22 March 2024 , 09:53
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BAE Systems has been awarded a contract to construct Australia's nuclear-powered submarines as part of a joint military package.
This deal means the British firm will team up with Australian government-owned company ASC, and it forms part of the Aukus partnership involving the UK, Australia, and the US. While visiting the Osborne Naval Shipyard in Adelaide, Defence Secretary Grant Shapps said that this deal demonstrates the "huge confidence" Australia places in the UK's defence industry.
Joined by his Australian counterpart Richard Marles and US ambassador to Australia Caroline Kennedy, Mr Shapps said: "Through these collaborations, British industry will grow, and thousands of jobs will be created across the country, delivering security and prosperity to our two nations."
The Ministry of Defence has said that money from Australia - believed to be about £2.4 billion over the next 10 years - along with their own funding, will allow Rolls-Royce, which will deliver the nuclear propulsion plants, to double the size of its Derby site and create 1,170 skilled jobs.
BAE plans to increase its UK submarines workforce to around 17,000 people from the current 13,500. The submarine programme is set to create 7,000 UK jobs, and at its peak, more than 21,000 people will be working on the SSN-Aukus submarine programme, mainly in Barrow-in-Furness and Derby.
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The UK's first submarines with a new design will be ready in the late 2030s. The appointment of a builder by Australia comes a year after Prime Minister Rishi Sunak, Australian prime minister Anthony Albanese and US President Joe Biden announced the first generation of Aukus submarines would be based on the UK’s world-leading design.
Charles Woodburn, the chief executive of BAE Systems, said: "We're already making good progress on the design and development of the next generation submarine in the UK where we have more than 1,000 people working on the SSN-Aukus programme and major infrastructure investment underway."
He also said: "This latest step will ensure an integral connection between the UK design and the build strategy development in Australia as we work together to deliver next generation military capability as well as considerable social and economic value to all three nations."
The UK and Australia have just signed a new Defence and Security Co-Operation Agreement. Foreign Secretary Lord David Cameron and Mr Shapps were chatting with their Australian colleagues Mr Marles and foreign minister Penny Wong on Thursday during the yearly meetings between the two countries.