Contracts encompass work worth:

- GBP1,325M for the construction of giant sections of both ships by BVT Surface Fleet at Govan on the Clyde and Portsmouth;

- GBP300M for the construction of giant sections of the ships at the BAE Systems yard at Barrow-in-Furness;

- GBP675M for the bow section and final assembly and completion of the ships by Babcock Marine, with assembly taking place at Rosyth;

- GBP425M for design and engineering for Thales UK; and

- GBP275M for design and supply of Mission Systems for BAE Systems Integrated Systems Technologies (Insyte).

Defence Secretary, Des Browne, said: "This is a historic day for everyone in defence. The two aircraft carriers will provide our forces with the world-class capabilities they will need over the coming decades. They will support peace-keeping and conflict prevention, as well as our strategic operational priorities. The contract signing seals the future for thousands of jobs, and ensures that we will have a Royal Navy fit for the 21st century."

Baroness Taylor, Minister for Defence Equipment and Support, said: "This is truly a national project, involving companies from the Clyde to the Solent. Construction work will create or sustain around 10,000 UK jobs at the peak of production. I am delighted that we have signed the contracts for manufacture and I look forward to first cutting of steel for this exciting project later this year."

The future aircraft carriers, to be named HMS QUEEN ELIZABETH and HMS PRINCE OF WALES, will be the biggest and most powerful surface warships ever constructed in the UK. They will provide our forces with world-class capabilities, supporting peace-keeping, conflict prevention and our strategic operational priorities. They will be a highly versatile and potent joint defence asset, able to meet the widest range of tasks.

First Sea Lord, Admiral Sir Jonathon Band, said: "I am delighted with the news that the contract for the two new aircraft carriers, to be named HMS QUEEN ELIZABETH and HMS PRINCE OF WALES, has been agreed and signed. These ships, with their embarked aircraft, will provide the UK with a potent and powerful aircraft carrier force that will deliver air power in support of the full range of future operations at sea, in the air and on land."

Chief of the Air Staff, Air Chief Marshal Sir Glenn Torpy, said: "The contract signature marks an important step forward in the Carrier Strike programme. These ships will provide additional options for projecting offensive air power at a time and place of our choosing, and I very much look forward to the arrival of both the carriers and the extremely capable Joint Combat Aircraft on the frontline".

Alan Johnston, CEO of BVT Surface Fleet, said: "This is an important announcement for BVT and for the UK maritime industry at large, guaranteeing work for years to come across the country. We are looking forward to delivering these very important ships to the Fleet in the next decade and intend to begin construction work later this year."

Once the carriers enter service in 2014 and 2016 respectively, they are expected to remain in the fleet for at least thirty years.

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