Hutton slashes defence spending across forces

SUBSTANTIAL cuts are to be announced by Defence Secretary John Hutton today in a desperate attempt by the ministry to claw back a £1.5 billion overspend on equipment this year.

These will be the first effective defence cuts announced by the Government for years, and they reflect the dire state of defence finances, which according to a recently retired senior commander have been "suffering huge distortions for more than 20 years." The Government is reluctant to announce outright cuts of individual equipment programmes and instead will cut the number of items to be ordered.

The number of Future Lynx battlefield reconnaissance and strike helicopters for the Army and the Navy will be cut. A contract worth £1.2billion has been signed with AgustaWestland in Yeovil, Somerset, for 70 aircraft with an option on a further 10. That option will not now be taken up, and the introduction of the new helicopters will be "slipped" substantially, according to industrial sources.

The biggest immediate loser will be the Army, which will not get its £12billion programme for four new fighting vehicles and communications - the Future Rapid Effects System - due in 2012.

A few weeks ago a £700 million order for new carriers and command vehicles for Afghanistan was announced. Codenamed "dogs of war'", the Cougar, Jackal, Mastiff and Ridgeback will be bought off the shelf with money advanced by the Treasury which the MoD will have to pay back. The vehicles are not expected to outlive the Afghan campaign and the Army has been desperate to get new fighting vehicles for some time.

It will now be told there will be "further study" on the Future Rapid Effects System. In the interim, the Army has been told to make do with refurbished Scimitar light tanks and tracked carriers, which first entered service nearly 50 years ago.

The Navy's £3.9billion order for two aircraft carriers will be confirmed although the programme is likely to be delayed and an option to cancel the second carrier is being considered. The Navy is worried that a project for surface ships to replace the Type 23 frigate will be frozen.

Service chiefs are now pressing for a comprehensive strategic defence review, setting out the aims for the British forces at home and abroad, with a matching defence industrial review to say what the forces can afford to buy. Mr Hutton has taken no time in stating publicly he doesn't want a review - at least not until after the next election.

There are likely to be further pressures on defence spending soon, however, since Gordon Brown will find it hard to refuse a request for more British troops in Afghanistan if President-Elect Barack Obama requests them.

The MoD will probably also have to order or lease up to a dozen new C-130 and C-17 transport planes for the RAF as the pan-European Airbus A400M is facing serious teething troubles and severe delays.