Thursday, 14 November 2013

Portsmouth: The Solution?

I'd better say straight out that this is going to sound populist. Never trust a solution that promises to solve all your problems. But this isn't a populist post and it won't solve many problems at all – it's a limited, thought-out proposal which appears to make economic sense, political sense and military sense. And it may well not be a good idea. Yet I'm going to sound unavoidably populist suggesting it.

The government should keep Portsmouth's BAE shipyard open. And they should do it by re-ordering the two Type 45 Destroyers they cancelled in the 2011 Military Spending Review.

There. I told you it would sound populist. 

The yard's woes are fundamentally caused by a long-term decline in military shipbuilding both in Britain and all over Europe. This decline is in turn symptomatic of largely positive things: a durable peace in Europe caused by the EU, NATO etc. In short, there's less demand for warships because there's less chance of maritime war. 

That's a very, very good thing. It does, however, raise the spectre of inevitable decline of Europe's military industries.

This is why Scotland's SNP politicians have got their patter broadly right. British shipbuilding needs to move from military to civilian construction. We have geography and heritage in our favour – and we're seeking to rebalance our economy towards manufacturing anyway. But a successful rebalance will be (a) a long process and (b) one requiring some state support.

There seems to be a general consensus around these two points. Yet, to come back to the first point, we simply don't need as many warships as before.

Enter the Type 45s. Twelve of these were originally planned; half were cancelled between 2003 and 2011. Can six Type 45s (designed to protect aircraft carriers and other vessels from air strikes) defend the entire Royal Navy, scattered around the globe as it is? Many within the Navy insist that at least eight Type 45s are necessary for effective operations and have been far from silent about it. 

Two extra boats would cost £2bn and save, for a time at least, England's last BAE shipyard. But is this not just an expensive and in-denial postponement of an inevitable decision?

The Scottish Referendum

No. It isn't. Here's why: the obvious rebuttal to my argument thus far is that it is a politicised one. In fact, it de-politicises the decision by taking, in effect, the Scottish referendum out of the equation. Many, at present, suspect that the government has chosen, essentially, to trade Portsmouth's yard for Scotland. It's messy and cynical politics – or if it isn't, it appears so. 

Far better would be to show that Union isn't zero-sum. The continuation of shipbuilding at Portsmouth would be a fitting reflection of Adam Smith's great economic principle that cooperation between two parties can produce benefits for both, not just one. It would make a stronger and wiser case for union than any not-so-subtly veiled threats about reallocating orders should Scotland secede.

And as for the future of Portsmouth, let's learn the lessons of history. Ailing heavy industry can thrive if restructured with good management & government support (think of the German car industry). BAE is attempting to expand its non-military business activities anyway; this transition needs support and time.

And even if civilian shipbuilding does not fit into a BAE future for Portsmouth, government should be far more active than it has been in trying to find a buyer for the shipyard. Why haven't they been? Perhaps because there's a post-Thatcher culture of non-intervention within British government which tends towards extreme laissez-faire. Frankly, Whitehall is at times more ideological than pragmatic about home industries.

So: re-ordering the two Type 45s would make a far better and more positive case for Union. The Navy has already made a military case for them. And the time taken to build them would create a window within which government (local or national) can try to find a future for the yard, in fitting with our vision of a growing manufacturing sector.

£2bn is big money, but similar amounts have leaked out of the budget completely needlessly (think Universal Benefits + the aircraft carriers fiasco) and this would be money well spent.

Of course, it is fair to assume that government has already considered all this. But the embarrassment of another military u-turn makes it unappealing, as does a rigidly non-interventionist culture within Whitehall. That's a rational default position to take, but would become irrational if exceptions were never made.

The best thing campaigners for Portsmouth's shipbuilding can do now is to make this case – and make it loudly. That could quite possibly tip Westminster's thinking towards what seems to me a far preferable course of action for the navy, the Union and Portsmouth.

And even if it doesn't, it's a conversation we should already have had. Well, as we so often end up saying in British politics – better late than never.

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