Waste of public money on Carrier Strike project continues
10 May 2013
The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, comments on a report by the National Audit Office (NAO) on Carrier Strike: The 2012 reversion decision.
The Rt Hon Margaret Hodge MP said:
"The saga of the terrible waste of public money on the Carrier Strike project continues. This report shows that a further £74 million at least has been thrown away on top of the billions of pounds of notes already torn up.
"When this programme got the green light in 2007, we were supposed to get two aircraft carriers, available from 2016 and 2018, at a cost to the taxpayer of £3.65 billion.
"We are now on course to spend £5.5 billion, get one operational carrier, and have no aircraft carrier capability for nearly a decade.
"The decisions taken at the time of the Strategic Defence and Security Review (SDSR) in 2010, including changing the carriers and the aircraft flying from them, were supposed to save the taxpayer £3.4 billion.
"The Ministry believed that the cost of converting the carriers would be between £500 million and £800 million. By May 2012 it had realised that the true cost would be as a high as £2 billion. Following the 2012 reversion, the Ministry estimates that it will avoid just £600 million through this decision.
"This latest U-turn came about because the decisions taken in the SDSR were based on the same wildly over-optimistic assumptions and poor understanding of costs and risks that have characterized this programme from the start.
"We are also now looking at a further delay of another 2 years because the Ministry has decided to postpone the early warning system that is a key part of the Carrier programme. This means the UK will have no Carrier Strike operating capability until 2022.
"What the Ministry of Defence needs to do now is stop backtracking on decisions and haemorrhaging money, and finally get a grip on this ongoing fiasco.
"For a start, that means getting better information before committing vast amounts of taxpayers’ money, and it means being much stronger at monitoring and controlling costs, especially from its commercial partners."