MOD Warned Its Equipment Plan Is 'Unaffordable'

The Ministry of Defence’s (MOD) equipment plan remains "unaffordable", the Whitehall spending watchdog has warned.

The National Audit Office (NAO) has pointed to a potential funding shortfall of up to £13 billion, stating the MOD has shown an unwillingness to take "difficult decisions", meaning military capabilities could be lost as funding for them runs out.

The NAO's warning comes after Boris Johnson launched what has been billed as the largest defence review "since the end of the Cold War".

The MOD projects the rolling 10-year programme to purchase and support military hardware will cost £183.6 billion between 2019 and 2029 – a budget overspend of £2.9 billion.

However, the NAO warned that if all the risks associated with the plan were to materialise, that overrun could rise to £13 billion in a "worst-case scenario".

It is the third consecutive year the NAO has concluded the plan is "unaffordable".

The NAO has criticised the MOD's "short-term focus" on living with annual budgets, which it said means existing military capabilities are at an increased risk of being lost.

It said, unless action was taken, the "floating hospital" facilities provided by the ship RFA Argus could disappear, and the number of Sentry early warning radar aircraft could be cut.

"The MOD needs to determine its strategic priorities so that it can develop an affordable long-term programme of investment," head of the NAO, Gareth Davies said.

Defence Secretary Ben Wallace insisted the MOD had made "encouraging progress" in improving its financial management but acknowledged there was still work to be done.

"We will need to create the financial headroom in our equipment plan to harness emerging technologies and develop the battle-winning capabilities of tomorrow," he said.

"We know that to get this right, we must accelerate our work to mobilise, modernise and transform so that we deliver more effectively and efficiently over the long-term," he added.

An MOD spokesperson said the department acknowledged "the existing difficulties with the ten-year equipment plan".

"We have stayed within budget this year, and the previous two, and strive to continue to reduce the gap," they added.

Cover image: A British F-35B fighter jet parked on aircraft carrier HMS Queen Elizabeth (Picture: MOD).