End of the line: Defence giant BAE cuts 1,775 jobs as it halts shipbuilding at historic Portsmouth yard

1,775 jobs axed across country in its naval ships business after 'significant' reduction in workload

A general view of the BAE systems yard at Govan on the Clyde (Jeff J Mitchell/Getty Images)

BAE Systems has announced the loss of 1,775 jobs across the UK’s shipbuilding industry, and that it will be ending production at Portsmouth altogether.

It is the end of a long tradition of supplying ships to the Navy for the south coast yard, and comes in anticipation of a “significant” reduction in workload when the current aircraft carrier programme towards the second half of next year.

BAE said it remained committed to continued investment in Portsmouth, however, and Prime Minister David Cameron said that the city’s position as a major naval base would guarantee the majority of its dockworkers employment for “many years to come”.

Nonetheless, the announcement means that the only yards in the UK left capable of producing substantial warships for the Navy will be in Glasgow – and unions and local politicians have criticised the Government for making a decision with, they say, one eye on next year’s referendum on Scottish independence.

Defence Secretary Philip Hammond addressed the Commons on the future of shipbuilding this afternoon following Prime Minister’s Questions.

He told MPs the Coalition was “acting in the best interests of the whole of the United Kingdom”, and that the changes announced today represented the most “sustainable and cost effective” option for Britain’s warship-building industry.

And a spokesperson for Mr Cameron told a regular Westminster media briefing: “These are decisions taken in the UK's national interest.”

Asked whether the desire to encourage Scots to vote No in next year's independence referendum had played any part in the decision, the spokesman said: “This is a Government that always takes decisions based on the national interest.

“This decision was taken with a view of how we have the best-equipped, best-maintained Royal Navy. That is the basis on which it was taken.”

He added that the Coalition had proceeded “on the basis that we are confident that the case (for Scotland to stay in the UK) will be successfully made”.

In total, BAE said 940 jobs will be lost in Portsmouth, and a further 835 will go across yards in Govan and Scotstoun in Glasgow, Rosyth in Fife and Filton, near Bristol.

BAE’s statement read: “Following detailed discussions about how best to sustain the long-term capability to deliver complex warships, BAE Systems has agreed with the UK Ministry of Defence that Glasgow would be the most effective location for the manufacture of the future Type 26 ships.

“Consequently, and subject to consultation with trade union representatives, the company proposes to consolidate its shipbuilding operations in Glasgow with investments in facilities to create a world-class capability, positioning it to deliver an affordable Type 26 programme for the Royal Navy.”

David Hulse, chair of the Confederation of Shipbuilding and Engineering Unions' (CSEU) shipbuilding national committee, said: “There is no doubt that this is a devastating day for the UK shipbuilding industry and the company will have justify to us the job losses planned.”

When asked what impact the referendum has had on the decision, Scottish Deputy First Minister Nicola Sturgeon said: “The Clyde's won these contracts because it's the best place to build the frigates. That won't change with independence.

“I've just heard Philip Hammond in the House of Commons confirm what BAE said this morning, that the Clyde was the most effective and value-for-money place to build the contract. That's the reality and I mean no disrespect to Portsmouth about that.”

Unite’s national officer for shipbuilding Ian Waddell said: “This is a very worrying time for the workforces and their families as the work on the two carriers comes to a conclusion.

“It is a huge blow to Britain's manufacturing and industrial base, with many highly skilled workers faced with losing their jobs.”

Gerald Vernon-Jackson, leader of Portsmouth City Council, said: “I condemn the decision to shut down the last remaining shipyard in England with the capability to build advanced surface warships.

“This decision is bad for Portsmouth, with the loss of many highly-skilled jobs, but it's also bad for the defence of the UK and for the Royal Navy.

“The remaining yards with the capability to build advanced warships are in Scotland, and the referendum on Scottish independence is less than one year away. Ministers have put the defence of the UK and the future of the navy at real risk.

“We will work as hard as we can to protect jobs in Portsmouth. Portsmouth remains the home of the Royal Navy, with more than 10,000 jobs remaining in the dockyard.”

The Prospect union voiced its “deep concern” over the loss of so many skilled shipbuilding jobs and has called for an urgent meeting with ministers and the company.

Deputy general secretary Garry Graham said: “For an island nation and in this time of increased global uncertainty, we should be seeking to maintain our shipbuilding capacity, not reduce it.

“Job losses of this scale will have a devastating impact upon local communities and economies. These are the very type of highly skilled jobs which should be leading us out of recession and helping create growth in the economy.”

Meanwhile, the MoD announced it had commissioned three new ocean-going offshore patrol vessels for the Royal Navy, in part to provide work for the BAE yards on the Clyde in Scotland between the completion of the current aircraft carrier contract and the start of the Type 26.

Mr Hammond also announced that more than £100 million will be invested in the naval base at Portsmouth, which will be home to both HMS Queen Elizabeth and HMS Prince of Wales.

Mr Hammond said: “This deal will provide the Royal Navy with three brand-new maritime patrol vessels with a wide range of capabilities which will support our national interests and those of our overseas territories.”

He insisted the MoD was investing in “this country's warship building industry”, and said he was pleased to say Portsmouth would be extended to prepare it as “the home port for the Royal Navy's aircraft carriers and destroyers”.