The British engineering company Rolls-Royce has struck its biggest ever deal with the Ministry of Defence with a £9bn contract to make nuclear submarine reactors for the Royal Navy.
The government said the deal, which will create more than 1,000 jobs and safeguard 4,000 other roles, will boost UK national security and drive economic growth.
The contract with Rolls-Royce Submarines, dubbed Unity, will result in the engineering firm designing, manufacturing and providing support services for nuclear reactors for the UK’s submarine fleet.
“This investment in Britain’s defence will deliver a long-term boost to British business, jobs and national security,” said the defence secretary, John Healey. “National security is a foundation of our government’s plan for change, and this is a clear demonstration of our commitment to the UK’s nuclear deterrent, which is our ultimate insurance policy in a more dangerous world.”
The nuclear deterrent has been in place since 1969 and means at least one nuclear warhead-armed submarine, powered by Rolls-Royce, is always on operational patrol.
Healey will announce the deal during a visit to Rolls-Royce’s nuclear reactor production facility in Derby.
The government said that the new deal “streamlines” previous contracts and “incentivises more efficient delivery”, resulting in savings of £400m over the eight-year term of the contract.
“This will generate more efficiency and allow for effective risk and opportunity management, providing incentives to produce more for no increase in cost,” the government said. “Including on work such as the building of Dreadnought class submarines.”
The government said that the deal also showed its commitment to the “triple lock” nuclear deterrent, which includes building four new nuclear submarines at Barrow-in-Furness in Cumbria, and maintaining a “continuous at sea deterrent”.
“This long-term contract enables us to invest in the right skills, equipment and facilities to play our part in protecting UK interests at home and overseas,” said Steve Carlier, the president of Rolls-Royce Submarines.
In March 2023, it was announced that Rolls-Royce would provide the reactors for the new fleet of nuclear submarines in a defence agreement between the UK, US and Australia, a partnership called Aukus.
The submarines will be built in Britain and Australia but use technology from all three countries.
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The Aukus pact has not come without its frictions. In 2022, the Australian government agreed to pay €550m (£465m) to settle the cancellation of a contract with France’s Naval Group to build attack class submarines.
The confidential settlement drew a line under the cancellation of the $90bn deal between Australia and France, which was replaced with the Aukus partnership under which the US and UK offered to help Australia acquire at least eight nuclear-powered submarines and cooperate on technology.
The company opened a nuclear skills academy in Derby in 2022, designed to provide 200 apprenticeships each year for at least a decade.
Rolls-Royce Submarines is already doubling the size of its Raynesway site and has recently started moving into specially built warehouses in Pride Park.
“[The deal] is a clear signal of our commitment to deliver greater effectiveness, efficiency and agility to meet the needs of the defence nuclear enterprise and support the Royal Navy’s submarines now and in the future,” said Chris Gardner, the chief executive of the Submarine Delivery Agency.
Source: theguardian.com
