TRIDENT PROGRAMME: COST (Hansard, 10 February 1994)

The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne)

The current estimate of the total project of the Trident programme is £11,631 million, if all expenditure, including payments already made, is brought up to current prices and a common exchange rate of £1-$1.44, as assumed in the long term costing of the defence programme. If payments already made are expressed at the prices and exchange rates actually incurred, the equivalent estimate is now £9,937 million. Expenditure on the Trident programme to 31 August 1993 represented some 67 per cent. of the overall estimate.

After allowing for the effects of inflation and exchange rate variations, the revised estimate of £11,631 million represents a real cost reduction of £24 million compared to that announced last year. The increase in cash terms is £955 million, primarily as a result of a less beneficial exchange rate. The reduction in real terms since the original 1982 Trident II estimate, including the savings resulting from the decision to have UK missiles processed in the United States facility at King's Bay, Georgia. now stands at some £3.5 billion.

The proportion of the estimate for work undertaken in the United Kingdom has decreased from 74 per cent. to 70 per cent., reflecting the change in exchange rate. I am pleased to say that the Trident programme remains on schedule to enter service in the mid-1990s. There has been no slippage in the in-service date since the decision to purchase Trident II was announced in March 1982. My right honourable friend the Secretary of State for Defence, as in previous years, is sending to the Chairmen of the Public Accounts Committee and the Select Committee on Defence a more detailed report on the programme. I am also placing a copy of this report in the Library of the House.