Hospital ship lifeline

Two shipyards are discussing a £120m hospital ship contract for the UK?s Ministry of Defence in a bid to cope with a work gap caused by delays to the £3.5 billion aircraft carrier programme for the Royal Navy and a slowdown in refit contracts for navy warships.

Jaap Kroese, owner of the Swan Hunter yard on Tyneside, is meeting Alex Marsh, business development director of Babcock International, which owns the Rosyth yard in Scotland, to discuss the situation. Kroese said a fresh contract was vital because Swan Hunter, which has cut jobs from 1,600 to 700 over recent years, was facing a lull between the end of 2006 and the middle of 2008, when the first steel is due to be cut on the aircraft carriers. He said: “It would help us tremendously if we could have something between 2006 and 2008.”

Swan Hunter is pinning its hopes on a need for a Joint Casualty Treatment Vessel, identified by the MoD in its 2003 review. However, there is some doubt whether ministers can find the necessary funds to pay for it. A MoD spokesman said: “We are aware of Swan Hunter’s offer. The programme is under review.”

A spokesman for Babcock, which has cut Rosyth jobs from 1,200 to 610 over the past year, declined to comment. However, sources played down the importance of the contract. One said: “It is at a very early and speculative stage. Rosyth has diversified its work base very effectively and it now consists of four separate business units, of which warship refit is one.”