My Lords, there has been no change in the Government’s plans. It remains our intention to award a single design and build contract for five Type 31e frigates by the end of 2019.
My Lords, I thank the noble Earl for his answer. Many of us who are concerned about the number of ships in the Navy have been concerned about this delay in ordering. Only yesterday, the noble Lord, Lord Lee of Trafford, accosted me and asked whether the ships’ names committee could call them the “Grayling Class” as there were no ships, which I thought a little unfair. Can the noble Earl reassure the House that the first of these ships will be fully active in the Royal Navy in 2023? If not, as the noble Earl knows, “HMS Argyll” will pay off and the number of frigates that this great maritime nation possesses will have dropped to 12.
My Lords, we see no reason at all to depart from the timescales that we set ourselves; they remain unchanged. We want the first ship in 2023 and all five by the end of 2028. I say to the noble Lord that we have streamlined the procurement procedure in a way that should be helpful, to enable us to award the contract by the end of this year.
My Lords, my noble friend will be aware that we are both designing and building frigates for other Commonwealth countries, notably Australia and Canada. Will he encourage his friends to consider the proposal that these frigates—I am not sure whether they are Type 26 or Type 31e—shall be crewed and operated jointly by Commonwealth navies?
My noble friend draws attention to something very encouraging. The UK shipbuilding sector has been able to compete in the world market for very high-end specification frigates—it is the Type 26 frigates which he was referring to. This aids the issue of interoperability between allies, which he also highlighted. We welcome the fact that Australia and Canada have entered the fold of nations which will operate this vessel.
My Lords, in light of the National Audit Office’s November 2018 report, which suggested that the MoD’s equipment plan remained unaffordable, falling about £10 billion short over the next 10 years, will the Minister explain to the House what plans the MoD has to ensure that the Type 31e frigates are delivered on time and, crucially, on budget? Are the new procurement arrangements intended to deliver that?
The noble Baroness is quite right: in April, the forecast cost of the equipment plan exceeded the allocated budget of £7 billion over 10 years, which is the central estimate. Indeed, if we took no action, the plan would not be affordable. However, based on past experience as well as what we are doing, we are confident that we will successfully deliver the plan within budget, both this year and next year, through effective management, by monitoring and controlling costs as we go, and with the benefit of the additional money secured in the Budget.
My Lords, on 20 July 2016, the then chief executive of Defence Equipment and Support, said to the Defence Committee that,
“the eight Type 26 frigates are approximately £8 billion-worth of planning going forward”.
I interpret that as meaning that a Type 26 frigate will cost £1 billion. The Government have consistently said that the Type 31e frigates will cost a quarter of £1 billion each. Just how incapable will these frigates be, or does the Secretary of State have a magic wand?
My Lords, the Type 26 is a high-end specification, anti-submarine warfare frigate; not unnaturally, that specification makes it expensive. The Type 31e is an adaptable, general purpose frigate, subject to completely different procurement processes. However, it should not be inferred from that comparison that the Type 31e will be in any sense a low-grade warship. Of its kind, we intend it to be a world-beater, which other Governments will wish to buy.
My Lords, will the Minister confirm that these frigates will be based in Portsmouth, and when a decision will be announced to this House? As the home of the Royal Navy, Portsmouth is the obvious home for these frigates, not least because the general purpose Type 23 frigates are currently based there. This decision would bring much support and give reassurance to the city, community and the diocese I serve.
My Lords, I declare an interest in defence procurement issues, as reflected in the register. I wholly support the noble Lord’s aspiration to increase the size of the surface fleet—it must be expanded. The Minister will, however, recognise that the three principal trade-offs in a great military procurement exercise are performance, cost and time. Cost is fixed. Time is fixed. Performance must be traded down. Does the Minister agree that the best way to trade on performance is in some way to compromise on the exquisite nature of the platform to ensure that the combat and command systems on board are state of the art?
The noble and gallant Lord speaks with great experience and he is right: we are consciously prescribing an adaptable but general-purpose specification for the Type 31e, as opposed to the more exquisite high-end specification of, for example, the Type 26. That is not to say—as I emphasised before—that the Type 31e will be in any way an inferior warship—quite the contrary, in terms of the capability that we will require of it.