"We've got to have this thing built over here whatever it costs - We've got to have the bloody Union Jack on top of it."

The competition to build the next generation of three new Royal Fleet Auxiliary (RFA) support ships (known as the Fleet Solid Support / FSS) has become increasingly politicised, with Jeremy Corbyn making a speech demanding that all three vessels be built in the UK. Why has this situation emerged, why would UK industry and MOD want to build overseas and what are the benefits for the UK in doing so?

The FSS project has its roots in the early 2000s, when the MOD began to look at options to recapitalise its increasingly elderly RFA fleet into the 21^st Century. At the time the RFA operated four stores ships – two Fort I (AUSTIN & ROSALIE) and two Fort II (GEORGE & VICTORIA) class, with subtly different roles. This scheme was known as MARS and was intended to provide a widespread replacement for the RFA flotilla.

The original Fort class entered service in the late 1970s carrying dry stores / ammunition to support either Carrier or Amphibious forces, while the Fort II’s were originally envisaged as a mothership for a group of Type 23 ASW frigates, when these were intended to be a highly austere vessel. Planned to be armed with VLS Seawolf and facilities for servicing up to 5 helicopters, they represented the pinnacle of cold war RFA designs. Post cold war both ships tended to be used in support of carrier groups, or as command platforms in the Middle East due to their size and excellent facilities.

The 2010 SDSR cut the RN aspiration to operate both a carrier and amphibious task group in different locations and saw some MARS requirements merged in to produce a total need for 3 dry stores ships in the RFA- enough to support the combined requirements of the amphibious force (whose landing size had been drastically scaled back), and the future planned carrier force that would realistically see one deployed vessel (the other carrier originally being planned to be in reserve or scrapped). This in practical terms saw the Fort I’s primarily work to support amphibious forces, while FORT VICTORIA supported carrier operations and then went to the Middle East. She is now being refitted for work to support QEC as part of the Carrier Strike regeneration.

Image by Ministry of Defence; © Crown copyright

The wider reduction in defence funding slowed the MARS project, and it wasn’t until early this decade that four (rather than the six originally planned) Tide class tankers were ordered. Since that point no progress has been made on ordering the FSS, which seems stuck in Planning Round hell, unable to secure sufficient funding to proceed into full construction. 

The situation today is that replacements are urgently needed for all three ships, which are ageing and increasingly fragile. They are a key enabler of the Carrier Strike capability, and in supporting the currently planned amphibious forces too. A failure to bring replacements into service in a timely manner will cause real risk to the delivery of Carrier Strike and the ongoing credibility of the RN as a blue water navy in the next few years.

What is the issue?

The reason this case has become so politically sensitive is due to emotionally charged, and often highly misleading claims that these ships have been ‘promised’ to the Clyde shipyards, or that the MOD should order them via a UK builder and not look for an overseas build.

The problem is that it is not clear whether there is sufficient capacity in the UK shipbuilding industry to build these vessels to the timelines required, while also delivering the hugely ambitious shipbuilding programme for the next 15 years.

When the TIDE class were ordered, despite multiple UK companies looking to bid, not one proposed a UK build solution for the project. The reason was the lack of space in UK shipyards to complete the ships and also finish all the work on Type 45 and CVF while also beginning work for the Type 26 as well.

There is a finite number of yards and workforce available in the UK at any one time that can build large vessels, and when the TIDE order was competed, not one UK company felt that it could complete the initial build in their own yards. For all the bluster about building the TIDES in Korea, it is worth remembering that these ships would have been built abroad, or not at all.

For the FSS order the challenge is similar – there is a significant amount of shipbuilding going on in the UK over the next 15 years that is going to require a large amount of capacity to deliver. Between 2019 and 2034 the current plans envisage the final delivery of both QEC class carriers, delivery of the remaining Batch 2 RIVER class, the delivery of 8 Type 26 CITY class frigates (which are substantial warships) and at least 5, potentially more, Type 31e light frigates. Meanwhile the Submarine Service will also be delivering the remaining ASTUTE class SSN’s and then the four DREADNOUGHT class SSBN’s too. This massive construction effort will see the delivery of 7 submarines over the next 15 years.

Work is also likely to be needed on replacing the RN’s MCMV capability – most likely through a combination of fewer hulls and a wide range of complex systems that ‘takes the man out of the minefield’. The Survey flotilla will also require thinking about how they replace the capabilities offered by both SCOTT and the E class hulls too, which will be 20-25 years old by 2022. Finally, there are a plethora of patrol craft that will require replacement over the next few years too (such as the ARCHER class).

Put together this means there is a very substantial naval construction programme underway for the Royal Navy for vessels that will be built in UK yards, by British workers over the next 15 years.

What is the Strategy?

The MOD has put a National Shipbuilding Strategy in place which makes abundantly clear that warships will always be built in the UK. This strategy is designed to ensure that there is a coherent flow of work for the shipyards which will keep the right skills and capabilities present within the UK, and also preserve the critical niche industries and areas where it is vital that sovereign capability matters.

For the UK, what really matters is less where a support ship is built, but more that the vessel can be designed and maintained in the UK. Maintenance of a long-term warship design capability is absolutely vital. Similarly, maintaining sovereignty over things like communications, IT infrastructure and certain electronic or other niche capabilities is equally important. These are the areas which really matter for protection, the physical act of constructing a supply ship is a nice to have, but not a critical ‘need to have’.

The UK has long operated its RFA’s on a different model to other nations and does not class them as warships – they are government operated vessels, but not warships. This is actually an important point as it changes the rules by which the ships can operate – particularly for prosaic issues like getting diplomatic clearance to enter harbours, and where the ships can go.

In practical terms this means RFA’s are also subject to subtly different procurement rules from normal warships, and tenders for construction need to be openly competed in line with EU rules. This does not automatically mean that the work will go overseas, it simply means applying rules in the manner that they are intended to work. Plenty of defence contracts are competed this way, they just don’t have the same emotive draw of ship construction to gain wider attention.

More widely other shipbuilding contracts in the UK are also run this way – with many component parts of the UK Government ordering vessels overseas as a result. For instance, a major tender to replace a Scottish fisheries protection vessel failed in the 200s because of a breach of EU procurement rules – these rules have to be adhered to whilst the UK is still subject to them.

As we look to the next 5-10 years, UK shipbuilding faces a bit of a bottleneck, with a large amount of new designs entering service. This places pressure on shipyards with finite resources, and on the supply chain too – a ship is not built in one place, rather it is the putting together of thousands of parts from across many different companies in one spot. In many ways shipbuilding is like making a LEGO model – the parts are brought together in one spot and then turned into something workable.

The challenge for shipbuilders and their supply chain is to ensure that they can manage to successfully deliver multiple designs into service at roughly the same time. The current work package places a lot of pressure on many ‘pinch points’ including trained staff and ensuring that the work can be delivered on time – particularly as the RN is effectively looking to introduce 3 new classes of surface ship (T26, 31 and FSS) into service at roughly the same time.

While in an ideal world all ships would be built at home, the cost may well be unsustainable, as to meet the demand of mass introduction and construction programmes, companies would need to temporarily expand (thus incurring additional costs) to meet demand, but then reduce back in size again afterwards, when there is no effective follow up work (to coin a political phrase, a very ‘boom and bust’ approach to shipbuilding). In a time of real budget stretch, such a move may make finishing three hulls unaffordable, and threaten the timely introduction to service of desperately needed new capabilities.

Future Affordability?

The wider long term picture is that even if the ships were built in the UK, there is no follow on work to naturally replace the skills and industrial set up that would make building them work out more cheaply – e.g. as soon as construction was done on the third hull, work would begin on a new class using existing resources.

A look out to the RN’s ‘big ship’ replacement programme, even before the likely cuts of the LPD force in the next defence review, indicates that no big replacement programmes are planned realistically before the mid 2030s. There will be a need then to replace potentially three LSD(A) and theoretically 2 LPD plus wrapping up any residual LPH(R) requirements as well.  It is also assumed here that ARGUS and DILIGENCE will not be replaced directly, but by capability enhancements on other platforms instead. This also assumes of course that the RN wants to remain in the LPD/LSD game and not move to a different approach built around aviation and not landing craft based manouvere…

Regardless though, there is realistically a 5-10 year gap even in a best case budget scenario where no large ships are likely to be under construction. Given the slippage in ordering other big ship replacements, it is hard to see any new construction beginning until the mid 2030s at the earliest, while FSS should deliver hulls in the 2024-2025 timeframe. There is no requirement to follow on from them, meaning that any ‘bulge’ in shipyard capacity and workers will need to be lost, causing job losses and increasing the unit costs of all three ships.

Faced with this, there is a strong argument to be made that to reduce pressure on the UK chain, and be economically sustainable, companies may want to partner with an overseas builder to produce a solution that sees the ship designed in the UK (thus preserving this niche set of skills), built to a basic  finish overseas (reducing pressure on the UK shipyards and supply chain) and then completed in the UK (protecting the niche areas of interest like communications and electronics).

More widely it is difficult to reconcile the strong domestic opposition to seeing UK designed ships built abroad as somehow being a ‘bad thing’ while at the same time expecting other nations to come flocking to the UK to have their own ships built. Modern defence exporting is a ‘give and take’ affair, where nations spending money expect a significant level of investment back in return. The UK showing its commitment to being a ‘fair player’ in the global market, and willing to consider ordering overseas paradoxically strengthens the argument for exports of the Type 26 and 31e design. It sends a message that the UK is prepared to engage in a balanced manner when it comes to warship construction. In the keenly competitive world of defence exporting, this counts for a great deal.

While a UK build solution may provide a short term boost to jobs in one sector, it would realistically be bad for the defence budget as a whole, increasing costs and reducing the ability to spend money elsewhere on other UK capability instead. For example, the cost increase associated with a UK build could potentially have been instead used to protect and sustain lots of niche companies elsewhere in the defence supply chain, ensuring their long term survival – the impact being a loss of jobs and national capability elsewhere in order to safeguard an already buoyant shipbuilding sector.

A final thought is that the concept of what is really ‘British’ is often not well defined in an era where sovereign production capabilities don’t really exist. Many people bemoan the supposed loss of the UK aerospace industry as we apparently no longer build aircraft at home, while conveniently ignoring that the UK has a 20% stake in every Joint Strike Fighter built, while also possessing one of the worlds largest aerospace industries.

Defining a defence capability as ‘British’ simply because it was assembled here is not terribly helpful in a globalised world. Look at the component parts of a ship, then try to work back through the supply chain to understand where they all came from and how they fit together and you’ll quickly see how much defence equipment components and sub components are built across the globe and slots together as a final finished product here.

Is the QUEEN ELIZABETH less British because many of her sub systems and components were built abroad and then finished here? Are US Navy submarines somehow less American because critical parts of their equipment are manufactured here in the UK? Is Germany a less sovereign power due to the way that their Typhoon fighters rely in part on equipment manufactured in Italy? In an incredibly interconnected world, worrying about whether a product is British, just because part of its build phase was overseas is frankly irrelevant.

What really matters is the ability to design the ships, to know how they fit together and then to bring it altogether into a finished product that can then be safely and effectively operated globally – not worrying about whether the bare bones hull was begun here on in Korea.

There is much political anguish about this, but for all the demands that British Government ships be built in Britain, particularly on the Clyde, but it is worth remembering that in the late 2000s the Scottish Government oversaw the Scottish Fishery Protection agency place a tender for OPVs to be built in Poland and not Scotland. Memories are short at a time of political opportunity but be in no doubt that all the main political parties in Government have ordered foreign built vessels before for Government work.

It is also perhaps ironic to see an Opposition party that increasingly defines itself by opposition to the use of force under any circumstances, bar World War Two, demanding that the UK build ships at home intended to support military operations and the delivery of kinetic effect overseas. It is hard to reconcile the pacifistic tendencies of the current Opposition to avoid any use of the armed forces with any desire to see these ships used as designed or even enter service.

The ultimate goal of the FSS is not to subsidise jobs for a few years in the defence industry, but to deliver three hulls that can ensure the Royal Navy is able to project carrier and amphibious power globally. It is easy to demand that they are built in Britain, but to do so risks more jobs and capabilities in the Defence sector, puts at risk the successful introduction to service of other ship types and could jepoardise the successful implementation of the incredibly bright shipbuilding programme that the Royal Navy has to look forward to over the next 15 years – all so we can say ‘built in Britain’. Is this a price really worth paying?