It’s a huge privilege to be here today, and I want to start by congratulating BAE for taking on 800 apprentices this year. That is a record in your company’s history. I think it’s a really great achievement. It’s going to be great for the people involved but it’s also really, really important and good for our country.
And I want to say, before I really start, just when I look at this company and what you do, and I have the huge privilege of being Prime Minister and seeing what you do, I think you should be incredibly proud of what this company does. Right now, you are building some of the biggest warships the Royal Navy has ever had, including the 2 aircraft carriers. You’re launching submarines from Barrow that are some of the most advanced and silent and brilliant anywhere in the world, that enable us to keep our country safe. Here you’re making the Typhoon, an aircraft that has proved itself again and again in the skies over Libya, over Iraq, over the skies of our own country, and I get to see that first-hand. So this is a brilliant manufacturing technology and engineering business, and you should be really proud of what you do.
Before taking your questions – and that is what today’s about, your questions and I will try and answer them – I just wanted to make 3 points. The first is that we have a plan in our country, an economic plan, and the plan is working. It’s a plan about getting the country back to work. It’s a plan about getting our economy growing. It’s a plan about getting our deficit and our debts under control and it’s a plan about rebalancing our economy between south and north so we have a genuinely balanced economy, not so reliant on finance and services, but also reliant on manufacturing and technology.
Now, I can’t claim that in the last 5 years we’ve solved all those country’s problems – that would be wrong – but we have created 1,000 new jobs every day. We are now the fastest growing major economy in the Western world. We got the deficit down by half as a share of our economy, and jobs and livelihoods are growing in every part of the country, not just the south. Indeed, there have been more apprentices created in the north west, and, over the last year, the claimant count has fallen faster in the north west than anywhere else in the country. So we got a plan. The plan is working. We should stick to the plan.
Second point is that BAE Systems is actually a key part of that plan. I say we need to train more young people and you are investing in apprentices. I say we need to export more to other parts of the world and you are blazing a trail with your exports up over the last 5 years, and I believe more to come. I believe we need to rebalance this economy between south and north, between finance and manufacturing, and that’s exactly what you’re doing with your training, with your investment and with your future plans. So you’re a key part of the plan that is working that’s creating a stronger economy.
But the third thing I wanted to say is I want us, as a country, to be more ambitious, and more ambitious in a couple of really important regards. Yes, we’ve got more people in work in our country than ever before but we should be aiming for full employment, for anyone who wants a job, should be able to get a job. We don’t have that situation yet but if we stick to the plan, we keep investing, we keep growing, we can get there.
But I also want us to be more ambitious – even more ambitious on apprenticeships. We created 2 million in this Parliament. [Political content removed]
And there’s a new way that I’m announcing today that I want us to be even more ambitious. And that is I think that when young people leave school, they should either be going into an apprenticeship – as many of you have done – or going on to university to study a degree. That’s the aim. Everyone should have 1 of those 2 opportunities. So increasing apprenticeships but we’re also uncapping the number of university places. And today I can announce a new idea, a new scheme which is actually to bring the two together. To have a degree apprenticeship, so, as you leave school at 18, you would become an apprentice and you would start studying for your degree at the same time. Your fees at university would be paid for by a combination of the government support and the company that would be backing you.
Now I think this is really exciting because, of course, today you can do a degree and then you can do an apprenticeship. Or you can do an apprenticeship and then you can do a degree. But bringing the two together and being able to do the two at the same time, earning while you are learning, I think is really exciting. I think it will be very good for the young people involved because you get a degree, you get the skills without having to pay the fees; you’re earning while you’re learning.
It’s good for the companies because I think companies are keen to get hold of talented young people and train them up, and many can’t manage to attract the best graduates but under this scheme they’ll be able to get them, train them and work with them before they become graduates. And it will be good for our country because the basic truth is this: we are in a global race, global competition with other countries and we’ll win if we have the most skilled, most trained, most motivated workforce in the world. And that is the vision that we should have.
So I wanted to make that announcement today about being ambitious: ambitious for full employment, ambitious for more apprenticeships and ambitious for degree apprenticeships, the new scheme announced today.
That was what I wanted to say. Thank you for the welcome. Congratulations on appointing 800 apprentices this year. Thanks for what you’re doing, building these extraordinary aircraft and all the other work across BAE Systems. And with that, who wants to give me the first question.
What will you do to ensure that the aerospace industry in the north west is not only secure but grows?
What will I do to keep it growing? Well, the first thing I can do is to carry on in the job that I have. I’m Prime Minister but I’m also – I joke with Ian – I’m one of your unpaid sales staff. I like to get out around the world and encourage people, our partners and our allies, to buy the great equipment that we make.
And I want to make this point quite frankly. No one should be embarrassed or worried by the fact that we make defence equipment and we sell it to our allies around the world. It is an absolutely legitimate business. And I tell you why it is legitimate, because sometimes people forget this. We have a right in our country to self-defence, don’t we? We can invest in our defence industries and in our armed forces to defend ourselves. Other countries have that right too and you can’t expect every country to produce every last piece of equipment that is necessary for their defence. So we have one of the most tightly-controlled and licensed defence sales businesses in the world but it is a legitimate business. [Political content removed] So get out there and promote the great kit that we’ve got.
Second of all, the apprenticeship scheme, the skills, is absolutely essential. But third, and perhaps most crucially, is that people will only believe that we have great equipment if we are investing in it ourselves. And so I have said that the £16 billion that we spend every year on defence equipment, we are committed to that for 10 years. So you have a £160 billion defence equipment budget that will go up in real terms each year so we can plan for the future because it’s no good if you chop and change your defence equipment all the time. We need to know that we can afford those aircraft carriers, those Type 26 frigates, those submarines that you’re building at Barrow-in-Furness. We need to know that the money is there. So the equipment budget is sacrosanct, is protected, and so I think the combination of the equipment budget, the skills we’re investing in, the work we do with our allies overseas, I think there’s a very bright future for aerospace. We’re the number 2 in the world after the United States, and, I think, if we go on doing those things, there’s no reason why we can’t keep that position for the future.
Hi, what I wanted to know is what kind of message would you give to young people who may not utilise their vote in the general election?
What I would say to everyone, please vote, even if you’re not going to vote for me. Vote because it is important. There are people all over the world who, you know, would love to be able vote and people who have died for the right to vote. And so I would say, if only for that reason, get out and vote and make your choice and read up about what the different politics and policies and parties are.
But I would also challenge the whole kind of Russell Brand nonsense about voting doesn’t matter or doesn’t make any difference. I think he’s completely wrong. It does make a difference. You know, you might agree with me, or you might agree with the other guy, but we have very different ideas about the future of the country. [Political content removed] I’ve got a vision for the future of the country. Now his vision’s different. So don’t let anyone say there aren’t differences between the politicians. There are. You choose.
Final point I’d make – odd one maybe for a Prime Minister to make. One of the great things about voting is you can get rid of people you don’t like. In our system, you know, whether it’s your local council, whether it is your Prime Minister, your Member of Parliament, you can chuck them out, literally. You know, if you vote against me on 8 May, I’ll be driving a removal van up Downing Street and packing up and going. That’s the way it works. It’s incredibly valuable. [Political content removed] But it is a really powerful thing so don’t let anyone tell you voting doesn’t matter. It does. It’s a privilege. It’s not compulsory – we shouldn’t do that – but it’s a privilege and you should make the most of it.
Hi, my question is to you is what are we going to do about the Russian Bears invading our airspace?
Right, okay. Good point because, of course, when these Russian aircraft fly close to British airspace, as they have done on several occasions this year, 1 of these or 2 of these fantastic Typhoon aircraft are immediately up in the air and escorting those aircraft away from British airspace, and so it’s a reminder of just how essential the Typhoons that you build are to our air defences.
What are we going to do about it? Well first of all, I think we should recognise that the Russians are probably trying to make some sort of point here. They’re showing off their capabilities. We shouldn’t overreact because these planes haven’t actually come into our sovereign airspace. They’ve been flying around it. But we should keep our defences strong. We should make sure we can scramble these Typhoons at a moment’s notice and escort them away from any danger. So keep our defences strong, make clear to the Russians that they might be trying to make some sort of point, but frankly we’re not very impressed by it. And make sure that we have the capabilities to keep our air defences strong, which we do.
And these are extraordinarily capable aircraft, and I know that because when aircraft fly into a British sovereign airspace that we don’t know about, I know exactly how fast these things can get up in the air and get alongside any aircraft, whether it is rogue or unknown or whatever, and how quickly we can take action. So we should be very proud of the capabilities we’ve got right here.
Do you believe that research is important, not only to manned but unmanned aircraft for us to keep in our – keep our level in this year – in this – in the country and in the world?
I think this is a really important point because the truth is that the next platforms are likely to be more unmanned aerial vehicles, UAVs. And if you are going to be a front rank defence player, you’ve always got to be thinking of the next development. So let’s be incredibly proud of the Typhoon. It’s a world-beating aircraft. I think you’ve got forward orders of some 370 and hopefully will have some more as we show it off around the world, how capable it is.
But we should be thinking of the next step, and the next steps are even more stealthy aircraft, more unmanned aerial aircraft, and for that what we should be doing is working out who to partner with so that we can jointly invest in the research and development, but make sure there’s a really big British footprint involved in it. And so I signed something with the French called the Lancaster House Agreement, and I think France and Britain, as the 2 major military players in Europe, I think there’s a real opportunity for us to work together on this future technology.
There’s vital work you’re doing here, there’s a commitment from the government to the research and development, there’s a knowledge that future aircraft are quite likely to be unmanned. I wouldn’t say the age of the piloted fighter jet is over, not least because of course we’ve got the Joint Strike Fighter coming up next, which many of you will be working on. But clearly, more unmanned aircraft drones, ISTAR, intelligence gathering aircraft – these are going to be a vital part of the future and we have to be doing the research now, otherwise we’ll be left behind.
And this leads to a really important point that sometimes I think people don’t get about defence. Your defence budget – it’s no good if you just keep it where it is and keep the capabilities that you have. You have to keep thinking to the future: what is it we’re going to need? And I can tell you, as Prime Minister, when we’re thinking about how do we help the Nigerians rescue the Chibok girls, or how do we try and help recover a hostage on the other side of the world, or how do we help our allies in Iraq and Syria to deal with terrorists on the ground, more and more what we need is intelligence, surveillance, information gathering, we need forces that are very mobile. So if you just stick with what you’ve got – if we stick with, you know, battle tanks rather than drones, we’d be making the wrong decision. Of course you need both, but the job of government is to get the balance right, and the balance needs to shift more in favour of research development and the future capabilities because otherwise we won’t be able to intervene in the ways that keep our country and our people safe.
Hi. My question is, you said this company is a key part to your plan, but I’m guessing that means the Successor Programme as well, and I was just wondering what you’re doing to sway the voters who are against the Trident replacement.
Okay, very good point, Trident replacement. Well, first of all, thank you for what you’re doing at Barrow with the hunter-killer submarines. They’re absolutely vital. But we must, in my view, replace the Trident submarines and renew our nuclear deterrent.
And it’s worthwhile, for a moment, sort of standing back and considering why this is necessary. It’s obviously a lot of money, it’s a big investment, but I have quite a straightforward view about it, which is we live in a very dangerous world, the nuclear deterrent is our ultimate insurance policy against blackmail, and you’ve got to recognise that there are lots more states in the world that are trying to attain nuclear weapons. So to me, the idea of giving up our nuclear deterrent or weakening our nuclear deterrent at a time of uncertainty and danger, when you’ve got countries trying to acquire nuclear weapons, that is a risk we shouldn’t take.
So if you’ve passed that question, you’ve then got to ask, ‘Well, what does a replacement to Trident look like?’ And I’ve looked at all the arguments, and it seems to me incontrovertible that the best form of deterrents is a submarine-based system that can be continuously at sea, so that it is undetectable and can always give you the assurance that your deterrent is inviolable. So to me, it has to be continuously at sea, submarine-based, and we have to replace it in full. Now, the argument that I will make, and I’ll make it all over the country, is simply that – that, you know, in a dangerous world, you need the ultimate insurance policy and the price you pay for that insurance policy is fair, given that if you gave it up, you’d never be able to regenerate it.
[Political content removed] It also means jobs, it means technology, it means research and development. I think it’d be very difficult to maintain some of our other capabilities if we didn’t have this capability. But those are all secondary arguments, but I will make the first principle argument: Britain’s a front-rank power, we should have that insurance policy, and that means renewing Trident. [Political content removed]
Hi. I’d like to know how your plan for apprenticeships is better than what other parties are offering.
Well, I think the good thing is that everyone is interested in apprenticeships. Everyone recognises this is a model that works. And what we did as a government is obviously we had to make some difficult decisions and there were some areas we had to reduce some spending. So for instance, we said to the police, you do a great job but we want you to do it with a lower budget, and they’ve done it and crime has fallen. They’re done a great job. But we looked at apprenticeships and thought actually this is an area where we really should be expanding. [Political content removed]
I think second thing is, this degree apprenticeship – I don’t know what the other parties think, but this is work that we’ve done, listening to businesses, particularly maybe slightly smaller businesses than BAE, maybe some of your suppliers, some of whom have said to us we really want to hire bright graduates, but we sometimes lose out against the big companies because they can do the milk round, they can attract very bright graduates, so we would like to invest in graduates before they even go to university. And so I think this is a very neat scheme which we are particularly pioneering.
So I think it’s good there’s sort of cross-party agreement, apprenticeships are good, but I would argue we’ve thought it through, we’ve put a number on it, and crucially, you know, you can only afford things like apprenticeship programmes if you’ve got a strong economy, and because of the policies we’ve pursued, you know, we’ve created the jobs, we’ve got the economy going, we’re getting the deficit down – a strong economy can support skills and universities and good schools and the rest of it. A weak economy where you don’t get hold of the debts, then you get into trouble.
Hi. I’m curious what you’re doing to try and make housing both more affordable and make sure that it goes to young people.
Yes. Yes. Very good question. The bold truth is, we just haven’t built enough homes in Britain for many years. Housebuilding has basically declined every decade since the 1960s. So there’s a fundamental problem we’ve got to get to grips with, and that is one of the reasons we have reformed the planning system. We replaced a thousand pages of planning rules with just 50 pages and now we’ve seen, I think, in the last year 240,000 planning permissions go through, so we are building more houses.
But I don’t think that’s enough just to build houses. We need to change the system, and there are two fundamental things we’ve done that I think will make a big difference. One is Help to Buy. This is a scheme that basically recognises many of you in a couple of years’ time with a well-paid job and a partner in a job – you could afford a mortgage payment, and so you could afford to live in a house you own, but you might struggle to get the deposit together because the banks and the building societies recently have only been offering 70%, 80% loan-to-value mortgages.
So Help to Buy says, if you can afford the mortgage payments, we will help you by ensuring that part of the mortgage that takes us up to 90% or 95%. So this has enabled 88,000 people in our country in the last 3 years, young people mostly, to buy their first home because they’ve been able to have a small deposit, maybe £10,000 or £15,000, and then they’ve been able to afford the mortgage payment. So Help to Buy is absolutely crucial and we’ll keep that going in the next parliament.
Second thing we’re going to do is build starter homes for sale rather than for rent. I think most people want to own their own flat or their own home. They don’t want to rent forever, and so we need to build homes that young people can afford. So these homes, they’ll be 80% of the normal market value. We won’t make the builders have to build so many other affordable homes at the same time to keep the price down. They’ll be reserved for people who are under the age of 40 so they can’t be bought by buy-to-let landlords, they can’t be bought by foreign property investors, they are reserved for young people living in Britain who want to get on the housing ladder.
So I think those 3 things: change the planning system to get Britain building, build starter homes, and have Help to Buy so you don’t need a massive great deposit. Those 3 things I think will make a real difference, because I want us to be a country where people who work hard, who do the right thing, can afford to buy their own home, and at the moment not enough people are able to do that, and it needs to change.
Thank you. Some professional staff across several companies feel that apprentices are being brought in to replace their jobs. How do you propose to create the harmony to, you know, encourage new apprentices to come in but also to restore the faith in all these people who are building these things?
I think – yes. Look, I think that’s a really good point because there is a danger, of course, that companies will hire apprentices in order to have relatively low-cost labour to replace people who are working very hard. And that’s why we have to make sure that the apprenticeship schemes are quality schemes, that there is real training and education involved. And the apprenticeship minister is sitting right in front of me, Matt Hancock, and that is a very important part of his role to make sure that we don’t let companies do that. So they have to be good schemes, good quality, good education.
So, yes, the company’s benefiting, because they’re getting bright people to work for them, but the individuals are benefitting too because they’re getting training and they’re getting skills. And that, I think, is the key because we’ve got to make sure that, as you leave your apprenticeship, you’re going to get a well-paid job. And I was asking here, you know, what the figures are, and actually they compare very well – better – 4 years of an apprenticeship here, at BAE Systems, you’re earning more than a university graduate going into a graduate job typically would get. So, you know, I think it is working, but we’ve got to keep our eye on the quality of the apprenticeships. And also, I think we need to look at the minimum wages that are paid, including the apprenticeship minimum wage, which I want to see rise. I think it’s time for that to rise, and I hope we can make some progress in the coming days.
Hi. I’m just wondering with the US saying that we – they were worried about how much we spend about defence. Do you think that we need to spend more on, you know, BAE or defence as a whole?
Yes. Look, I think the defence budget is absolutely a crucial part of our national security. There are other parts too. We’ve got to invest in our security services, intelligence services, GCHQ, policing. These things are all about our national security. Our defence budget is the second biggest in NATO. We’re one of the only countries in Europe that spend 2% of our GDP on defence. And what I’ve said very clearly is, look, the most important thing is that we are clear about the equipment budget for the next ten years, because that is really the key to having a – forces and capabilities that, with the Americans and others, we can make a difference in the world.
And so, I’m not saying all of it will go to BAE Systems. But the £160 billion over the next 10 years that’s going to pay for the aircraft carriers, the Type 26s, the submarines, the typhoons, the F-35s – in my constituency, I’ve got the Voyager aircraft, and the A400Ms at RAF Brize Norton. The money for those things is there, so we can have the confidence we’re going to be a front rank defence player with the Americans. We meet 2%. We meet it this year, we’ll meet it next year. The time to set the defence budget overall is at the next spending round, but I will be very cognisant of the fact that, you know, you get what you pay for in defence.
What we’ve done the last 5 years is that we basically kept the defence budget level, at about £35 billion: as I say, fifth biggest in the world, second biggest in NATO. And by keeping it level, we’ve had to take some difficult decisions, but actually we’ve got rid of the great black hole in our defence budget, where we were signed up to lots of things we couldn’t afford. What we’re now signed up to, we can afford.
And crucially, when you talk to our troops, when you talk to our navy, our RAF, and you ask them about their equipment, you know, they say we’ve now got some of the best equipment anywhere in the world. I always ask this question. I’ve been to Afghanistan, I think 13 times in the last 10 years, and the last time I went, you know, not a complaint about helicopters, about equipment, about body armour, about what we’ve got for our forces. So, I’m satisfied we have a strong budget. We’re going to have to set it at the next spending round, but the equipment budget is absolutely secured, and I think that’s the crucial part of the long-term deal for defence.
Good morning, Prime Minister. I am an employer of apprenticeships and degrees as well, and I do consider there’s a – what you’ve announced today, I think it’s absolutely brilliant in terms of the linkages between apprentices and degree courses. But as an employer, we do find there’s a delta between the graduates coming out of university now, in having the appropriate skills that the universities are offering them, to the actual skills that we need as an employer in industry and in engineering. So, I was just wondering if more could be done to align the universities to engage with the companies to create those specific needs and work closer?
I think that’s a really important point. You know, at the end of the day, the education system’s only working if we’re producing school leavers and graduates that can do the jobs that a modern economy is generating. And I think degree apprenticeships absolutely will help with that, because, in future, if you want, you can talk to a school leaver about doing an apprenticeship with you and a degree at the same time, and so you’ll be working with them through their university career. But that’s only 1 solution. I would say also we need employers to get stuck in with the universities and talk to them about the capabilities and the courses that would be most useful for them. I think that would make a difference.
Third thing is publishing better information. It’s disappointing we still don’t really have – we will have soon, but a proper database where you can search, ‘If I do this degree at this university, or this course at this college, what job and what pay am I likely to get?’ We should have a totally searchable database so that young people can see far more detail about what I will get out of the education I’m undertaking. I think that would make a difference.
Third and final thing. This is very basic, but the basics really matter. Lots of companies I go to, when I ask them how many apprentices they’re creating, they might say 10 or 20. And then I ask how many people apply, and they’ll say 100/200. And I say, ‘Well, how on earth do you decide how to take the 10 or the 20?’ And they say, ‘Well, the problem is, Prime Minister, that all too often lots of the people applying haven’t got the basic maths and English that are at the heart of any apprenticeship.’ And I do think we do need to make sure that everyone in our school is studying English and maths at least to GCSE level, so that they’ve got those basic qualifications. I think, in the past, sometimes people were almost told, you know, well there are vocation skills and there are academic skills. But actually English and maths are key vocational skills as well. So, I think instilling that into our primary and secondary schools is absolutely vital to solving the problem that you are talking about.
Can I thank you again for the very warm welcome? Can I thank you for what you do at this amazing company? Can I wish you well, all of you starting out or some way through your apprenticeships? I hope you find you’ve made really great choice, because in the end this is what this is all about. We can talk about policies and manifestos and facts and figures, but in the end what it’s about is: are we giving people the chance to get on in life and achieve their dreams, to get a decently paid job, to raise a family, to have a home of their own, to enjoy a decent quality of life in this great country? That, to me, is what apprenticeships are about, and that is what great businesses like this are all about. It’s a privilege to work with you here at BAE Systems [Political content removed] ] It’s been an enormous privilege over the last 5 years to get to know just some of what you do at this great business. Thank you very much indeed.