The Tories and skilled jobs – unable or unwilling?

A couple of weeks ago the Conservative-led government published a white paper on defence procurement that committed the Ministry of Defence to buying on the open market with little regard to supporting British industry or British jobs. At the time that policy was announced, I criticised the government for being short-sighted about the potential knock on effects to the British economy. In handing the MARS contract to a Korean company, we are now seeing the consequences of that new policy.

The government insisted in a written statement to Parliament that the contract represented support for the British shipbuilding industry with ‘up to 20%’ of the contract value to find its way to British businesses but the alternative, European bid set a minimum of 35% work-share for British based firms, providing a more solid guarantee for hard working families dependent on those industries. Furthermore, the letter sent through to the MoD earlier this week opened the door to greater cooperation with British firms, including BAE, which could have resulted in some much-needed good news for the UK economy.

RUSI, the respected defence think tank, has calculated that up to a third of the value of defence contracts, awarded to British-based companies, finds its way back to the government through tax revenues, and by investing in British industry and creating jobs the government has to spend less of taxpayers’ money on benefits for unemployed workers. Labour has called for a more active industrial strategy, which supports our manufacturing sector and secures high skilled jobs here at home. I find it baffling that the government rushed out a decision to hand this contract, worth hundreds of millions of pounds, to the bidder prepared to make the smallest commitment to the UK economy.

Ministers have real questions to answer about a tender which put British based companies off from making a bid, about a process which has been rushed, and about a decision which saw the British government turn its back on British workers and businesses who deserve better. Across the world prospective buyers must look and wonder why they should buy from British firms if the British government won’t make that same commitment.

In the aftermath of the Bombardier fiasco, when the government sent skilled jobs overseas and just weeks after the prime minister allowed a multi-billion pound fast jet contract slip through our fingers and into the hands of the French, this is just another example of a Tory-led government unable or unwilling to put its weight behind the British economy at a time when it most needs support.

Alison Seabeck MP is a Shadow Defence Minister