Page last updated at 11:50 GMT, Thursday, 4 March 2010

MoD 'misleading' over budget problems, say MPs

British soldiers in Afghanistan
The government said troops would get the equipment they needed

The Ministry of Defence has been accused of giving "misleading" answers to MPs scrutinising its budget.

The defence committee said it appeared the MoD was "in the process of taking steps to manage a funding gap of £21bn" when officials gave evidence last year.

But it added that witnesses' denials of the existence of such a gap at that time "now appear disingenuous".

Defence minister Quentin Davies said nearly 90% of defence projects had been delivered to cost.

The Commons defence committee highlighted last year's National Audit Office criticism of the MoD's "save now, pay later approach" - delaying projects in the short term but driving up eventual costs by hundreds of millions of pounds.

Chairman and Conservative MP James Arbuthnot said financial mismanagement by the ministry meant taxpayers' money was being wasted.

Witness denials

"What I point the finger at is not a specific project, but at a system within the Ministry of Defence, which consists of perverse incentives to buy the wrong thing, to buy it more expensively than it needs to be bought, to take longer over it and to buy something that does less than was originally intended."

The British taxpayer deserves to know the exact amount of debt he or she is expected to carry
Nick Harvey
Lib Dems

The defence committee said when it questioned MoD witnesses about funding problems last year, they did not give straight answers.

"The evidence suggests that at the time... the MoD was in the process of taking steps to manage a funding gap of £21bn," the report said.

"Witness denials at that time of the existence of such a gap now appear disingenuous."

They said the minister for defence equipment had "told us he could not provide any information" about the reduction of the funding gap nor how much spending had been "merely postponed beyond the planning period".

The committee also said it did not believe the MoD's claim that it had reduced the number of Type 45 destroyers from 12 to six due to a "better understanding of the capabilities of the ship".

Acquisition reform

"The spiralling costs of the ship and the pressure on the equipment programme budget suggest that the reduction in numbers was in fact primarily down to affordability," they said.

"The misleading explanations provided by the MoD in this case are another example of the unhelpful nature of MoD responses to our questions."

It concluded that answers to questions about funding gaps were "at best confused and unhelpful, and at worst deliberately obstructive".

For the Conservatives, Liam Fox said: "It is clear that the MoD's procurement programme may as well have been operating in Wonderland.

"It is nonsensical to deny the very existence of a deficit, refuse to share crucial information with the defence committee and consistently order equipment with no means of paying for it."

Liberal Democrat defence spokesman Nick Harvey backed the committee's call for regular independent reviews of defence spending.

We are currently managing some 2,000 projects and over the past two years, nearly 90% have been delivered to cost and over 80% have been delivered to time
Quentin Davies
Defence minister

"The British taxpayer deserves to know the exact amount of debt he or she is expected to carry. No MoD official should be allowed to withhold or distort this knowledge," he said.

But defence minister Quentin Davies said the committee had not criticised the way forces were equipped on the front line and said troops in Afghanistan would "continue to receive the equipment they need".

He added: "We are currently managing some 2,000 projects and over the past two years, nearly 90% have been delivered to cost and over 80% have been delivered to time, but we recognise that further improvements must be made."

He said the government was looking at reforming their strategy for defence acquisition.

"This strategy includes clear commitments to improve the way we manage our future equipment programme, by bringing costs into balance and being more transparent - all of which will ensure the MoD delivers the future equipment our armed forces need effectively and efficiently."

In December the National Audit Office - the public spending watchdog - warned of a £36bn deficit over the next 10 years if the defence budget was not increased.

Its report said the cost of the 15 biggest military projects had increased by £1.2bn in 2008-9 alone, and £733m of that was down to deliberate delays.



Print Sponsor


SEE ALSO
Delays 'driving up defence costs'
15 Dec 09 |  UK Politics
MoD accused of wasting millions
20 Jul 09 |  UK Politics
Warning over UK defence equipment
26 Feb 09 |  UK Politics
Defence spending 'masked' by MoD
22 Jul 08 |  UK Politics

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC iD

Sign in

BBC navigation

Copyright © 2019 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific