Threat to defence firms

The defence industry, vital to the regional economy, is set to face increased competition from overseas companies providing ready-made alternatives.

Unveiling the Government's plans last week Defence Equipment Minister Peter Luff said: "wherever possible" it would seek to buy through open competition in the domestic and global market, buying off-the-shelf where appropriate.

BAE Systems says it supports the objective but warns in a statement: "The Government has been very supportive of our business winning activities globally and this will continue to be critical if the UK defence and aerospace industry is to succeed in highly competitive export markets." It says it will continue to work closely with customers to understand their needs and ensure it cuts costs, drives efficiency and remains competitive. The exception would be cases where buying British is essential for national security such as submarine-building.

The move is not thought to be a threat to Yeovil-based helicopter-maker AgustaWestland. The company won the contract to replace its own Lynx with the Wildcat; produces the heavier anti-submarine and troop-carrier EH101, and the American Apache, which is developed under licence for the British Army. Now the Government has ordered American Chinooks, Britain's helicopter needs for the next ten to 15 years have been addressed.