LONDON — Equipment programs could bear the brunt of a 1.5 percent cut to the British defense budget announced June 4 by Chancellor George Osborne in Parliament.
The MoD had to find £500 million (US $766.3 million) in savings for the current financial year as part of wider government cuts totaling £3 billion across all departments other than health, education and international aid. Cuts were not expected to kick in until the next financial year starting April 2016.
The Defence Department said the agreement will not affect the baseline defense budget, manpower numbers or current operations.
A spokesman for the MoD said the reductions to the £34 billion budget would focus on efficiency cuts and a “recalibration of the equipment program.”
There are no indications of whether a recalibration of the £14 billion equipment and support budget might involve canceling programs, pushing them to the right or both.
The Conservative Party committed to increasing defense equipment spending by 1 percent per annum over inflation for the next five years starting in 2016 as part of its pledge ahead of its victory in the May general election.
The spokesman said the efficiency cuts would cover items such as civil service overtime and travel budgets. The latter has already been significantly reduced in recent years.