The Ministry of Defence has rejected a call for parliament to get a detailed update on the multi-billion-pound costs of the Defence Nuclear Enterprise every year.
Members of parliament’s Public Accounts Committee made the recommendation in a report on the MoD’s Equipment Plan back in June.
The Defence Nuclear Enterprise is a partnership of organisations that operate, maintain and renew the UK’s nuclear deterrent. It includes the MoD’s Defence Nuclear Organisation, the Royal Navy, the Submarine Delivery Agency, the Atomic Weapons Establishment and a range of civil industry partners.
MPs said the “ever-increasing cost” of the DNE was likely to add pressure to the MoD’s overall budgets, restricting the money available for conventional equipment and other requirements, such as improving poor accommodation for personnel and their families.
The PAC report said the MoD’s nuclear budget for 2024-25 was £10.9bn – around 18% of the whole defence budget. However, it noted that costs were being pushed up by plans to speed up the DNE’s work schedule, add new programmes to it, and the effect of inflation.
MPs said forecast costs for the DNE for the 10 years from 2023-24 had increased by around £10bn, from £117.8bn to approximately £128bn – and that the forecast 10-year costs had already been £7.9bn over budget in 2023.
Among their recommendations, MPs said the MoD’s annual report to parliament on the DNE should provide additional information, including planned costs, the proportion of the whole defence budget that spending on DNE accounts for and any variances from the previous year.
The committee also said the update should include details of DNE budgets moving between years or from the wider defence budget into the DNE “ringfence”.
However the latest set of Treasury Minutes responses to the PAC’s recommendations shows that the call for transparency has been rejected.
The response says the MoD disagrees with the committee’s proposal.
“The annual update to parliament has never been a vehicle for detailed financial reporting on the Defence Nuclear Enterprise,” it states. “The government believes it is better to provide DNE financial information as part of wider MoD financial reporting to avoid any risk of inconsistency or misaligned timing of data.
“Financial information on the DNE is provided, along with financial information relating to wider defence budgeting and spending, in the department’s annual report and accounts and as part of the Parliamentary Estimates process. It is also expected that financial information will be included in the Defence Investment Plan.”
There was, however one crumb of comfort for PAC members in relation to the MoD’s nuclear spending.
The Treasury Minutes response said ministers are “continuing to consider” an earlier PAC call for a new committee to be set up with a specific remit to scrutinise DNE expenditure.