Potential funding gap of GBP21 billion found in UK defence equipment plan

31 January 2018

The United Kingdom’s GBP179.7 billion (USD254.6 billion) 10-year defence equipment plan is underfunded by at least GBP4.9 billion and up to GBP20.8 billion, according to a report released by the country’s National Audit Office (NAO) on 31 January, which warns of cutbacks, delays, and cancellations in acquisition programmes if problems are not addressed.

The report, designed to assess the robustness of Ministry of Defence (MoD) forecasts in order to inform Parliament of risks and costs that have not been accounted for, concludes that GBP10.9 billion of forecast acquisition and support costs have not been budgeted for, including at least GBP1.3 billion of the cost of procuring five Type 31e frigates, despite their planned entry into service in 2023.

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