Government set to announce £1bn contract for reactors to power next generation of nuclear submarines

The Government will tomorrow make the long expected formal announcement of the £1 billion contract for reactors to power the next generation of Britain's nuclear submarines.

Defence Secretary Philip Hammond will stress, however, that no final decision on Trident will be made for another four years.

Replacing Britain's nuclear deterrent has been a source of contention in the Coalition with the Conservatives committed to a full renewal of the UK's fleet of four Vanguard-class submarines by 2028 and the Liberal Democrats opposed to a direct replacement.

Ministry of Defence officials have pointed out that it was public knowledge that a decision was due to announced on the contracts around this time and that the Liberal Democrats were looking at alternatives.

Mr Hammond said “The actual decision to go ahead and build them won't have to be taken until 2016 and what we are doing at the moment is ordering the things that have to be ordered in order to give us that option.

“We have already done a review of options and value for money of the Trident programme and that concluded that replacing the Vanguard submarines and continuing with Trident was the best-value solution to maintaining a nuclear deterrent. But the Liberal Democrats wanted to have another look at some emerging technologies and Nick Harvey, the Armed Forces minister, is leading a review to look at whether there are any.”

The first of the four Vanguards had been due to leave service in 2022, but the Government extended the vessels' lives as part of the 2010 Defence and Security Review.

Last month Mr Hammond awarded contracts worth £350 million to UK companies to design the next generation submarines.

The contract announced tomorrow will be for two reactor cores, one of which will be used for the seventh Astute Class attack submarine and one for the first of the next generation nuclear deterrent submarines.

The funding will also be used for an 11-year refit of the Rolls-Royce five-year-old plant at Raynesway, Derby, which will carry out the highly specialised work. The deal will directly create 300 jobs.

The SNP, who are opposed to Trident, criticised the £1 billion contract. Angus Robertson, the defence spokesman, said: “People in Scotland do not want Trident. Church leaders, the Scottish Trades Union Council, The Scottish Government and the Scotland's Parliament are all against weapons of mass destruction being in our waters.

Despite this the UK Government is prepared to send £1 billion of taxpayers' money on a needless programme and then expect the people of Scotland to accept weapons of mass destruction being dumped here.”