Don't worry, BAe happy

Robin Cook wrote in his 2003 autobiography, "I never once knew Number 10 to come up with any decision that would be incommoding to British Aerospace."

On the face of it, Swan Hunters' loss of the Lyme Bay to BAe in July after alleged overrun of nearly £309 million and two years late, seems reasonable (see Curly's Corner Shop for a bit of background). This is despite the landing ship project "being largely managed and supervised by 20 BAE Systems staff on-site in Newcastle" in it's last years. Obviously an inquiry is needed to clear matters up.

However, the MoD is not so punitive when it comes to Britain's favourite arms manufacturer.

The National Audit Office has reported that the contract for the new Nimrod MRA4 aircraft is £966m over cost and nearly a decade late. This is despite the fact that the Nimrods will not be new, but refurbished bodies with new wings, engines and systems. The original contract for 21 planes should have been completed in 2003. However, after 'restructuring' of the project in 2003, the number of planes went down to 18 and now only 12 planes will be renewed, and delivery is not expected until 2010 at the earliest.

The MoD's punishment for BAe's poor performance? Award the arms company with a £65m contract to maintain the current aging Nimrod fleet until the 'new' ones are finally ready.

Why does BAe get such preferential treatment?