Hopes of bolstering the Royal Navy with a fleet of five “bargain” frigates at an all-in cost of £250m per vessel have foundered after the Ministry of Defence conceded the ships could not be delivered at that price.

The National Shipbuilding Strategy unveiled in 2017 floated the concept of a new class of budget warship that would support the UK’s shipbuilding sector by spreading work around yards, along with breaking BAE Systems' near-monopoly.

Named the Type 31e - with the “e” denoting it was for export - the new ships were priced at a point that would be attractive to export customers, with a tight deadline of the first one going into service in 2023.

However, Whitehall and industry sources have confirmed the £250m target has now effectively been abandoned after warnings that a viable vessel could not be built at the price.

It is understood that what the MoD terms “government-furnished equipment” - thought to cover items including weapons and sophisticated software - will now not be included in the costing.

The MoD is also taking on more financial risk related to the project, such as foreign exchange movements and inflation pushing up the cost for bidders.

“The parameters have changed,” said one Whitehall insider. “We’re reverting back to a more normal form of procurement.”