There was huge embarrassment when a faulty propeller forced the £3bn aircraft carrier HMS Queen Elizabeth to abandon its departure for an Arctic Nato exercise last February.
It was not just the fact that this massively expensive piece of kit did not work when it was needed. This was only the latest episode in a lengthy saga that illustrates many of the things that can go wrong when a country spends billions on defence.
Long-running mechanical issues – a propeller fault had also forced sister carrier HMS Prince of Wales to limp back to shore just a few miles from its home port in 2022 – were just the start.
There was also the huge lead time involved – the decision to build the two new carriers was taken in the 1998 defence review with the first ship supposed to be ready by 2012.
But the £6bn project came in five years late at nearly double the budget. More worryingly, some believe that these huge ships are already obsolete – built for a type of warfare that no longer exists and sitting ducks for new hypersonic missiles.
Now, with the Government committed to spending an extra £6bn on defence a year – increasing the budget to 2.5 per cent of GDP by 2027 – it will need to ready itself for more delays, overspends, obsolescence and embarrassment.
Whether it is an entire fleet of aircraft scrapped after £3bn was spent on a botched refurbishment, or out of control costs, defence procurement has historically been an area of spending particularly vulnerable to waste and error.
Officials and experts are already warning there is a high chance of more good money being thrown away, at a time when ministers need every penny they can find.
A perennial problem for the Ministry of Defence (MoD) is that its budget is allocated annually, while most procurement programmes are multi-year projects. “It can create perverse incentives,” says Matthew Savill, director of military science at the Royal United Services Institute. Officials are left having to predict how much money is likely to be spent and forced to make counter-intuitive decisions, that ultimately delay projects and drive up cost.
“Say you reach the end of the year and you’re under budget. Then the incentive is to spend that money so you don’t lose it the following year,” says Savill. “Arguably worse, if you are over budget, you might delay a programme driving up costs with a contractor and keeping old equipment in use for longer, driving up maintenance costs in the long-run.”
Another structural issue comes in the form of government competence when dealing with third-party contractors. “It’s quite common for retired generals to work for private firms in some capacity,” says Tobias Ellwood, the former Army officer and ex-Tory defence minister.
“That means people who work for these companies are the best of the best who know how industry, government and the forces work. Ministers, who might have only been in defence for a matter of months, are supposed to negotiate with these people who can run rings around them.”
A senior solider, familiar with the procurement process, concurs, telling The i Paper: “Civilians are not really equipped to do these jobs as they don’t know what we need, in what numbers or what the challenges are of using equipment in real life.”
The job is made even harder because defence procurement is extremely complicated.
“When big stuff goes wrong, it really goes off the rails,” says Savill. “Defence is an extremely competitive industry – which is a good thing. Different companies are constantly competing to make better technology, which in the case of defence equipment might mean life or death. As a result, things you are developing might become obsolete very quickly and retired before they’ve even been used.”
Equipment becomes obsolete for a variety of reasons. It could be that newer, better technology has been invented, that adversaries have found ways to render it obsolete or that the real-life situation for which the equipment was initially procured has changed.
The government announced last year that it will be retiring its fleet of Watchkeeper drones in March of this year, as they have been overtaken by more modern technology.
The drones had initially been planned to remain in service until 2042. The project has cost considerably more than the initial £800m, with most recent estimates saying the Watchkeeper programme has cost £1.3bn. The ballooning price has been attributed to difficulties integrating more modern technology and development delays.
The drone was supposed to be in full service by 2010, but was not full operational until late 2018. MoD insiders say that the delays were in part due to an inability to test the large drones due to limited airspace in Britain. A number were also crashed in training raising questions about their efficacy in real-world situations. And there were internal disputes about who exactly should operate them, once they were in full service.
Multiple officials in the UK and at Nato agreed with this assessment when asked, noting that it often is not clear if something works as expected until it is used in a live exercise or on a battlefield. And unlike other industries, there is not much room for trial and error through prototypes due to the cost of making the equipment.
Stories of military spending gone wrong are hardly new. Another famous recent example is the ongoing saga of the Ajax – which was supposed to deliver hundreds of armoured vehicles to the army. The first deliveries only came this year, eight years later than had been originally planned. One of the many reasons the project has been delayed was because “excessive noise and vibration leading to concerns for the health of personnel operating the vehicles”.
The programme has so far cost over £5bn, well over the original £3.5 estimate. A review of Ajax highlighted “systemic, cultural and institutional problems” and “a number of errors of judgement” at the MoD.
Such incidents are far from isolated. In 2010, the RAF retired its fleet of Nimrod maritime patrol aircraft – better known for a fatal crash after an in-flight fire in 2006 – after a botched attempt to upgrade the aircraft for modern use. The programmed was scrapped, despite costing the taxpayer £3.6bn.
Britain’s fleet of Nimrod maritime patrol aircraft was retired as part of the 2010 Strategic Defence and Security Review. The government had spent more than £3bn attempting to refurbish older Nimrod airframes – effectively the skeleton of the aircraft – with more modern components, including wings.
This was done as an attempt to save money, however the project quickly became problematic. The airframes that were to be refurbished, it turned out, had not been built to single specification, meaning a one-size-fits-all approach could not be used in refurbishment. The weight distribution of each plane was different, and wings had to be modified on a case-by-case basis.
The project was delayed a number of times, driving up the cost and making it one of the more controversial procurement projects in recent years.
Scrapping the programme left Britain without maritime patrol aircraft, meaning short-term arrangements needed to be made with allies until the American-made Poseidon replacements were delivered between 2019 and 2022.
Even as far back as the 1960s, errors in procurement blighted the British Armed Forces. In 1962, President John F Kennedy cancelled the Skybolt, a US programme to develop an air-launched ballistic missile with a nuclear warhead. Britain was relying heavily on Skybolt for its nuclear deterrent and the cancellation caused a major diplomatic crisis, after being left high and dry by its ally.
The Skybolt crisis is still referred to in procurement circles when conversations take place about how best to procure equipment and, if the taxpayer is footing huge bills, where that money should be spent.
“There is always political pressure for spending like this to go to British industry, but it’s often cheaper and quicker to buy from an ally,” says Liam Fox, a former Conservative British defence secretary.
“The danger with this is if they change their priorities, so you have to weigh that up.”
These decisions, which the current Government will soon have to make, pose a number of difficult dilemmas. There will be pressure for contracts to be given to British firms, creating British jobs.
But for diplomatic reasons, there could be advantages to spending money in other allied countries.
It could, for example, help a US president feel more warmly to Britain and Nato if it helped create American jobs. It could also help relations with European allies if Britain were to enter joint programmes – saving money all around.
“Clearly sharing the financial burden helps us all but inevitably reduces sovereign or even operational independence,” says Fox.
We do not know exactly what the extra defence money might be spent on. But the increase announced by Keir Starmer on Tuesday will not cover the many and varying priorities that officials and experts believe are required to fix Britain’s defences.
Ultimately it will be a political decision for the Government, informed by the upcoming Strategic Defence Review, to pick and choose what it thinks is most urgent.
After years of underspending and Britain’s weapon and ammunition stocks running low in the wake of the war in Ukraine, it is probable that buying more equipment will be one of the priorities.
But when ministers do decide what purchases to make it may only be the start of their problems.
Comments
Leave a Comment