Source · Select Committees · Public Accounts Committee
Recommendation 20
20
Acknowledged
We are also concerned about the impact of inflation on the Plan’s delivery, particularly the...
Conclusion
We are also concerned about the impact of inflation on the Plan’s delivery, particularly the Department’s ability to obtain the skills required. The Department told us that it and its suppliers do not have enough data scientists, software engineers or project managers. This puts at risk the delivery of a range of information, communication, and technology programmes.53 This risk may increase if staff leave due to below-inflation pay rises. The Department has offered staff a pay rise of 3.75% and every future additional 1% pay rise above those planned will cost £1.4 billion over the next nine years. The Department acknowledged that the pay settlement was challenging and would remain so.54 Supply chain
Government Response Summary
The department continuously updates its forecast of the cost of the equipment plan and reviews its affordability through the annual financial planning process. The government announced an additional £5 billion for defence in the remaining two years of the 2020 Spending Review settlement at the 2023 Spring Budget, but the department still faces financial pressures.
Government Response
Acknowledged
HM Government
Acknowledged
5.1 The government agrees with the Committee’s recommendation. Target implementation date: September 2023 5.2 The department continuously updates its forecast of the cost of the equipment plan and reviews its affordability through the annual financial planning process, which involves bottom-up costing by delivery agents, such as Defence Equipment & Support, through programme cost reviews. 5.3 The government announced an additional £5 billion for defence in the remaining two years of the 2020 Spending Review settlement at the 2023 Spring Budget, but the department still faces financial pressures and is working to adjust its plans to balance the department’s objectives and outputs with the funding available to it.