...Like I said before, where's the 'LIKE' button ???
NEVER a truer word spoken (typed...)
SA
The Royal Navy Discussions and Updates
- Thread starter overlander
- Start date
NEVER a truer word spoken (typed...)
SA
I don't really want to pick holes, but....
Like most people in the real world, we tend to deal with REAL things, like £1.00 Sterling being worth 100 UK pennies, so your analogy isn't quite true.
However, if you were to discuss it in the context of TCO (Total Cost of Ownership), as in the whole life of the ship, its construction, support costs, running costs & disposal, then it would be more in line.
Secondly, as one whose job is reliant on the UK Shipbuilding Industry being maintained, I cannot & will not buy into the pish-posh that you’re peddling, WRT stretching the build programme of the largest & probably most complex warship that will be built in the UK in the 1st quarter of the 21 century.
I do appreciate that you are being hypothetical, but I'll look at this from a REAL perspective, so we can see how YOUR idea would work, in absolute terms.
At present, CVF is keeping approx 1,000 shipbuilders employed on the Clyde, about 500 at Portsmouth, 300 - 500 across A&P Tyne & Cammel Laird, with say (for arguments sake) 500 at Rosyth.
Taking those numbers to their max, that gives us a nice round figure of 2,500. Now that's the figures for those DIRECTLY employed by the Alliance, to build the ship. You could probably add at least another 1,000 in the support structures of keeping the yards open (the maintenance crews, the transport teams, the design sub-contractors & the manufacturing subcontractors), again within the Alliance, but tagged as INDIRECT Labour.
Now, for each one of THOSE jobs within the Alliance (direct & Indirect), it is ESTIMATED that there are TEN employed in the public sector, from the companies who make the cabling & electrical equipment, down to the paint manufactures & those making the construction steel or pipes.
I’ll round figures up, so we'll say 40,000, as it make the maths easier ! (Then again, if you listened to the media in the run up to the UK Election in 2010 those figures varied from 50,000 thru to 75,000).
So... Let’s imagine the build programme as a sine wave (looking at only the positive cycle) & on the basis that construction started in 2009 & will probably run through to 2019, it's fair to say that of the 40,000, the majority will be employed for an estimated 6 years, spanning the centre of the peak (3 years each side). Again, using rule of thumb and employing the 80/20 rule (80% being the six peak years, 20% being the lean years of start & finish).
As both ships are being constructed with overlapping build timetables, the figures will gradually rise, peak, then fall slowly, but in sharp steps, with no boom & bust, so no cyclic elements of variance & giving a large workforce the ability to remain employed for a good period of time, allowing Govt coffers to receive a steady income, all the while allowing employees to be able to spend their income over that same period, allowing for growth domestically in the retail sector. (A long term GOOD THING!)
So let’s look at the prospect of building 3 identical ships, on a FIXED PRICE CONTRACT, across a 30 year period (1 ship per decade) with all costs & contracts being agreed & placed before construction of the 1st ship has commenced.
Following the descriptive analogy above (the sine wave), we’d have 3 sine waves, (1 for each decade), but with a reduced manpower total at the peak, as we’re only building one ship. Practically, that would equate to about a 33 to 50% REDUCTION in the overall labour force of the Alliance. This build style would also dictate a ‘Boom & Bust’ cycle, with the added issue of skill gaps, skills fade & continuity / transfer of knowledge (WRT the workforce).
As it’s a FIXED PRICE Contract, the practicalities of the manufacture of components & materials in the public sector would be affected also, with many companies opting to produce all the materials for the 3 ships at once & then SUPPLY them to the Alliance, for them to STORE the parts. This action alone would skew the figures of employment for the 1st decade by INCREASING them, but would in turn reduce the total on the next 2 cycles. This would give the Public sector figures an estimated REDUCTION of 33% for the 1st decade, 50% for the 2nd & 85% for the 3rd.
The ‘Boom & Bust’ approach also allows the skilled workers with the intrinsic knowledge to complete the work, the ability to move onto similar tasks in other sectors of Heavy Industry construction, during the ‘bust’ section. This happens as the Alliance can’t afford the overhead costs of MAINTAINING employees when there isn’t anything for them to do.
Of course, the Alliance can’t expect any loyalty from these employees, as they will have moved onto the next wage earner, so that they can maintain their ability to provide for the own needs & those of their families.
So, without attempting to put actual monetary figures into this, it’s apparent to the lay-man that the CURRENT build approach of x2 ships, overlapping, is the BETTER option for the UK.
The Upshot is that when CVF is finished, it would be an IDEAL time for T26 to start, that’s assuming that there won’t already be orders from other nations, as such an ideology allows the shipbuilders to MAINTAIN their workforce, keeping key / relevant skills alive, while providing continuous employment for current & future generations.
SA
kev 99
Member
I don't know where you're getting £2.9b from but it's wrong, the original cost of the carriers was around £4b.
From BBC 11/12/08:
http://news.bbc.co.uk/1/hi/scotland/glasgow_and_west/7777065.stm
I was referring to the original estimates which would be a fair baseline if you were starting from scratch in 2000. However the same principles would apply if your started with £4bn (i.e. 3 x 1.8bn £5.4bn about what it will currently cost for the 2)
BBC NEWS | Business | Carrier costs 'could escalate'
Navy Matters | Future Aircraft Carrier Part 22
kev 99
Member
If you are using the original estimates and compaing them to the final cost of approx £5.4b unfavourably then this is simply wrong, you should factor in the same margin of error on cost to your '10% cheaper' ships as well and then compare the cost. What you are suggesting is that in your world mistakes on estimates don't get made.
You have to factor in the cost of the delay to your estimate, you may of stated that your method would avoid this but it is very obviously not true as the MOD was still strapped of cash. Also as I have previously stated stretching out procurement adds to costs, every report into MOD procurement practice states that this makes the contract cost more in the long term.
So far you're plan costs more to procure and more to operate as you still haven't managed to explain where the extra budget for operating a third carrier is coming from, what other ships would you decommission?
I never mentioned a fixed price contract; you would be very unwise to fix a commitment/timescales further than needed. Over such long periods a supplier would have to build in massive contingencies which will be reflected in the price and you would never get back.
In fact you have completely contradicted yourself, with you boom and bust suggestion. The original contract was building both over a shorter period. Mine would be to build over a natural cycle. A similar approach to all other construction:
i.e.:
10 SSBN/SSN average service 30 years lay down 1 every 3 years
12 destroyer/heavy frigates average service of 30 years lays down 1 every 2 1/2 years
and so on.
This way you maintain a drumbeat, but also you avoid completely new designs and the huge risks this bring with them (as most other manufacturing does look at your average BMW). The T45, Astute and CVF have had such long breaks between their predecessors that there have been few if and follow through items.
You asked where I had got the £2.9m from as you have never seen the figure?
The delays where not caused by budgets cuts they where caused by RN/MOD exceeding their budget and the Government having to step in.
If you are building 3 ships over 2 1/2 times as long you have much more budget to play with so the risk of exceeding budget is far less, your commitment is also smaller than buy building 1 at a time so again the risk of delay cost is less.
I was suggesting my ideal and I think managable within the budget, was to build 3 ships of c20,000t with a modest but workable helicopter capability of 10-12 (ie 1/3 to 1/2 of Ocean) and a dock. A mult role ships that could do the assault work, logistic, act as a tender for partol work/MCM, humanitarian work etc.
The ships would have been built near the standard of Ocean/Bays than Albion/Bulwark.
This would have been instead of: Ocean, Bulwark/Albion and the 4 (soon to be 3) Bays. These ships would have been much more attractive to the export market and more affordable and useful to the RN in the real scenarios it faces.
I many have retained Sir Galahad and even built a couple of similar sized sisters if there had been funds, but then the Points have largely taken on that role so maybe not.
kev 99
Member
The figure is out of date, £4b is the correct figure that should be used, otherwise you are comparing apples to oranges.
Irrelevant, the budgetry pressure still exists, you can't make it go away by apportioning blame. The only ways to make it go away are:
1) Increase the budget
2) Cut other programmes
3) Sign the contract at some other point in time, probably several years later when that budgetry pressure does not exist, this would of course put the final cost up due to defence inflation.
While it is certainly true that you have a greater budget to spread the costs over it is also documented fact that this pushes up procurement costs, as stated previously you will find this evidence in numerous reports into MOD procurement practice including the Gray report.
As stated above even if you are only ordering 1 carrier at a time you still have to pay the cost of delay or order at some time in the future, which increases the cost as well. As I have mentioned in previous posts all of your components are costing more in this scenario as well, buying in bulk, even if it is just 2 sets of everything is always going to be cheaper than buying 1.
You're '10% cheaper ships' are costing the RN more money than the ones they have ordered, you're ideas for managing the budget just spreads the agony across a greater number of years, and yet you seem to think this is going to save the RN money. Still no mention of where the budget for a operating third carrier comes from.
These point have all be answered, we are just restating out positions, and I don’t think I am ever going to be reconciled to you “nothing could be done differently, the RN is the victim of miserly Governments” approach.
However as an aside on the level of commercial competency in the MOD. I am doing some work for a major consultancy and I was talking to one of the partners who had come off a project to support the MOD on negotiating one of the larger high profile contracts. He was telling me how desperately naive the senior military personal were, both about the budgeting/commercials but also to almost any pressure from the supplier.
kev 99
Member
You haven't adequately answered any of those points.
If you think I have that approach then you are very, very wrong, the difference between myself and you is that I recognise that decisions have been made, I don't see the point in suggesting solutions that should have been applied years ago as if I had access to a time machine.
I don't see that as any sort of revelation, in fact I would expect it to be the case; my opinion on the competencies of most government departments personnel when negotiating contracts is extremely low. There is a wealth of examples available of widespread procurement cock-ups that appear with depressing regularity going back decades.
That's because your model for reduction in costs revolves around the government behaving completely differently if they were building three carriers than if they were building two. As soon as you establish a level playing field to discuss the matter on, your idea of saving money by building three smaller carriers disintegrates.
If you come up with some things that could have been done that actually relates to the historical facts, we'll all listen attentively I'm sure. I'm rapidly gathering the impression that you don't know what was built, when and why (neither do I but I'm not claiming I do!)
Ian
Well if you just regard this as an information site thats fair enough, however I do think there is value in discussing alternatives as we can learn from past and hopefully not repeat the mistakes.
So to answer your points:
1, Budget is spread over 2 1/2 times the lengh of the current construction, at least 3 time the original.
2, I would have built 4, 6-7,000 destroyers a decade (4 in the 90s, so only 4 T45 2000s, 4 in the teens) as these would be a progression the total cost would be less)
3, The assault force would be nearly half the size and hulls
4, The actually carrier orders would have been less so les risk had there been delays
kev 99
Member
Sounds nice as long as you do it in a progressive manner, i.e. look to apply it to future decisions, unfortunately you don't do this, you just bring up old decision X and state that Y and Z should of been done instead. That is not applying lessons from history it's just being critical.
Just restating your case, nothing further to your argument and doesn't answer the case that it's the most expensive way to build, you can't argue against this, it's fact and every report into MOD procurement states this catagorically. Where are you finding the extra money from years down the line? It sounds to me suspiciously like the 'climate of optimism' that many have stated is prevalent within the MOD, you are just hoping that budgetry pressure will be eased in years to come.
Irrelevant, it doesn't answer any point I have made at all since I never mentioned anything about the escort fleet, we were discussing your building of a larger number of cheaper carriers in the hope this would save money. And see above point regarding apply history progressively.
I never mentioned the amphibs either other than some clarification of Swerve's point, again see my above point about applying history progressively.
Really? I hardly think the industry restructure that was the establishment of BVT would have occurred on the back of an order for a single carrier in the region of 40 - 50,000 tonnes with the vague promise of other orders for 2 additional carriers at an unspecified date somewhere down the line, remember there were to be an additional 2 T45s ordered at some point that industry never believed (quite rightly) would materialise.
The legal issues involved in the merger of BAE surface fleet and VT into BVT were said to have provided significant delays in the signing of the carrier contract, the interested parties needed a firm order to make the merger viable, what you're suggesting seems to me to throw a whole lot more doubt and therefore risk into the equation.
You still have answered the most important point of all: Where are you getting the money to operate three carriers instead of 2?
The reduced order for T45s and assault force is relevant as it impacts the overall funds available. I am not sure BVT was a sound idea anyway.
We'd still have been embedded in the Horizon project at the point you're starting building those four T45's - again, you're relying on a time machine and perfect prediction. Yes, I'm damn sure if we'd had our time over, the words "NEVER EVER GET INVOLVED IN HORIZON" would have been burning in our minds. The T45 didn't exist in the 90's to build however.
Ian
A follow on to the T42, addressing the issues with the design would have be a fraction of the cost and provided the basis for the T45.
Anyway to avoid being accused of dwelling on the past, the lesson for me is:
Avoid near 100% new designs, the best way to do this is build over the industrial cycle. Focus certain projects on specific yards.
kev 99
Member
The reduced order for T45s made MORE money available.
Expanding the debate to the amphib fleet does nothing to explain how you are planning on building 3 smaller carriers for less or comparable money over a longer period than the plan of 2 larger ships built more quickly.
Interesting that you think BVT wasn't a good idea, that would leave the UK military ship building industry in the state it was previously with just 2 suppliers, one of which (VT) wanted out. I wonder what our resident worker (SA) in this industry thinks about that?
You have had quite a long reponse on how the carriers would be similar or less cost than we ended up paying I think we just have to acknowledge that we don't agree.
The reduced order for T45s made MORE money available.
Expanding the debate to the amphib fleet does nothing to explain how you are planning on building 3 smaller carriers for less or comparable money over a longer period than the plan of 2 larger ships built more quickly.
Interesting that you think BVT wasn't a good idea, that would leave the UK military ship building industry in the state it was previously with just 2 suppliers, one of which (VT) wanted out. I wonder what our resident worker (SA) in this industry thinks about that?
On BVT there is over capacity in the industry and without exports yards will have to close, merely merging will not keep them open it will just restrict competition.