UK taxpayers will pay more for Royal Navy support ships under a deal struck to save troubled shipbuilder Harland & Wolff, with Spanish state-owned business Navantia stepping in to buy it.
The Belfast-based company was placed into administration in September for the second time in five years.
The deal with Navantia will secure 1,000 jobs across the UK and protect the future of H&W’s shipyards.
The firm, which famously built the Titanic, is a subcontractor in part of a consortium that landed a major contract to build new fleet solid support, FSS, ships for the navy.
Navantia UK is the main contractor on the contract, which was originally valued at £1.6 billion for three vessels.
Business Secretary Jonathan Reynolds would not be drawn on how much extra cash would now be pumped into the contract but insisted the revision was ‘relatively minor’ and represented a good deal for taxpayers, workers at H&W’s shipyards and national security.
The deal, which is subject to regulatory approval, will secure jobs at H&W’s four shipyards in Northern Ireland, Scotland and England: Belfast, Methil on the Firth of Forth, Arnish on the Isle of Lewis and Appledore, north Devon.
The purchase agreement is set to protect workers’ existing terms and conditions.
Reynolds said the change to the FSS deal was ‘relatively minor given the size of that contract, which is obviously a very important one for national security’.
Officials said the variation made the ‘minimum changes necessary’ to ensure Navantia can still deliver on the contract and build all three ships.
Reynolds told reporters: ‘This is a huge vote of confidence in the UK. It is good for jobs, it’s good for national security, and it’s good for all parts of the UK.
‘This was a huge problem that we inherited walking into office. We have been able to broker a solution that is not just a solution to the short-term problem, but one in the best long-term interests of the UK.’
He said the amendment to the FSS contract was ‘a far better solution than what was on the table when we initially came into office, which would have been a loan guarantee, which I believe would have lost the taxpayer all of its money and not delivered those ships and not secured the yards or the jobs’.
Northern Ireland Secretary Hilary Benn and Department for Business & Trade Minister of State for Industry Sarah Jones visited the Belfast shipyard on Thursday where they undertook a tour of the premises and spoke with workers.
Benn described the deal as ‘great news for Belfast, for Northern Ireland, but above all for Harland and Wolff’.
‘It’s an iconic company with a really proud history, but now it has a bright future,’ he said.
‘Sarah and I have been walking around the yard, talking to the staff, particularly the apprentices, and as one person said to me, ’everyone is buzzing’, because they see a bright future. Today is a day for celebration’.
Jones added: ‘When we first came into government, this was a real worry and concern, and a lot of people have worked very hard to make sure we can support this brilliant deal today.’
East Belfast MP Gavin Robinson was also at the yard on Thursday and described it as ‘a good day’.
‘It has been unsettling but today you can just see the joy in staff throughout the yard and the enthusiasm they have,’ he said.
The Unite union said it will engage with the deal to make sure that commitments are delivered for the workforce at all four shipyards to transfer with no break to continuity of employment.
Unite General Secretary Sharon Graham said: ‘Unite has been working day and night to secure the interests of the workers at Harland and Wolff and the future of the UK’s shipbuilding industry.
‘After countless meetings with government, the employer and prospective buyers, we now have a good news story offering real hope for the future. Unite will always do whatever it takes to fight for workers’ interests.’
George Brash, regional officer for shipyard workers in Belfast, said: ‘We want to secure a deal that offers a bridge into the future for our members and the centuries-old Belfast shipbuilding industry.’
The GMB union welcomed the deal but said it remained cautious about the future of H&W’s yards.
Matt Roberts, GMB national officer, said: ‘Today’s announcement is a hugely positive step for retaining UK sovereign manufacturing.
‘But despite all four yards remaining open, GMB remains cautious. Without a steady drum beat of work these yards will continue to struggle.
‘GMB will continue the fight to ensure that does not happen.’
By David Young, David Hughes and Rebecca Black
Press Association: Finance
source: PA
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