British defence budget 'black hole' widens

15th October 2010, Comments 0 comments

The "black hole" in Britain's defence equipment budget grew significantly in the final year of prime minister Gordon Brown's administration, the watchdog on government spending said Friday.

Brown's Labour government went 3.3 billion pounds (5.3 billion dollars, 3.8 billion euros) over budget during the year ending March 2010, the National Audit Office (NAO) said.

Defence Secretary Liam Fox said the cost over-runs were "the direct result of the incompetence of ministers" in Brown's government, which left office after the May general election.

The NAO blamed a failure to set "realistic" budgets, resulting in a "mismatch" between the Ministry of Defence (MoD)'s planned expenditure and its forecast funding.

The new Conservative-Liberal coalition government's Strategic Defence and Security Review due out next week is expected to usher in a major reconfiguration of Britain's military capability and funding.

The new government says there is an overall 38-billion-pound "black hole" in the MoD budget over the next 10 years -- the gap between MoD funds and spending commitments -- forcing them to seek significant cuts.

US Secretary of State Hillary Clinton warned that plans to slash Britain's military spending could damage the NATO military alliance, days before the cuts are unveiled.

She told the BBC she was worried about the cuts because they could affect the maintenance of the alliance's common defence policy.

The increase reported by the NAO was put down to cost surges in two procurement programmes: Typhoon fighter jets, up 2.7 billion pounds; and two planned new aircraft carriers, up 650 million pounds.

The long-term cost "represents poor value for money for the taxpayer," the NAO said.

The watchdog's report "offers the definitive and damning judgment on Labour's record on defence", Fox wrote in The Times newspaper.

"The previous government has left the MoD in an impossible situation having ordered equipment for which it didn't have the money.

"Our recovery will have a strategic direction and we will have a global vision of Britain's place in the world.

"It will be painful, and sacrifices will be made, but we must get the economy back on track and we must get the defence programme balanced."

Fox promised that at the end of the process, Britain would have "the capabilities it needs for the future, we will continue to be a big contributor to NATO and our interests will be more secure."

© 2010 AFP

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