VR,
A military fixed price contract (at least a British one) is normally only fixed price until it goes wrong.
For example, I seem to remember the Nimrod MRA4 contract being re-negotiated with BAE when they said they couldn't deliver on it. A contract for 21 (wasn't it?) became a contract for 3 prototypes with a separate contract for development aircraft if my memory serves me right.
MOD hasn't got the gonads to enforce contracts, or even penalty causes in contracts, as the company (+ local MP, trade unions) usually play the loss of jobs/capability/etc card....
At least that is my opinion, looking in from the outside....
I could be wrong, but this is a rumour network after all
