Upholder Class Submarines (Hansard, 6 April 1998)

§ Lord Gilbert

The Government of Canada have today announced their intention, subject to final negotiations, to lease all four of the Upholder class submarines for a period of eight years. Canada has chosen to acquire the submarines via a lease with an option to purchase, as this is the most satisfactory solution for them.

During the period of the lease, the submarines will still be owned by the UK, but Canada will have full and unrestricted use and control of them and will indemnify the UK from any claims that may arise from Canadian operations. At the end of the lease period, the Canadian Government will have the option of purchasing the submarines outright. If Canada does not take up this option, Canada will dispose of the submarines on our behalf.

This arrangement is worth some $610 million (Canadian) to the UK. Various UK companies will be involved in reactivating the submarines and GEC Marine at Barrow will be providing technical and logistic support, including the provision of training.

This decision by the Canadian Government represents the most practical and cost-effective manner of securing the future of the submarines and is a strong indication of the continuing close relationship between the UK and Canada in defence matters. The links between our armed forces are traditionally strong, both bilaterally and within NATO. Her Majesty's Government hope that this deal will lead to further co-operation between the two navies and that it will enhance Canada's contribution to NATO.