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BBC Scotland business correspondent Hayley Millar
"This decision has been a long-time coming"
 real 56k

Thursday, 26 October, 2000, 19:06 GMT 20:06 UK
Govan handed 150m lifeline
Govan workers
Delight at Govan after the contracts were announced
The Govan shipyard in Glasgow has lost out on a major ferry contract but has won an order to build two Ministry of Defence vessels worth 150m.

The work will safeguard more than 800 jobs at the Clydeside yard and about 200 more off-site - but one union official has expressed fears for Govan's future.

BAE Systems was bidding for a six-ferry MoD contract but has failed to win the order.

A contract for two of the ferries has been awarded to Harland and Wolff in Belfast, while the other four will be built in Germany.

Instead, Defence Secretary Geoff Hoon said Govan would build two amphibious ALSLs - Alternative Landing Ships Logistic.


By my reckoning, this does not meet the challenge of ensuring Govan's future as an integrated shipbuilding facility

John Wall, MSF
Two other ALSLs will be built at the Swan Hunter yard on Tyneside.

The decision was welcomed by unions representing the 1,000 workers at Govan.

Danny Carrigan, regional secretary of the AEEU engineering union, said officials were now seeking a meeting with yard owners BAE Systems to clarify when work would begin on the order.

"We asked for government support and we have received it," said Mr Carrigan.

Campaign 'vindicated'

He said the work would mean the yard's future was secure and it would be able to stay open until 2004, when it will build the first of the Type 45 destroyers already ordered by the Ministry of Defence.

"We are delighted that Govan has been saved and that we have received a positive declaration of Clydeside's future. Our campaign has been vindicated."

But John Wall, the Manufacturing Science and Finance union's Scottish secretary, said: "By my reckoning, this does not meet the challenge of ensuring Govan's future as an integrated shipbuilding facility."

Welder
Jobs have been safeguarded
He said Swan Hunter had been appointed as the "lead" yard. The ships were of Dutch design, meaning no design work for Govan.

"It is my understanding that steelwork on these ships will not commence until late summer 2001, possibly July or August. At present, there is insufficient work to bridge that period."

Mr Wall said the solution, which the MoD could provide, was to give the construction of a floating submarine dock to Govan. This would allow immediate design work "allied to an early start date on steel work".

Scottish Secretary John Reid said: "The award of this contract is magnificent news and is expected to secure jobs at Govan and sustain the yard for the future.

"It is testimony to the skills, hard work and determination of everyone at the yard that this order has been won. It removes the doubt and uncertainty that has affected the workforce.

'Renewed optimism'

"Now both they and the company can look to the future with renewed optimism as they face the challenges and opportunities that lie ahead."

The ferries contract is worth an estimated 200m, with spin-off work expected to take the total value to 1bn.

It was put out to tender last year and a decision has been expected for many months, with workers at Govan left on tenterhooks.

Earlier this year it was reported that another UK consortium using a German shipyard had significantly undercut Govan for the ferry work.

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See also:

26 Oct 00 | Northern Ireland
Shipyard to get MoD order
17 Oct 00 | Scotland
Unions in 'final push' for shipyard
16 Oct 00 | Scotland
Reid dismisses shipyard doubts
21 Jul 00 | Scotland
Question over vital ferries order
13 Jul 00 | Economy
Unions hail shipbuilding summit
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