British Aerospace

Several of you wrote in expressing dismay at the proposed tie up between BAe and the Franco German civil aviation company. I did not write about it, as I assumed it would be an impossible deal to execute. The documentation was very voluminous, so I did not bother to read it. The politics were always likely to bring it down, so there was no need to analyse the business, economic and strategic issues.

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56 Comments

  1. Iain
    Posted October 11, 2012 at 8:19 am | Permalink

    Relying on the difficulty of the deal is an irresponsible position to take when we are dealing with a strategically important company. Surely you should have had a view on it rather than relying on Merkel’s Nein?

    As I posted on ConHome

    Our politicians want us to have a more balanced economy where manufacturing plays a much more significant role, in this they look at the German economy with envy. Well with the BAE EADS deal that fell apart we got a good reason why they have that enviable economy and we don’t. THEIR POLITICAL CLASS BELIEVE THEY HAVE A NATIONAL INTEREST, while our political class don’t.

    German politicians wouldn’t countenance their business being flogged off here and there for a short term gains by City firms, here in this BAE EADS deal we got to see the problem close up, a British Prime Minister championing a strategic company being flogged off abroad, worse willing to place it in foreign powers hands, while a German Chancellor, when being asked to have a slightly reduced say in the company, said Nein.

    The BAE situation has not finished, for now the City believes it has been ‘PUT IN PLAY’ which says everything about what is wrong with our economy, they believe the chance to churn it into foreign ownership in order to make a fast buck is still game on. IS THIS THE WAY TO HAVE A STRATEGICALLY IMPORTANT MANUFACTURING COMPANY TREATED?

    So our politicians have a chance to show they have learnt something from this, and so make it very clear to the City trading firms that BAE hasn’t been ‘put in play’ and its not ‘game on’ and never will be.

    It also comes to something when a large chunk of BAE’s shareholders couldn’t see the strategic benefit of the tie up, while our politicians were lemming like thinking it was the best.

    • Winston Smith
      Posted October 11, 2012 at 1:42 pm | Permalink

      Absolutely. Once again I am astounded by JR’s naivety or, perhaps, that is what he wants us to think. This deal WILL HAPPEN in some form in the near future. You only have to read the opinions of the media elite to see that the establishment political elite support such a deal to cement the European project.

      Reply: Some of your conspiracy theories are absurd. Of course I do not wish to see secret take overs by the EU. Just how do you think this deal can be revived? It looks dead to me.

      • outsider
        Posted October 11, 2012 at 2:56 pm | Permalink

        Reply to reply: a partial, gradual or complete pooling of interests after the model of Airbus perhaps?

  2. Posted October 11, 2012 at 8:49 am | Permalink

    I can’t understand why British shareholders are so willing to sell out to foreign companies. I can’t think of any other country which has allowed so many major companies, and utilities in particular, to be foreign owned. My water supply comes from a French Company as does my electricity, and I believe the sewage company is now German owned. Our major airports are owned by the Spanish and our biggest confectioner by the Americans.
    The way we are going, there soon won’t be any major British owned companies – no other country behaves like this so why do we.
    I suspect it is because the bulk of shares in most companies are owned by various financial institutions, and they can make a quick buck (and enhance their bonus) by selling when there is an above market price bid. Short term profit now seems more important than long term investment.
    No wonder the country is in such a mess – a British owned company might take a risk and invest in something in the interests of the country, a foreign owned company certainly won’t and will put its own nationals first. I’m sure if Heathrow were a factory, its production would be in Spain by now.

    • Disaffected
      Posted October 11, 2012 at 8:53 am | Permalink

      I am glad it helps stops the build up of the EU defence force that Cameron was hoping for.

      • lifelogic
        Posted October 11, 2012 at 11:37 am | Permalink

        Me too. I did not hear Cameron comment on it all all I wonder why when it employs so many in the UK. More interested in his late father’s problems with his legs it seems.

        • zorro
          Posted October 11, 2012 at 1:26 pm | Permalink

          Well it tells you all need to know about his idea of industrial strategy, national interests and all. He is far happier (and convincing, well sort of) when talking PR/touchy freely stuff really……

          zorro

      • Robert Taggart
        Posted October 11, 2012 at 1:02 pm | Permalink

        Cameo – really ? but, Cleggy – certainly.
        As for Milibund – doh !

    • forthurst
      Posted October 11, 2012 at 10:52 am | Permalink

      When a company is ‘put in play’, there is often a very significant change in the share registry as hedge funds and others buy the share in the hope of making a fast buck. Many of these speculators are not nationals or lack loyalty to this country and will be quite happy to give it a kick on the way down.

    • Bob
      Posted October 11, 2012 at 11:06 am | Permalink

      @English Pensioner
      “I suspect it is because the bulk of shares in most companies are owned by various financial institutions, and they can make a quick buck (and enhance their bonus) by selling when there is an above market price bid. Short term profit now seems more important than long term investment.”

      The problem is that that we are forced to hold our shares through large investment funds due to our tax system (pensions and ISAs). If the tax system were simplified, we could control our own investments and the fund managers would have less opportunity to pick our pockets. But the fund managers and bankers live in the same pond, and the politicians bend over backwards for them in the hope of lucrative non-exec directorships.

      Google: “Revealed: why Gordon Brown sold Britain’s gold at a knock-down price”.

      (It’s an article in the Telegraph by Thomas Pascoe).

      • David in Kent
        Posted October 11, 2012 at 3:53 pm | Permalink

        I don’t think you are really ‘obliged’ by the tax system to hold your shares via intermediaries. In my experience the fundholding industry has only proved adept at picking my pockets and lining their own. I now look after my own investments and find my results are no worse and at least the mistakes are my own.
        You should try it.

        • Bob
          Posted October 11, 2012 at 6:17 pm | Permalink

          @David in Kent

          You’re kidding yourself.

          When you invest in your share ISA or SIPP, do you get to vote at the AGM ?

          How many billions of our money are invested in company pensions? ~ do the members of the fund get to vote on the shares held in the fund?

          This is why huge takeovers can be waived through by the banks, insurance companies and fund managers without any consent from the people who’s money they’re playing with.

          Why shouldn’t I be allowed to hold the shares in my own name and vote ?

        • lifelogic
          Posted October 11, 2012 at 7:26 pm | Permalink

          Indeed read the free book “Monkey with a Pin”.

    • Denis Cooper
      Posted October 11, 2012 at 11:07 am | Permalink

      Just because a company is registered in Britain and operates in Britain and has British in its name that doesn’t necessarily mean that any of its shareholders can be described as British.

      I’ve no idea who owns shares in BAE, apart from finding in wikipedia:

      “As of 18 February 2009 BAE listed the following as “significant” shareholders: AXA (9.02%), Barclays plc (3.98%), Franklin Resources, Inc. and affiliates (4.92%), Legal & General Group plc (4.07%), and BlackRock (4.96%).”

      But:

      “BAE inherited the “special” shareholding that was established when British Aerospace was privatised. This special share, with a nominal value of £1, is held on behalf of the Secretary of State for Trade and Industry. This shareholding prevents amendments of certain parts of the company’s Articles of Association without the permission of the Secretary of State.[6] These Articles require that no foreign person or persons acting together may hold more than 15% of the company’s shares or control the majority of the board and that the CEO and the Chairman of BAE Systems must be British nationals.”

      So does that mean that providing the government deems that they’re not “acting together” foreigners or foreign companies could own all the shares?

      Reply: Yes, of course. What matters is if a single foreign controller, or a concert party foreign controller emerges. The UK government cannot tell UK shareholders they must not to sell to someone unless they live in the UK>.

      • zorro
        Posted October 11, 2012 at 1:28 pm | Permalink

        Reply to reply – no ‘golden shares’ in this one I guess…..

        zorro

        • zorro
          Posted October 11, 2012 at 1:30 pm | Permalink

          At least not ones that the government would care to invoke…..

          zorro

      • Posted October 11, 2012 at 2:28 pm | Permalink

        “The UK government cannot tell UK shareholders they must not to sell to someone unless they live in the UK”
        What do the French and German Governments do? They seem to manage to stop any strategic companies being taken over by foreign companies. I can’t imagine the British being allowed to take over, say, EDF in France or Siemens in Germany.

    • outsider
      Posted October 11, 2012 at 3:48 pm | Permalink

      Dear English Pensioner, it is worse than you think. Try building a house: bricks, tiles, cement, steel, heating systems, plumbing systems, plasterboard even the paint. All once made by big British companies, now they are all gone – to France, Germany, Brazil, Mexico , India …

      • outsider
        Posted October 11, 2012 at 3:52 pm | Permalink

        PS: Forgot the glass, now a Japanese company.

    • prof
      Posted October 11, 2012 at 4:28 pm | Permalink

      Sorry to pull you up on that last one.
      The country is not in a mess.
      We are the greatest on the planet.
      Get with the program and stop moaning.
      P sok
      Bournemouth

      • prof
        Posted October 11, 2012 at 4:59 pm | Permalink

        [please;-]

      • lifelogic
        Posted October 11, 2012 at 7:29 pm | Permalink

        Cameron claimed we were the leaders in green energy.

        Translated as – the government recklessly subsidised nonsense technology with tax payers money stolen from real industry.

  3. Matthew
    Posted October 11, 2012 at 9:31 am | Permalink

    Well said – you’ve got to wonder what the BAe board were playing at.

    They pulled out of the booming civil airline industry – didn’t further develop the 146 – sold their airbus stake only in 2006 (I think the UK government gave a £500m grant for wing development, but the wings are still made here)

    Then they decide to venture into civil aviation again by this deal, putting their US contracts at some risk.

    • forthurst
      Posted October 11, 2012 at 11:23 am | Permalink

      Unfortunately, the residue of GEC lives on in BAe with its overpromoted accountants; accountants should never run technology businesses because, totally lacking insights into the businesses they purport to manage, when they should be seeking out synergies and areas for organic growth through R &D, they spend their time cooking up deals when they are not trying to cut ‘non-essential’ costs.

      The old GEC, run by an accountant with an ex-politician posing as chairman to act as salesman to governments, managed to recycle most of the UK’s electrical and electronic engineering businesses and then started creating joint ventures on the continent. The net result of all this was that our shrunken electrical engineering industry finished up in foreign hands and our electronic engineering industry, apart from Marconi (now part of BAe) almost ceased to exist.

      Of course, the City loves these people and ministers and civil servants would rather talk to them than someone else who actually knew what he was talking about. Personally, I always checkout the board before investing in technology companies because I’m looking for organic growth, not short term spivery which often as not results in loss of value. It’s usually a sound strategy; the Germans seem to rate it as well. It would also encourage engineers to enter industry to know they might one day run the business as in Germany. Strangely, when one looks at newer technology companies, accountants are conspicuous by their absence.

      • outsider
        Posted October 11, 2012 at 3:01 pm | Permalink

        Exactly as you say, Forthurst, and no political party cared. Nor did the liberal elite or much of the press.

    • lifelogic
      Posted October 11, 2012 at 11:38 am | Permalink

      The BAe board have behaved absurdly some should go now.

  4. Sebastian Weetabix
    Posted October 11, 2012 at 9:50 am | Permalink

    A deal would have been dead from the beginning if the government had pointed to its golden share and simply said “for reasons of national security we will never allow BAe Systems to pass into foreign ownership”. But they didn’t, did they? And why is that? Could it be Cameron and friends want to see a single European defence identity with European armed forces, under the effective control of the Franco-German cabal that runs the EU?

    A properly Conservative government would never have behaved this way. I put this together with gay marriage, the imminent closure of power stations leading to the lights going out, the insane policy on renewables, no action on getting out of the EU etc. and all I see is a continuity Brown administration. What a wasted opportunity the last 2 years have been. This administration squandered a consensus on reducing government expenditure – taking tough and doing nothing. Where is the bonfire of Quangos? Why aren’t they scrutinising all expenditure on a line by line basis? Why no hiring freeze, no pay freeze?

    This government is spending money like a drunken sailor and shows no sign of grasp, or even direction. We are being governed by juveniles. And if Cameron thinks a vague hint of a possibility of a referendum on some obscure question of his choosing (but never, heaven forfend, on actually leaving the EU) some time after the next election is going to secure my vote he can get lost. We have seen his cast iron promises count for nothing. In any case all this talk of adjusting our ‘relationship’ with Europe is a joke. We have a relationship with Europe in the same way Sheffield has a relationship with the UK. It’s in or out, everything else is just guff.

    If Milliband really wants to be sure of winning the next election all he has to do is announce we will hold an in-out referendum on EU membership if he gets in.

  5. Robert Taggart
    Posted October 11, 2012 at 9:59 am | Permalink

    The Government continues to hold a ‘golden share’ in BAE Systems.
    Presumably they will continue to protect Blighty’s largest manufacturer from hostile takeovers ? – including any ‘shots’ from across the ‘pond’ ?!

    • A.Sedgwick
      Posted October 11, 2012 at 11:33 am | Permalink

      I don’t trust this Government with any strategic decision, whether defence or finance.

      • Brian Tomkinson
        Posted October 11, 2012 at 1:22 pm | Permalink

        Or anything else for that matter.

        • zorro
          Posted October 11, 2012 at 1:32 pm | Permalink

          Any decision at all really….apart from claiming expenses.

          zorro

  6. David in Kent
    Posted October 11, 2012 at 10:18 am | Permalink

    As a shareholder in BAE I have a personal interest as well as a national interest in the success of this company.
    While BAE is rather profitable it is also cheap because people recognise it is threatened by likely decline in defense spending. That means there was and remains a risk of our national asset being snapped up by a foreign company.
    I wasn’t sorry that EADS wasn’t allow to buy it but a solution is still needed. Maybe BAE should buy Bombardier and get into civil aviation that way?

    • Iain
      Posted October 11, 2012 at 12:11 pm | Permalink

      As a share holder do you have confidence in the Senior management of BAE?

    • Robert Taggart
      Posted October 11, 2012 at 1:04 pm | Permalink

      On the basis of past governments – Bombardier will lose out to EADS !

  7. David John Wilson
    Posted October 11, 2012 at 10:40 am | Permalink

    We need to see more government action to stop British companies eing sold to foriegn competitors. While initially they gaurantee that jobs ect. will be maintained in the UK it doesn’t take long for British factories to be closed down for reasons of efficiency.
    A large amount of our manufacturing industry has been lost to foreign companies buying up our companies and then moving the work abroad.
    We need government action to make it more attractive to manufacture in the UK. This means not just speeding up planning consent and reducing red tape but also taking positive action to reduce costs. Getting rid of employers’ NI would be a major step in this direction.
    We also need more grants given by government and local authorities subject to being repaid if the activity for which the grant was given does not proceed into the medium term.

  8. Lindsay McDougall
    Posted October 11, 2012 at 10:53 am | Permalink

    Make sure that you remember and file the objections of the French and German governments and the reasons they gave. I suspect that they will be grist to the Eurosceptic mill.

  9. Alte Fritz
    Posted October 11, 2012 at 11:57 am | Permalink

    And today The Telegraph reports that two Chinese telecoms companies, one of which won the BT contract in 2005 (and sank Marconi in the process) is blacklisyed by a Congressional comittee in the USA.

    There is something seriously wrong with our lords and masters when they can see British companies sink, and take worthless promises from foreign buyers at face value. Was it not reported that the top men at BAE were in for substantial bonuses for getting the “merger” through? What does that mean for corporate governance?

    • A different Simon
      Posted October 11, 2012 at 5:57 pm | Permalink

      Alte Fritz ,

      What does it say about the top men themselves ?

      Another thing that concerns me is small listed companies run by people who actually understand the business and stand a chance of growing it .

      All too often a predator which has no interest in running the business let alone growing it seizes control , takes it private and and sells off the assets .

      The smaller shareholders who have stuck with the company through hard times never get to see the upside .

      Gotta wonder whose benefit the companies act and takeover code are established for .

  10. outsider
    Posted October 11, 2012 at 12:12 pm | Permalink

    Dear Mr Redwood,
    Your point is fair and accepted. I am relieved that the EADS takeover is off but it would be equally bad for the UK economy if BAE Systems were taken over by an American (or other) company. Likewise Rolls-Royce.
    Such companies are a key part of the country’s infrastructure. They represent big pools of technical knowledge, research, decision-making and not least capital. They also deliver corporation tax.
    It is too often forgotten that the retained profit of big corporations is by far the biggest source of new risk capital in this country. They have the capital and expertise to undertake innovative new projects. Without them, we lose one of the two great driving forces for growth. The French and German governments understand this better than the UK.
    If such companies are foreign owned, this risk capital flows abroad, just as UK multinationals bring a flow of risk capital to the UK. We have to rely on government and on attracting inward investment, which often requires public subsidy or privileged deals. We also often lose research and invariably lose a great deal of corporation tax revenue.
    BAE Systems and Rolls-Royce exist only because the UK was allowed to keep a golden share for defence security reasons. In most other sectors, especially both light and heavy manufacturing, the UK leaders have been lost over the past 25 years.
    As a result of this alone, we must expect the UK growth rate to be much lower than the previous long-term average of 2.3 per cent. That is now inevitable. And, of course, foreign investors/ owners are less likely to site new branch factories in a low-growth economy, further depressing growth.
    If the Prime Minister genuinely realises that the UK is in a fight to retain its economc place in the world, then he should be told that the long-standing tripartisan indifference to our economically strategic companies will have to change.
    Our attitudes to takeovers, agreed “mergers” and the risk-averse dead hand of control exercised over big companies’ strategy by investment banks would have to change fundamentally.
    The free market did clearly not work to our advantage, for instance, when smaller but domestically protected French and German companies got together to take over the larger, but totally unprotected UK multinational British Oxygen. By contrast, Associated British Foods was able to start up the immensely profitable Primark chain solely because it was family controlled, sadly an extreme rarity in UK big business.
    I do not think the answer is a lot of new regulation. But we need to “nudge” the free market through tax (such as stamp duty) and through tax privileges currently abused by investment banks and some pension funds; by using all the influence of the state; occasionally by state (minority) shareholdings, as in two UK banks, and by reinstating a public interest test of plc takeovers, including their effect on corporation tax receipts.
    If you, as a justly famous champion of free financial markets, could bring yourself to think this through, it would have a great influence on others.

    Reply: I am not urging a merger of BAe with anyone. The government does have a golden share. I think defence technology is an area where the government may have to say “No” to a foreign takeover as the technology can be important to national defence and has been built up using UK taxpayer payments.

    • outsider
      Posted October 11, 2012 at 2:40 pm | Permalink

      Sorry Mr Redwood, I do not seem to have got my point across very well. I was not suggesting you favoured takeovers of BAE or Rolls-Royce.

  11. Bert Young
    Posted October 11, 2012 at 12:32 pm | Permalink

    Advice to any British company – “Think Cadburys”.

    • outsider
      Posted October 11, 2012 at 2:47 pm | Permalink

      Dear Bert Young: good advice but, having thought Cadburys, what can they do?

      • outsider
        Posted October 11, 2012 at 3:23 pm | Permalink

        By the way, I see that the Financial Services Authority is consulting on new rules to make life harder for family-controlled companies such as Associated British Foods. They will have a choice between ceding board control or being given second class listings and kicked out of the FTSE indices . This is supposedly to protect investors, by which I think they mean giving more control to investment banks.

        • A different Simon
          Posted October 11, 2012 at 6:16 pm | Permalink

          Just like the rules which make it difficult for AIM companies to undertake rights issues so pushing them to make private placements instead .

          All done under the guise of protecting retail investors from danger and risk .

          The FSA has been such a disaster . How that clown Turner manages to sleep at night after the suffering he has caused ordinary people I don’t know .

          All he knows about ethics is that it is North of Kent .

          Some people will do anything for 30 pieces of silver .

    • Robert Taggart
      Posted October 12, 2012 at 10:04 am | Permalink

      Such a sweetie !

  12. Patrick Loaring
    Posted October 11, 2012 at 1:17 pm | Permalink

    Long term, UK plc has a problem due to all the major industries now foreign owned. With the exception of the utilities which have to remain here just about everything else can be moved away from the UK. Take for example Terrys Chocolate that once had a large factory site in York but now all their products are produced outside the UK having been moved there by the new owners Kraft. How long before Cadburys also owned by Kraft is also moved offshore? Our politicians need to wake up and do the things that the Germans and French have been doing for years which is protecting their industries from foreign takeover. Camerons speech yesterday (wed) was an opportunity to make a new start but instead we get half truths and evasions. Our politcal class are out of touch with what business needs because very few of them have any practical experience of managing a business.

    • A different Simon
      Posted October 11, 2012 at 6:20 pm | Permalink

      Managed a business ?

      I’d settle for politicians who have worked in a business .

  13. Martin Ryder
    Posted October 11, 2012 at 2:33 pm | Permalink

    In an ideal world it wouldn’t matter who owns the companies operating in the UK. In an ideal world company boards would take commercial decisions for commercial reasons. But we do not live in a ideal world. Governments all over the world interfere with the decisions taken by their major companies, including those trading in other countries, in order to ensure that their countries benefit the most from the activities of those companies. I am sure that France and Germany benefit a great deal from the activities of the utility companies that control our gas, electricity and water supply. The only government that doesn’t give a damn is our own.

  14. Barbara Stevens
    Posted October 11, 2012 at 2:37 pm | Permalink

    It has been said, the Germans refused to continue with this deal, and one does have the right to ask why? If this had gone ahead they would effectively had control on our defence industry, that would be a terrible mistake knowing their history. Included in the assumption for me is the French, who capitulate when the going gets tough. Neither can really be trusted, I’d much rather have the USA on my side any day. We have already fought two conflicts in the past, and the future cannot be assured because of the EU, as Germany tries to take command of Europe with its money. The EU as we now see it cannot be trusted to continue as the euro continues to have problems, it could break up at any time. We are much better going it alone, with our own expertise and workforce, we may have problems but any problems could be overcome with the right investment and attitude. Cameron’s idea’s of investing in education and apprentiships is the right step forward, but needs to be intensified over the next few years for this country to make up for lost time. We must also remember it was under Thatcher’s government apprentiships were abandoned for youth training, that was a bad mistake for short term monetry gain.
    Our defence is better off in our hands, and no government has the right to let it disperse to other countries that cannot really hand on heart be trusted. The peace we have had over the past 70 years was hard won, don’t let us be foolish and throw it all away for monetry gain, defence of the country is far to important. Simply I don’t trust the Germans or the French.

  15. Atlas
    Posted October 11, 2012 at 4:39 pm | Permalink

    Cameron tries to weaken our defence daily. Yet he has the cheek to propose to force our children to go to the First World War Graves. Did he learn nothing in his school days of all those people who died so we could remain free? Instead he cosies up with the forces that created the blood-bath. My Grandfathers and my Father would wonder why they risked all just to let the successors to Heath sell-out our ancient liberties. Appeasers seems to be an apt description of many wielding power in the Civil Service and the politicians who don’t think for themselves.

  16. Jon
    Posted October 11, 2012 at 9:14 pm | Permalink

    Everyone is looking to the US it seems if they weren’t before. Perhaps this was just a skirt raiser to catch attention.

  17. Mactheknife
    Posted October 12, 2012 at 10:45 am | Permalink

    A bold move just relying on the complexity of the deal for it to fail. As we have seen with other Franco-German power grabs common sense does not always prevail. It would have been yet another travesty for British manufacturing had this deal gone ahead. Even the share holders were set against it. Perhaps now its time for an EGM and the shareholders can deal with the BAE board.

  18. Peter Brown
    Posted October 12, 2012 at 1:55 pm | Permalink

    It is obvious that BAE need to diversify if they are to retain their financial standing. However, the big drawback to all technology firms is the cost of R&D which is the reason why we are in such a big mess with having to collaborate with other Countries’ technology giants.

    However, BAE already has considerable expertise in the form of Vickers Shipbuilding (formerly VSEL) who have been building small, ship borne, nuclear reactors for decades. These reactors are powerful enough to provide sufficient energy for a small city and there has never been a ‘leakage’ scare on any of the reactors built by Vickers.

    Most will agree that the UK has an energy crisis in the making. North Sea oil is running out and no previous Government had the foresight to build suitable reservoirs for gas consequently, the gas has been shipped abroad for storage and we are now in the ridiculous situation of having to buy back (at inflated prices) the very same gas that we produced along with Russian gas with which Putin has a stranglehold on the whole of Europe.

    Nearly all of the UK’s existing reactors are beginning to require replacement as they are nearing the end of their design life. Lack of forethought or political will by any Government in the last 3 or 4 decades has removed investment for any new reactors leaving the UK with a, potentially, vast hole in it’s ability to supply energy. The other, very serious. problem is that the UK will be burdened by the need to decommission and dispose of a large number (of very large) nuclear reactors in a short space of time. The cost will be horrendous and there will also be a problem of where to dispose of the contaminated construction materials. Even if a Government had the political will to build more nuclear power stations, we in the UK no longer have the expertise to build them. We would need to contract a foreign firm to build them either from France, Japan or (god forbid) Russia.

    If BAE were to use the considerable expertise that they control to install a number of small reactors around the Country to provide cheap power locally, this would remove the high cost from foreign owned energy companies and also provide cheap electricity for the manufacture of hydrogen for domestic and transport fuel that would not rely on terrain such as for other hydroelectric forms of generation. Neither would we have to blight the environment with inefficient windmills, vast swathes of solar panels and other so-called ‘green’ technology or with coal/gas fired generators. Being essentially ‘ship borne’ reactors, there should be no shortage of ex-Royal Navy personnel to operate them. ‘Ship borne’ reactors can also be made small enough to be encapsulated in-situ as a single unit and transshipped in it’s entirety for disposal in a safe depository.

    • Bazman
      Posted October 12, 2012 at 4:36 pm | Permalink

      Fantasy. There is no comparison in the safety of a nuclear submarine reactor and one land based designed specifically for electricity generation according to a heavily censored report declassified by the Ministry of Defence.
      “UK submarines compare poorly with these benchmarks, with the ability to tolerate only a structural failure equivalent to a …” Unfortunately the rest of the sentence, along with most of the following two pages, are blacked out in the released document.
      The MoD’s senior nuclear safety expert warns that the safety of submarine reactors compares “poorly” with that of nuclear power stations, and there could be dangerous leaks of radioactivity.
      In the late 1980’s VSEL as it was known then employed fifteen thousand workers. These days employed less than five thousand. The redundant hardly made the national papers. Now an unemployment black spot blighted by geography. This merger will be the end of shipbuilding there. Diversity was discouraged by the government as it is a military shipyard. Shipyard of NHS are the main employers and the idea of everyone starting a business is not real.

  19. MartinW
    Posted October 15, 2012 at 2:54 pm | Permalink

    In my opinion, George Osborne’s speech at the Party Conference was far better than David Cameron’s. It was spoken quietly and with great conviction, and was full of real content. In contrast, Cameron seemed to lack real conviction or belief in what he was saying. If you ‘looked behind his eyes’, there was little there.

  20. Posted April 9, 2013 at 3:54 pm | Permalink

    A belief, idea, or conviction firmly held despite abundant information
    to the contrary. That is partly because my book is entirely based on public information

  • About John Redwood

    John Redwood has been the Member of Parliament for Wokingham since 1987. First attending Kent College, Canterbury, he graduated from Magdalen College, and has a DPhil from All Souls, Oxford. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.
    Published and promoted by Thomas Puddy for John Redwood, both of 30 Rose Street Wokingham RG40 1XU
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