The Ministry of Defence’s multibillion budget overrun has been caused in part because of its spending splurge on flashy new “cyber” capabilities, according to the National Audit Office.
The MoD faces an “unaffordable” spending plan between now and 2030 thanks to poor management and planning, said the NAO in its latest report.
“The Department faces the fundamental problem that its ambition has far exceeded available resources,” it thundered. “As a result, its short-term approach to financial management has led to increasing cost pressures, which have restricted Top-Level Budgets from developing military capabilities in a way that will deliver value for money.”
The MoD faces a budget black hole measured in billions thanks to its profligacy – and even the announcement of a cash top-up of £4bn per year between now and 2024, on top of its £41.2bn annual budget, won’t be enough to plug it, according to the auditors.
Defence officials managed, said the NAO, to spend “£2.1bn of additional costs in Strategic Command’s equipment programme, reflecting £1.1bn of new investments to fill capability gaps.” On top of that, the MoD’s desire to “strengthen cyber capabilities” combined with plans to enhance “global connectivity” resulted in “£1.1bn of cost growth”.
Fuelling that cyber-driven budgetary incontinence was the creation of the National Cyber Force (NCF), as announced in November. While this year’s budget included £141m for “critical capability risks” including the NCF, the MoD still insisted that “additional funding would be needed to develop military capabilities such as its cyber resilience”.
This focus on “cyber” regardless of budget constraints even led some crafty Army officers to suggest cutting tanks in favour of cyber regiments, something that may have been tongue in cheek – or a political move to protect Britain’s decrepit heavy tank units from the beancounters’ pen.
While top brass increasingly focus, quite wisely, on the rising digital threats posed by the likes of Russia and China, it seems their answers begin and end with “throw more money at us.”
The rest of the report focused on how largely American-made equipment in the MoD’s Major Projects portfolio is a millstone around the ministry’s financial neck.
“For the fourth successive year,” sighed the NAO in its report, “the Equipment Plan remains unaffordable. However, the Department has still not established a reliable basis to assess the affordability of equipment projects, and its estimate of the funding shortfall in the 2020-2030 Plan is likely to understate the growing financial pressures that it faces.” ®