Written statements on 1) Type 26 Batch 1 Update and 2) Defence Electronics and Components Agency Update

Type 26 Batch 1 Update

Secretary of State for Defence (Ben Wallace): Today I wish to provide an update on the progress of the first batch of Type 26 frigates.

The Type 26 Frigate is an advanced Anti-Submarine Warfare warship designed for the critical protection of the Continuous At Sea Deterrent and Carrier Strike Group. The manufacture of Ship 1, HMS GLASGOW, is progressing in BAES’ Govan shipyard and is expected to be in the water by the end of 2022. The manufacture of Ship 2, HMS CARDIFF, commenced with a steel cutting ceremony in August 2019 and the manufacture of Ship 3, HMS BELFAST, commenced with a steel cutting ceremony in June 2021 conducted by HRH The Prince of Wales.

The Type 26 reference design has been successfully exported to Australia and Canada who are developing the Australian Hunter Class and Canadian Surface Combatants respectively. Winning these export deals has demonstrated the world class credentials of the Type 26 design, as well as further securing thousands of highly skilled UK jobs and strengthening strategic alliances with our close allies.

HMS GLASGOW’s Royal Navy ship’s crew have already started to join. They are providing vital Royal Navy expertise to deliver the ships and have already met with HMS GLASGOW’s sponsor, HRH The Princess of Wales.

Type 26 production is well underway as evidenced by completion of the platform design, joining the fore and aft sections of HMS GLASGOW, successful gearbox installation and shaft alignment work in readiness for float off to the Scotstoun yard around the end of this year. The gearbox for HMS CARDIFF (ship 2) has been successfully tested at the factory, delivered and installed, along with the major propulsion components (e.g. diesel engines, electric motors, gas turbines) and the fore and aft sections are on track to be joined together early next year.

BAES, the Type 26 prime contractor, and the MOD are also working on improving ship build productivity through the introduction of updated welding machines and technology, digital ways of working to enable the workforce timely access to build data and more efficient sequencing and automation of production line work for block construction. As a result significant improvement has already been witnessed in ships 2 and 3.

Due to the impact of COVID19, where the Govan yard was required to shut down for a number of weeks, and challenges typical of those experienced with the first of class ship, including finalising the ship design and timely delivery of key new to service equipment, the Department is forecasting a twelve-month delay to the Type 26 Initial Operating Capability (IOC) from October 2027 to October 2028. A proportion of the associated cost growth will fall to the Contractor as part of the Target Cost Incentive Fee (TCIF) commercial arrangements. The resultant cost growth for the MOD is 4.2% over forecast, which is £233 million over the life of the programme.

Work is already underway to increase productivity and improve on the revised forecast IOC date. In addition, an investment in a new Shipbuilding Hall to build ships undercover and to further improve build efficiency is in progress, with the planning application submitted to the local authorities. BAES are also working closely with DE&S and the Royal Navy to streamline the trials, testing and acceptance into service plans. Examples include using Royal Navy procedures and ways of working during Ship builder acceptance trials to avoid the need to repeat these activities after vessel handover to the Royal Navy. Plans are also in place to have DE&S and Royal Navy personnel present and engaged with test and commissioning activity to grow Type 26 ships’ staff experience and de-risk the successful in service operation and maintenance of the Class, providing another opportunity to bring forward the IOC date.

The Type 26 programme remains on track to meet all user requirements and deliver world-class anti-submarine warfare frigates in time to replace the anti-submarine warfare Type 23s.

Defence Electronics and Components Agency Update

Minister of State (Alex Chalk): I am today confirming the Department’s intention to merge two of Ministry of Defence (MOD)’s arm’s-length bodies (ALBs), which will see the Defence Electronics and Components Agency (DECA) merge into Defence Equipment and Support (DE&S).

This follows the UK Government Investments (UKGI) tailored review of DECA, 2021. The review confirmed the continuing value and need for DECA to be retained within MOD as a strategic second-source, in-house provider of maintenance, repair, overhaul and upgrade (MRO&U) services. This decision reflects the need for the MOD to widen DECA delivery across defence to achieve even greater savings.

Consistent with the Government’s Public Body Reform agenda, we have investigated a number of potential governance and operating models and concluded that merging DECA into DE&S provides best overall value to the taxpayer. This will be achieved through improved governance structures and an operating model better aligned with government policy and defence planning outputs. This will put DECA on a stable, sustainable footing and achieves greater savings through increased utilisation of DECA across defence.

The merger option has been developed with a wide range of defence stakeholders, with other government departments, and with the two ALBs themselves. A key aspect has been to protect those elements of DECA’s current operating model that have proven valuable in the delivery of Defence outputs.

The merger will also sustain and grow highly skilled jobs at DECA’s main site at MOD Sealand, North Wales, its other existing locations across the UK, and provide further opportunities to develop a DE&S hub in support of wider defence work.