Ministers must deliver Britain’s “hugely complex, costly” aircraft carrier and jet programme on budget or risk other defence projects being jeopardised due to already “very strained” budgets, MPs have warned.
The Carrier Strike programme incorporating two Queen Elizabeth class aircraft carriers, new F-35 Lightning II jets and a new radar system, Crowsnest, leaves the Ministry of Defence “exposed financially”, the Public Accounts Committee (PAC) said.
Fluctuations in the value of the pound, which plummeted against the US dollar after the 2016 Brexit vote but is beginning to recover, also risk adding “significant cost pressure” as the jets are being bought from American aerospace giant Lockheed Martin.
PAC chair Meg Hillier said: “There is a lot at stake with Carrier Strike – a hugely complex, costly programme intended to be at the heart of national defence for years to come.
“The project continues to leave the MoD exposed financially. Government must bring Carrier Strike in on budget or risk jeopardising the funds available for other defence programmes.
“Uncertainty over some costs and the potentially negative impact of foreign exchange rates mean this will be no easy task.
“There are also questions over the Lightning II jets and the eventual deployment of Carrier Strike, which could threaten the programme’s value for money.
“All this is taking place as the MoD awaits clarity on the future size of the defence budget.
“We will be keeping a close eye on this programme and will expect the Department to keep us abreast of developments.”
The committee said the ships and jets must be deployed “fully and flexibly” and be “future proof”, so they can be upgraded as technology advances, in order to achieve value for money.
The PAC also warned there must not be a gap between the retiring of Type 23 frigates, which defend the carriers against submarines, and new Type 26 ships entering service in 2027 because it would limit the use of the larger ships.
Britain must also seek to maintain its influence over the design and testing of the F-35s after its “Tier 1 partner” status comes to an end in 2019 amid reports of technical issues with the jets, although the MoD dismissed concerns regarding its computer memory.
The MoD must also develop its estimate of support and operational costs as they are not fully included in current budgets, the committee said.