Wallace: Royal Navy supply ship contract will 'grow jobs' at shipyard

The contract to build three new supply ships for the Royal Navy will grow the Harland & Wolff shipyard in Belfast, the Defence Secretary has said.

Ben Wallace sought to defend the decision to award the £1.6 billion contract for three Fleet Solid Support (FSS) ships to a Spanish-led consortium.

He also accused an MP of "slagging off" Harland & Wolff, where the ships will be assembled.

The three vessels will be constructed in blocks at shipyards in the UK - including Appledore in Devon and Methil in Fife - as well as in Spain.

The FSS contract went to Team Resolute, which is led by the Spanish state-owned company Navantia, ahead of a rival bid by companies called Team UK.

Mr Wallace appeared at Westminster's Scottish Affairs Committee on Tuesday as part of its inquiry into defence in Scotland.

The SNP's Deidre Brock suggested the Team UK bid would have led to more spending in the UK.

Mr Wallace said: "You will see a ship entirely put together in Belfast - a warship for the first time in 15, 16 years.

"It's going to grow the jobs in Harland and Wolff, a historical (sic) yard."

He added: "I think that is good news for British shipbuilding."

Mr Wallace said precise details of spending are still being worked out, but there will be investment of £72 million in the UK.

Many defence projects such as the Eurofighter Typhoon jets involve components made internationally, he said.

Former Labour defence minister, Kevan Jones, raised concerns with Mr Wallace about the company structures of Team Resolute, saying Navantia's UK arm is a "shell company".

He asked: "Where is the risk, in terms of who is underwriting that contract?"

Vice Admiral Paul Marshall, who appeared alongside the defence secretary, said: "We are absolutely looking to the prime contractor to shoulder the risk."

Mr Jones said the situation appeared similar to the Army's troubled programme to procure Ajax vehicles.

He said Harland & Wolff had a relatively small turnover and more of the work could end up going to Spain if things went wrong in the UK.

Mr Wallace took exception to the Labour MP's questions, saying: "I think you're slagging off Harland & Wolff, Kevan, quite considerably."

Mr Jones said he had been told that the first ship would be built in Spain.