What does the closure of Harland and Wolff shipyard mean for the Royal Navy?
Having not constructed a warship for 50 years, the announcement that Harland & Wolff in Belfast had gone into administration this week might seem to be of little consequence to the Royal Navy. The company’s involvement in bids for the Type 31e frigate programme had provided a glimmer of hope for the yard’s future and potential re-engagement as a naval supplier. Obviously distressing for the workers in Belfast, but also seen from a wider perspective, the dwindling number of shipyards in the UK cannot be good news for the RN or British sovereign naval construction capability.
Founded 166 years ago, Harland & Wolff built 174 warships for the RN between 1868 and 1969. The last warship built in Belfast was the Leander class frigate, HMS Charybdis delivered in June 1969. Their most recent contributions to the Naval Service were the construction of RFA Fort Victoria, launched in 1990 and Ro-Ro vessels under charter to the MoD, MV Hartland Point and MV Anvil Point completed in 2002. For the last two decades, H&W have mostly been involved in construction for the offshore oil, gas and renewable energy sector with some commercial ship maintenance work. Northern Ireland’s industrial base is in a poor state and aerospace manufacturer, Bombardier Belfast (formerly Short Brothers) on the site next to H&W is up for sale. With an undercurrent of sectarian tension still very much alive, Brexit looks likely to be particularly challenging for the province and a faltering economy does not help.
Despite bankruptcy, H&W has a £22m contract to refit the Terra Nova, a large oil production storage and offloading vessel on its books. It has also been sub-contracted by BAE Systems for small amounts of steelwork fabrication for the Dreadnought submarine programme. H&W posses the largest dry dock in the UK and is one of the very few sites that could comfortably accommodate the Queen Elizabeth Class aircraft carriers for refitting or emergency repairs. At its peak, 30,000 people worked at H&W and as recently as the 1970s there were still 15,000 employees. Numbers have declined drastically to just 123 full-time workers now but this tiny core, together with the great facilities still have the potential to be expanded and revived.
Government is very reluctant to offer aid or intervention in failing industries that cannot be all be propped up indefinitely but if nothing is done there will be further decreasing options when building ships in the future. With the loss of the BAES Portsmouth facility, (2015) Appledore (2018) and now H&W, there are only three sites left that can construct warships or large auxiliaries; BAES Glasgow, Babcock (Rosyth) and Cammell Laird (Birkenhead). Ferguson (Clyde) could also have a part to play in the Type 31e project but is also teetering on the edge of bankruptcy or possible nationalisation by the Scottish government.
Calls to nationalise the H&W yard from Unions and some Labour politicians might be a very short-term solution if a sustainable future flow of work can be found. Boom and bust has been a feature of shipbuilding for decades, something Sir John Parker attempted to address in his National Shipbuilding Strategy report published in 2017. In the space of less than two years, two shipyards specifically mentioned as potential contributors to the Type 31 program have now closed. Ironically, Sir John himself started as an apprentice at H&W and eventually became the company chairman during the 1980s. The sorry state of the industry rather makes a mockery of the central premise of the NSbS that would see work distributed across the UK and sustained by a drumbeat of orders and exports. Despite the comparative speed of the Type 31e project, it has just come too late. A lack of warship orders and a strategic failure to think and plan for the industry beyond the completion of the aircraft carriers is coming home to roost.
H&W was the nominated lead yard for the AEUK/TKMS bid for the Type 31e frigate. With such a small workforce and no experience of building warships for decades, H&W was always a shaky proposition for this role and they would have required considerable reinforcement with personnel from the German company. With no alternative immediately available it is possible that AEUK’s bid is dead in the water but it rather depends if the design is considered separately to the construction plan when the MoD assesses the submissions. It is possible that if their A-200 design was the winner they could then approach Cammell Laird or even Babcock to do the construction. This all seems unlikely and lengthens the odds of the AEUK bid being successful even further. Was the German bid just an exercise in securing £5M worth of work to occupy their naval architecture teams and gain experience in the UK, but done with no real expectation of winning the contract? All along AEUK have refused to make any public comment about their bid so one can only speculate. There are rumours that the MoD may announce the winner of the Type 31e project slightly sooner than expected, either during, or soon after, the Defence and Security Exhibition International (DSEI) in September 2019.
H&W were central to the British consortium bidding to build the Fleet Solid Support ship. Boris Johnson has appointed Anne-Marie Trevelyn MP as the new Defence Procurement Minister. She is a member of the All-Party Parliamentary Group for Shipbuilding which advocates that the FSS be built in the UK and not open to foreign competition. In her brief tenure as Defence Secretary, Penny Mordaunt also advocated “buying British” and there is appears to be political momentum to ensure the FSS is built in a UK yard. This could be good news for Babcock Rosyth but a guarantee that H&W would participate in building blocks for FSS could be a potential lifeline. Like Penny Mordaunt, Anne-Marie Trevelyn can be considered very much a friend of the Navy but the political situation is so volatile, it is unclear how long this government survive as the Brexit crunch approaches. The National Audit Office says, there is also still at least a £7.8 Billion hole in the MoD 2018-28 Equipment Plan, a ticking time-bomb, which remains unaddressed. Boris Johnson has made the right noises, without being specific, about substantial increases in defence spending but is also promising to loosen the purse strings across other government departments. The only certainty for now, in defence and much of its supporting industry, is uncertainty.
Subsequent to publishing this article, in late September 2019 Harland & Wolff has bought by energy firm InfraStrata, primarily to construct aspects of the Islandmagee underground gas storage plant off the coast of Country Antrim. It remains unlikely to return to shipbuilding.
Main image: RFA Fort Victoria fitting out in Belfast, 1991.