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This briefing paper examines the Dreadnought programme as it advances. It does not examine the Government’s overall nuclear policies, the synergies between the civil and military nuclear sectors, or the UK’s position on disarmament. Nor does it set out in detail the arguments for and against nuclear weapons.

The decision to replace the nuclear deterrent

In a vote in July 2016 the House of Commons approved the decision to maintain the UK’s nuclear deterrent beyond the early 2030s. After almost a decade of work on the project, that vote subsequently enabled the programme to move forward into its manufacturing phase, which will see the construction of four new Dreadnought class ballistic missile submarines over the next 15-20 years.

What is the Dreadnought programme?

Although commonly referred to as “the renewal or replacement of Trident”, the Dreadnought programme is about the design, development and manufacture of four new Dreadnought class ballistic missile submarines (SSBN) that will maintain the UK’s nuclear posture of Continuous at Sea Deterrence (CASD).

A Common Missile Compartment (CMC) for the SSBN, which will house the existing Trident strategic weapons system, is being developed in conjunction with the United States.

Under changes introduced in the 2015 Strategic Defence and Security Review (SDSR), the first Dreadnought SSBN is now expected to enter service in the early 2030s and will have a service life of at least 30 years.

Replacement of the Trident II D5 missile itself is not part of the programme. The UK is, however, participating in the US’ current service-life extension programme for the Trident II D5 missile, which will extend the life of the Trident missile potentially to the early 2060s. 

Replacement of the nuclear warhead is also not part of the Dreadnought programme. After having deferred a decision on replacement in the 2010 SDSDR, the Government recently confirmed that a replacement programme is underway. Transition to the new warhead, which will be compatible with the Trident missile system, is expected from the late 2030s onwards.

Delivery of the Programme

Recognising that the Dreadnought programme is one of the largest Government investment programmes going forward, the 2015 SDSR made a number of changes to the structure of the project, specifically with reference to governance and oversight of delivery. A new Submarine Delivery Agency has been established, which became an Executive Agency of the MOD on 23 April 2018. That agency will manage the procurement and in-service support of all current and future nuclear submarines, including Dreadnought. It will sit alongside the MOD’s Defence Equipment and Support (DE&S).

In tandem, the MOD and its two key industrial partners on the dreadnought programme, BAE Systems and Rolls Royce, have formed a new commercial alliance in order to jointly deliver the programme.  

Where is the programme at?

In May 2018 the MOD signed contracts for the second phase of the build programme. Delivery Phase 2, which is expected to be a three-year phase of work under the management of the Dreadnought Alliance, will continue the design and build of the first Dreadnought submarine and commence the build of the second, including furthering the design and manufacture of the nuclear propulsion power plant.

Jobs and Industry

BAE Systems, Rolls Royce and Babcock International are the Tier One industrial partners in this project. Although the MOD has contracted directly with BAE Systems and Rolls Royce for production, hundreds of suppliers across the UK are working on the Dreadnought programme. As the programme moves forward BAE Systems has estimated that 85 percent of its supply chain will be based in the UK, potentially involving around 850 British companies.

It is unclear, however, how much of the actual value of the programme rests with the supply chain in the UK and how much will be spent overseas. To date BAE Systems has contracted for the specialised high strength steel required for the first submarine from a French supplier. The use of foreign steel in the construction of the Dreadnought class has raised many questions over whether more can be done to promote the British steel industry within MOD programmes, and what the implications of Brexit will be for the programme in the longer term.

Costs

The cost of the programme has been estimated at £31 billion, including defence inflation over the life of the programme. A £10 billion contingency has also been set aside. Once the new nuclear deterrent comes into service the annual in-service costs are expected to continue at approximately 6 percent of the defence budget (£2.4 billion in 2020/21)

In its 2019 Update to Parliament the MOD confirmed that the programme remains within its cost estimate and that £7 billion had been spent so far on the concept, assessment and early delivery phases of the project, to date.

In order to keep the programme on track, reduce risk and achieve cost efficiencies, however, additional investment for the early years of the programme was also announced as part of the Autumn 2018 budget statement and the 2019 Spending Round. This is not extra funding for the programme, but oney that has been re-profiled. The Treasury also granted access to £600 million from the Dreadnought contingency fund in 2018/19 and has made provision for further contingency funding over the next two years, should it be required.

In line with convention, the Dreadnought programme will be funded from the MOD’s core equipment budget. The National Audit Office has, however, raised concerns over the impact of the MOD’s nuclear programmes, including Dreadnought, on the affordability of the Department’s overall equipment plan.


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