Ministry of Defence awards £1.1bn contract to Rolls-Royce for future submarines

The Ministry of Defence has announced that it has signed a contract worth £1.1 billion with Rolls-Royce Power Engineering to support the future production of nuclear propulsion plants for the Royal Navy’s future submarine fleet.

The contract covers a programme of work to rebuild the Rolls-Royce site at Raynesway in Derby, where submarine reactor components are manufactured.  £500 million will be spent on progressively demolishing existing buildings at the site, some of which are approximately 50 years old, to replace them with new facilities.  Planning permission was granted to Rolls-Royce by Derby City Council in November 2008 for construction of a new manufacturing facility at Raynesway.  According to the Ministry of Defence, regeneration of the Raynesway site is required to ensure the facilities will continue to meet safety standards set by the Office of Nuclear Regulation.  

The new facilities, with a planned life of 60 years, will be able to undertake work for the ‘Successor’ submarine construction programme, scheduled to end in the mid 2030s, and beyond if the Ministry of Defence decides to develop a new class of fleet submarine.  There are clear parallels between the Raynesway regeneration programme and the construction programme currently underway at the Atomic Weapons Establishment, where new facilities are being built which will allow the UK’s nuclear warhead programme to continue into the 2050s.

The contract with Rolls-Royce includes a further £600 million which will be spent to “sustain reactor core production” at Raynesway over an eleven year period until March 2023.  During this period work is scheduled to take place on reactor cores for all remaining Astute class submarines and the first of the ‘Successor’ class submarines, if constructed, and the contract has been interpreted by some media sources as a commitment to build two further reactor cores to those which have been previously ordered – one for the seventh Astute class submarine and one for the first of the ‘Successor’ submarines.  

The ‘main gate’ decision on construction of the first ‘Successor’ submarine is not scheduled to be made until after the next election in 2016.  Armed Forces Minister Nick Harvey told the BBC’s Today programme: “The money that has been committed today is a spend over an 11 year period, so if we decide in 2016 not to go ahead with some of these engines the government of the day would have to negotiate its way out of that, and give them some alternative work on the next submarine programme instead.”

According to the Ministry of Defence the contract will secure 300 jobs at Rolls-Royce.

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