Defence boss quits in protest at 'laughing stock' carriers

• Lord Hesketh has called the project a 'Loony Tunes' operation Picture: PA

Lord Hesketh quit as deputy chairman of the Rosyth-based engineering company Babcock International after his comments on the 5.2 billion aircraft carrier contracts were published in a national newspaper, reigniting fierce debate over the Conservative/Liberal Democrat defence strategy.

The peer was said to be angered by the decision effectively to mothball the second carrier, the Prince of Wales, and not fly fast jets off the other, the Queen Elizabeth, until after 2020.

The government has made it clear it would have built just one of the carriers had it not been for a contract with another defence giant BAe Systems that made it more expensive to cancel one by about 500 million. The contract is already under heavy scrutiny by the Commons' powerful Treasury select committee, and Tory Chancellor George Osborne and his Lib Dem deputy Danny Alexander have both been forced to explain it.

Last week Mr Osborne released a letter sent by BAe's chief executive Ian King at a late stage in the Strategic Defence and security Review, which forced the government's hand in going ahead with both carriers.

In his comments, Lord Hesketh described the project - which supports 1,500 jobs at his former company in Rosyth and another 5,000 BAe jobs on the Clyde - as a "Looney Tunes" operation. He claimed it was about to become a "classic British disaster".

• Norwegian co-operation on defence

He also suggested that money could be saved by adapting the British Typhoon jets for sea use rather than purchasing the new joint strike fighters.

But the coalition's opponents claimed it was not the contracts that were "a laughing stock" but the government's decision. Labour MSP John Park, a former Babcock employee and union shop steward, said: "The real laughing stock is the UK government, who are building two carriers but not flying any planes off them for a decade.

"This highlights how eccentric and absurd Liam Fox's decision is."

He added: "These carriers are vital for the defence of our country and building them here keeps alive a British shipbuilding and refitting capacity for the future.

"The carriers have been used in every major military excursion in my life, and in humanitarian missions, too."

Babcock issued a statement yesterday distancing itself from Lord Hesketh's comments.It said: "Babcock dissociates itself from these personal comments, which do not in any respect reflect the views of the company.

"Babcock, with its partners in the Carrier Alliance, is focused on delivering this major upgrade to the UK's defence capability on time and to budget."

Defence minister Peter Luff said the problem was the state in which Labour had left the Ministry of Defence's finances.

In exchanges at defence questions in the Commons yesterday, Mr Luff reminded the House that there was "a 38bn black hole" in the MoD's budget.

He added that the department had been forced to find its share of the 80bn of cuts announced for the next four years.

However, in increasingly bitter exchanges one Tory MP, Greg Hands, described the carrier contracts as "disgraceful." Ministers were also pressed by Scottish affairs select committee chairman Ian Davidson to reconsider mothballing one of the carriers.

Meanwhile, Dunfermline and West Fife MP Thomas Docherty, whose constituency includes Rosyth, appealed for work on fitting the new launch system to come to Babcock.

Mr Docherty pointed out that it would be cheaper and quicker to get the work done now at Rosyth while the deck sections were being built.

There are also doubts over the Fife town's long-term future in servicing the carriers, because of a deal with the French that could see the work go from Rosyth to Brest, in Brittany.

Mr Luff said he was unable to give any guarantees on the launch system.