Trident Cancellation Could Save UK £83.5 Billion

BASIC Report: Options for UK Nuclear Weapons Programme

The last Labour Government reaffirmed its commitment to Britain’s independent nuclear deterrent, based on Trident, at the end of 2006. The current coalition government, in its October 2010 Strategic Defence and Security Review (SDSR), maintained a commitment to this decision in principle but also announced some changes to UK nuclear doctrine, a reduction in the number of warheads and missiles possessed by the United Kingdom, and a delay to the timetable for the construction of the replacement submarines on which the Trident system depends.

The decision to delay the final judgment on replacing the submarines until after the next election has created a window of opportunity for further deliberation on UK nuclear weapons policy. The starting point for the BASIC Trident Commission is a belief that it is important to make the most of this opportunity.

We are living through a period of enormous change in international affairs with new powers and security threats emerging, increased nuclear proliferation risks, and growing pressure on economies and defence budgets in the West. Since the original 2006-07 decision on Trident renewal modest arms control progress has also been made by the United States and Russia and President Obama has set out a vision of a world free of nuclear weapons. The current government, more recently, has also initiated a further review of possible alternatives to Trident.
In our view, there is a strong case in this context for a fundamental, independent, review of UK nuclear weapons policy.

There is also a case, in the national interest, for lifting the issue of the United Kingdom’s possession of nuclear weapons out of the day to day party political context and for thinking about it in a cross party forum. The BASIC Trident Commission is doing this by facilitating, hosting, and delivering a credible crossparty expert Commission to examine the issue in depth.

The Commission is focusing on three questions in particular, namely:
• Should the United Kingdom continue to be a nuclear weapons state? • If so, is Trident the only or best option for delivering the deterrent? • What more can and should the United Kingdom do to facilitate faster progress on global nuclear disarmament?

This discussion paper addresses part of the context of relevance to all three of these questions. It is the second in a series and makes an important contribution to our understanding of the economic implications of the decisions that the government have to make about Trident. The paper outlines the industrial factors that are relevant to the UK’s Trident system, considers the potential impact of government decisions on jobs and local economies and estimates the cost of both the renewal and the operation of the system over time. Of course, economic factors should not be the determinant factors in the decision whether to renew Trident.

However, if for no other reason than that the manufacture and maintenance of Trident is concentrated within a small number of highly dependent communities, the Government will need to take account of economic factors when considering alternatives.

The report is published in the name of the author, rather than in the name of the Commission as a whole, but it will feed into the Commission’s deliberations and we hope it will stimulate wider discussions and further submissions of evidence for the Commission’s consideration.

1. This study reports on the employment, skills, regional and industrial impacts of the Trident replacement decision (the Successor Deterrent Programme). It is not claimed that the replacement decision should be dominated by these impacts. However, in making choices, policy-makers need to be aware of the impacts of their decisions.
2. The UK submarine industry is a unique industry with a single customer, monopoly suppliers and small production numbers. Gaps in design and construction work present major problems in retaining the specialist design and construction worker skills, especially the skills needed for nuclear work. However, more analysis and evidence is needed on the costs and benefits of production gaps of different magnitudes, including their cost and employment implications.
3. A Trident replacement will be costly with total costs of some £87 billion over the period 2007 to 2062, equivalent to annual average costs of £1.6 billion. A replacement will possibly support some 26,000 jobs some of which are located in high unemployment areas (e.g. Barrow-in-Furness). However, it must be recognised that a Trident replacement is designed to contribute to UK defence by providing peace, protection and security: it is not designed to support UK jobs. Often, there are alternative and more costeffective methods of creating UK jobs.
4. Cancellation will produce substantial cost savings of up to £83.5 billion over the period 2016 to 2062, equivalent to an annual average saving of £1.86 billion. It should be emphasised that the total cost savings will not be available immediately on cancellation in 2016: they occur over the period 2016 to 2062. Cancellation also means job losses with some high unemployment areas at risk. The worst case scenario for submarine-related jobs assumes that after 2052, the United Kingdom will withdraw completely from the operation of nuclear-powered submarines. The result would be the loss of 9,200 jobs after 2037 followed by the loss of a further 21,700 jobs after 2052: a total of almost 31,000 jobs being lost.
5. Any possible cancellation will not occur before 2016. Some of the high unemployment areas at risk have submarine work which will continue to about 2025. This means that there is a substantial adjustment period allowing Government to decide on the future of the UK submarine industry and to introduce appropriate public policies to allow a smooth adjustment to cancellation.

The full report can be viewed at (PDF 804KB, 32 pages)

Company or Organisation Portrait:
BASIC is a small but influential think tank with one very large idea: we want a world free from the threat of nuclear weapons. A growing number of politicians, government officials and other decision-makers share our vision. We work constructively with them - and with others who are not yet convinced - to achieve our goals of nuclear disarmament and non-proliferation. We leverage our reputation as a respected, trusted and independent source of information, ideas and perspectives to inform debate and foster creative solutions.

BASIC is the only peace and security non-governmental organization that is British-American in composition and focus. We work on both sides of the Atlantic to encourage sustainable transatlantic security policies and to develop the strategies that can achieve them. We partner with other international NGOs that share our goals and we promote public understanding of the danger of growing nuclear arsenals.

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