Those who sit within the upper floors of MoD in Whitehall must dread the mention of another National Audit Office report on the efficiency and effectiveness of how our military is managed.

A long list of recent reports from the Nuclear Enterprise to the Recruitment and Retention of service personnel have been critically scathing to say the least.

The latest, published just last week, identifies serious failings and points to overly optimist estimates in how the MoD Equipment Plan will be delivered over the next 10 years. The MoD has developed a reputation for poor financial management and they have an approach which suggests their ambitions are not backed up by hard cash, so allowing serious gaps to appear in the finances over a period of time.

The over committed plans have resulted in it making hastily thought out cuts which have impacted on front line operations and an Equipmant Plan that is now totally out of sync with reality. That’s possibly how you get to a point where you have a very expensive £3 billion aircraft carrier going into sea trials with no tried and tested aircraft to fly off its decks or having past their sell by date ships coming out of service, with no adequate replacement ready to fill the capability gap.

The bottom line is that with a funding gap that the NAO calculate as being close to £7bn, the MoD Equipment Plan is unaffordable. That unaffordability was reported to the MoD last year too by the NAO, yet nothing has been done to re-assure parliament, other than the announcement by the Defence Minister, Gavin Williamson, of the Modernising Defence Programme. That programme was announced last January and was due to report before Parliament’s Summer recess in July. So almost a year on, the UK government’s great saviour has still to see the light of day… while costs of major programmes continue to run out of control.

My main worry is of the £7bn in projected cost over-runs and risks, 84% of that figure is  due to surface in the next four years, just at a time when there are increasing economic uncertainties with Brexit. These uncertainties will put further pressure on public finances and this is not a time to have internal budgets in such an uncontrolled shambles. 

The NAO report suggests that even if major projects are deferred, delayed or de-scoped, then it’s perhaps too late to save the MoD from themselves unless substantial extra funding is put in by the Treasury or spending programmes are cut out of the Equipment Plan permanently. For the time being there does not appear to be any enthusiasm on the part of the current Chancellor to play a financial get out of jail card for the MoD – despite the small concession given in the Budget last month. As an industry insider suggested last week – the Chancellor, Philip Hammond, was previously Secretary of State for Defence and he knows the weaknesses of the MoD budget inside out! The political rumour mill has suggested for some time that there is no love lost between Hammond and Williamson, so perhaps the MoD can expect very little in the way of financial favours in the coming years.

So when people ask about more Type 26 frigates for the Clyde , or the Type 31 light frigate that’s currently out to competition and could go to a Scottish yard such as Rosyth, remember that there’s little incentive for the UK Government to push on with these commitments despite promises that were made in 2014. The MoD are still working to an overly-optimistic “jam tomorrow” approach and even then the jam will be spread very thin.