Royal Navy 'depleted by vicious cycle of retaining old ships'
The Royal Navy fleet is being depleted by a "vicious cycle" of old ships retained beyond their sell-by date, an independent report has warned.
A review headed by Sir John Parker found that the procurement of naval ships takes too long from concept to delivery compared with other industries.
He concluded that fewer ships than planned are ordered too late, saying: "Old ships are retained in service well beyond their sell-by date with all the attendant high costs of so doing.
"This vicious cycle is depleting the RN fleet and unnecessarily costing the taxpayer. It needs to be broken."
Sir John, chairman of mining giant Anglo American, said there is a "vibrant" UK shipbuilding, marine and defence supply chain sector which the Ministry of Defence (MoD) should harness.
He called for a "sea change", with "pace and grip" from the Government so that shipyards across the UK can win work and create jobs.
He said the Government must drive cultural change in defence to inject "genuine pace" into the procurement process and get a clear grip over cost and time.
The MoD should lay out its plans for naval ships over the next 30 years, the report recommended.
Sir John suggested that work on warships should be shared among companies across the UK.
He said BAE Systems should build the Type 26 series, describing the defence giant as having the breadth of technical and engineering talent and the most recent experience of building sophisticated warships.
But he added that a new fleet of Type 31 naval frigates was urgently needed to maintain the Royal Navy's fleet numbers and to establish a UK exportable light frigate.
"There is no precedent for building two 'first class' RN frigates in one location," he said.
A separate lead shipyard or alliance would appear to be the best way forward for the new frigate to minimise risk, the report said.
SNP defence spokesman Brendan O'Hara said the UK Government must now end "unnecessary and worrying delays" in bringing forward a national shipbuilding strategy.
''The MoD told us the strategy - vital to our shipbuilding industry - would be complete by the Autumn Statement last week at the latest.
"We are now told it will be spring next year before we can see any firm plans and that means more unnecessary and worrying delays for the workers, families and communities that depend on shipbuilding.
"These concerns about another Westminster muddle will only be heightened by some of the recommendations in this report, with clear implications for yards on the Clyde in particular.
''Today's report is a distraction for shipyards and shipbuilding in Scotland, who deserve better than this."
The MoD said the report will inform the Government's shipbuilding strategy, to be published next spring.
A statement said: "Sir John recognises the skill and experience Scottish shipyards possess. He argues that Scotland's cutting-edge technology presents an opportunity to implement modular construction more widely, a process in which ship components are produced across the UK before being assembled at a central hub.
"The build of the Royal Navy's largest ever warships - the Queen Elizabeth Class aircraft carriers - has already demonstrated the success of such an approach, with multiple shipyards and hundreds of companies across the UK working together and benefiting from the aircraft carrier build and final assembly taking place at Rosyth."
Defence Secretary Sir Michael Fallon said: "I would like to thank Sir John for providing an ambitious vision of naval shipbuilding in the UK based on a new era of co-operation as part of our modern industrial strategy.
"This report will inform our national shipbuilding strategy to match the needs of the Royal Navy with the ability to design and build efficiently, maintain skills, and maximise export opportunities.
"This will ensure a strong naval shipbuilding sector and help deliver an economy that works for everyone."
Scottish Labour's Westminster spokesman Ian Murray said: "The confirmation that construction of the new Type 26 frigates will begin on the Clyde next summer secured the future of the yard for the next 20 years, but we want to see the future of the Clyde and its workers safeguarded for much longer than that.
"The Clyde shipyard is a historic centre of UK shipbuilding and its world-class workforce must be protected and maintained.
"The UK and Scottish Governments need an industrial strategy that invests in defence and commercial shipbuilding on the Clyde to increase opportunities for shipbuilding. Promises were made to the workers on the Clyde and we will not allow the Government to go back on them."
A Downing Street spokesman said: "Sir John has put together a very thorough analysis of Navy shipbuilding and recommendations around that.
"It is only right that we now take that report and give it the careful consideration it needs before we produce a national shipbuilding strategy that reflects the needs of the Royal Navy.
"We will respond in due course to the recommendations that Sir John has made."
The spokesman said he did not recognise suggestions that the Navy was the victim of a vicious cycle of underinvestment in ships.
"I don't agree with that in principle," said the Number 10 spokesman.
"There's been a lot of investment in shipbuilding from the MoD - an estimate is £1.4 billion in 2014/15 on shipbuilding and repair in the UK alone. That resulted in 15,000 direct jobs and 10,000 indirect jobs.
"So the investment in shipbuilding is going in.
"We've got money going into the Type 26, we're building two new offshore vessels on the Clyde and you've got the OPV (offshore patrol vessel) 4 and 5 contracts to be awarded shortly."
Shadow defence secretary Nia Griffith said: "This report should be a wake-up call to ministers, who have presided over severe cuts to the capabilities of the Royal Navy.
"As Sir John points out, keeping ships in service well beyond their sell-by date not only undermines our national security, it ends up costing the taxpayer more in the long run due to high maintenance costs."