To commit money to the "Mid Life Upgrade" quite a few very senior people would have had to sign up to there being five years useful life left in the aircraft, post MLU completion. That's a basic Treasury rule - I imagine the projected life would have been much more.
That being so, the Services, and those who signed, have every right to feel let down because the decision to scrap the aircraft wouldn't have been so sudden that some money couldn't have been saved. I suspect there are those who had been planning this for years and knew very well that the £600M was to be wasted.
Not entirely dissimilar from the RAF supplier's decision to chop certain Sea Harrier capability in the early 90s, by the simple expedient of scrapping the necessary kit without telling the RN. I always thought that the beginning of the end for SHAR, because the RN (their Aircraft Support Executive) rolled over and didn't complain. But thereafter they could not claim to have that capability, which weakened any Board Submission for funding. (Not wishing to start a light/dark bunfight here - the same AMSO policy decision rendered Chinook, Nimrod, C130 etc unairworthy - you don't have to take my word, see the RAF's own various ART reports - so, arguably, they suffered more from their own Chief Engineer's decisions).
You always get back to that AMSO policy that wasted Billions. It was the first determined attempt to create the "Black Hole" we have today.