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Industrial Strategy

Part of Laser Misuse (Vehicles) Bill [Lords] (Programme) – in the House of Commons at 5:20 pm on 18th April 2018.

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Photo of Mark Menzies Mark Menzies Conservative, Fylde 5:20 pm, 18th April 2018

I welcome this debate and the Government’s commitment to a new industrial strategy. This is a significant opportunity for us to chart a course for UK business, so that it does not merely adapt to global trends but is at the forefront, building new industries and leading global change. This is a broad debate, but the central theme is how the Government can work together with industry to shape a strategy that will develop the entire UK economy. Past Governments’ interaction with industry has not always been successful in that endeavour, and we are right to be sceptical when the state wants to get too closely involved with business, but this afternoon I would like to confine my remarks to two industries in which close Government involvement and support is not only welcome but vital for their continued success in this country.

In my constituency, just under 8,000 people are employed directly in the defence and nuclear sectors, and several thousand more rely indirectly on BAE Systems’ Warton military aircraft and Springfields nuclear fuels manufacturing sites for their employment. Both facilities can continue to function only due to the sensitive, strategically important nature of those industries, and if the Government are willing and able to provide support.

The UK’s military aircraft sector is worth £10 billion to our economy and provides directly tangible benefits through exports, employment, technological advancement and the development of skills. Furthermore, BAE Systems is capable of delivering a sovereign capability; in other words, the independent design and manufacture of military aircraft. We should and we must build our own military aircraft. I welcome the Government’s intention to launch the combat air strategy. It will look towards a sixth generation of military aircraft, which the Secretary of State for Defence recently announced. That is another demonstration of the Government’s significant commitment to delivery on behalf of those who work in our defence industry.

The Aerospace Growth Partnership, which has brought industry and Government together to tackle barriers to growth, boost exports and grow high-value jobs in the UK, published its aerospace industrial strategy in 2013. It has encouraged UK companies to co-operate more closely in addressing challenges that affect the sector as a whole, such as supply chain competitiveness, R&D and skills development. It contributed to a 30% growth in productivity during the period of the coalition Government, compared with just 3.3% across the rest of the economy. That demonstrates the huge benefits that a successful strategy can have for an industry.

We cannot stop here, however. In my constituency, a future fighter programme is required for BAE Systems to sustain its military aircraft design and development engineering capabilities. Currently, the Typhoon and F-35 programmes do not provide enough work to sustain the business that is crucial for the Fylde’s economy. We simply cannot rely on getting on with what currently exists. We have to develop and devise a strategy to deliver the sixth generation of future fighters. I urge the Government not to put off the key decisions on who should partner the UK in building those aircraft, and I go further in asking that they support a European deal, which has proved highly successful for both Typhoon and its predecessor Tornado, as a partner in designing and building the next generation of military aircraft. It is clear that only a European deal can guarantee that the UK plays a full part in all the design, build and maintenance phases of manufacture. A comparison between the Typhoon and F-35 projects demonstrates that clearly. Only then can we guarantee jobs throughout the full cycle of an aircraft’s lifespan, retain UK intellectual property and export overseas aircraft designed and built in the UK, sustaining high skilled manufacturing jobs for decades to come.

My hon. Friend Trudy Harrison covered the nuclear industry in great depth, but I would like to make an appeal to the Minister and to the Secretary of State, whom I have met on a number of occasions on this matter. It is vital that, as we roll out a new generation of nuclear generation capability in the United Kingdom, we retain the sovereign ability to manufacture nuclear fuel in this country. If we rely on importing nuclear fuel, not only does that put an enormous strain on the balance of payments, but at a time when we have the ability to manufacture nuclear fuel for any of the reactors that are currently being proposed for the UK’s new fleet, it would be absurd in the extreme if we were to turn our backs on that capability and instead outsource it overseas. We live in an uncertain world, and I would like to retain that sovereign capability here.

In conclusion—he says, turning to the back page of his speech—although there is much for the Government to consider in this field, the economic value and strategic importance of the skills provided by the defence and nuclear industries mean that they deserves their primary consideration. I commend the significant steps that have been taken towards setting out the plans that the Government have for both, but we need a concrete proposal for delivering a sixth-generation fighter aircraft that guarantees long-term sustainable employment in Fylde, and indeed across Lancashire and the north-west. We need deals to guarantee that nuclear fuel is manufactured in the UK, and we need to deliver them now if we are to safeguard and grow these sectors, and to sustain and then create jobs for the generations to come.