Reid: UK Must Continue to Lead the Field in Missiles
(Source: UK Ministry of Defence; issued Dec. 15, 2005)
The UK must retain its capability to produce Complex Weapons according to the Defence Industrial Strategy (DIS), published today, announced Secretary of State for Defence John Reid today.

The DIS sets out the need to retain this capability while acknowledging that industry will have to change to meet new challenges.

Launching the DIS John Reid said:

"The Complex Weapons industry is very important to us and we have built-up significant expertise. For reasons of operational sovereignty we would wish to retain in the UK the capability to design new Weapons (including upgrades), integrate them into the wider military network and support them throughout their service life. We need to retain the capability to undertake these activities independently or as a leading player in collaboration with others.

"We have made significant investment in them in recent years, driven by the introduction of new systems such as StormShadow and Brimstone.

"However the scale of our investment will reduce as new Weapons Systems are brought into service. As such, there will be overcapacity in this sector and we need to work with industry to ensure the critical skills the UK requires are sustained. A team will be created to take this work forward.

Emphasising the importance of maintaining the capability in the UK, John Reid said:

"Sustainment of the industry may mean we have to temper International competition in the short-term. We will also work with European allies and industry to investigate potential for restructuring across Europe, to maintain critical skills. But this will not be to the exclusion of US-owned companies, in particular those who have already established a firm foothold in the UK."

The complex weapons industry is based across the UK at many sites including Stevenage, Glenrothes and Belfast (ends)

New Era for Naval Shipbuilding and Ship Support
(Source: UK Ministry of Defence; issued Dec. 15, 2005)
Naval Shipbuilding and Ship Support in the UK will need to undergo a radical overhaul to ensure it delivers first class equipment for the Royal Navy and remains a viable industry, Secretary of State for Defence John Reid announced today.

The Defence Industrial Strategy (DIS), published by the Ministry of Defence (MoD) today, set outs the need to consolidate the industry to ensure core skills built up over generations are put to best use.
Launching the DIS John Reid said:

"The [UK] has a proud tradition of shipbuilding and ship support which has grown up over centuries. I believe the knowledge and experience we have in our yards is second to none and it is essential that we make the very best of it.

"That simply isn't happening at the moment because industry is currently fragmented - different companies and facilities undertaking submarine build, surface ship build, and support, even though the skills cross over in some areas.

"The MoD is currently engaged in the biggest shipbuilding programme for decades - Type 45s, the Carrier Programme and the Astute submarine will ensure jobs for years to come. But industry faces a lower workload once this peak is past and therefore must make plans for the necessary changes now - so that we can keep the required key skills onshore.'

The MOD will build on the momentum generated by the industrial and commercial arrangements being put together on the CVF programme to drive restructuring in the surface ship industry to meet both the CVF peak and the reduced post-CVF demand. John Reid said.

"in the longer term we will require a consolidated industry to sustain the shipbuilding and support 'crown jewels' - particularly the skills needed for design, systems engineering, construction integration and support. This is also a much better arrangement for workers, providing the basis for more security and stability to develop and enhance their skills in long-term structured and secure employment."

Cost growth in the submarine area is putting the whole enterprise at risk. With several monopolies on one side and only one customer on the other, a new structure is required. The MOD will immediately start negotiations with the key companies that make up the submarine supply chain to achieve a programme level partnering agreement with a single industrial entity for the full life cycle of the submarine flotilla, while addressing key affordability issues.

In surface ship support, competition has helped, but cannot now sustain the industry. We will start a detailed dialogue with industry with the aim of exploring alternative contracting arrangements ahead of the next upkeep periods, which start in the autumn of 2006.

For surface ship build, while the industry will be fully loaded with the future aircraft carriers and T45 destroyers for the next 10 years, the steady-state demand will be lower once they are delivered. Once the major reinvestment in new ships, which the Department has overseen, has concluded it will not be affordable to sustain excess industrial capacity in the longer term unless we plan now to avoid a cycle of boom and bust.

The searching examination within DIS of just what we need to do onshore has also caused us to modify our policy concerning the fabrication and assembly of new Royal Navy warship hulls. A stable and healthy programme of complex ships will continue to be built in the UK, and will maintain and grow the high-end skills of those who will manage construction and integration of the wider Maritime Force. However the blanket requirement for all warship hulls to be built onshore will no longer be the case.

Speaking at the launch the Minister for Defence Procurement Lord Drayson said:

"We need to sustain the high-end, value-added, systems engineering skills to manage the integration of complex warships, and their combat systems - this is the critical issue for national security and sovereignty. The security issue is complexity, not warlike or non-warlike.

"The time to act is now - to put our policy on a sustainable footing; and to get industry to invest to improve performance and availability.' (ends)
Reid: Defence Industrial Strategy Offers Challenges and Opportunities
(Source: UK Ministry of Defence; issued Dec. 15, 2005)
The defence industry in the [UK] must seize the opportunities set out by the defence industrial strategy (DIS), published today, announced Secretary of State for Defence John Reid.

The DIS, describes the commitment from the Ministry of Defence (MoD) to the Armoured Fighting Vehicle (AFV) industry. As part of this Strategy, the MoD and BAES Land Systems (LS) will enter into a support partnering arrangement for the current AFV fleet. Both parties recognise that working together in this way will present a real opportunity to improve upon the delivery of battle-winning AFV capabilities to the front-line. In transforming our business relationship with BAES LS, we aim to achieve greater efficiency and effectiveness in the AFV support arena.

The strategy also outlines the opportunities available to industry in respect of the forthcoming FRES programme, representing a major investment in capability, for the next generation of medium weight AFVs. Whilst no decisions have yet been made regarding the result of any procurement competition for the programme, if BAES LS is successful in making the necessary changes detailed in the support partnering arrangement, it will be well placed for the FRES programme.

As well as increasing the focus on through life support and incremental acquisition, the DIS highlights the potential of alternative contract arrangements, including partnering, where it offers better value for money. This approach is demonstrated with the award of an innovative contract worth some £185 million for the support of its Turbo-Union RB199 engine to Rolls-Royce Defence Aerospace (RRDA). The engine powers the MOD's fleet of Tornado aircraft, which are in service with the Royal Air Force. Support work will be undertaken in the UK by RRDA's traditional suppliers including Goodrich, Birmingham.

Launching the DIS John Reid said:

"The Midlands and the North East have played a key role over the years in the development of a range of armoured fighting vehicles for our forces. We must ensure that we maximise the skills which have developed over the generations, building on this heritage to produce high end, battle winning, technology to keep our forces one step ahead.

"Partnering means a different way of doing business - more transparent, working together to make necessary changes but fundamentally remembering what each side's responsibilities are. It's about sharing objectives, risks and rewards while recognising that different drivers apply.

"You have to be clear what the aims are - and how to terminate the relationship if necessary, particularly if either side fails to deliver on its commitments. It needs skilled, motivated individuals, committed for the long-term to working together to keep our Armed Forces effective.

"I am also pleased to announce we have reached an agreement with Rolls Royce to provide future through life support to the RB199 engine on the RAF's Tornado aircraft."

Speaking at the launch the Minister for Defence Procurement Lord Drayson said:

"The Armoured Fighting Vehicle fleet is key to the Land Forces' military effectiveness and for that reason we must retain a capability to maintain and upgrade both current and future equipment. The partnering arrangement with BAES LS aims to achieve this. That is good news for both the Midlands and the North East." (ends)
Reid: Defence Industrial Strategy Offers Challenges and Opportunities for the Aerospace Industry
(Source: UK Ministry of Defence; issued Dec. 15, 2005)
The aerospace industry in the [UK] must seize the opportunities set out by the Defence Industrial Strategy (DIS), published today, Secretary of State for Defence John Reid announced.

The DIS recognises the need to sustain the core industrial skills, capabilities and technologies that exist in the North West to operate fast jets now and in the future.

Launching the DIS John Reid said:

"The [UK] has played, and will continue to play, a key role over the years in the development of our fast jet capability, and will be integral in the development of two new, highly sophisticated manned combat aircraft types, Typhoon and the Joint Combat Aircraft (JCA). Once these are delivered, we expect them to remain in service for some thirty years.

"Although no final decisions have been taken, we do not currently have plans for a future generation of manned fast jet aircraft beyond the current projects. Since the current fleet, and the new types we are introducing, are likely to have such long operational lives, we will need to retain a UK based aerospace engineering and design capability to support and upgrade them.

"Typhoon and the JCA will inevitably need to evolve throughout their lives, tackling new challenges and incorporating new technology. We have to retain the skills within the UK to manage this evolution, so that we maintain our sovereign freedom to operate our aircraft as we, not some other nation, chooses. The North West aerospace industry has a critical role to play here and there will be substantial business opportunities for BAE Systems and for other companies like Rolls Royce and Selex in maintaining and upgrading our fast jet fleet."

The DIS sets out a challenge to industry and MoD to manage this transition and to maintain in the UK the industrial skills, capabilities and technologies that are required to sustain our ability to operate, support, maintain and upgrade the UK's aircraft over the next 30 years. The DIS also sets out the need to look at new technologies in the aerospace arena, including emerging technologies in the field of Uninhabited Aerial Vehicles (UAVs).

Speaking at the launch the Minister for Defence Procurement Lord Drayson said:

"We need to explore the future mix of conventional aircraft with UAVs, including combat versions. I want us to press ahead with a significant UAV technology demonstration programme, working jointly with industry and building on their previous excellent work with us.

"This will help to sustain some of the skills required to support our new manned aircraft, give us far better insight into the full potential UAVs can offer to a wide range of capability requirements, and potentially allow UK industry to develop specific commercial expertise in what is likely to be a significant growth market in the future."


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