REPORTS: MoD Struggles To Save £500m After Botched Ship Deal
The Royal Navy will be attempting to save an extra £500 million over the next two months after wasting money on unneeded ships after a procurement deal went wrong, according to the Times.
The contracts made with BAE systems for five new offshore vessels are the result of poor negotiations by the MOD, meaning that savings will now need to be made elsewhere, the report continues.
The newspaper suggests that savings could be made by cutting the size of the Royal Marines or asking the army to pay for duties that a soldier might carry out, such as guarding naval sites.
The failure to make up the £500 million in the annual budget could mean that the other forces may be asked to bail the Navy out.
In interviews conducted by the Times, a number of retired military officers criticised the situation which the Navy has been left in:
“I am worried . . . and I don’t see a way out of it without a shock and nobody wants a shock”
- Admiral Sir Mark Stanhope, a former First Sea Lord
The revelations come following a declaration by Defence Secretary Sir Michael Fallon that 2017 will be “the year of the navy”.
The MoD is committed to spending £230 million a year on protecting shipbuilding capability, meaning that three of the five vessels were ordered 2014, with a further two commissioned in 2016.
But the MoD have countered the claims in a statement saying:
“Britain has the largest defence budget in Europe and it is growing as we invest billions of pounds in new ships, submarines and aircraft. The Royal Navy is playing a key role as Britain steps up around the world, helping to provide stability abroad and security at home.”
Whilst BAE Systems said it was:
“On target to exceed planned cost-savings in its shipbuilding operation through efficiency measures put in place under the terms of business agreement”.
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