The decommissioning ceremony of HMS Illustrious in 2014

For months, the 22,000-tonne leviathan has been in a state of limbo, moored at Portsmouth Naval Base since her decommissioning in 2014.

And while efforts have been made to preserve the Falklands flagship in the UK, including bids to keep her in Portsmouth or move her to Hull as a floating museum, so far none have succeeded.

It seemed Illustrious’s saviour had appeared in the form of the government of Gibraltar which in recent months has taken an interest in the ship, sparking hopes a deal could be struck to convert her into a maritime attraction there.

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Speaking to The News, a spokesman from the British territory authority said the organisation had given such a move ‘serious consideration’.

But in spite of this, the Gibraltarians have today revealed the proposal has been spiked, claiming the costs of maintaining the aging carrier ‘proved to be prohibitive’.

Now, the president of the HMS Illustrious Association has warned the ship is at risk of becoming a ‘national embarrassment’ if action isn’t taken.

Vice Admiral Bob Cooling – one of Illustrious’s former commanding officers – said: ‘Unless Lusty’s future is adequately funded to preserve her appearance and dignity as the UK’s longest-ever serving aircraft carrier then it would be better that she is scrapped rather than risk her becoming a national embarrassment.’

Vice Adm Cooling added the association would ‘be very disappointed’ if the latest revelation meant the end of hopes the ship would be preserved as a heritage attraction.

He said the ship would have been ‘the perfect centrepiece’ for Gibraltar’s historic dockyard, claiming ticket sales could have paid for the Illustrious’s upkeep.

‘What better than such an iconic example of British naval heritage showcased in a vital overseas territory which itself reflects over 300 years of British maritime history?’ Vice Adm Cooling said.

Illustrious, nicknamed Lusty, is the last Invincible-class carrier left – both her sister ships HMS Invincible and HMS Ark Royal have been scrapped.

Fears are that if she remains moored in Portsmouth, she will deteriorate to a similar state to the former minehunter HMS Bronington, which has partially sunk at her moorings in Birkenhead.

The Ministry of Defence said it was determined to agree a deal but acknowledged it was taking time to determine Lusty’s future.

But the MoD said the disposal of such a large craft was a complex undertaking – one that was important was dealt with correctly. An MoD defence source added a plan was being considering which could see Illustrious continue its life at sea – although the details of this are being kept a closely-guarded secret.

Explaining the situation, an MoD spokesman said: ‘No decisions have yet been made on the future of the former HMS Illustrious and options for her sale are still under consideration by the Disposal Services Authority.’

Lusty was decommissioned at a service at Portsmouth Naval Base in July, 2014 after 32 years of active service.

She was rushed into service to join the Falklands War effort, but then went on to sail almost 900,000 miles around the world during her deployments.