Battle over big RAF contract

AN Anglo-US consortium bidding for Britain's £13bn air-refuelling defence contract has accused its French-led rival of hyping up job creation figures in its bid.

Tanker Team, which includes Boeing and BAe Systems, said its own bid for the 27-year contract to supply and maintain a new fleet of airborne tankers for the RAF would create about 5,000 jobs in Britain.

Rival AirTanker, led by French defence firms EADS and Thales, has pledged to create about 7,000 jobs. Boeing and BAe claim that this figure includes theoretical estimates for building new planes which may in fact only be leased from airlines with surplus aircraft.

AirTanker rejects the accusations and says its figures are based on jobs directly created by a core fleet of new planes to be built by Airbus.

Tensions over the contract, Britain's biggest offered under the private finance initiative, have been mounting steadily as the Ministry of Defence reaches the closing stages of selecting a preferred bidder. A decision, already delayed several times, is expected around Christmas.

Tanker Team's proposals centre around a fleet of 19 second-hand Boeing 767s to be acquired from British Airways and converted to carry fuel.

The consortium also claims its contract will open up £2.3bn in export opportunities and lead to savings of about £220m for the MoD. Both bids are being evaluated by the Department of Trade & Industry for their impact on British industry, including jobs.