Governments across the western world are under huge pressure to slash spending programmes as a result of the global financial crisis and its impact on national budgets. In many states, few areas of expenditure are being scrutinised as closely as defence. In the US, Bob Gates, the defence secretary, has already signalled that he wants to overhaul his department’s spending priorities, cutting back on programmes such as the F22 fighter jet deemed surplus to requirements. Now it is the turn of the UK to take a long hard look at the ministry of defence’s equipment budget, long seen as bloated and inefficient.

On Thursday, the MoD published a report by Bernard Gray, a former departmental adviser, into its procurement record. His is a damning indictment. Mr Gray finds that annual expenditure on equipment – from aircraft carriers to fast jets – is well beyond what the MoD can possibly afford. Its project management record is also abysmal. The average equipment programme overruns by five years. The average increase in cost of those programmes – over initial budget – is £300m. All told, the MoD spends up to £2.2bn every year just on the cost of managing delays and overruns.