Opinion it might be Crab - but not a well rounded comment based on fact like many of your other posts - what you say is simply not possible - the defence industry cannot "milk" the MoD or UK Government with the procurement scrutiny and rules that apply these days (which in itself adds considerable delays/costs often) - it can and does have to stand by while all its more effiicient plans for design, production and delivery are undermined by constant last minute requirement changes, annual financial changes (often more reduced budgets) and all round political decision making cock ups (eg CH47 SF Mk3 Fix to Field!), which then lead to mega cost and time overruns - this doesn't suit industry anymore than it suits the front line. Unfortunately its the history of at least the last 40 years of UK procurement - despite the several major attempts to sort it (whither "smart aquistion"?). It also has to be said that many of our allies are even worse so lets not stare at our navels too much. Only those countries that truely buy off the shelf on the back of other nations "over expenditure" win this game - eg most 3rd world or emerging nations who also usually get selling nation "grants" to buy it too!!
The simple fact is (as Gray's report identifies - and note he has his own agenda as having been Blair's placeman in 97/98 as the archtiect of smart aquisition with George Robertson (SofS at the time) - and is annoyed at how it was ditched by the entrenched MoD "old Guard"....etc etc....) that the UK has tried for too many years to keep all its roles and the advanced equipment that goes with them... and yet no governing party has seen fit to fully fund the programmes at their outsets to reflect this (particularly the up front R&D and derisking)... and hence it was clear even 5 years ago that the programme was going to cost circa £90B over the next 10 years (before any genuine over-runs) and yet this government's MoD procurement budget plan from the Treasury was (in 2004) £65B - already nearly the £35B gap then!). Therefore decisons needed to be made then to chop programmes - but none were made - as usual we shuffled things around and officalliy extended delivery programmes (see Nimrod MRA4 as a prime example!) and this alone can add 20-50% to a project's cost overrun - the present Labour government being motivated and determined to spin its way out of not being a Defence Cutter government!).
So there you go -at one level (the basic one) its like any other budget - if you decide what you want, understand the risks - agree the price and then stick to the delivery schedule you get a fair chance of it arriving on time and cost....However, if you act like all UK governments of the last 40 years, and not decide and agree truthfully what you want in the first place, (eg hiding AH64 logistic costs to get it through Cabinet at the right price!!), then not fund it properly and then not stick to the procurement schedule (very few programmes have ever done this but some have and they have succeeded!!), - the lack of cash means programmes slip and this immediately causes the spiral of additonal cost and yet further delays.
Meanwhile the old equipemnt (egs VC10,Puma and Sea King, Type 42s etc etc) stays in service at even greater expense than originally funded adding more cost than planned to the annual defence budget which in turn then squeezes cash out of the operational budget (look at how many newish frigates the RN had to sell off in recent years) and the new procurement budget just when it needs more to cope with the officially required delays to the new projects...etc etc ad nauseam.
Same as a household budget really - you buy what you can get with the money you have - or you save up for x years and buy something more special (or get it on a PFI mortgage at 3 times the cost !!) - what you don't do is ask the shop to try and produce for you something you were never gonna be able to afford anyway and then just as it arrives on the counter - say can you hold it back for a few years until I have the money - inflation alone means you'll end up paying a higher price later - and that assuming you still have the original supply chain that can sell you all the components at the right procurement and support chain prices you planned in the first place - and then the next spiral down is to order less (see Typhoon!!) and this in turn means spare parts production costs go up and in service costs shoot above target etc etc etc etc...........
My head is now exploding........................... We either fund our defence properly (not an option!) or we get out of the game of being a world expeditionary power...... you can't have it both ways!!! ( PS I support us staying in the game by the way!!)
Cheers