I begin by offering my thanks and by paying tribute to you, Madam Deputy Speaker, to the other Deputy Speakers and to Madam Speaker for allowing this debate to take place. Last week, Madam Speaker generously granted a debate on Rosyth dockyard but, for reasons of which everyone is aware, it was not possible for it to occur. I know, however, that everyone involved has been working to ensure that it takes place tonight. It is only fair that I should thank all right hon. and hon. Members, and the Whips on both sides of the House, for their assistance in ensuring that the debate takes place. In many ways, tonight could not have been a better time for this debate, as Parliament was lobbied today by workers from all the dockyards involved in defence.
I am here to speak not just for myself or on behalf of my hon. Friend the Member for Dunfermline, East (Mr. Brown); nor am I here to speak only for the work force of Rosyth—for its 4,100 direct employees and its many thousands of indirect employees. No; I am here to speak out for every man, woman and child in Scotland.
Over the years, the industrial giants of Scotland have disappeared. The only one left is Rosyth dockyard, Scotland's largest industrial complex. If the Government do not secure Rosyth's future, we in Scotland will be left with nothing but an industrial history, former employment and bitter memories.
I want to cover three main areas in this speech—employment, industrial strategy, and the strategic, security and cost implications for Rosyth. The people of Scotland fear that the Government will break their promises. Since 1985, Rosyth royal dockyard has been promised that it will be the prime submarine refitting yard. In 1985, a senior member of the Government told us that the yard could look forward with high hopes. We were told that work on the refitting of Trident submarines was guaranteed. He added that the Government would complete the building of the massive facilities required to support Trident submarines, which would be refitted at Rosyth. That Minister is still a member of the Government; indeed, he is now an even more senior member—the right hon. Gentleman is now the Chancellor of the Exchequer. I ask the Minister of State for Defence Procurement whether the Chancellor still holds the views that he expressed in 1985, and I ask him also to give us his own opinion.
I shall talk about the jobs that were guaranteed by the Government, jobs that now seem so insecure. In the dockyard, there are 4,100 direct employees. In Fife, there are certainly another 4,000 to 5,000 indirect employees. It has been estimated in a study produced by the Fraser and Allander Institute and St. Andrew's Economic Services that overall job losses throughout Scotland as a result of the closure of the dockyard, which would take place if it was not awarded the Trident refitting contract could be up to 18,000. Sub-contractors would collapse, as would small businesses, 80 per cent. of which have 50 or fewer employees.
There are 245 companies providing supplies or subcontracted services to the dockyard. A further 250 provide services to the naval base. Throughout Scotland, an additional 835 companies have some sort of business with the dockyard. What future will the Government promise 1,330 companies in Scotland if the dockyard is closed? What future will the Government promise the naval base, and especially 4,000 naval personnel, if the dockyard closes? What future will they offer 18,000 employees and their families in Scotland if they do not fulfil their promises to Rosyth? Those people are like the 18,000 who comprise the population of Buckhaven, like the 18,000 who live in Balerno and Baberton, which are in the constituency of the Secretary of State for Defence, and like the 18,000 who live in Huntingdon and Godmanchester, in the Prime Minister's constituency. What will happen to those people if the dockyard has no future?
Fife does not have low unemployment; it has the second highest unemployment in Scotland. If the dockyard closes, it will certainly come top of the list. It will have an overall unemployment rate of 17 per cent. In the Dunfermline area, we shall be talking of up to 30 per cent. unemployment—one in every three people out of work.
We are aware of the plight of many young people. At present, Rosyth dockyard still brings some hope—for example, it still trains 65 per cent. of all Scottish engineering apprentices. If it closes, the Government will be telling those apprentices and engineering firms that there is no future for them.
If the yard closes, it will cost the Government a great deal. We reckon that redundancy costs will be about £102 million. Clean-up costs will amount to £2 million and unemployment costs will reach £280 million; that is not to mention writing off the £125 million that has already been spent on the new Trident fitting work. I am suggesting to the Government that they can save more than £500 million. They can save jobs and their own reputation by adopting Babcock Thorn's proposal to have two dockyards with one management.
That proposal is for a dual-site option of submarine refitting at Rosyth and surface ship refitting at Devonport. That option would save the Ministry of Defence more than £260 million and would save the Exchequer an additional £250 million. It would preserve local economies and employment and provide a safe solution for submarine refitting. Babcock Thorn has made a fixed-term bid to the Government of £267 million. It offers Rosyth new equipment and fabric which are designed with low maintenance in mind. It offers facilities and special skills, efficiency and throughput, more jobs and minimal cost to the Exchequer.
It is not just Rosyth's management who are arguing for two dockyards and one management. Just last week Professor Donald MacKay, the chairman of Edinburgh consultancy PIEDA Ltd., said that savings of up to £440 million in defence spending could be made if submarine work was carried out at Rosyth and work on surface ships was carried out at Devonport. He estimated that the two yards could produce cost benefits of between £320 million and £438 million over the next 30 years.
Other worldwide studies demonstrate that the best savings are made by adopting a multi-site focused approach rather than a large-scale single-site operation. Safety, decommissioning, lay-ups, operational availability and location considerations all favour the dual-site approach, with Rosyth dealing with submarines.
I have just received a report from Price, Waterhouse —hardly a firm of which I would normally speak well. About Rosyth it said:
As a result of our analysis of the projected operational costs to the MOD estimated by BTL under the two options and the sensitivity analysis which we have undertaken on certain material figures and assumptions, we conclude that costs are marginally balanced in favour of a dual site option.
In addition the MOD have a potential opportunity to save approximately £120£140 million by concentrating nuclear submarine refitting and decommissioning at Rosyth. These savings represent the differential cost of Rosyth's ability to accommodate the full nuclear programme earlier than Devonport.
The Rosyth proposals are intrinsically safe. Rosyth is much more remote from the public than Devonport, where 38,000 people live within 2 km of the dockyard. Rosyth is capable of meeting all modern safety standards and its work force have an impeccable track record in submarine refitting and technical expertise. Its safety record on nuclear refitting is second to none.
The site for a new refit facility was chosen not by Babcock Thorn but by the Ministry of Defence after intensive investigation in the early 1980s. The design of the new facilities at Rosyth is at an advanced stage. They will be built on bedrock, which is more secure than any other kind of rock anchor. Rosyth's results have been audited by the nuclear installations inspectorate.
Let me say something about industrial strategy. The Fife economy is very fragile, because of such factors as long-term structural change, peripherality and a lower level of company formation; yet the dockyard has been innovative. It has developed defence diversification up to 15 per cent. of its work load. The most famous example is probably its work on London underground carriages.
None of us is under any illusion: the new era of peace and the peace dividend is in danger of creating an economic desert in parts of the country—particularly in Fife, where 30 per cent. of all businesses are defence related. In Rosyth, 10 per cent. of regional gross domestic product is provided by the dockyard; the dockyard, together with the base, has a turnover of £394 million, the vast majority of which is spent in Fife; and the Scottish economy is further affected by related expenditure of £380 million a year.
Let me ask the Minister some questions which I should particularly like him to answer. When does he believe that Rosyth will be ready to undertake the first Trident refit? When does he believe that Devonport will be ready? What Government savings will result from the closure of Rosyth, given the massive increase in unemployment benefits and the reduction in tax and national insurance receipts? When will a decision be made and announced? Hon. Members want specific dates, rather than further generalities such as "before Christmas" or "early in the new year".
Would Rosyth be given a lifeline, just to delay its closure? Does the Minister see a future for the naval base, which I visited on Monday, if the dockyard closes? Is it true that the Navy Board has come out in favour of Devonport? Why has the Ministry of Defence rejected Babcock Thorn's proposal to take over all nuclear refitting work three years early, in 1994, which would save £150 million? Does the Minister accept that Rosyth could handle the whole operation from 1995? Are the Government in favour of a dual site or a single site? As far as the Minister knows, does the Chancellor still hold the views that he held in 1985, and does the Minister share those views?
Finally, let me ask a question that was given to me to ask tonight:
When the Government privatised the Royal dockyards…it announced that, in addition to securing better value for money, it also wanted to achieve 'scope for expansion of employment opportunities in the regions concerned' and 'an assured long-term future for the Dockyards' … It is clear that the proposal put forward by Babcock Thorn is consistent with these objectives. Can Ministers confirm that these are still aims of Government policy?
Let me be honest: I never thought that I would stand in this Chamber arguing for nuclear submarines that would assist the Government. I am prepared to do so because think that people are most important—the Rosyth work force, their families and the people of Fife and Scotland in general. It does not come easy to me, but I propose that the Government increase their popularity with the people of Fife and Scotland by retaining Scotland's largest industrial complex. I do not need to tell any hon. Member what will happen if Rosyth dockyard closes, nor do I need to tell any hon. Member that this is not just a local campaign or a Fife campaign. It is a campaign throughout Scotland, and possibly even further, by all those who care about the defence of this country.
I congratulate the hon. Member for Dunfermline, West (Ms. Squire) on, first, attaining this debate and, secondly, being kind enough to agree—as have my hon. Friends—to my speaking in the debate. I have no hesitation in contributing to debates on defence matters. Many hon. Members know that for many years it has been my job to defend the reasons why we maintain our nuclear capability on the Clyde. I have believed in deterrence for many years, and I still do. We must examine how to maintain the submarines that will be based in the Clyde for the next 30 years.
The Minister will be aware that the Babcock Thorn proposals which he and the Government have received, as well as the modified versions, are financially sound. Babcock Thorn's two-dockyard proposal was not dreamed up simply to save jobs. It is a management proposal made on sound management lines that clearly demonstrates that one can manage two facilities more effectively and efficiently than one.
Another huge and important advantage of having the submarines serviced at Rosyth and the surface ships serviced at Devonport is that the proposals are environmentally sound. A purpose-built, earthquake-proof dry dock facility for nuclear submarines at Rosyth must surely be safer than a modified facility at Devonport. The absence at Rosyth of a high-density population makes it a much better choice. It cannot be wise to put nuclear submarines into a modified facility right in the centre of a large, waterfronted city, particularly when a more suitable, less populated site at Rosyth is available.
Can the Minister confirm that this aspect of the environmental considerations will be fully and adequately addressed before any decision is made? Can he also confirm that the Babcock Thorn single management proposals for both dockyards will be fully and properly examined, again before a decision is taken? Will the independent report that supports these views also be considered?
Furthermore, can the Minister confirm that the real and full cost to the public purse, in the event of that facility being closed, will be made known? I refer to the money already spent at Rosyth as well as to that which has been committed and that will not be recouped. There will also be the cost of redundancies and the unemployment and social security costs. Will the Minister ensure that the figures submitted by Fife regional council and the Fraser of Allander Institute are part of the package that the Treasury must properly examine before just a military decision is taken? My view, and that of independent experts, is that the cost to the public purse of closing the Rosyth facility would be far in excess of the cost just to the Ministry of Defence.
Can the Minister also confirm that, before any decision on the future of the Rosyth dockyard is made, proper consultations will take place with all those involved? I have particularly in mind the trade unions and the management.
I remind my hon. Friend—the hon. Member for Dumfermline, West drew attention to this—that at present not so many engineering apprentices are being trained as one would wish. In Scotland the number of engineering apprentices is slightly more than 600. When one remembers that more than 300 of those apprentices are trained in the dockyard at Rosyth, one realises that the cost in the training budget would be massive if we had to find alternatives. That is important. Such matters must be taken properly and fully into account before any decisions are made. One should be in no doubt what the economic consequences will be for central Scotland if the dockyard closes. The consequences will be horrendous. One should have no doubt about that at all.
I have no hesitation whatever in standing behind my hon. Friend and saying that I do not need to be persuaded that it is wise to keep Rosyth. I have always believed that Rosyth is one of the great jewels in the crown of defence, and I still believe that. That is why I argued in 1985, and earlier, that we must keep both the dockyard and the naval base. I still believe that the retention of the dockyard and the naval base is an essential military requirement.
It is worth noting the proposal of Babcock Thorn to have submarines serviced at Rosyth. That is sensible because submariners have their homes in central Scotland and the submarines are based on the Clyde. Anyone who has studied such matters knows that submariners spend a lifetime in the service. Many of them buy homes in central Scotland and put down roots there. If submarines are required to be serviced, it makes sense to have them serviced in a convenient place so that submariners do not have to move from home. They can travel daily because Rosyth is as near to where many of them live as the base on the Clyde. That matter must be taken into account. It is equally true that the service fleet is largely based in the south of England. The sailors who man the surplus ships have their homes in the south of England, so it makes sense to have the ships serviced in the south of England. That must be another important matter.
I now turn to yet another important matter. [Interruption.] It is not a matter about which anyone should mutter or be foolish. I refer to one of the most important defence decisions that we will make, probably this century. It is also one of the most strategic and economic decisions that Scotland will face. If we do not retain the facility, the consequences are too horrendous to contemplate.
As the Conservative Member who has been charged with the responsibility of looking after defence matters on behalf of the Conservative party, I ask my hon. Friend to bear in mind, as the Government will, the fact that there are bound to be political costs which I would hate to contemplate if we considered closing Rosyth. The peace movement has given free reign in Scotland to oppose the location of a nuclear deterrent on the Clyde. The big factor that has undermined from the beginning the peace movement's campaign against nuclear deterrence—the hon. Lady put her finger on it—has been the jobs at Rosyth. The jobs at Rosyth were our deterrent. When I say "we", I refer to those of us who believe in nuclear deterrents. The Rosyth jobs were the trade-off for trade unions supporting the retention of nuclear deterrents on the Clyde.
We must examine the matter carefully, together with all the other political considerations. I would not look foward to appearing on radio and television to defend the retention of the nuclear base if I could not constantly remind people of the massive number of jobs that generated from the maintenance of submarines at Rosyth.
I am grateful for the opportunity to say a few sentences in support of the hon. Member for Dunfermline, West (Ms. Squire), who introduced the debate with great skill and considerable conviction. One should acknowledge her persistence in ensuring that the debate took place.
It would also be wrong of me not to congratulate the hon. Member for Tayside, North (Mr. Walker). It appears that he is impervious to change. Prime Ministers come and go and reshuffles take place, one after the other, but still he ploughs an occasionally solitary furrow as the guardian of the defence interests of the Scottish Conservative and Unionist Association in Scotland. That is a rare achievement and, even on a serious occasion such as this, one should perhaps acknowledge it.
My interest in the debate stems partly from the fact that my constituency lies within Fife. Although the economic consequences of the closure of Rosyth might not affect north-east Fife with quite the same severity as it would undoubtedly affect the constituency of the hon. Member for Dunfermline, West, any substantial reduction in economic activity that would occur as a result of closure would have a significant effect on the economy of Fife as a whole and, indeed, on the economy of central Scotland.
The military justification for the retention of the dockyard is overwhelming. Before I deal with that, I should like to note that, if the dockyard closed, the military arguments for retaining the base would be less strong than at present. It is not unreasonable to assume that if the dockyard closed, in due course the base would also go. The economic and employment consequences would be extremely severe.
It cannot be right from a military or security point of view to put all one's ship repairing resources and facilities in one location. I ask the House to think about it in terms of something as simple as sabotage. Let us suppose that all the facilities were located on the south coast of England. The technology of ballistic missiles is now so advanced that some countries in the middle east have the ability to put ballistic missiles into western Europe and the mainland of the United Kingdom. That may seem improbable, but only a couple of years ago we were engaged in a conflict with someone who would have had no compunction, if he had had the capacity to do it, about firing ballistic missiles at the mainland of the United Kingdom.
If perchance or even by design such a missile landed on the sole ship repairing facility, the damage to the ability of the United Kingdom to conduct its defence affairs could be substantial. It cannot make sense for the moment to concentrate all our facilities in one location. If the proper defence of the United Kingdom is to be achieved, it is inevitable that there must be two separate locations.
I have no discomfort in arguing for Trident submarines to be refitted at Rosyth, because I believe in the independent nuclear deterrent. I believe in a four-boat Trident fleet. The more boats in the fleet, the better opportunities there will be for refitting. The Minister should also bear it in mind that it would be a strange irony if the economic advantage to be derived from refitting nuclear submarines at Rosyth was taken away while the facilities at Rosyth were used for the storage of decommissioned nuclear-powered submarines for which no final resting place has yet been found.
For the reasons that I have given and in view of the powerful arguments made by the hon. Member for Dunfermline, West, I support the proposal that surface fleet work should be located at Devonport and the refit of nuclear submarines should be sent to Rosyth, where the facilities are available and the skills and the capacity of the work force are well proven.
I, too, compliment the hon. Member for Dunfermline, West (Ms. Squire) on her speech about Rosyth dockyard. I am grateful to her for allowing me and my hon. Friend the Minister to participate in the debate. I was an apprentice at Rosyth dockyard. My home town was Dunfermline. The hon. Lady commented on the value of those apprenticeships to young people nowadays, and I endorse every word that she said on that subject.
Rosyth dockyard has played an important role in Britain's defences over many years, especially during the past 50 years, and I believe that it still has an important role to play in the future. During the Falklands war, it certainly rose to the occasion. Throughout the past 20 or 30 years, Rosyth has played a vital role in maintaining the Polaris fleet, which has been right at the centre of British defence policies. Trident is at the centre of those policies for the future, and the nuclear deterrent has operated from Scotland over the years, as it will in the future. It is right to expect that the nuclear deterrent fleet, which has been maintained so well at Rosyth, will continue to be maintained there.
Since Babcock Thorn took over, Rosyth has changed considerably from the dockyard I knew. It has won more than 40 per cent. more work than others through competitive tenders—a remarkable achievement. Its labour utilisation has improved by about 22 per cent.—that, too, is remarkable. Its cost overruns on Ministry of Defence budgets have been virtually eliminated. That fact must weigh heavily with my hon. Friend the Minister when he considers Rosyth's future.
As the hon. and learned Member for Fife, North-East (Mr. Campbell) said, and for all the reasons that he mentioned, it is important that at least two naval bases be maintained in the United Kingdom.
Rosyth dockyard now has tremendous skill and knowledge within the base, and I ask that that skill and knowledge be put to good use for the future of Britain's defence systems.
This has been a useful and timely debate, and I begin by congratulating the hon. Member for Dunfermline, West (Ms. Squire) not only on her good fortune but also on her tenacity in securing it. I pay her a genuine tribute, because for months she has campaigned with commendable vigour on behalf of her constituents through correspondence and by coming to see Ministers —and now by securing this Adjournment debate.
I took especial note of the fact that the hon. Lady, with the leader of Fife regional council and other local authority leaders, and with the hon. Member for Dunfermline, East (Mr. Brown), who is on the Opposition Front Bench tonight, came to see me last week to argue on similar lines and with great force the case that she has made so eloquently tonight.
I have visited both Rosyth and Devonport to see for myself their facilities and plans and their blueprints for the future, and I have been impressed, as it is easy to be, with the efforts and the determination of the management teams and the work forces at both dockyards.
Like all my colleagues in the Government, I am deeply conscious of the great importance of the royal dockyards at Devonport and Rosyth to the economies of their areas. Both employ several thousand people and sustain employment for many thousands more in firms throughout their regions. The companies are also among the largest trainers of apprentices in their areas; and I was glad to hear the personal contribution of my hon. Friend the Member for Ayr (Mr. Gallie), who speaks with the experience of a former apprentice at Rosyth royal dockyard.
We are conscious that when we make our proposals in due course we shall be taking some important decisions, and we recognise the enormous significance for Fife and for Scotland of the issues which have been raised tonight.
However, we must also recognise that the subject generates strong emotions in the other part of the country likely to be affected. As I shall make clear to the House, our future plans for ship refitting and repair will have great and wide implications for the communities both of Devonport and of Rosyth. We have to be very careful how we reach our decision.
At the end of the day, we can be influenced only by hard facts of the kind that we have heard tonight. We are approaching the decision with scrupulous fairness and impartiality. To some extent, I am almost in purdah tonight because we are fairly close to reaching our decision and, as far as Ministers are concerned, this debate must be something of a listening exercise. However, I will answer all the questions asked by the hon. Member for Dunfermline, West.
Before responding to the questions of the hon. Member for Dunfermline, West, I want to pay a genuine tribute to the work forces at both dockyards who have given long and devoted service to the Crown over many years. Rosyth has carried out all the refits of Britain's Polaris submarines, including that of HMS Renown whose rededication ceremony took place a few days ago. In particular, I pay tribute to both companies which have reacted positively and enthusiastically to a requirement to complete warship refits ahead of time and to convert vessels of the Royal Fleet Auxiliary to war time use in preparation for the Gulf conflict and, before that, the Falklands conflict. The whole country has good reason to be very grateful to all those who work in the royal dockyards.
I want now to respond to some of the specific questions that have been raised in the debate, and I will do so in reverse order. My hon. Friend the Member for Ayr, whose contribution as I said, was very valuable from his perspective as a former apprentice at Rosyth, quite rightly highlighted improvements in productivity and competitiveness at the yard. He praised the great reservoir of skill and knowledge in Rosyth dockyard. I entirely accept his points.
The hon. and learned Member for Fife, North-East (Mr. Campbell) set out eloquently the military and security case for two locations. We are well aware of that. However, I thought that he was a little far-sighted when he envisaged the possibility of missiles raining down on Devonport. I suppose that stranger things have happened in the military world and it was perfectly valid for him to make out his case about the importance of two locations rather than one.
My hon. Friend the Member for Tayside, North (Mr. Walker), who has long been a staunch and vociferous champion of strong military defences of this country—more so than the hon. Member for Dunfermline, West, who acknowledged her recent Damascus-like conversion to Trident submarines—ran through a list of questions. He asked whether we would take into account environmental considerations, and the answer to that is yes; whether we would properly consider the dual-site proposal, and the answer to that is yes; whether we would take into account the recent special reports, particularly that from Fife council, to which the answer is yes; whether we would take into account the money that has already been spent on the RD57 project at Rosyth, to which the answer is also yes; whether we would take not just a military decision but a wider decision, and the answer to that is also yes, we will take all those broader factors into consideration. Finally, he asked whether I would be willing to receive consultations, and the answer to that is also yes.
We do not seem to have done much but receive representations from every possible viewpoint. In addition to representations in respect of this debate, I met a delegation this afternoon from Devonport and, a few minutes before the hon. Member for Dunfermline, West opened her debate, we heard a petition tabled from Devonport. We are trying to carry out a genuinely even-handed approach. Lack of consultation has not been a problem.
I want now to consider the specific questions of the hon. Member for Dunfermline, West, many of which referred to dates. She wanted to know when Rosyth and Devonport would be ready to undertake the first Trident refit. We are confident that the facilities at either Devonport or Rosyth will be ready in time for the first Trident refit. We estimate that Devonport could take over all nuclear work at approximately the end of 1996 and that Rosyth could do the nuclear work nine months earlier, in the spring of 1996.
The hon. Lady asked what Government savings there would be if Rosyth was closed. Given the unemployment increases that she predicted, I cannot give her a precise figure, but, as I said in answer to a question from her on 27 October, all relevant considerations will be taken into account. The amount of spending that might be necessary on unemployment benefit will be roughly the same in both areas.
The hon. Lady asked me when the decision will be made and announced. It is our firm aspiration and intention to announce our proposals by the end of the year, but I should enter the caveat that, if more time is needed to get those proposals right, we will take it, because it is a decision of some complexity and wide significance. If we need to take a little longer in the interests of checking more carefully, I do not think that the House would begrudge such extra time, but we hope that it will not be necessary.
The Minister will agree that the loyal work force in Devonport and in Rosyth are on tenterhooks on this issue. I should like it to be recognised that at least one west country man is present who has constituents in Devonport. The loyal work force to whom the Minister rightly paid tribute recognise that it is an extremely important decision and that it must not be rushed, but it has gone on for a very long time and patience is wearing thin.
There is no question of any kicking for touch or unreasonable delays on the part of the Government. As I have said, it is our firm aspiration and intention to reach a decision and to publish our proposals before the end of the year. I entered the caveat because more information is still coming in and further representations are being made. Only this afternoon, I saw people from, I presume, the hon. Gentleman's constituency or from neighbouring constituencies, and it is only fair to make sure that everyone has his say. I accept that we have already tarried some time in reaching this stage in our considerations.
The hon. Member for Dunfermline, West asked whether there would be a future for the naval base if the dockyard closed. That is a hypothetical question. The decision that we have to take is primarily about the future location of nuclear refitting work. Of course we will take into account the implications for all other installations at Devonport and Rosyth, but those are not directly germane to the issue.
I was asked about reports from the Navy Board. I cannot comment on advice that the board might or might not have given in confidence to Ministers, particularly as that advice is still continuing. We receive advice from a variety of sources, and some of it is still in progress. I was asked by the hon. Lady why the Ministry of Defence had rejected Babcock Thorn's proposal to take over all nuclear refitting work three years early in 1994 and to save, allegedly, £150 million. We have neither accepted nor rejected any proposal, although we had reservations about a timetable from Babcock because it would have involved deferring the refit of one SSN.
The hon. Lady asked whether I accepted that Rosyth could handle the whole operation from 1994. We accept that Rosyth would have the facilities available from the end of 1994 to handle all nuclear refitting work, but a key factor would be the nuclear programme of the other yard which might be continuing for some time.
I have done my best to answer those broad questions. I hope that I have not left out anything. However, let me say a word about the reasons for and the conduct of the review, because the crux of the matter is our review of future refitting strategy. My right hon. Friend the Member for Bridgwater (Mr. King), the former Secretary of State for Defence, made it clear in his original statement on "Options for Change" in July 1990 and in his statement on fleet support in July last year that there has been a fundamental change in the level of readiness, infrastructure and support that we now need to defend this country and our overseas interests.
Against that background it would be irresponsible if the Government failed to give the most careful consideration to whether the investment that we make in defence is giving good value for money to the taxpayer. That applies as much to the support area as to the front line, and we have, as the House knows, engaged in a thoroughgoing assessment of our future needs in the fleet support area, including the dockyards.
A particular factor has been the consideration of the future size of our nuclear submarine fleet, which now comprises 13 hunter-killer submarines besides the four ballistic submarines, which carry Britain's independent nuclear deterrent.
Our original intention was, as the House knows, that Trident submarines should be refitted at Rosyth. The hon. Lady reminded the House of statements made by Ministers some years ago, but they were made when our submarine force levels were rather higher, and there was no doubt that two refitting facilities would be required.
However, studies done in my Department, on the basis of proposals by each of the existing dockyard contractors, have shown that it would be feasible and cost-effective to concentrate nuclear refit work at one dockyard.
Does my hon. Friend concede that, if Rosyth were selected, its experience and knowledge are sufficient to maintain the fleet without the movement of resources from elsewhere, but if Devonport were selected expertise and knowledge would have to be moved there from Rosyth to maintain the Trident submarines?
That is a fair point, but it is debatable. Others might make out a different case. We listened carefully to all those points of view and are considering whether to have two sites or one and whether there will be only one nuclear refitting site.
We have reached the point when we must consider the best way forward in the light of all the evidence that has been given to us. That evidence has covered a broad range of issues, including military, financial and other factors, and we want to get the process right.
The hon. Lady referred—as she would, given her constituency—to the proposal that we received recently from BTL. We recently received further proposals from both dockyard contractors and the parent company of the management contractor at Rosyth, Babcock International Ltd., has proposed that it should manage both dockyards, with nuclear refitting concentrated at Rosyth. That is known as the dual-site approach. We have had a similar proposal from Devonport Management Ltd., but it would be wrong for me to discuss the details of the proposals made by Babcock or Devonport because they contain so much commercially confidential information.
Both proposals are extremely constructive. I am grateful to the hon. Lady for drawing my attention to the Price, Waterhouse report, which she introduced as though it were a rather ill-smelling piece of fish, even though it seemed to substantiate her case and its conclusions. I gather that she does not have much love for accountants, even when they serve her cause.
All the documents and reports have been helpful and constructive and have assisted us to find the best way forward. They will be wholly taken into account when we announce our eventual package to the House.
The Government are fully aware of the momentous importance of the decision. As we are discussing Rosyth, we recognise how crucial it is not merely to Rosyth dockyard and its immediate surroundings, but to the people of Scotland and the economy of Fife. That importance is reflected in the good attendance at this late hour.
The impact on the local economy—on jobs and industrial strategy, to which the hon. Lady drew attention —is one among the many factors that we have to consider as we seek to balance the needs of the Navy and the taxpayer against those of south-west England and eastern Scotland, and against the more general needs of the defence of the United Kingdom and the cost-effective use of taxpayers' money and public funds.
As soon as we have proposals, we shall announce them, and we shall then be able to discuss their wider ramifications with hon. Members, local authorities, trade unions and other interested parties. That process will be immensely important in the consultation period in ensuring that we reach the right conclusion in the end.
I am grateful to the hon. Lady for giving me this chance to set out the Government's plans and proposals on this important matter.