Source · Select Committees · Public Accounts Committee
Recommendation 25
25
The National Audit Office has also reported that the Department’s continued focus on living within...
Conclusion
The National Audit Office has also reported that the Department’s continued focus on living within its in-year budget is affecting its ability to develop the military capabilities that are needed.72 The commands undertook yet another re-prioritisation exercise to balance the annual budget for 2020–21, either descoping equipment projects or delaying expenditure. This focus on living within its annual budget means the Commands must manage long-term projects within short-term expenditure approvals, which also leads to higher overall costs. The Department now estimates a funding shortfall of £8.3 billion in the next five years.73
Government Response
Acknowledged
HM Government
Acknowledged
3.3 Since the Committee's report, the department published the Defence Command Paper which sets out new policy aims and the capability decisions that were underpinned by the additional £16.5 billion investment from the 2020 Spending Review. The department has taken a balanced approach, with an appropriate level of risk and contingency, investing in the current programme and new capabilities such as space, research and development (R&D) and the Future Combat Air System (FCAS). In doing so, the department has demonstrated that it has the mechanisms in place to deliver a coherent programme and to fund modernisation will disinvest in capabilities such as in the case of Warrior Capability Sustainability Programme (CSP).