There was some good news for the government as politicians return to Westminster and Whitehall after the summer break: the Royal Norwegian Navy will buy at least five Type 26 anti-submarine warfare frigates from BAE Systems Maritime. The vessels will be built by BAE’s shipyards at Govan and Scotstoun in Glasgow and the overall agreement is being billed as worth £10 billion.
There are aspects of the deal which are unquestionably positive. Norway’s selection of the Type 26 frigate over the American Constellation-class, the F126 from Germany and France’s Fregate de Defense et d’Intervention is a fillip for the UK’s defence industry. It is also a welcome boost for BAE’s facilities on the Clyde; the 2015 strategic defence and security review reduced the Royal Navy’s requirement from 13 ships to eight, so Norway’s order for ‘at least five’ frigates makes good that gap. The Ministry of Defence boasts that this will support ‘4,000 jobs across the UK supply chain until well into the 2030s’, half of those in the Govan and Scotstoun shipyards.
The delivery schedule for the warships for both the UK and Norway is a matter of some anxiety
The construction of the ships for the Royal Norwegian Navy in the UK is important. The Type 26 has already been sold to Australia and Canada, but in both cases the vessels will be built in the customer’s home country: the Hunter class will be constructed by BAE Systems Maritime Australia at the Osborne naval shipyard in Adelaide, while Canada’s River-class destroyers will be built at the Halifax shipyard in Nova Scotia.
This is also more than a straightforward customer purchase. In February, the UK and Norway issued a ‘joint statement on enhanced defence cooperation’ which included a commitment to ‘develop closer industrial ties, enhance our capabilities, and strengthen our armed forces’. A final agreement is expected to be concluded soon, but the Type 26 deal refers to the Royal Navy’s vessels and those ordered by Norway working as a ‘combined fleet’ in the North Atlantic. This force will combine the anti-submarine role with the protection of critical national infrastructure and is a valuable addition to the security of Nato’s northern flank.
The government has made much play of the value of the order. At £10 billion, this is Norway’s largest ever defence procurement project, as well as the UK’s ‘biggest ever warship export deal by value’ (note the careful definition). That is a significant commercial agreement by any standards, but it should be taken with some caveats. The first is that, as far as we can currently tell, the deal will sustain jobs in the UK, and help support the skills base on which the defence industry is so reliant, but it will not actually create additional employment. The Prime Minister’s commentary was worded with exquisite, lawyerly care:
This £10 billion deal is what our plan for change is about – creating jobs, driving growth and protecting national security for working people… the export of our world-leading Type 26 frigates to Norway will do exactly that, supporting well-paid jobs up and down the United Kingdom, from apprentices to engineers.
There is another important element of the agreement which is yet to be set out in detail. There is a reference to ‘industrial cooperation with Norwegian industry equivalent to the total value of the acquisition’, the extent and nature of which are as yet unclear. It is likely to include repair and maintenance at the Hamek shipyard in Harstad in northern Norway, which signed a memorandum of understanding with BAE Systems in February, but the final full spending allocation will require careful examination.
The delivery schedule for the warships for both the UK and Norway is a matter of some anxiety. The agreement stipulates that the Royal Norwegian Navy receives its first vessel in 2029: this inevitably means that one of the five Type 26s currently under construction for the Royal Navy will be transferred to Norway’s allocation, as there is no time to start a new ship from scratch for delivery in 2029.
Managing the demands of the two navies will be challenging, and the Royal Navy’s eight Type 23 frigates, which are being replaced, are now well past their prime: the first was launched in 1987. BAE is confident it can deliver a frigate every year, but each takes 66 months to build, and the Ministry of Defence will need to be clear that the deal with Norway does not result in any capability gaps for the UK.
The agreement with Norway is a positive development. It is good for BAE Systems and therefore good for British business, and close bilateral cooperation between the UK and Norway within the framework of Nato is a sensible approach to Euro-Atlantic security. There are important details still to be revealed, and the relentlessly on-message sloganeering of the official media announcement is unhelpful, both unconvincing and obfuscatory. But we can give at least two cheers – and perhaps hold back the third until the process is underway.
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