February 26, 2013 11:59 pm

Warning of new defence cuts risk

The Ministry of Defence may need to find new savings of about £11bn in the decade after 2015, a prominent defence think-tank has warned, underlining the pressure on Britain’s armed forces from budget cuts.

In the most detailed independent analysis to date this year on the state of MoD finances, the Royal United Services Institute said on Wednesday that last year’s Autumn Statement implied there could be a £1.1bn reduction in the 2015-16 defence budget.

The report, by Professor Malcolm Chalmers, therefore argues that “on reasonable assumptions, the MoD may need to find [about] £11bn in savings over the next decade”.

Prof Chalmers says that if the MoD budget emerges from this year’s spending review at the pessimistic end of expectations, the government may need to reopen the assumptions on which it designed the 2010 Strategic Defence and Security Review.

His report says the UK is on course for substantial pressure upon its defence equipment budget in the 2020s because of the cost of building a successor to the independent nuclear deterrent.

“From 2016-17, the MoD will face a sharp rise in annual spending on the new class of nuclear missile submarines, a level of spending which will then be sustained through to the late 2020s,” Prof Chalmers says.

Philip Dunne, defence minister, said: “Our armed forces will remain a formidable fighting force, backed by the fourth-largest defence budget in the world.”

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