§ Mr. Arbuthnot
I am pleased to announce that we have decided, subject to the satisfactory completion of negotiations, to award two contracts to Royal Ordnance, a division of British Aerospace Defence Ltd., for the supply of five years' worth of 81mm mortar ammunition. The requirement is for the high explosive and smoke rounds for the 81mm mortar in service with the British Army. The total value of the two contracts is approximately £80 million.
The high explosive round contract was won by Royal Ordnance in the face of competition from other UK firms and overseas suppliers. The contract for the smoke round will be placed with Royal Ordnance, as the producers of the only approved product to meet this requirement, subject to the satisfactory completion of price negotiations.
A number of Royal Ordnance factories will benefit from these orders, in particular the factory at Glascoed, Gwent which will undertake the filling and assembly of the high explosive rounds. Significant work packages are also expected to go to RO factories at Birtley, Radway Green and Bridgwater. The orders should help maintain up to 400 jobs at Royal Ordnance sites and its UK sub-contractors for the duration of the contracts.