North East MPs have called on Prime Minister Andy Burnham to award a £2.4 billion UK military satellite contract to US firm Lockheed Martin, which is planning to open a factory in County Durham. The facility at the NETPark in Sedgefield could create 500 direct jobs and potentially support many more in the local supply chain.
The factory depends on Lockheed winning the Skynet 6 military communications contract, which is the subject of a major row. The Prime Minister is reportedly reviewing the decision and has faced pressure from Sharon Graham, general secretary of the Unite union, to stick with rival European firm Airbus, which has designed, built and launched the MoD’s military satellites for more than 20 years.
Union warns of 'hammer blow' to space industry
Unite claimed last week that handing the contract to Lockheed Martin over Airbus, which has bases in Stevenage and Portsmouth, would be a “hammer blow to the British space industry”. The union said the promised jobs boost in Sedgefield would actually result in a net loss for the UK as a whole.
Ms Graham warned that choosing Lockheed would “hobble the UK’s growing space sector and make our military reliant on the goodwill of the US President”.
MPs press for decision at PMQs
At Prime Minister’s Questions on Wednesday, Newton Aycliffe and Spennymoor MP Alan Strickland told Mr Burnham that the region receives less than 1% of the Ministry of Defence’s (MOD) industry funding. He asked for an update on when the Skynet contract decision would be made and called on the PM to meet local MPs to discuss putting North East industry “at the heart of national defence”.
Mr Burnham told Mr Strickland he was “completely committed” to reindustrialisation and that, while no final decision had been taken on Skynet 6, he was determined it would “drive good jobs in his region, reindustrialisation across the country, as well as building the defence and security of the UK”.
Economic impact and local support
Lockheed Martin also has links to Newcastle through its £15 million backing for the planned North East Space Skills and Technology Centre (NESST) at Northumbria University. Newcastle Central and West MP Chi Onwurah told the Chronicle that the North East sends the highest proportion of young people into the Armed Forces, yet receives only £200 million of defence spending versus nearly £8.5 billion in the South East.
She added: “Neither Airbus nor Lockheed Martin are British. Airbus is French, German and Spanish and Lockheed Martin is American. I certainly believe in sovereign capability, it’s one of the reasons I have campaigned for Palantir's NHS contract not to be renewed. But I don't think we should reject all American investment in the UK - we have a long history of working with the US, particularly in defence and what is more, this specific investment will help build sovereign capability in the North East, which has a thriving satellite ecosystem, just as Nissan's investment helped build a British automotive supply chain in the North East. Lockheed Martin UK has confirmed to me that their new satellites will be built by highly skilled British workers here in the North East and that their bid will be compliant with the MOD’s contractual requirements for Skynet 6 WSS so the satellites will be fully sovereign, with decisions made for the UK by the UK and adding 2,000 high-value jobs. Lockheed Martin are already investing £15 million in Northumbria University’s ‘space school’ NESST in my constituency and supporting the £20 million investment for the new factory near Sedgefield, with an economic impact of £1.2 billion GVA for the North East and £3.7 billion for the UK, and potential access to more than £15 billion of global programmes and export market opportunities.”
She concluded: “The North East suffers from not having a major defence prime in the region. Small businesses repeatedly tell me how hard it is for them to gain access to Defence contracts when there is no big supplier in the region. That has to change.”
