Annex A (continued)
SWIFTSURE & TRAFALGAR
CLASS UPDATE
The Swiftsure & Trafalgar (S&T) Class
Update is a two-phase incremental programme to counter sonar obsolescence
and to deliver enhanced military capability to the in-service
attack submarines. The Initial Phase (Stages 1 & 2) successfully
achieved its in-service date (ISD) in June 1996. This phase resolved
sonar obsolescence, introduced enhanced sonar capability (Sonars
2074 & 2082), integrated the new submarine command system
(SMCS) and delivered an incremental improvement in weapon system
effectiveness to the Swiftsure Class and older Trafalgar Class
submarines. The Final Phase (Stages 3 & 4) will enhance the
operational effectiveness of the four newest Trafalgar Class submarines,
principally by the introduction of a new integrated sonar suite
(Sonar 2076), an upgraded Tactical Weapon System (TWS) and a number
of signature reduction measures.
BAE Systems Electronics Ltd formerly BAE Systems
Astute Class Ltd (BACL), as Prime Contractor for both the Astute
Class and the S&T Class Update Final Phase, has selected derivatives
of the main Final Phase sub-systems for the Astute Class. Co-ordination
of requirements across both programmes is ensured as they are
being managed within the same Integrated Project Team.
Sonar 2076 is a software intensive system that
represents a step change in both technology and military capability.
The sonar contractor, Thales Underwater Systems Limited (TUSL),
formerly Thomson Marconi Sonar Limited (TMSL), has experienced
difficulties in meeting the required programme, in particular
the major challenge of developing the signal and data processing
software in the required timescale. A lower risk recovery programme
has now been approved which will introduce the required Sonar
2076 Stage 4 capability in incremental stages, thereby minimising
slippage to this element of the update programme.
Operational Requirement
Nuclear powered attack submarines (SSNs) make
a vital contribution to peace and security by providing conventional
deterrence. In time of conflict, the SSN's qualities of stealth,
endurance and flexibility afford it the freedom to operate unsupported,
worldwide, whilst remaining undetected, either independently or
in support of surface ship task groups or joint operations. SSNs
play a vital role in our layered anti-submarine defences, without
which the security of the SSBN deterrent and the deployment of
joint expeditionary forces would be at significant risk. The SSN
provides a capability to seek out and destroy other submarines
that may present a threat to friendly forces, and can also detect
and attack surface forces. By its actual or potential presence
in an area, the SSN can deny the use of that area to an opposing
force.
SSNs with the capability to launch Tomahawk
Land Attack Missiles (TLAM) are able to influence the strategic
situation by posing a serious threat in periods of tension. In
the event of hostilities, they can deliver these highly accurate
and lethal weapons against important targets that might otherwise
have remained relatively invulnerable. The SSN is also able to
make a significant contribution to the intelligence collection
effort, through its ability at close range to conduct covert surveillance
and reconnaissance of opposition forces at sea or on the coastline.
In support of covert operations, Special Forces can be inserted
by a submarine.
The Royal Navy's current SSN flotilla of Swiftsure
& Trafalgar classes provides this range of operational capabilities.
The Final Phase of the S&T Update programme will provide greatly
enhanced sonar performance, TWS integration and signature reduction
measures, thereby increasing the UK's ability to fulfil these
operational roles.
Trade-offs
Feasibility studies, including cost/capability
trade-off investigations, were completed in November 1990. It
was concluded that a phased approach, in four stages, would progressively
satisfy the operational requirements in a way that would reduce
technical and programme risk whilst fully exploiting the remaining
submarine hull lives.
Further trade-offs were carried out during 2001
to reduce the technical risks to the programme whilst maintaining
the priority of key elements of the capability. These will result
in the staged introduction of the Sonar 2076 functionality with
the deferment of some capability until later in the Stage 4 programme.
Numbers
The Initial Phase (Stages 1 & 2) introduced
capability enhancements to three of the Swiftsure Class (SSN08,
09 & 10) and the three oldest Trafalgar Class (SSN13, 14 &15)
submarines.
The Final Phase (Stages 3 & 4) will be limited
to the four newest Trafalgar Class submarines (SSN16, 17, 18 &
19) as the other in-service SSNs have insufficient remaining planned
service life for further updating to be cost-effective.
Strategic defence review
The SDR confirmed and highlighted that the nuclear-powered
attack submarine is an extremely potent weapon system with an
important role to play in support of a wide range of operations.
These findings are consistent with the SDR New Chapter.
Military capability
The S&T Update is designed to shift the
balance of operational capability further towards the UK by enhancing
the submarines' sonar performance and reducing the chances of
counter-detection.
Equipment to be replaced and in-service date
The programme involves the upgrading of existing
equipment. The ISD for the Final Phase will be declared once HMS
TORBAY, the first boat to receive the Update, successfully completes
her sea trials with the Stage 4a increment, following her first
Revalidation Assisted Maintenance Period (RAMP). HMS TORBAY was
accepted back into the operational fleet in November 2002 with
the Stage 3 equipment fit, and the ISD is planned to be achieved
in 2004. The Final Phase update will be introduced progressively
to the remaining submarines during their first refit and second
commission.
Acquisition approach
Approval for Full Development and Initial Production
for the Final Phase was given in January 1994. Final Phase procurement
was initially being undertaken through eight separate contracts
with various equipment suppliers, including the Sonar 2076 contract
with TUSL. These contracts were novated in 1997-98 to the prime
contract with BAE Systems Electronics Ltd (GEC Marconi Astute
Class Ltd at that time) as part of a risk reduction strategy embracing
both the S&T Class Update and the new Astute Class. As part
of the Sonar 2076 recovery programme, approved in November 2002,
a common product approach to the Sonar 2076 will be taken across
the S&T Update and the ASTUTE class submarines. This approach
will significantly reduce the risks to the ASTUTE class combat
system programme.
Crewing
The current complement of the submarines will
be unchanged as a result of the update.
Alternative procurement options
Alternative procurement options were considered
in mid-2000, in the light of the difficulties experienced on the
Sonar 2076 programme. These were discounted due to their unacceptable
impact on the timescales and costs of both the S&T Class Update
and Astute programmes.
Export potential
Export potential is constrained by the high
performance and sensitive nature of the technologies involved,
particularly in respect of Sonar 2076. There are no export plans
for these technologies.
Industrial factors
TUSL is a major supplier of cutting edge military
sonars. This company currently employs around 350 personnel on
the Sonar 2076 programme at locations in Cheadle Heath (Manchester),
where the bulk of the system design, software development and
systems engineering work is performed, and in Church Crookham
(Hampshire) and Templecombe (Somerset) where hardware production
is carried out.
Smart acquisition
The inception of this project pre-dates the
Smart Acquisition Initiative. Nevertheless, Smart Acquisition
principles have been adopted where appropriate. This has resulted
in a more incremental development programme and the formation
of an integrated management team, in partnership with industry,
to exploit the benefits to be derived from a common product fitted
in both S&T and Astute class submarines and the associated
integrated programme.
Key milestones
The Key milestones and their expected dates
are as follows:
| Milestone | Criteria
| Date |
| ISD for First of Class (HMS TORBAY), providing an Initial Operating Capability (IOC)
| Stage 4a increment accepted into service |
2004 |
| Second Stage 4 increment installed and operating in HMS TORBAY
| Stage 4b increment accepted into service |
*** |
| Final Stage 4 increment installed and operating in HMS TORBAY
| Stage 4c increment accepted into service |
*** |
| Fleet Weapon Acceptance (FWA) | he full required Stage 4 functionality accepted into service in HMS TORBAY
| *** |
| Final Operating Capability (FOC | The full required Stage 4 functionality introduced into service in the last of the four Trafalgar-Class SSNs)
| *** |
Costs
The Major Projects Report for 2001 reported estimated total
programme costs of £687 million (on a resource basis at outturn
prices) for both the Initial and Final Phases (Stages 1 to 4).
Of this total, some £615 million was attributable to the
Final Phase. The current expected cost of the Final Phase is £727
million and is in line with the latest project approval in November
2002. The increased costs reflect the impact of programme delays
brought about by software development problems and slippage in
the submarine refit programme, together the new Sonar 2076 Stage
5 programme and the attribution of funds for the S&T Final
Phase sea trials. A recognition of the remaining technical risk
also contributes to this increase.
In-service support
The current planning assumption is that the in-service support
responsibilities for the equipment will be transferred from the
Attack Submarines (ASM) Integrated Project Team (IPT) to the appropriate
IPT within the Warship Support Agency, who will manage the required
support using existing arrangements where possible. However, other
options are being considered, particularly for common equipment
such as Sonar 2076, where there may be an opportunity to provide
support more cost effectively by exploiting the Contractor Logistic
Support arrangements being established for the Astute Class submarines.
"Front Line" numbers
The Initial Phase Update is currently operational in three
Swiftsure Class submarines and the three oldest submarines of
the Trafalgar Class. The Final Phase Update will be implemented
in the four newest Trafalgar Class submarines. At any given time,
some of these submarines are in the repair and maintenance cycle
and are not immediately available for operational deployment.
Interoperability
There are no interoperability issues for the S&T Class
Update programme.
Disposal of equipment replaced
There are no equipment disposal issues which arise as the
programme involves either the fitting of additional equipment
or the upgrading of existing equipment.
In-service life
The six Swiftsure and Trafalgar Class submarines that received
the Initial Phase update are due to remain in service until their
planned decommissioning towards the end of the decade. The first
submarine to receive the Final Phase update (1st increment at
Stage 4a) is planned to be in-service in 2004 and will provide
the Initial Operating Capability. The last submarine in the programme
to receive the full Stage 4 update is planned to be in service
by ***. The four Final Phase submarines are planned to remain
in-service until they are progressively decommissioned from the
end of the next decade onwards.
Development potential
An additional programme of work (known as Stage 5) is currently
being pursued. The aim is to develop and de-risk the enabling
technology that would allow a more affordable, timely and cost
effective means of sustaining and upgrading Sonar 2076 in the
longer term. This could lead to a wider use of commercially available
technology to enable future capability insertion and the potential
re-use of common modules (software and hardware) from other UK
submarine combat system projects. Additionally it may facilitate
the sharing of advanced signal processing algorithms with collaborative
partners.
ASTUTE CLASS
SUBMARINES
The Astute Class of Submarines (formerly known as the Batch
2 Trafalgar Class) are a derivative of the Trafalgar Class nuclear
powered attack submarines (SSNs), incorporating the Swiftsure
and Trafalgar Class Update tactical weapon system capability and
the nuclear reactor based on the Pressurised Water Reactor 2 (PWR2)
design deployed in Trident SSBNs.
Ministerial approval was given in December 1993 for a prime
contract to design and build three submarines with options for
a further two. Approval for Full Development and Production of
three submarines (HMS ASTUTE, HMS AMBUSH and HMS ARTFUL) was given
in March 1997.
The Astute Class will progressively replace existing Swiftsure
and Trafalgar Classes later this decade.
Operational Requirement
Nuclear powered attack submarines (SSNs) are a key component
of the Royal Navy force structure and make a vital contribution
to peace and security by providing conventional deterrence. In
time of conflict, the SSN's qualities of stealth, endurance and
flexibility afford it the freedom to operate unsupported, worldwide,
whilst remaining undetected, either independently or in support
of surface ship task groups or joint operations. By comparison
with conventionally powered submarines, they have unlimited endurance;
a high strategic deployment speed; and carry more weapons. SSNs
play a vital role in our layered anti-submarine defences, without
which the security of the SSBN deterrent and the deployment of
joint expeditionary forces would be at significant risk. The SSN
provides a capability to seek out and destroy other submarines
that may present a threat to friendly forces, and can also detect
and attack surface forces. By its actual or potential presence
in an area, the SSN can deny the use of that area to an opposing
force.
SSNs with the capability to launch Tomahawk Land Attack Missiles
(TLAM) are able to influence the strategic situation by posing
a serious threat in periods of tension. In the event of hostilities,
they can deliver these highly accurate and lethal weapons against
important targets that might otherwise have remained relatively
invulnerable. The SSN is also able to make a significant contribution
to the intelligence collection effort, through its ability at
close range to conduct covert surveillance and reconnaissance
of opposition forces at sea or on the coastline. In support of
covert operations, Special Forces can be inserted by a submarine.
The ASTUTE class submarine will play a key enabling role
in the future concept of maritime warfare with its ability to:
Project maritime power inland from both the open ocean and
in littoral operations.
Rapidly provide a maritime presence worldwide.
Integrate its sensors, command and weapons systems fully
in the maritime battlespace.
Numbers
We have an order with BAES covering the design and build
of the first three boats and a commitment to contracting for further
boats.***
Strategic Defence Review
The SDR (and subsequent studies of future capabilities requirements)
confirmed and highlighted that the nuclear-powered attack submarine
is an extremely potent weapon system with an important role to
play in support of a wide range of options. These findings are
consistent with the SDR New Chapter.
Military Capability
The military capability specified for Astute builds on that
of the current in-service Trafalgar Class, but with greater emphasis
on land attack, intelligence gathering and special forces operations.
These attributes require a new submarine combat system and a greater
weapon load. An enhanced sonar system will reduce the chances
of counter-detection and is a key part of the Final Phase Update
of in-service submarines currently in progress. Designed to contribute
to network-enabled capability (NEC), the Astute class submarine
is planned to have improved communications facilities to integrate
with other joint assets. Availability will also be improved by
the Vanguard Class reactor plant, which will be fuelled for life
and hence lead to cost savings.
Equipment to be Replaced and In-Service Date
The Astute Class will progressively replace the Swiftsure
and Trafalgar Classes of SSN which first entered service in the
1970s. The approved In Service Date for Astute was 2005, but delays
in the Astute programme will result in the first of class coming
into service by 2008 as announced in February by the Secretary
of State for Defence.
Acquisition Approach
The prime contract for full Development and Production of
three submarines was placed in March 1997. The prime contract
with GEC Marconi, which subsequently merged with BAe to form BAE
Systems (BAES), the contract is incentivised through a Fixed Price
Incentive Fee arrangement, with a shareline arrangement which
allowed the company and MoD to share cost under/over-runs up to
a maximum price. However, this contract is currently in the process
of renegotiation.
The Prime Contractor is responsible for the design and build
of the vessels and provision of all equipment, including the combat
system, demonstrating functional performance, and supporting the
submarine during an initial period of in-service life.
Further Orders of Astute
On current plans we intend to place orders for further Astute
class submarines which we expect to enter service from the next
decade onwards.
Programme Delays and Agreement on the Way Ahead
Following BAES' disclosure of significant delay and projected
cost overrun in the Astute programme during 2002, MoD entered
into discussions with BAES about arrangements which would address
those difficulties and, in parallel, commenced interdepartmental
consideration about the extent to which MoD would contribute to
the resolution of the difficulties.
Whilst MoD said it was not prepared to protect BAES from
its failure to perform, it did acknowledge that it would discuss
the exceptional difficulties which may have arisen from the introduction
of the CAAD 5 design tool. This formed the basis on which MoD
entered high level negotiations. These negotiations took place
throughout January and February 2003, culminating in an agreement
ratified by the Government on 19 February 2003. Under the agreement,
the design and development and production of the First of Class
(FOC), HMS ASTUTE, will be separated from the production of the
second and third submarines. Full scale production work will resume
once confidence in BAES's ability to undertake the work has been
established and the design substantially completed. The Design
and FOC elements will be priced through continuance of the existing
Target Cost Incentive Fee (TCIF) format of the Astute contract
but with new share lines above and below the newly established
Target Cost. It is the aim to agree fixed prices for the second
and third submarines and BAES is incentivised to submit timely
price quotations. The agreement also contains incentives on BAES
to reduce construction man-hours and to shorten submarine build
periods.
The original contract was based on a single source supplier
(GEC-Marconi) as the only UK provider of this capability. The
MoD sought to establish a fair price, given the economic conditions,
and agreed joint assumptions on an open book basis at the time
of contract signature in March 1997 on how the project would be
delivered. These assumptions related, in part, to the benefits
to be derived from the first comprehensive application of computer
aided design (CAD) techniques to UK submarines. CAD will deliver
significant advantages in the future but its benefits have proved
more difficult to realise on a programme of this complexity than
either the MoD or the company had assumed. It is now clear that
the introduction of CAD requires more time and effort than had
originally been anticipated. As a result, the Government have
agreed to increase its funding by around £430 million, subject
to final negotiations, as against an increased contribution by
the company of £250 million. Significant additional MoD expenditure
will not begin until 2008. The cost increases reflect the Government's
acceptance of a share of the responsibility along with BAES for
the underestimate of the required effort and the consequent design
delays. They also cover costs incurred through restructuring and
other revisions to the project and will result in the first of
class coming into service by 2008. In the light of what is now
known about the costs and benefits of CAD, the MoD is confident
that the agreement represents a good deal for the taxpayer. It
will provide an outstanding class of new generation attack submarines
for the Royal Navy, and will maintain important UK industrial
capability. Subject to the necessary arrangements being agreed,
it is intended that BAES will call upon short term assistance
from the Electric Boat Division of General Dynamics to help strengthen
BAES skills in CAD management.
The exact details of how the Astute contract will be restructured
to reflect the agreement is being worked up in a joint implementation
plan being developed with BAES. Work on this will continue apace
and is expected to take several months to complete.
Crewing
Crew numbers will be the minimum possible consistent with
maintaining operability and skill levels. The crew will be smaller
than for the Swiftsure and Trafalgar Class and the contractor
is incentivised to keep total numbers down to a maximum of 84,
excluding trainees and sea-riders.
Collaboration
Given the sensitive nature of the technologies and capabilities
concerned, a collaborative approach is generally inappropriate
for SSN procurement. However, it is planned that US expertise
in Computer Aided Design (CAD) processes will be brought into
the programme.
Export Potential
Export plans for the technologies associated with Astute
are limited because of its sensitivity, not least to the SSBN
connection. Only the United States would be a source of information
exchange on any aspect of propulsion, but weapon systems—such
as periscopes or weapon discharge systems—would be export
candidates as they have been in the past.
Industrial Factors
The Astute Class is critical to maintaining the nuclear submarine
industrial base. The Barrow shipyard is the only UK facility capable
of undertaking the design and build of nuclear submarines. BAES
have announced their intention that Barrow is to continue to be
a centre of excellence for submarine building. As far as the MoD
is concerned, Barrow has the assurance of a continuing submarine
programme which will provide work for some years yet and current
assumptions are that the RN will have a need for further submarines.
Smart Acquisition
This is a legacy project whose Main Gate equivalent approval
pre-dates the (then) Smart Procurement Initiative. Nevertheless,
Smart Acquisition principles have been adopted and applied where
appropriate.
Key Milestones
| Milestone | Criteria
| Date |
| Entry into service | Initial trials of HMS Astute completed
| 2008 |
Costs
We have previously reported an estimated total cost for the
programme of some £2.7 billion on a resource basis at outturn
prices. The cash addition to the programme resulting from the
latest Agreement is some £430 million. Taking this into account,
together with the overall impact of three years' programme slippage
(including increased cost of capital of some £150 million),
the current estimated forecast cost of the programme is some £3.6
billion in resource terms. These costs will be refined during
the course of negotiations and subject to re-approval when the
detailed programme is reset in the Summer.
In-Service Support
The original Astute contract included an initial period of
Contractor Logistic Support for three boats. The division of responsibility
between MoD and Industry is being reviewed to establish whether
risk management and financial liability has been appropriately
allocated. Discussions to agree a way forward on a longer term
strategy are in progress.
Interoperability
The Astute Class will be capable of participating in joint
operations with allies and providing capability such as land attack
(via TLAM) and Special Forces insertion. The planned communications
system will be key to enabling interoperability with the US Navy
and other allies and reflects the continued priority afforded
by the MoD to NEC.
Disposal of Equipment Replaced
Astute will progressively replace Swiftsure and Trafalgar
Class submarines which are planned to begin decommissioning towards
the end of the decade.
In-Service Life
The Astute Class submarines are due to remain in service
for 25 years.
Development Potential
Capability enhancements are under consideration. Their implementation
will be subject to approval once we have received satisfactory
commercial proposals from BAES.
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