The next generation of shipbuilding jobs in Scotland has been secured with the announcement of a £3.7 billion contract with BAE Systems to build three Type 26 frigates on the Clyde.
Work to begin cutting steel for the vessels will begin next month, with up to 1,700 jobs protected across Scotland and another 1,700 in the UK-wide supply chain until 2035.
Unions welcomed the announcement, which follows months of speculation that the Type 26 programme could be delayed or downgraded due to a lack of funds.
However, there was disappointment as the Ministry of Defence confirmed that the contract for another five vessels, worth upwards of £5bn, would not be negotiated until the early 2020s.
Defence secretary Michael Fallon said the contract for the Type 26 programme had been designed to prevent cost overruns and delays.
The anti-submarine Type 26 “global combat ship” will be built at BAE’s Govan and Scotstoun shipyards, where the defence giant promised to invest in a “frigate factory” three years ago.
The number of vessels in the class was subsequently cut from 13 to eight, and unions had raised the alarm over claims the MoD was seeking to shave hundreds of millions of pounds from the contract.
The GMB union said the contract would ensure that shipbuilding skills remain on the Clyde.
“It’s a fantastic announcement,” said Ross Murdoch, GMB national officer and acting chair of the Confederation of Shipbuilding and Engineering Unions.
“This will be a great boost for apprentices as well, not just securing existing jobs. There will be a lot of young people in the west of Scotland who can now get highly skilled jobs and guaranteed work for a generation.”
But he added: “They’ve always said it was going to be announced in batches. We’re a bit frustrated as we don’t know why they can’t confirm the other five. Because they’ve scaled it back before, there’s always a bit of concern that they might not deliver on what they’ve said.”
Ian Waddell, national officer for union Unite, said: “We welcome the long-awaited news that the Type 26 programme has been given the go-ahead.
“These first three ships will secure thousands of highly skilled jobs on the Clyde and across the UK supply chain.
“The contract is testament to the world-class skills of the BAE Systems workforce on the Clyde and we urge the government to sign on the dotted line for the next five ships as soon as possible.”
Investment in shipbuilding on the Clyde became a key battleground in the 2014 independence referendum, with the Scottish Government accusing UK ministers of failing to deliver on promises made ahead of the vote.
Last year the MoD announced that two more offshore patrol vessels would be built on the Clyde to act as a stop-gap until work on the Type 26 begins, amid fears jobs and skills could be lost.
Unions are also awaiting the government’s response to a shipbuilding review by Sir John Parker, who called for five planned lighter Type 31 “general-purpose frigates” and additional support vessels for the Royal Navy’s new aircraft carriers to be built around the UK, rather than being concentrated on the Clyde. An announcement was delayed by the general election.
The first of the two carriers, the new Royal Navy flagship HMS Queen Elizabeth, left BAE Systems’ shipyard at Rosyth last week for sea trials.
A study by the Fraser of Allander Institute has estimated that BAE supports 6,000 jobs in Scotland, pumping wages worth £163 million per year into the economy around its Clyde and Forth sites and connected supply chain.
Fallon said the Type 26 programme would “bring vast economic benefits to Scotland and the wider UK” and would maintain Britain as a “global naval power”.
He said: “The contract is structured to ensure value for taxpayers’ money and, importantly, now designed to protect them from extra bills from project overrun.
“The investment will secure hundreds of skilled jobs at BAE Systems on the Clyde for the next 20 years, and thousands of jobs in the supply chain across Britain.”
SNP defence procurement spokesman Douglas Chapman, the MP for Dunfermline & West Fife, which includes the Rosyth shipyard, said the announcement was welcome news.
“The MoD must now make good the commitment that the next batch of five vessels will be built on the Clyde, and it’s a great pity the UK government has not offered the workforce and apprentices on the Clyde greater security for their future beyond 2020.”