§ Sir C. Osborneasked the Secretary of State for Defence if he will investigate why the British tender for four American harbour tugs worth $2 million involved 2½ times as many man hours as the American bid, in view of the need to ensure the success of Her Majesty's Government's policy of selling British equipment to offset partially the $2½ billion purchases of the Phantom and F111 aircraft; and if he will make a statement.
§ Mr. HealeyI have carried out a searching inquiry into the reasons why the British firm failed to secure this particular order. The additional man-hours estimated to be required were not the only factor. The facts of geography alone had a significant effect. The successful United States bidder had won earlier orders for the same class of harbour tug. So had the other United States firm which bid for this contract. Both were therefore at an advantage over352W any British firm. The design lends itself to batch production, so the United States builders had a further benefit from this earlier experience. Also, unfamiliarity with the stringent United States contract conditions and requirements tended to increase the estimate of man-hours allowed for the work as compared with what a firm more experienced in building for the United States Navy would have included.