News: British Industry Presses For Bolstered Action On Shipbuilding Strategy

Representatives from across the UK’s maritime sector and shipbuilding industry have made recommendations to government after assessing progress on a key strategy launched last year.

The National Shipbuilding Strategy Refresh, launched in March 2022, set out the Government’s vision for a productive, competitive and innovative shipbuilding sector. It set out a 30-year shipbuilding pipeline for cross-government orders, pledged to support green shipbuilding technologies and build the UK’s skill base, and develop a Home Shipbuilding Credit Guarantee.

Eight recommendations have now been made, aimed at bolstering and advancing progress on the strategy. The recommendations follow a joint meeting of the Scottish Parliament’s Cross-Party Group (CPG) on Maritime and Shipbuilding and the UK Parliament’s All-Party Parliamentary Group (APPG) on Shipbuilding and Ship Repair.

The recommendations include:

• Ensuring the cross-government shipbuilding pipeline maximises opportunities for the UK shipbuilding enterprise, to deliver economic benefits across the country.
• Raising the threshold for UK content in new builds.
• Greater levels of investment for innovation, research and development to strengthen the UK’s maritime supply chain.

Paul Sweeney MSP, convener of the CPG on Maritime and Shipbuilding, said:

“With major programmes like ScotWind support vessels looming large on the horizon, Britain has a critical five-year window of opportunity to re-establish commercial shipbuilding at scale, and the National Shipbuilding Strategy Refresh is a welcome framework from which to focus the UK shipbuilding enterprise on securing these commercial opportunities, but we still risk missing this opportunity if government at all levels does not act with a sense of urgency to link all the critical elements together coherently and underpin the shipbuilding industry with the necessary support. We have already seen orders from the 30 Year Cross-Government Shipbuilding Pipeline flow overseas to Spanish and Turkish shipyards.

“That is why both Scottish and UK Government Ministers must immediately act on the eight cogent recommendations that will expedite this strategy. These recommendations, encompassing four critical themes – Demand Signal & Public Procurement Policy, Technology & Innovation, Exports & Finance and Skills – are fully endorsed by both the All-Party Parliamentary Group at the UK Parliament and the Cross-Party Group at the Scottish Parliament. We will continue to work constructively with government and other stakeholders to realise this immense industrial opportunity.”

Kevan Jones MP, chair of the APPG on Shipbuilding and Ship Repair, said:

“The National Shipbuilding Strategy Refresh was needed and welcome, particularly the 30-year pipeline. However, over a year since it was launched, the Government still needs to give UK industry more clarity and certainty, and key challenges remain unaddressed.

“These recommendations from the shipbuilding industry and maritime sector give the Government a crucial insight into what meaningful action it can take to keep the ambition of the National Shipbuilding Strategy Refresh alive, including around finance, demand signals and skills.”

Chris Shirling-Rooke MBE, CEO of Maritime UK, said:

“Sixteen months ago, the launch of the National Shipbuilding Strategy provided an invaluable signal to the maritime sector of the Government’s commitment to the UK’s shipbuilding enterprise as an engine for growth.

“It is crucial to keep that momentum going and ensuring that the UK can chart a course for itself as a global shipbuilding hub in the coming decades. Our members remain committed to working with the National Shipbuilding Office to deliver on this vision.” 

NOTES

Full recommendations:

1. The NSO should continue to work with the UK and devolved governments to ensure that the delivery of vessels within the cross-government pipeline maximises the opportunities for the UK shipbuilding enterprise, enabling it to deliver a range of economic benefits across the country.

2. The UK and devolved governments must adapt public sector shipbuilding procurement policies to better recognise the strategic importance of the UK shipbuilding enterprise and its contribution to UK prosperity.

3. Despite welcoming the minimum 10% social value weighting, the UK shipbuilding enterprise urges the UK and devolved governments to show more ambition in their use of social value, in line with the practices of competitor shipbuilding nations, and raise the threshold for UK content.

4. The UK and devolved governments should devote even greater levels of investment in innovation, research and development, and green infrastructure and incentivisation in order to strengthen the maritime supply chain and the UK’s shipbuilding enterprise’s place within it.

5. The UK and devolved governments should work with stakeholders across departments to take forward the recommendations outlined in Maritime UK’s Offshore Wind Plan, collaborating with the offshore renewable energy sector and the wider catapult network to further strengthen the UK’s maritime sector. ScotWind presents an unrivalled opportunity to collaborate with developers to establish common programmes for Support & Operations Vessels (SOVs), Crew Transfer Vessels (CTVs), Anchor Handlers and Unmanned Survey Craft. NSO should take a leading role in brokering this.

6. UK and devolved governments should address the competitiveness gap in providing capital that will allow for the funding of decarbonisation projects within the UK’s shipbuilding enterprise by implementing the recommendations of the UK Marine Decarbonisation Report – endorsed by the MCA and the Financial Products Working Group – and referencing the work of the Scottish National Investment Bank (SNIB) into the Clean Maritime Plan Refresh.

7. The UK Government should commit to a clear timeline for the implementation of the Home Shipbuilding Credit Guarantee Scheme (HSCGS) and work with major banks and financial institutions to address the lack of access to Builders Refund Guarantees/Performance Bonds in the UK. The Scottish Government should explore the option of enabling the SNIB to offer Builders Refund Guarantees/Performance Bonds, thus providing a financial cornerstone for commercial shipbuilding in Scotland.

8. The UK and devolved governments should actively engage with the UK Shipbuilding Skills Taskforce by responding to the task force’s final report before the end of 2023.

The full briefing can be viewed online here

Image: UK MOD © Crown copyright 2023