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By Howard Wheeldon, Senior Strategist at BGC Partners

02 Jan 12. In its 56th report of Session 2010-12 ‘Providing the UK’s Carrier Strike Capability’ published late November last year the House of Commons Public Accounts Committee provided detailed analysis from a close examination made of the UK Future Aircraft Carrier (CVF) programme costs. Within a mandate that requires that it should provide warning of potential or past waste of precious taxpayer resource the PAC has done yet another excellent job of work. Given the history of the CVF programme and the long standing public debate over maintaining ‘Carrier Strike Capability’ the report was both timely and constructive. Of necessity the report conclusions were mixed – on the plus side saying that construction of the two Queen Elizabeth class aircraft carriers for the Royal Navy being built by the Aircraft Carrier Alliance (a partnership consortium made up of BAE Systems, Babcock, Thales and the UK Ministry of Defence) is progressing very well but on the negative, highlighting concern that the technology proposed for the catapult and arrester system has yet to be tested, that the cost of converting the carriers for this is not yet fully understood and that the ‘carrier’ version of the F-35 Joint Strike Fighter will be unique to Britain and thus could increase the cost of risk.

Given the extended period of design, development and government induced delay on CVF caused by a combination of factors including government indecision, programme change and additions plus decisions made by the previous government purely for funding purposes and that in effect stretches out the planned build programme timetable overall that the PAC report has concluded that the build programme itself is on schedule is excellent news. The report also highlighted that 98% of work originally planned to be completed in 2011 had already been delivered by November and that no less than 48 of 53 milestones set for 2010/11 had by that time also been satisfactorily achieved. Later discussion of the report provided reminders of the rising cost of maintaining carrier strike capability with claims that although the starting cost for two carriers had begun at around £3.5bn the cost of completing the two ships was already over £6bn.

In separate interview comments chair of the PAC, the former Labour Minister Margaret Hodge is reported as accusing Prime Minister David Cameron of misleading the House of Common by implying that the cost of cancelling the programme was greater than completing them. This latter point is something of a ‘red herring’ in my view though for it ignores the basic principle that both the previous and current government even if for different reasons had decided that Britain required to maintain full carrier strike capability albeit that through decision made by the present coalition Government within SDSR 2010 there would be a nine year gap before the planned new capability was fully on stream.

Few would deny that aircraft carriers are expensive beasts in terms of design, procurement and build. It is of course all too easy for critics to blame the build contractors though in this case it is clear that the larger elements of increased programme cost lie firmly in the hands of the current and previous government plus the MoD because of the various changes and delays to the overall procurement plan.

As with other military procurement programmes there is a long history of open debate with regard to operation and maintenance of full carrier strike capability in the Royal Navy. I make no apology for placing my support for maintaining strong air power capability as a priority but neither do I make any apology for supporting the coalition governments decision to maintain ‘carrier strike capability’ for the UK as yet another priority notwithstanding the high cost of maintaining such capability in terms o

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