Source · Select Committees · Public Accounts Committee
Recommendation 8
8
Accepted
The Department said that it would argue for new capabilities through this process, and if...
Conclusion
The Department said that it would argue for new capabilities through this process, and if it received more resources, it would add these to the Equipment Plan. However, it accepted that it would need to prioritise investment decisions if new demands exceeded the funding from HM Treasury.19 In March 2023, as part of the Integrated Review refresh, the Prime Minister announced that the Department would receive £5 billion of additional funding over 2023–24 and 2024–25.20 Of this new money, it will spend £3 billion across 10 Qq 13, 14 11 Q 13 12 Q 33 13 Committee of Public Accounts, Defence capability and Equipment Plan, Tenth Report of Session 2019–21, HC 247, July 2020 14 Committee of Public Accounts, Improving the performance of major defence equipment contracts, Twenty- Second Report of Session 2021–22, HC 185, November 2021 15 Q 26, Integrated Review Refresh 2023 16 Q 26 17 Q 28, British-led design chosen for AUKUS submarine project - GOV.UK (www.gov.uk) 18 Q 52 19 Q 49 20 Integrated Review Refresh 2023, P34 10 MoD Equipment Plan 2022–2032 the defence nuclear enterprise and the remaining £2 billion on replenishing stockpiles and increasing them in line with a reassessment of appropriate levels.21 In November 2022 the Secretary of State for Defence had told Parliament that the inflationary pressure on his budget over the next two years was £8 billion.22
Government Response Summary
The government agrees with the recommendation to clearly set out to HM Treasury the capability requirements, priorities, funding needs, and risks arising from the refreshed Integrated Review, with details to be explained in the next update to the committee.
Government Response
Accepted
HM Government
Accepted
2. PAC conclusion: The refreshed Integrated Review may revise judgements about operational requirements and identify new priorities which are not currently funded in the Equipment Plan. 2. PAC recommendation: The Department should clearly set out to HM Treasury as soon as it can what capability requirements and priorities arise from the refreshed Integrated Review, the funding requirements to provide these, and the risks arising from any shortfall. We expect to see the Department reflect these decisions in the next Defence Command Paper and its 2023 Equipment Plan and will challenge the Department on the changes next year. 2.1 The government agrees with the Committee’s recommendation. Target implementation date: Summer 2023 (Defence Command Paper Update) and Winter 2023 (update to the Committee) 2.2 The department has worked with HM Treasury to set out the implications of the Defence Command Paper Refresh including any specific commitments ahead of its publication. The department will continue to work with HM Treasury as it continues to develop its plans in response to the priorities set out in the Integrated Review Refresh. 2.3 The details of the implications for the equipment plan will be explained in the next update to the committee.