Defence expenditure Committee report

15 December 2008

The Government's forecast for the costs of military operations in Afghanistan in this financial year reveals a significant increase compared to the last financial year, says a report from the House of Commons Defence Committee published today. Meanwhile, the forecast operational costs for Iraq have remained broadly the same, and have even increased in one or two areas, despite the expected drawdown early in 2009.

The Report found:

  • The forecast cost of operations in Afghanistan, including indirect resource costs, is 54.1 per cent higher at £2.318 billion than the outturn from 2007-08 of £1.505 billion. There are particularly significant increases in the expected costs of capital additions and equipment support. MPs say this probably reflects the Government’s announcement in late October to buy 700 additional armoured vehicles, but say that the Ministry of Defence must provide more detail on these costs.
  • The forecast cost of operations in Iraq has declined by just 4.1 per cent, despite the expectation of drawdown in early 2009. Surprisingly, two cost areas for Iraq show prominent growth – military personnel and equipment support. The MPs say the MoD must explain why some costs are rising while others are remaining static or falling in the context of the expected drawdown next year.
  • The Ministry of Defence currently expects to spend £1.063 billion on Urgent Operational Requirements in this financial year. If these costs end up being greater than £1.065 billion then half of the excess will fall on to the MoD’s main budget in financial year 2010-11. The MPs request a paper setting out the implications of this for future defence spending.

The Report – published on the day before the House of Commons will be asked to agree the Government’s Winter Supplementary Estimates – recommends that the House approve the MoD's request for additional resources, given that UK Forces in Iraq and Afghanistan require them, in particular on account of the operational need for new equipment and force protection.

Commenting on the Report, Committee Chairman Rt Hon James Arbuthnot MP said:

"The investment being made in better facilities and equipment for our troops in Afghanistan is vital and we welcome it wholeheartedly. We applaud the MoD for providing more information about these costs earlier in the financial year than it used to do. There has been real progress in this area, and the MoD has promised more improvements in the future. However, the reasons for the increases and the magnitude of costs in general are still not transparent enough. The MoD needs to provide a more coherent picture of what these costs really represent on the ground in future."

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