AEROSPACE workers were celebrating a huge, billion pound order today - as British Aerospace defended its controversial sale of Lancashire-built jets to Indonesia.

South Africa confirmed a package of orders and options for 28 Gripen fighters and 24 Hawk jet trainers from BAe and Saab of Sweden.

The order is a major boost for the giant's Samlesbury and Warton sites where more than 12,000 people work. Small aerospace firms in East Lancashire which supply BAe will also benefit from the order.

"It is good news for the whole aerospace sector in East Lancashire," said John Whalley, chief executive of the Nelson-based North West Aerospace Alliance which represents more than 80 firms in East Lancashire.

"British Aerospace has a policy of not building new sites or taking on large numbers of people so the greater the workload at Samlesbury and Warton the more work for local firms."

The order announcement came as BAe announced an increase in half year profits and defended its sale of Hawks to Indonesia.

Although the Hawk contract is concentrated on the Warton site where they are built, Samlesbury will be heavily involved in the order for nine dual seat Gripens. It is the first export order won for the two seater version of the Swedish fighter. South Africa also has options on a further 19 single seat Gripen. The order for Hawk jet trainers comes amid the controversy over the Government's decision to block the exports of the planes to Indonesia. The two seater Gripen is a joint venture between BAe and Saab under which the British giant helps build the multi-role aircraft and market it for export sales.

BAe's Samlesbury site helped design and build the components for the development aircraft and is, together with Warton, involved in production.

A spokesman at Samlesbury today said that it was too early to say exactly what involvement the site would have in the new Gripen order.

"But any orders for Hawk and Gripen are good news for the company," she said.

Senior BAe bosses today defended its sales of Hawk jets to the Indonesian government amid the growing turmoil in East Timor.

Chief executive John Weston said: "We are not embarrassed by it. We are in close consultation with the British Government over the issue and we will go along with whatever the Government decides to do." Since pro-Indonesian militias went on a rampage after the massive vote for independence by the East Timorese last month, BAe has come under fire for selling the jets.

Mr Weston said it was BAe's policy not to reveal how many planes it had sold the Indonesian government, but the order was not major compared to others fulfilled by BAe.

Mr Weston's comments came as BAe revealed that its first half profits before tax and exceptional items had risen to £358 million in the six months to June 30, up from £349 million at the same time last year.

But after exceptional items of £226 million, including a £190 million charge from the restructuring of BAe's Royal Ordnance business, the profit was reduced to £132 million.

Sales dropped to £4.1 billion from £4.2 billion last year.

The group said it had a strong order book at the start of the second half of its fiscal year, with sales from its Airbus business expected to boom.

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