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MOD accused of betraying UK manufacturing

The UK Government was accused today of a ‘stunning betrayal’ of manufacturing after moves to buy defence equipment ‘off the shelf’.

Defence Equipment Minister Peter Luff announced that at least 1.2 per cent of the Ministry of Defence's budget would in future go on developing new ideas in a bid to halt years of decline, adding that the department was also committed to buying off the shelf solutions where it was the best value option for the taxpayer.

Ian Waddell, national officer of the Unite union, said: "This is yet another stunning betrayal of British manufacturing. The Government have learnt nothing from the fiasco at Bombardier when it put Britain's last trainmaker at risk in favour of a rival European manufacturer.

"The latest decision by the Indian government to select a French fighter aircraft over the BAE Systems Typhoon highlights how important it is to support British jobs when it is within the power of the Government to do so.

"This Government should be using procurement to support British companies rather than using it against them.

"The defence industry provides highly skilled jobs and is hugely important to the economy. The Government is doing next to nothing to support UK manufacturing."

Prospect, which represents over 16,000 civilian defence specialists, warned that a White Paper published today "peddles the myth" that cuts to the public sector will generate economic growth in the private sector.

Deputy general secretary Mike Clancy said the MoD's new defence industrial and technology strategy "papers over the cracks" in the UK defence industry and will do nothing to arrest the decline in defence jobs and skills across the UK.

He said: "The MoD says it will seek to fulfil UK defence requirements by open competition and by procuring equipment off the shelf. It is an off-shore solution to a home-grown problem. Does it really represent value for money? What about maintenance, upgrades and spare parts, what about emergency deployments?

"The UK still needs its own defence manufacturing base. Exports will be hit as well. Why would foreign governments buy UK companies' equipment if our own MoD has rejected it?

"The idea in the White Paper that the UK will retain freedom of action and will sustain the necessary people, skills and infrastructure is the MoD facing both ways and tearing itself in two."

An MoD spokeswoman said the balance between bespoke equipment and off the shelf solutions would be made clear later this year when a 10 year equipment plan is published by the department.

Luff said: "We must ensure that our armed forces, national security, and law enforcement agencies have the best capabilities we can afford at the best value for money for the taxpayer. Balancing these considerations appropriately is even more important given the economic situation we face.

"Wherever possible, therefore, we will seek to fulfil the UK's defence and security requirements through open competition in the domestic and global market, buying off-the-shelf where appropriate. We will look first for products that are proven, that are reliable and that meet our current needs.

"This is the best way of ensuring that our armed forces and security services have access to the equipment they need at the time they need it and at a price the nation can afford.

"However, and importantly, where essential for national security, we will protect the UK's operational advantages and freedom of action; when we do this it will mean sustaining the necessary people, skills, infrastructure, and intellectual property that allow us to build and maintain our national security.

"Technology underpins this approach so it is our intention to end a long period of declining budgets and maintain MOD's investment in science and technology at a minimum of 1.2 per cent of the defence budget as protection for our future."

Matt Cavanagh, associate director of the IPPR think tank, said: "With unemployment at historic highs, now is the worst time to eliminate consideration of the impact on UK employment from the cost-benefit analysis of defence contracts.

"The Government should build on examples like the recent contracts for armoured fighting vehicles, which generated real competition from UK and international suppliers while also factoring in the impact on UK industry and jobs. The Government must also show more ambition on research and development - 1.2 per cent of a shrinking defence budget is nothing to boast about."

Shadow defence secretary Jim Murphy said: "This four-times-delayed report is a missed opportunity to support one of the UK's genuine success stories.

"Recent events remind us of the enduring importance of our armed forces and the defence industry to our national security and economic stability. On both counts the country will be deeply disappointed by the Government's failure to deliver the far-reaching reform that is required.

"Defence procurement faces major challenges which require far-reaching change within the MoD yet the Government plans to continue operating within the same flawed structures."

Rees Ward, chief executive at defence trade group ADS, said: "Contrary to general opinion, the delay in the White Paper's release would appear to have been beneficial, resulting in deeper understanding of industry's concerns within the Government.

"Industry is looking forward to working in partnership with Government to ensure that the White Paper's proposals are carried out to the benefit of both the nation's defence and security and the achievement of growth in the economy."

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