MOD's failure over plan to fund desired capabilities leaves UK in alarming place, report says

The Ministry of Defence (MOD) has no credible plan to fund the military capabilities the Government wants and leaves the UK vulnerable to reliance on protection from allies, according to a new report.

The Public Accounts Committee (PAC) says it risks such support not always being available and has called on the MOD to get a better control of defence procurement.

In a report on the MOD's Equipment Plan published on Friday, the PAC also stressed the credibility of Britain's Armed Forces had been "undermined" and it leaves the nation in an "alarming place".

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It comes amid the greatest-ever deficit between the MOD budget and the cost of Britain's desired military capability requirements.

The gap has ballooned to £16.9bn despite an injection of £46.3bn over the next 10 years.

The PAC, however, has warned that the real deficit could be closer to £29bn as some parts of the military only included capabilities that were affordable rather than all those the Government had requested.

There were further criticisms of the MOD's procurement processes with MPs saying slow delivery of new systems had created gaps in capability.

Only two of the MOD's 46 equipment programmes are currently rated as highly likely to be delivered to time, budget and quality, while successful delivery seems unachievable for five projects, including nuclear submarine reactors, new communications technology and missiles.

The report accused the MOD of dodging "major decisions" about cancelling procurement programmes it cannot afford and relying too much on an assumption that defence spending will rise to 2.5%, in line with the Government's long-term ambition.

It also highlighted that the decision to prioritise the Defence Nuclear Enterprise, which manages the UK's nuclear deterrent, had increased the deficit and risked further squeezing budgets for conventional forces.

MP Dame Meg Hillier, committee chair, said: "This problem is not new. Year on year our committee has seen budget overruns and delays in defence procurement. A lack of discipline in the MOD's budgeting and approach has led to an inconsistent plan that just isn't a reliable overview of the equipment programme's affordability.

"We're disappointed that not only are the same problems we're used to seeing on display here, but they also appear to be getting worse. Despite a budget increase, this year's plan shows a clear deterioration in affordability.

"The MOD must get to a better grip, or it won't be able to deliver the military capabilities our country needs."

MPs also highlighted "widely reported" recruitment problems, with more people leaving the military than joining, and the mothballing of Royal Navy ships due to crew shortages.

In January, ministers had to deny reports that HMS Albion and HMS Bulwark would be mothballed ahead of their planned retirement dates in the mid-2030s due to a lack of available personnel.

The MPs said: "With the support of its allies, the UK's Armed Forces continue to fulfil a crucial international role. However, many of its allies are facing similar challenges to the UK, which might affect their ability and willingness to continue providing extensive support."

Dame Meg said: "In an increasingly volatile world, the Ministry of Defence's lack of a credible plan to deliver fully funded military capability as desired by Government leaves us in an alarming place.

An MOD spokesperson said: "Our Armed Forces stand ready to protect the UK and as a leading contributor to Nato, we continue to defend our national interests and those of our allies.

"We are delivering the capabilities our forces need – significantly increasing spending on defence equipment to £288.6bn over the next decade, introducing a new procurement model to improve acquisition, and confirming our aspiration to spend 2.5% GDP on defence.

"By maintaining part of our equipment plan as uncommitted spend, we have the flexibility to better adapt to changing technology and emerging threats."

Shadow Defence Secretary John Healey said: "Conservative ministers might talk a good game on defence but this report is more proof of their failure to deal with the deep problems in the MOD.

"Ministers have lost control of the defence budget, failed to fix the 'broken' defence procurement system and wasted billions of pounds of public money.

"With war in Europe and conflict in the Middle East, ministers risk leaving our Armed Forces without the equipment they need to fight and fulfil our Nato obligations.

"Labour has a plan to defend Britain better. In government, we will establish a new military strategic headquarters and appoint a national armaments director to make sure our forces are ready to fight and defend Britain."

Treasury minister Gareth Davies said he did not "recognise" the findings, adding there was "record funding" going into defence.

He told Sky News: "We have got, I think, over £50bn being spent this year on defence, it was uplifted by £11bn at the last spring budget, so money is going into our defences.

"But the nature of conflict has also changed in that we need technology and a different way of tackling conflict and being ready to do so."