Race for pounds 2bn Nimrod contract enters last lap

Click to follow
British Aerospace is set to win a fierce lobbying battle at Westminster against GEC-Marconi, the British electronics giant, for a pounds 2bn contract to replace the ageing fleet of 25 Nimrod maritime patrol aircraft.

Defence ministers rejected a last-minute appeal by GEC-Marconi for a 90-day delay with an offer to cut the price of their bid by pounds 150m. "It looks like an admission of defeat," one Whitehall source said. "Winners don't cry foul." The decision is expected to go to BAe after a meeting next Thursday of the Overseas Policy and Defence (OPD) Cabinet committee chaired by John Major.

The battle has involved black propaganda, splits between Tory MPs, hints that the decision could help some Tory constituencies, and a desperate lobbying campaign to convince MPs that one project is more "British" than the other.

Intense lobbying has been going on for Orion 2000 - the bid involving GEC electronics and planes supplied by the United States company, Lockheed; and Nimrod 2000 - the "cheap option" of refurbishing the old aircraft by BAe with new electronics by the US Boeing corporation.

BAe hired Hugh Colver, the former chief press officer at Conservative Central Office, to lobby MPs discreetly. GEC-Marconi hired APCO UK as public relations advisers, and installed simulators at an office block near the Commons to demonstrate the technology to more than 50 MPs.

Both sides competed with claims of the number of British jobs they would create. One side pointed out that two Cabinet ministers with GEC-Marconi plants nearby their constituencies - the Foreign Secretary, Malcolm Rifkind, and Ian Lang, President of the Board of Trade - were both on the OPD committee.

Orion 2000 claimed that it would provide 7,000 jobs in the United Kingdom; 50 per cent of the aircraft would come from UK firms and the Mission System Avionics - the electronic "brains" - would be wholly from UK industry.

Nimrod 2000 claimed that 76 per cent of the work would go to British companies securing 10,000 high quality jobs. BAe has plants all over Britain, with jobs in north-west Lancashire constituencies - including Wyre, held by Keith Mans, the chairman of the Tory backbench defence committee.

Black propaganda circulating at Westminster included claims by MPs supporting the Nimrod 2000 bid that the GEC on-board computers would not communicate with each other - a charge totally denied by GEC.

Orion 2000 supporters rubbished the BAe bid proposing to refurbish the old Nimrods, which have been in service since 1969. They said it could be put into service again in 2001 with a lifespan of 25 years.

But the final decision may rest on the price. Nimrod 2000 is cheaper, but Orion 2000 offered a cash-back deal of pounds 2.5m for the next 30 export orders, giving the Ministry of Defence pounds 4bn on exports of 250 planes.