Select committee: Public Accounts Committee
Recommendation 8
Nineteenth Report - MoD Equipment Plan 2023–2033
Published 8 Mar 2024
Addressed to HM Treasury
Public Accounts Committee The Equipment Plan 2023–2033 All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The MoD asserted that it was not a gamble to assume that its budget will increase to 2.5% of GDP.21 At present, however, the MoD has budget certainty only to the end of March 2025, which hinders its ability to plan with any degree of precision over 10 years.22 The MoD said that it made sense for defence to have a multi-year settlement.23 From a military perspective, a five-year settlement would help the MoD provide long-term deterrence by allowing it to build the confidence the defence industry needs to invest in its capacity.24 The MoD also told us that if government’s ambition for defence spending was reduced to less than 2.5%, it would need to revise the level of capability it could buy to match the smaller budget.25 12 Q 12; Correspondence from MoD to PAC, 4 December 2023 13 Q 12; C&AG’s Report, para 1.8 14 Qq 12, 13 15 Q 62 16 Qq 13, 68, 69 17 Q 16 18 Qq 19, 20, 136–138 19 Q 99 20 Q 13; C&AG’s Report, para 2.25 21 Q 66 22 Qq 18, 19, 93 23 Qq 70, 71 24 Q 73 25 Q 67 10 MoD Equipment Plan 2023–2033 Inconsistencies in the Plan
From: Public Accounts Committee, Nineteenth Report - MoD Equipment Plan 2023–2033 (HC 451), 8 March 2024
Government response
The government responded to the whole report on 28 May 2024.
Summary written by Accountability Index from the government's response. It is not the government's own words.The government agrees with the Committee's recommendations on consistent forecast costing, clearer signals to industry, assessing the new procurement model and reliance on allies, but disagrees with those on setting out cuts under a 2.5% shortfall and on reporting nuclear funding trends.
- On the 2.5% of GDP aspiration, the government disagrees with the recommendation; the department "does not intend to set out a list of capabilities that would be cut" because this would risk operational security and industry confidence.
- On nuclear costs, the government disagrees with the recommendation. If conventional budgets are affected by nuclear funding needs the department "will make that clear", but it considers going further "wholly speculative".
- The government agrees that all budget holders should treat forecast costs consistently, with a target implementation date of Spring 2025. The department "will seek to standardise" the data and its presentation.
- The government agrees to assess the impact of the Integrated Procurement Model, with a target date of December 2024. It will "monitor the increase in pace of delivery and provide updates as appropriate".