Rachel Reeves Approves £1 Billion Leonardo Helicopter Deal for Somerset Plant
The Government is poised to finalise a major £1 billion contract with helicopter manufacturer Leonardo, bringing relief to thousands of workers at its Somerset facility. The Italian company's Yeovil site had been facing prolonged uncertainty while awaiting the Treasury's decision on the defence procurement agreement.
Government Intervention Secures Critical Defence Contract
According to sources familiar with the matter, Chancellor Rachel Reeves and Prime Minister Sir Keir Starmer have personally intervened to ensure the contract's approval. This move comes after the Ministry of Defence had reportedly deprioritised the project within its Defence Investment Plan framework.
The decision follows the cancellation of a planned visit by Defence Secretary John Healey to the Yeovil plant on Thursday, where he was expected to announce the contract award. Leonardo, as the sole bidder for this government contract, faced a Sunday deadline for bid expiration, adding urgency to the situation.
Securing Jobs and National Capabilities
Leonardo describes itself as Britain's only comprehensive rotary wing manufacturer, employing approximately 3,300 staff directly and collaborating with nearly 12,000 suppliers across the country. Company chief executive Roberto Cingolani had previously warned that the UK operation's future would be jeopardised without contract approval.
A Treasury insider emphasised the Chancellor's commitment, stating: "Rachel cares about keeping the country safe and driving jobs in the UK because our security and economic growth are fundamentally connected. This project is key to those principles – she wasn't going to let this deal collapse under her watch."
Union Celebrates "Tremendous Victory"
Trade union Unite, representing thousands of aerospace and defence workers, hailed the contract approval as a significant achievement for both industry and workforce. General secretary Sharon Graham declared: "Unite has been campaigning for this Government to buy British defence for over a year because it is vital for jobs and skills as well as national security."
Graham continued: "The Leonardo contract is a tremendous victory for Unite members in Yeovil and across the aerospace sector. Without their commitment, hard work and dedication, it would not be being signed today. Of course, we are pleased that Rachel Reeves has now listened to Unite on this issue. However, it took way too long to get this done, and we still have to question why workers were left in the dark until the 11th hour."
Both Leonardo and the Ministry of Defence have declined to provide official comments regarding the contract approval. The decision represents a significant development in Britain's defence procurement landscape, ensuring the continuation of domestic helicopter manufacturing capabilities while safeguarding thousands of skilled positions in the South West region.
