Oral - Statement On The Defence Training Review

Today is a red-letter day for Wales, because of the announcement by the Secretary of State for Defence, Des Browne, a few hours ago, that the Metrix consortium has been selected as its preferred bidder to deliver specialised technical training on a tri-service single-site basis to the army, Royal Navy and Royal Air Force, and as the potential preferred bidder for the second training package, namely non-military non-technical training, such as logistics, foreign languages, police and security, and so on.

Members will be aware that Metrix’s chosen location for the core of its proposals is the former RAF station, later the Defence Aviation Repair Agency headquarters at St Athan. This site is in our ownership, and we are very pleased to have played a critical part in backing the winning bid. Metrix, a consortium of global leaders in the provision of outsourced training and education, was the only bidder to bid for both packages in the bidding process, and the only bidder to choose a site in Wales as the location for the defence training academy. That is why today is such a red-letter day for Wales.

This prize would not have been won without the outstanding leadership of Andrew Davies and the Department for Enterprise, Innovation and Networks, and other Ministers and their departments, post the merger of the former quangos into this administration. Today’s announcement demonstrates what can be achieved by a delivery and customer-focused Welsh public service.

The Ministry of Defence’s defence training rationalisation contract, or pair of contracts, is expected to be worth well in excess of £10 billion over 25 years. It also means that, subject to successful final contract negotiations, this may well be the largest single Government investment to come to Wales since the announcement of RTB’s new Llanwern steel works half a century ago. That is another reason why this is such a red-letter day for Wales.

Today’s announcement is exceptionally welcome news, not only for St Athan, the Vale of Glamorgan and the region of south Wales, but also for the whole of Wales. In a location that has experienced major job losses recently, the full proposed defence training academy at St Athan will create a modern purpose-built training campus of just over 10,000 people, of whom almost 7,000 will be living on the site if both packages are confirmed for Metrix after the completion of the due diligence negotiations.

Overall, the project is expected to create 1,500 jobs initially during the construction phase, between 2008 and 2011, and could employ approximately 5,500 people thereafter, directly and indirectly. It is estimated that it will generate over £58 million a year of additional spending power in the regional economy. It is difficult to be precise over the proportionate split between package 1 and package 2 in value and in job numbers, but 3,000 to 4,000 might be near the mark for the number of jobs in package 1, and there may be a further 1,500 in package 2. Restoring St Athan to its primacy as one of the UK’s most important defence establishments is important to the Welsh economy, and that is why we have been so keen to assist the Metrix bid by providing an outstanding site like St Athan.

The scale of the site—nearly 1,000 acres in our ownership—means that it is uniquely able to accommodate both packages of the MOD contract plus our plans for an aerospace park, which will gain greatly from the decision to co-locate the defence training academy next door. The modern state-of-the-art Project Red Dragon superhangar is the jewel in the crown of the St Athan site’s facilities. That hangar was purpose-built for fast jet repairs, but is equally suitable for instructing trainee servicemen and women engineers. Instructors who are currently employed by the three armed services elsewhere will be welcome to transfer to the new academy; however, where those instructors do not wish to exercise their right to move here, the former DARA maintenance staff, now working elsewhere, will have an excellent basis for becoming instructors and will thereby have a chance to pass on their skills to incoming trainees. The development of the aerospace park on that part of the extensive St Athan site that is not required for the academy will greatly benefit from the relocation to the St Athan area of that outstanding skills base.

Although the Assembly Government is not part of the bidding consortium itself, we have strongly supported the Metrix bid from the outset and have facilitated it through our land ownership at St Athan. Team Wales made a concerted group effort to help Metrix to win this project, and today’s decision is an excellent reflection of the hard work and dedication of everyone involved. It shows what Wales can do when we all pull together. The intense competition between the consortia, and therefore between Wales and other locations, for these investments has been well publicised, and I am delighted that Wales has today come out on the winning side for the very best of reasons, in a way that in no way crowds out our plans to develop an aerospace park.

Further negotiations are expected to continue between Metrix and the Ministry of Defence as regards package 2 to bring it into line with package 1, so that the maximum synergies arising from having both training packages on a single site can be extracted to get the best value for public money and the greatest flexibility in using the full range of the proposed academy’s facilities.

It is right that we all welcome and celebrate today’s wonderful news for Wales. Detailed negotiations will continue between the MOD, Metrix and us, as the land owners, to finalise the contract. The proposal will have to go through the usual detailed planning scrutiny and public consultation. In addition, Metrix and the Assembly Government need to conclude legal agreements, setting out our respective roles in this investment.

Construction on site will begin once the contracts are signed and detailed planning permission granted, and we expect to welcome the first trainees at the new defence training academy in 2011-12. A dedicated project team is in place within the Department for Enterprise, Innovation and Networks to ensure that Team Wales continues to deliver successfully on our side of this huge project. We will continue our effective partnership working with the MOD and the Metrix consortium over the coming months to make this a full success for Wales and for the MOD, and enable Britain’s armed forces to have the best technical training facilities anywhere in the world.

Let us take the opportunity today to celebrate the fact that Wales has won this great prize, and that Wales is winning because of this announcement.