SELECT COMMITTEE ON ECONOMIC AFFAIRS - Parliament

Professor Gerald Holtham—Oral evidence (QQ 331–367)
Q354 Lord Lawson of Blaby: They are not independent, but they are not the same
either because they could pursue a spending policy irrespective of the oil revenues and so
on.
Professor Holtham: Yes.
Q355 Lord Lawson of Blaby: And the oil revenues would do what they do, irrespective
of their spending policies. So these are separate factors even though there is a connection
between them.
Professor Holtham: I think it would be rather like the policy that the Labour Government
followed in 1997. They attempted to follow a very tight policy initially in order to establish
some credibility. Having done that, they reversed the policy. But I imagine that the Scots
would be well advised to do at least the first part of that.
Q356 Lord Lawson of Blaby: I will ask the question that I was going to ask—sorry, Lord
Forsyth’s question was so fascinating that I wanted to take it a little further. Assuming that
the United Kingdom retains the independent deterrent—nuclear submarines, Trident or its
successor and all that—clearly, the idea of having your independent deterrent based in a
foreign country is slightly implausible. The defence experts think that it would be relocated
to the United Kingdom and that the destination of choice is Milford Haven, in Wales. It is
only just in Wales and is a rather English part of Wales. Nevertheless, it is in Wales. If that
were to happen, would that, first, confer an economic benefit on Wales and, if so, would it
be of any significance? Secondly, would there be a political uproar in Wales if that were to
happen?
Professor Holtham: I am not an expert in this area so I do not know how far this is a real
problem and how far it is an apparent problem. But Milford Haven is one of the largest oil
and liquid natural gas importing ports in the UK and there are substantial liquid natural gas
facilities. On the face of it, it is not an obvious place to put a nuclear deterrent.
Lord Lawson of Blaby: I am talking about a submarine base. That is what we are talking
about.
Professor Holtham: Absolutely. But if you are going to be storing nuclear warheads, and
you are going to replace Faslane and store nuclear warheads in the vicinity, there may well
be no technical, enduring problem but the public would need a lot of reassurance that this
moreover, was an intelligent combination if putting those forces there resulted in a
restriction of the development of the existing industries in Milford Haven, I do not think that
there would be an advantage. This is an area which the Welsh Government have earmarked
as an enterprise zone. They want to induce the British Government to give various benefits
to encourage the development of the area as an energy generating centre—with offshore
wind assembly as well as natural gas and the rest of it. If the nuclear deterrent is competitive
with that, it is not clear that there is a net advantage. If it is not, it is not. I cannot help you
on that. I do not know what the engineering truth is.
Q357 Lord Forsyth of Drumlean: How many jobs are implied by that development?
Professor Holtham: I do not know. I do not have that in front of me.
Lord Forsyth of Drumlean: At Faslane, the associated job are well over 10,000. The
number is very large.
Professor Holtham: I do not think that the existing facilities at Milford Haven would be
anything like that. So it would require a very substantial increase. I mean, they want to
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