According to a report released just yesterday by the British Parliament’s National Audit Office, the UK defense ministry is facing a budget shortfall of up to 36 billion pounds over the next decade. (The predicted shortage is equivalent to about 95% of Britain’s current annual defense budget.) ”The current [defense program] is unaffordable,” the NAO simply said in its public release accompanying the report. Amyas Morse, head of the National Audit Office, summed up the current state of British defense procurement:
“The Ministry of Defence has a multi-billion pound budgetary black hole, which it is trying to fix with a ‘save now, pay later’ approach. This gives a misleadingly negative picture of how well some major projects in MOD are managed, represents poor value for money and heightens the risk that the equipment [Britain's] Armed Forces require will not be available when it is needed or in the quantities promised.”
A striking features of this year’s report is the NAO’s finger-pointing at the precise impact of the programs’ delays. Among other factors, the NAO condemned the government’s delay tactics that are supposedly designed to achieve affordability in the short-term. According to the NAO, however, these tactics directly undermine their original purpose, which is to save taxpayer money. In fact, nearly two-thirds of the cost overruns of the MOD’s top 15 defense programs resulted from delays.
In rebuttal, Quentin Davis, the minister for defense equipment and support, argued that one of the primary reasons for the delays in projects is that they are “not essential for current operations.” Britain’s “priority has been — and continues to be — operations in Afghanistan and ensuring that [its] forces on the front line have the equipment they need.” With a defense budget that, in real terms, has been largely flat for some time, it might have been impossible for Britain to carry out its modernization plans in any case. But paying for current operations in Iraq and Afghanistan and dealing with rising government debt has put those plans even further into abeyance, if not killed many of them altogether.
Despite these bleak prospects, there is a bit of good news. After much criticism from various quarters of the opposition and military about the paucity of tactical lift for its forces in Afghanistan, the MOD just announced a 3.5 billion pound, or 5.7 billion dollar, airlift strategy, Vision 2020. The plan is to buy up to 30 Chinook helicopters from Boeing and procure an additional C-17. As reported, Vision 2020 foresees the purchase of up to 120 aircraft to be procured over the next ten years.
If everything goes according to plan, the first 10 aircraft of the multi-million deal will be delivered in 2013. That will have been about 7 years after the first complaints about inadequate airlift capacity descended upon Whitehall. More than likely, they will still be needed. In the meantime, British forces will remain on diet of fewer funds and shrinking capabilities.
Gary Schmitt is director of AEI’s program on advanced strategic studies. Philipp Tomio is a reasearch assistant at AEI.