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Plymouth Dockyard

Volume 210: debated on Thursday 25 June 1992

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Motion made, and Question proposed, That this House do now adjourn.— [Mr. Boswell.]

10 pm

Later this year, our Government will decide which of the naval dockyards —Rosyth in Scotland or Devonport in England—will carry out refitting and refuelling work on the Trident submarine. I have two reasons for requesting this Adjournment debate. First, I wish to explain how important Devonport dockyard is to the economy of Plymouth and the surrounding regions and what will be the consequences if Devonport Management Ltd. is not awarded either all or the substantial part of the nuclear refit work. Secondly, I wish to speak in favour of the DML bid, which I believe is the right choice for the Ministry of Defence in terms of value for money and other strategic considerations.

As the matter is so important to Plymouth, I have agreed that the hon. Member for Plymouth, Devonport (Mr. Jamieson), who is equally interested in the matter, should also take part in the debate. My hon. Friend the Member for Cornwall, South-East (Mr. Hicks) has requested that he should be associated with my remarks. He is well known, Madam Deputy Speaker, as you are, as a champion of many years standing of Devonport dockyard.

I turn first to the importance to Devon and Cornwall of DML winning the nuclear refit work. It must be understood that, for many years, Plymouth has been dependent on the dockyard for a significant proportion of its male employment. That is less so than it used to be, but the dockyard still employs 5,500 people from the Plymouth travel-to-work area. It is by far the largest private employer in the region.

Since 1985, when private management of the yard was introduced, it has reduced its work force from 13,500 to 5,500—a 60 per cent. reduction of mainly male jobs. How many other towns or cities in Britain have suffered a similar fate? It is partly for that reason that, as at April 1992, Plymouth had an unemployment rate of 14.2 per cent.—well above the national average.

Even though our dependency on the dockyard is less strong today than it has been for many years, its viability is of massive significance to the economy of Plymouth and the south-west. Many hon. Members believe that Plymouth is an attractive and prosperous city. It is attractive, but Plymouth has many needs, and the need for jobs is one of them.

The significance of the dockyard is increased by the collocation of the naval base as part of the Devonport complex. The continued existence of both Devonport and the naval base is of massive importance to the defence of this nation. It is certainly of substantial importance to our local economy.

It may help my hon. Friend the Minister in replying if I set out some relevant information. The Devonport complex and other military bases in Plymouth generate £521 million of income per annum for Devon and Cornwall. That is a massive sum. The defence complex, directly or indirectly, supports 29,900 jobs, of which almost 7,000 are generated by the expenditure of wages of defence workers and by purchases from local firms. More than 600 local firms receive orders from the dockyard, and some £38 million is spent directly on contracts with those firms. Approximately 30 per cent. of all local income in the Plymouth area is generated directly or indirectly by the dockyard and naval base, and other military installations. About 20 per cent. of the local work force have jobs which are directly or indirectly associated with the Devonport complex. Those figures clearly show that the continued existence of the dockyard and naval base are critical to the economy of Devon and Cornwall.

Let us consider for a moment the economic consequences for the region if the refit work is not forthcoming. There is every possibility that the dockyard would gradually die without that work. Certainly, many people connected to the yard firmly believe that the yard would close without the nuclear refit work. That would devastate the economy of Plymouth and simply cannot be allowed to happen.

There are those who believe that, if the dockyard were to close, the Navy would gradually leave Plymouth. That is what I call the domino theory. It would mean a further loss of jobs and would be a further body blow to our region from which we would find it hard to recover. I should be glad if my hon. Friend the Minister of State could say something about the second prospect—the commitment of the Navy to Plymouth in the long term —by way of reassurance to my constituents.

May I take this opportunity to kill off, once and for all, the feeling in some quarters that Plymouth is in some way anti-nuclear? It is not. The council, the community, the work force and the trade unions are all committed to carrying out the nuclear refit work in Plymouth. Of course, we are concerned about safety—only a fool would not be —but we are impressed and satisfied by the stringent safety standards introduced by the Ministry of Defence. Please, let the House be in no doubt that we want this work.

I should not like the House to think that we are asking for handouts that we do not deserve. Plymouth has coped remarkably well with the reduction of jobs in the dockyard since 1985. We have sought to diversify our local economy. There have been massive changes within the management of the dockyard to improve greatly value for money on behalf of taxpayers. Since DML took over the dockyard, there have been substantial commercial successes and many financial savings. About £100 million worth of commercial work has been brought in by DML, constituting about 20 per cent. of its work load. A recent National Audit Office report has made it clear that more than £110 million has been saved by DML in the past four years. Those savings increase year by year.

Recently, an independent study was made into the case for awarding the nuclear refit work to Devonport, and into the ongoing maintenance of the naval base and royal dockyard there. That study concluded that the collocation of the naval base and dockyard facilities provides economies on a scale at least equivalent to any potential net savings provided by closure. That study clearly showed that Devonport is geographically best placed in the United Kingdom for access to deep water and rapid response. It showed that closure of the Devonport complex would throw away recent investment, much of which would have to be re-created elsewhere. Most importantly, the study showed that Devonport could refit the nuclear-powered submarines, including Trident, much more cheaply than any other alternative.

The DML proposals provide for low-cost modernisation of existing facilities, strengthen nuclear safety and will allow all the planned submarine load to be accommodated at a single site, thus reducing fixed costs to the taxpayer. Given the Treasury's determination to curb public expenditure—a view that I wholeheartedly endorse and applaud—that is surely an advantage.

For all those reasons, the DML bid is supreme. Will the Minister also consider carefully whether now is a wise time to place all our nuclear submarine support facilities in Scotland, with the growing demand for independence or devolution in that country, which has no doubt received a recent boost by the strides towards nationhood of many of the central European peoples?

This issue will come to a head in the next few weeks. It is the subject of intense lobbying. The needs of our national defence, the prospects for employment and the future of communities are at stake. Inevitably passions have been heightened on this subject. In those circumstances, we all have a particular duty to ensure that emotion does not cloud reason and logic. No one has a birthright to the amount of work that any decision on the refitting contracts might provide. The decision as to who undertakes that work must be made on the basis of an open and fair competitive contest.

Devonport dockyard and the local community are confident that a decision taken on those grounds will give them victory, because DML can provide quality services at a reasonable cost with the flexibility that is required.

I invite my hon. Friend the Minister to mention the fact that he has been invited by me to come to Plymouth to visit DML, to speak with council leaders and to see for himself —I have no doubt that he will be impressed by it—our commitment to win the work and to do it well.

The decision is critical for Plymouth. I am fully persuaded that the DML bid is right for the MOD, the taxpayer and my constituents. I commend the Devonport case to my hon. Friend.

10.10 pm

I am grateful to the hon. Member for Plymouth, Sutton (Mr. Streeter) for allowing me to participate in his Adjournment debate. I am particularly pleased to note that you are in the Chair, Madam Deputy Speaker, because that means that the three Members for Plymouth, who have a particular interest in this matter, are here tonight. However, I am absolutely certain that you will show your customary impeccable impartiality on this matter as on others.

I am pleased to note that this issue is a matter of two-party accord. We are agreed on a matter of vital importance to Devonport, and we are speaking with one voice.

I shall not give way on this occasion.

The dockyard is the largest naval support facility in western Europe. It is home to the royal dockyard, the naval base, the barracks and all the support services. I hesitate to refer to history in your presence, Madam Deputy Speaker, as I am well aware of your considerable knowledge, but work started on constructing the dockyard more than 300 years ago in. 1691, under the orders of King William. He appreciated that Plymouth, with its deep-water port and as the entrance to the western approaches, was vital to the protection of the country.

This century, the need for the dockyard has been called into question on occasion. Each time, however, a crisis has arisen and the dockyard has proved its worth, especially during the two world wars. At the time of the Falklands war, had it not been for the work force working 24 hours a day for weeks on end, the task force would never have set sail. The dockyard also played a vital role in the Gulf war.

The dockyard still has a vital defence role. As the hon. Member for Sutton said, many jobs depend upon it, as does much of the local economy. Plymouth polytechnic has estimated that as many as 29,000 jobs in Plymouth and its travel-to-work area depend upon work in the dockyard.

I came to Plymouth in 1981 to become deputy head teacher of a medium-sized secondary school. Then, nearly one quarter of all the 16-year-olds applied to Devonport dockyard for traineeships in every imaginable skill, ranging from coppersmithing and bricklaying to commercial work and welding. Those skills did not simply remain in the dockyard but spilt out into Cornwall, Devon and the whole area, providing the expertise needed for much of private industry. Indeed, in every other house in every street in Devonport are people who learned their skills in Devonport dockyard.

I am sad to report that the number of youngsters taking such traineeships and the number of training places available have seriously declined. Because of the unusual geographical position of Plymouth, being a long way from other major cities, there are few alternative means of employment to youngsters.

The Goschen yard training school provided excellent training for many years in the city of Plymouth. I am sad to report that, when I visited the place recently, hundreds of thousands of pounds worth of equipment lay idle. It is little used now. I hope that the Ministry of Defence will look urgently at the possibility of leasing it to local education establishments, so that the facilities may be used again, in conjunction with DML, for training people locally.

The hon. Member for Sutton referred to unemployment, which in our constituencies, including yours, Madam Deputy Speaker, is very serious indeed in some places. Unemployment among males aged 20 to 35 is particularly high. In some parts of the city, 40 per cent. of males are unemployed. Apart from that being a serious state of affairs, we have seen from other parts of the country that eventually, if such high unemployment persists, social order can break down.

I confirm what the hon. Member for Sutton said about the city fully welcoming the contract for refitting nuclear submarines. We want the dockyard to continue giving the service, now and in years to come. The dockyard has adjusted over 300 years—from the sailing ships of King William in 1691—and can, and will, adjust to the technological changes that are required for the refitting of nuclear submarines, enabling it to continue to meet the needs of the Navy in the year 2000 and beyond.

As the hon. Member for Sutton said, the economic value of the dockyard was amply proved in the Audit Commission's recent report. The whole city will welcome the work, as will Cornwall, Devon and other areas of the region. It was felt a few years ago that we were less than enthusiastic in such matters, and there was some controversy about a nuclear dump at Weston Mill, which is near the dockyard. It was a controversial matter because the proposed site was on an old creek with unstable land. It was to have been very large and, in emotive terms, was a few hundred yards from a primary school and near houses.

Everybody now accepts that the case was poorly presented at the time. The plan has been withdrawn. The new plan put forward by DML and the Ministry of Defence to extend the storage of nuclear waste in the dockyard has now achieved widespread accord in the city. The consultation process, and the greater openness that has come with the Minister taking office, have been welcomed by the public, resulting in that much wider accord for the submission that has been made to the city council. I can confirm that the whole city is together in the matter. The city council, trade unions, the chamber of trade and commerce, the whole of the work force and hon. Members on a cross-party basis are in favour of the work moving to Devonport. I hope that the Minister will take up the invitation to visit Devonport dockyard and will visit the city council and talk to local people to confirm for himself that what I say is the case.

It is our earnest hope that the nuclear refitting work comes to Plymouth. We have the facilities, the skills, a committed work force and a site that is strategically well placed to do the work. The reasons why King William built the dockyard 300 years ago, for the strategic defence of the country, still prevail today.

10.19 pm

First, I thank my hon. Friend the Member for Plymouth, Sutton (Mr. Streeter) for his initiative in securing this Adjournment debate. It has been a pleasure to listen to it, because we have heard two excellent speeches, and it was refreshing to hear two-party co-operation in putting the case for constituents' interests. I found the advocacy of my hon. Friend and of the hon. Member for Plymouth, Devonport (Mr. Jamieson) persuasive on many points, although I must remain scrupulously discreet in many ways. I fully acknowledge the great importance of the dockyard to local employment, the local economy and the wider region of Devon and Cornwall, and I thank both hon. Members for putting their case so well.

I also welcome the fact that you, Madam Deputy Speaker, have been able, in the course of your august duties, to be present in the Chair tonight. Although I realise that you must remain impartial and silent, you have built up a formidable reputation over the years for your assiduity in your constituents' interests, and I know that you will listen to our proceedings with special attention

. This all-Plymouth event reflects the fact that this is a moment of great importance for the future of the dockyard and Plymouth. All hon. Members present will be aware that many of their constituents have given long and loyal service to the Crown at a facility that is not only one of the oldest but one of the largest naval dockyards in the world. It is good to be reminded that it stretches back to the days of the sailing ships of King William. Much more recently, however, Devonport's contribution to the defence of these islands has been incontestable. The Government have no intention of overlooking that when considering the future of the naval presence in the south-west.

Can the Minister be persuaded—less by the eloquence of hon. Members who represent Plymouth than by hard economic facts that all of us from that area can present to him—that the case for the Devonport dockyard is a case not just for Plymouth but for the wider region, which supplies one of the best work forces for any industrial complex in the British isles? It demonstrates only too well that this issue is not just emotive but economic.

I entirely accept that it is an economic issue. It has not been presented in purely emotive terms, but has been well presented by my hon. Friend the Member for Sutton and by the hon. Member for Devonport.

I shall make it clear at the outset that, when dealing with those arguments, I have some difficulty in responding in detail, because no proposals have yet come forward to Ministers on the vital question whether to concentrate all nuclear refitting work at a single location or in two locations, or on future arrangements for either dockyard. I hope that my hon. Friend and others will understand that, as those vital issues are now under consideration, any Minister is effectively in purdah and cannot say too much in response to the good points that have been raised.

However, as I understand the forcefulness of the case, may I respond to the gracious invitations that have been issued by my hon. Friend and the hon. Member for Devonport? Yes, my right hon. and learned Friend the Secretary of State and I intend to visit Devonport shortly, and I hope that a date can he arranged within the next four weeks. In case there are protests from Scottish Members who may be listening, I should add that I also intend to visit Rosyth shortly. But I look forward to visiting the excellent facilities that have been described tonight.

I think that it will be helpful if I set out the strategic and military context of the issues that we are discussing this evening. As my right hon. Friend the Member for Bridgwater (Mr. King), the former Secretary of State for Defence, made clear on 25 July 1990—and again, with specific reference to fleet support, on 17 July 1991—there has been a fundamental shift in the level of readiness, infrastructure and support that is now necessary to defend these islands and our interests overseas, and to fulfil our commitments to our allies.

Against that background, the Government would be shirking their responsibility to the taxpayer and the common interest if they failed to consider whether or not their overall investment in defence, and fleet support in particular, continued to provide value for money. I was glad that my hon. Friend the Member for Sutton placed emphasis in his speech, not only on value for money but on the need to contain public expenditure, which is a crucial Government responsibility. That is one of the reasons why we have instigated a thorough-going assessment of our current arrangements for fleet support.

My hon. Friend the Member for Sutton referred to the efforts made by Devonport Management Ltd., not only to improve value for money and refitting performance, but to diversify into other sectors in order to reduce overheads. I am happy to join him in applauding the progress made by DML over the past five years. Its performance—and, in fairness, that of its counterparts at Rosyth, Babcock Thorn—more than justified the Government's decision to introduce commercial management and a greater element of competition to the royal dockyards in 1987.

The benefits of commercialisation are clear, and were recognised by the National Audit Office in its recent report. Both dockyard management companies, having knowlingly taken on what was never going to be an easy ride, have made impressive progress towards greater efficiency and economy.

The hon. Member for Devonport fairly reminded us of the importance of the Falklands war and the fine performance of the Devonport dockyard in it. Before commercial management was introduced, it was feared that the sort of response from dockyard management and work force experienced at times of war and national crisis would not be as forthcoming from commercial managements. I am glad to lay that ghost to rest and agree with the comments of the hon. Member. The response and commitment received from both dockyards during the Falklands war and the Gulf crisis was extremely heartening, and I could give a number of fine examples.

In Devonport, DML converted the aviation training ship RFA Argus to its Gulf role as a primary casualty reception ship in just 20 days. DML also converted HMS Hecla, so that it could take over the MCM command ship role from HMS Herald in the Gulf in 1991. Those difficult tasks were undertaken most satisfactorily, and I applaud DML's performance.

I shall deal briefly with the domino theory that was mentioned by my hon. Friend the Member for Sutton. He believed that, if the nuclear refitting role were lost, that would lead to the closure of the dockyard and the naval base. I think that was an over-pessimistic prognosis. In advance of decisions being taken on the future allocation of nuclear refitting, I can say only that our refitting programme for surface vessels and diesel-powered submarines will be substantial. I cannot give any undertakings today on the allocation of that work, but my aim is for a greater proportion of the total refitting programme to be' subject to competition among ship repairers and ship builders. In those circumstances, the dockyard's future would depend on its competitiveness.

As for the naval base, my hon. Friend will know that we are moving the Upholder class submarines to Devonport, and we expect a defence presence—as exemplified by the Royal Marines at Lympstone—to remain in and around Plymouth.

Time is running short, and I must draw my remarks to a close, as more than the usual amount of time was, quite rightly, taken up by the fact that two hon. Members, my hon. Friend the Member for Sutton and the hon. Member for Devonport, made such eloquent contributions.

In our defence programme for the 1990s, we have promised smaller but better defence forces. It is only by ensuring that we subject all sectors of cost to rigorous scrutiny that we can make available the resources required to deliver improvements in our fighting capability. Improvements in efficiency in the dockyards have already contributed to that process, and we have recognised that the refitting facilities that will he required for our Trident submarines by the end of the decade will be crucial in that process. More investment, whether public, private or both, will be required in the coming years, but it is too early for me to give a commitment on where that investment will be.

When we visit Devonport and Rosyth, the aim of my right hon. and learned Friend and myself will be to ensure that we are thoroughly familiar with the facilities at both dockyards. That will be essential background information for our consideration of the recommendations that may affect their long-term future. Once we have those recommendations, we shall be in a position to discuss their wider ramifications in detail with hon. Members, the appropriate local authorities and other interested parties. Tonight's debate has been helpful in starting that process.

We will take into account a wide range of factors in seeking to balance the needs of the Navy 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. Those difficult decisions lie ahead. Tonight's debate has been a helpful and educational process.

Question put and agreed to.

Adjourned accordingly at half-past Ten o'clock.