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10/09/2003
MoD criticised over sub refit overspend
It has emerged that the Ministry of Defence has been landed with a £300 million bill due to overspending on a new nuclear submarine refit facility for the Royal Navy.
MPs fired shots across the bow of the MoD when it was revealed that the facility being built at Devonport would now cost in excess of £930 million – more than £300 million above target.
The Commons Public Accounts Committee said that a “hands-off” approach by the MoD had resulted in the huge overspend, and cautioned the MoD that the project should be placed under “tighter control”.
The facility is in the hands of project contractor Devonport Management Ltd.
The MoD was warned that its approach to the project was “unrealistic” and that it had not ensured that the project’s management was absorbing the cost overruns.
Commons Public Accounts Committee Chairman Edward Leigh said it was “unacceptable” that the taxpayer should now be left with the bills for the overrun.
The report revealed that flaws in the deal meant that the private company would have to be bailed out by the government as the facility being built for the Vanguard submarines formed an essential part of the UK’s nuclear deterrent.
While the report noted that there was a case for taking the company to court, the associated costs of legal action would have to been paid for by the MoD, which is funded from the public purse.
(SP)
MPs fired shots across the bow of the MoD when it was revealed that the facility being built at Devonport would now cost in excess of £930 million – more than £300 million above target.
The Commons Public Accounts Committee said that a “hands-off” approach by the MoD had resulted in the huge overspend, and cautioned the MoD that the project should be placed under “tighter control”.
The facility is in the hands of project contractor Devonport Management Ltd.
The MoD was warned that its approach to the project was “unrealistic” and that it had not ensured that the project’s management was absorbing the cost overruns.
Commons Public Accounts Committee Chairman Edward Leigh said it was “unacceptable” that the taxpayer should now be left with the bills for the overrun.
The report revealed that flaws in the deal meant that the private company would have to be bailed out by the government as the facility being built for the Vanguard submarines formed an essential part of the UK’s nuclear deterrent.
While the report noted that there was a case for taking the company to court, the associated costs of legal action would have to been paid for by the MoD, which is funded from the public purse.
(SP)
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