The Ministry of Defence has published plans to spend over £186bn in the next ten years in its 2018 Defence Equipment Plan, let’s take a look at what it contains.

The plan, found here, also outlines £935m in increased forecast costs for major infrastructure projects during 2017/18. These include an increase of £458m for HMS Queen Elizabeth and her F-35B jets. The rise in F-35B costs were attributed to changes in exchange rates, although the MoD say that these changes ‘were anticipated’.

‘Since 2015 the world has become more uncertain, volatile and dangerous at a faster rate than predicted’ Defence Equipment Plan 2018

The MoD has managed to offset cost increases with cost reductions elsewhere, notably on the Poseidon MRA1 programme (£207m), Apache ‘Sustainment Programme’ (£132m), and the Type 26 frigates (£104m).

A headline failure for the MoD has been the upgrade plans for the Warrior infantry fighting vehicle. This programme is now 13 months behind schedule, and £62m over-budget.

Note the Army's Warrior Capability Sustainment Programme. Costs have risen from £1.32 billion to £1.55 billion. This equals £4.1 million per vehicle for a fleet that will remain in service for less than 15 years. https://t.co/jaAw4Z6Eo3 — Nicholas Drummond (@nicholadrummond) November 5, 2018

Despite the cost reductions, the National Audit Office (NAO) stated that the MoD’s plan ‘remains unaffordable and is not sustainable if the Department wants to deliver longer-term value for money’. The MoD were however praised for being ‘more transparent than in previous years’.

The MoD forecasts spending £193bn on equipment in the next ten years, £7bn above its £186bn budget for that period. The NAO warned that in a ‘worst case scenario’, this gap could rise to £14.8bn. This figure is however lower than the £20.8bn worst case scenario forecast in January 2018.

The MoD must decide ‘which programmes to defer, de-scope or delete as soon as possible’ according to the NAO.