KOFAC strongly welcomes the 2005 Defence Industrial Strategy (DIS) and the earlier Defence Industrial Policy. Both documents provide a robust framework for providing the Royal Navy with affordable ships and submarines and, within the naval shipbuilding base sustaining key skills, tacit knowledge and jobs, whilst promoting 'A sustainable, competitive UK defence industrial base' (Hansard Col.1528W, 9 February 2009).

The Rt Hon Quentin Davies MP told Parliament on 12 January 2009 that "We are currently engaged in the most substantial peace time naval shipbuilding programme since the first world war. This is centred on the Type 45, Astute and future aircraft carriers. Following on from these we will have the future surface combatant and Successor class submarine.  This programme will provide the capability the Royal Navy needs to remain one of the world's most powerful maritime forces." (Hansard Col.171W).  This response was re-stated on 30 March 2009 (Hansard Col.648) when the Minister added "The programme is indeed affordable". (Hansard Col.647).

We note that on 20 January 2009 (Hansard Col.1264W) the Defence Procurement Minister stated that "In considering procurement decisions, the MoD needs to ensure it secures the best equipment available... whilst at the same time ensuring value for money for the taxpayer." This statement was welcomed by KOFAC as it replaced an earlier view (Hansard Col.678W, 2 June 2008) which had expressed a preference for 'shifting the overall balance of defence procurement to the support of operations'.

KOFAC welcomed the formation of BVT Surface Fleet Ltd on 1 July 2008 and the subsequent Terms of Business Agreement between the MoD and BVT.

Specifically KOFAC welcomes the undermentioned statements within the Defence Industrial Strategy:-

• "For the foreseeable future the UK will retain all those capabilities unique to submarines and their nuclear steam raising plant". (paras B.2.7; B.2.18 and B.2.26 to B.2.28)
• "Submarine design capability is at risk if long gaps emerge between first of class design efforts adding that "international collaboration can help sustain the UK submarine industrial base. (para 2.62).
• New nuclear submarines will be ordered to a drumbeat of one every 24 months starting with HMS Astute.
• Surface ship drumbeat will be one every 12-24 months.
• It will be necessary for the MoD and industry to demonstrate an ability to drive down and control the costs of nuclear submarine programmes.

KOFAC wants HM Treasury and the MoD to ensure funds are made available to sustain the drumbeats defined in the DIS and the skills needed to maintain them.

KOFAC's view is that the Royal Navy needs 8 Astute class submarines and the Successor deterrent carrying submarine fleet should be built to programme. Commitment to it is needed now in 2009-10. If it  is delayed awaiting the outcome of a Strategic Defence Review there will be a big impact on costs and the UK's ability to retain a sovereign UK submarine industrial base.

KOFAC welcomed a Ministerial statement of 14 December 2005 on closer cooperation with USA:-

"A statement of intent for co-operation and exchange between the USA and the UK on submarine concepts, design and construction was signed on 7 October 2005". It records the "intention to work to mutual advantage" and "for the construction, equipment production and logistics support to be maximised. Such work will not compromise the retention of submarine design capability in this country."

KOFAC also believe that DIS's proposal for an 8 year update of a submarine class design will not employ all the core skills required to sustain a submarine design capability in the UK. KOFAC considers that designers will need additional work on warships and submarines to enable the skills base to be sustained.

KOFAC supports the 'Key Supplier Initiative' of BAE Systems as a step towards improving affordability because over 60% of the cost of a new boat now lies with procurement through the supply chain, rather than through the prime contractor BAE Systems.  Barrow shipyard can assist suppliers to strive to implement innovative solutions and improvements in the supply chain to drive down the cost of each new vessel. The Department of Business, Innovation and Skills and regional development agencies could build on this industry initiative to help make the supply chain more efficient by using existing funding resources to help companies to modernise and invest. 

KOFAC urges the UK Government to order at least 8 Astute class submarines to enable the Royal Navy to have the capability it needs and to allow the nuclear submarine industrial base of the UK to have clear visibility of core workload, develop long lead equipment supply options which are more affordable than if a single boat is ordered one at a time, and allow scope for industry to offer innovative through life solutions for equipment supply and future in-service capability enhancements.

KOFAC considers that the MoD should invite companies to tender for the supply of systems for boats 4-8 on a through life basis.

KOFAC also wants the MoD to clarify its definition of 'complex' and 'less complex' ships.

KOFAC supports the UNITE July 2009 trade union policy paper, "Maintaining a world classshipbuilding sector in the UK".