pounds 500m bill may force U-turn over nuclear subs

DEVONPORT dockyard may be unable to carry out the refitting of Britain's nuclear submarine fleet, for which it was chosen over Rosyth in Scotland after a bitter lobbying battle. The Government is facing the possibility that it will have to make a humiliating U-turn and let the work go to Rosyth after all.

Devonport planned to upgrade its 1907-vintage drydocks to take large hunter-killer subs, and the four 16,000-ton missile boats of the Trident fleet. But tests by the Nuclear Installations Inspectorate, and geological surveys, have revealed that the plans are inadequate.

Already, the refitting of two Swiftsure class hunter-killer boats, scheduled for Devonport, has been quietly rescheduled for Rosyth, which was told when it lost the contract battle that it would get no more nuclear work. However, the Secretary of State for Defence, Michael Portillo, will not announce the news until next month.

Devonport's upgrading plans, which involved fitting steel anchors to the dock structures to strengthen them, are thought to have been costed originally at pounds 170m.

However, a drydock which relied on steel anchors for stability collapsed in Greece only eight years after it was built, because of corrosion. Recent tests have suggested that a rethink is needed; at the minimum, the dock is likely to need many more anchors than were originally envisaged. The extra cost could exceed pounds 500m.

The original decision in 1993 to award the nuclear submarine work to Devonport was controversial. It followed a long and, at times, acrimonious lobbying battle between the two rival yards.

Rosyth always maintained it was subjected to a greater level of scrutiny than its English rival, and was never really in the running. Devonport lies in an area where the Tories will have to defend several marginal seats at the next election. In Scotland, on the other hand, the Tory vote has already slumped and shows little prospect of significant recovery. This, argued the Rosyth camp, was why John Major chose Devonport.

The Prime Minister is so far standing by his decision. But Cabinet pressure for a volte-face is building up. Mr Portillo is joining the Foreign Secretary, Malcolm Rifkind, and the President of the Board of Trade, Ian Lang - both ministers with Scottish seats - in arguing that the pounds 5bn Trident refit contract should go north.

In choosing the West Country dockyard, the Government scrapped a pounds 387m programme at Rosyth to build a new refit facility for Trident submarines. More than pounds 120m of taxpayers' money had been spent on the project, called RD57, which is moribund but could be revived.

Both yards are due to be privatised next year. The only bidders are the companies that now run them under contract from the ministry, Babcock at Rosyth and DML at Devonport.The increasing uncertainty will put the sell-off in doubt and add to the Government's embarrassment.

A DML spokesman confirmed that no definite price for the upgrading had been reached and said that negotiations were continuing, but added: "We are confident there will be no U-turn and nuclear submarines, including Trident, will be refitted at Devonport."