Britain's new shipbuilding strategy aims to revive the sale of its warships around the world. The UK must overcome cost and flexibility challenges in a competitive marketplace.

HMS Queen Elizabeth under construction. Crown Copyright.

By Nick Childs, Senior Fellow for Maritime Forces and Naval Security

The British government’s new national shipbuilding strategy is a change of course, moving from consolidation towards increased competition. The approach is based on recommendations published last November by the industrialist Sir John Parker. A key driver is the delivery of a new, less sophisticated, more cost-effective frigate design – now called the Type-31e – not only to equip the Royal Navy and eventually rebuild United Kingdom fleet numbers but also to revive UK foreign warship sales (the “e” is for export). A great deal will need to go right for the strategy to actually achieve its declared aims.

This was all ushered in by the 2015 Strategic Defence and Security Review (SDSR), which concluded that the plan to replace the navy’s current 13 Type-23 frigates one-for-one with the complex Type-26 design was unaffordable. So eight Type-26s are to be built by BAE Systems at its facilities in Scotland. These ships will be focused on high-end task group and anti-submarine warfare (ASW) operations, to protect the new aircraft carriers and the Trident submarine force. The cheaper, smaller, general-purpose frigate (the Type-31e) will carry out other presence and maritime security tasks.

In principle, the formula unveiled in the 2015 SDSR had some attraction: it appeared to hold out the prospect (“in the 2030s”) of rebuilding RN destroyer and frigate numbers from the current low level of 19. In return, the naval staff has been forced to accept a concept it had previously resisted, of essentially a two-tier surface combatant force.

Strategy may boost sales abroad

So, under the strategy, design and construction of the Type-31e is being opened to competition among UK shipbuilders, with the  aim of nurturing a broad-based national shipbuilding sector. Construction could be on the distributed block model used for the new carriers. Some analysts doubt the cost-effectiveness of this, although it could have added attraction for potential foreign sales to countries wanting to build up their own industries – some sections of the ships could be built in the United Kingdom, others abroad.

But previous attempts to forge a UK shipbuilding strategy have foundered or been discredited in large part because successive governments have failed to deliver the flow of work implied in the approach. For all the government’s statements of intent this time, that concern remains, especially given the growing worry about overstretch within the defence equipment budget.

There must be flexibility in the system to adjust to changing requirements. Apart from anything else, the plan now must be able work beyond just building Type-31e. That, potentially, is one benefit of the new strategy from a supply point of view. But it will need to be underpinned by a genuine commitment to a broad scale of investment.

Achieving target price will be a challenge

Another element of Sir John Parker’s recommendations is in the field of improved project management. The success of the strategy will in large part depend on whether the changes that the government says it is implementing deliver the improvements required.

This leads to another area of doubt. The recent £3.7bn order for the first three Type-26s implied a unit price for these 6,900 tonne ships close to £1bn. The target price for the smaller Type-31e is £250m. While the navy see these ships chiefly for lower-tier presence operations, they will be operating in an ever more challenging maritime environment, and will still be required to integrate with the rest of the fleet when needed. The naval staff seems to think it can get a vessel of about 3,500 tonnes, with an adequate military capability, for the £250m target price. That will be a challenge.

Also, Britain’s underperformance in the warship export business is a decades-old problem. Reversing it in a world in which emerging maritime powers are also competing against established exporters will not be easy. And, paradoxically, just as the UK is embarking on a new, supposedly more exportable, more affordable warship design, interest in more capable high-end ASW platforms is on the increase. Type-26 is in the mix for the competitions to meet Australia’s and Canada’s future requirements. But this underscores the fact that UK strategy must be properly aligned at all levels, and have support at all levels, if it is to succeed.   

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