to be true, that it does include an emergency dock. I am sure that the noble Lord will find that information useful.
The noble Lord, Lord Carmichael, also suggested that considerable one-off savings in the BTL proposals would flow from Rosyth's ability to take on all nuclear work earlier than could Devonport. A figure of £50 million in a year has been quoted in connection with those supposed savings. It is possible that Rosyth might, on the basis of our current refit programme, be able to take on all nuclear work sooner than could Devonport. However, the period in question is determined by the programme of nuclear work which the ministry would be placing at the non-nuclear yard and the amount of nuclear work committed to that yard at the time that any decisions were made to place all nuclear work at the other yard. Should Rosyth be able to become the sole nuclear yard earlier than Devonport, that would indeed lead to some savings. That is common ground between the noble Lord and myself. Those savings, of course, would be taken fully into account as part of any evaluation of the options for future nuclear refitting. I can assure the noble Lord that during the course of our evaluations the point that he made has certainly been well taken and will be taken into account.
I am very conscious of the time I have taken in attempting to answer your Lordships during the course of the debate. I am also conscious that time probably dictates that I shall not be able to answer as fully as I should have liked. However, if your 76 Lordships will allow me I should like to refer to the question of the cost of RD 57. Many noble Lords—my noble friend Lord Campbell, the noble Lord, Lord Ewing, and the noble Lady, Lady Saltoun, in particular—referred to the matter and said that in their view the money spent on RD 57 is considerable (indeed, it is) and that it would be a shame to let it go to waste. It may seem curious to say so, but the sums already spent on RD 57 do not affect the decision we have to take as to where to invest in nuclear facilities. That decision has to be based on what is the most cost-effective means of meeting requirements in terms of our future expenditure.
I was extremely interested and pleased to hear noble Lords, and in particular, the noble Lord, Lord Cooke, refer to the importance of through-life costs. The noble Lord will be as aware as I am that through-life costs, calculated on a discounted cash flow basis, are on the whole the most useful tool in making a purely arithmetical investment calculation of the kind that must be made in both the private and public sectors. However, we also know that there is a conflict inherent in all government plans between through-life cost and the demands of annuality. If we regard through-life cost as virtue, annuality is a very hard taskmaster, particularly when the Government are facing a substantial PSBR requirement.
If your Lordships will allow me I should also like to say to my noble friends Lord Mackay and Lady Carnegy that the original 1985 decision to build facilities at Rosyth was taken in the context of a projected number of nuclear-powered submarines of more than 20 as opposed to the present projected figure of 16. We are extremely well aware of the political knowledge which both my noble friends have on my and their party's prospects, electoral and otherwise, in the nation of Scotland. However, I would say to them that circumstances have changed radically. I am sure that my right honourable friend the Secretary of State for Defence and my right honourable friend the Prime Minister will bear in mind fully the political imperatives they describe when the time comes to make what is a difficult decision. We have to conduct a fundamental examination into the most cost-effective means of refitting the nuclear fleet.
This has been a long debate, but the subject richly merits it. I conclude by saying once again that the Government are fully aware of the importance of the future of the Rosyth Dockyard to the people and economy of Fife and to the people and economy of Scotland as a whole. The impact on the local economy is certainly one factor among the many we shall consider as we seek to balance the needs of the Royal Navy and the taxpayer against the needs of South West England and Eastern Scotland and against the more general needs of the defence of the United Kingdom and the cost-effective use of public funds.
Once we have proposals to make we shall certainly announce them. We shall then be able to discuss their wider ramifications with all the interested parties. Certainly, I must say to my noble friend Lady Carnegy that Parliament will provide its own opportunities, or I do not know Parliament as I think I do. It is not for me to judge what those opportunities will be, but I 77 would be astonished if, after the decision has been taken, your Lordships did not hold me to account at this Dispatch Box. I know that my other ministerial colleagues will he held to account in another place. That process will be immensely important in ensuring that we reach the right conclusions in the end, as will today's debate. It is for that reason that I am grateful to your Lordships and to my noble friend Lord Campbell in particular for today's opportunity to discuss some of the issues.
The discussion will certainly help Ministers make the decisions—I do not say that purely in a spirit of egregious flattery of your Lordships—after taking the advice of consultants and of your Lordships. However, I say this to my noble friend Lady Carnegy. In the end it is Ministers who will take the decisions and who will have to stand up in your Lordships' House and in another place to defend them. It is the assurance that we shall be examined in Parliament for our decisions perhaps more than anything else which enables me to be certain that when I assure my noble friends Lady Carnegy and Lord Oxfuird, and the noble Lord, Lord Thomson, that we shall consider the issue fairly and in as unbiased a manner as we can, it will give your Lordships the greatest comfort.
Finally, I assure the noble Lord, Lord Carmichael, that the Government have still to make up their mind. If I were a betting man—which of course I am—I would say to your Lordships that it is too close to call.
§ The Earl of Perth
My Lords, before the noble Viscount sits down will he assist on one point? It is on the real danger that arises from having all the surface fleet work and submarine work in one place. I do not believe that he touched on that issue.
My Lords, I apologise to the noble Earl if I did not do so. I thought that I had briefly touched on the issue although constraints of time perhaps prevented me from doing so at appropriate length. I tried to draw a distinction between nuclear refitting at two bases as opposed to nuclear refitting at one base and surface refitting at another. I tried as best I could to explain to your Lordships that in the Government's opinion the case for nuclear submarine refitting at one port only in view of the smaller number of nuclear submarines for which we now plan, is difficult to upset. I certainly accept that there may well be a case for dual "porting" (if that is the right word) with the surface fleet being refitted principally at one port as opposed to the nuclear fleet of submarines which would be refitted at another. I hope that that gives some indication to the noble Earl of what I meant to say.