Jobs boost on way with big yard order

Apr 24 2008 by Karen Dent, The Journal

Skills retained

THE bedrock of skills retained from the North East’s shipbuilding and heavy industrial past means the region is well placed to benefit from contracts associated with the building two new Royal Navy air craft carriers.

HMS Queen Elizabeth is due to go into service in 2014 and HMS Prince of Wales in 2016. The combined £3.9bn project to build and equip the ships - which at almost 60,000 tonnes each will be the largest vessels ever sailed by the Royal Navy - is known as Future Aircraft Carriers, usually shortened to CVF.

The Aircraft Carrier Alliance (ACA), a group made up of the Ministry of Defence and industry representatives, has the job of delivering the ships on time. Its members include BAE Systems, Thales and Babcock, which are among the Government’s preferred contractors and suppliers for the contract.

They subcontract work to other companies, which is where the North East’s defence industry and its estimated 4,000 workers stand to benefit.

Although the construction of the carriers’ hulls will be carried out in Glasgow, Barrow, Portsmouth and Fife, Tyneside-based McNulty’s Offshore and ship repairer and converter A&P Tyne have already been "down-selected" by BAE in Barrow to perform some of the work.

Trevor Harrison, managing director of Northern Defence Industries (NDI), said: "From the point of view of the North East, a range of companies are doing significant elements of the work. Our companies have already got the background and the skills and experience. It puts us in a good position."

NDI is a lobby group representing around 200 companies with an interest in the defence industry in the North East and Yorkshire. It aims to bring as much CVF work as possible to the region.

Harrison said: "There are hundreds of millions of pounds of work still available to bid for. We have the expertise on a range of different things from pipework to electrical, valves and installation - traditionally the type of things that we are good at in the region.

"A number of companies are already in the pre-qualification stage. Some items have been bid for and some have been contracted. Obviously we can’t prejudge the government’s final decisions but there is a lot of history on this project already."

He agreed that businesses with oil and gas fabrication expertise, such as Heerema Hartlepool, were well placed to win CVF contracts even if they had no specific shipbuilding experience.

"These programmes tend to have to be completed in quite a demanding time frame. Companies working on large scale fabrication projects have the same sort of standards," he said.

It is also hoped that the £2.3m Marine Defence Centre, which opened in Newcastle last September, will bring additional defence contracts to the North East. One of its stated aims is to attract a further £100m to the region’s marine and defence businesses through new contracts by 2016.

A&P Tyne said last month it still had the skills to bring shipbuilding back to the river, three years after the last ship to be built by Swan Hunter sailed down the Tyne.