PDR1
There was no suggestion at the time that the RAF had no intention of flying them (quite the reverse).
This is the nub of the issue. While ACAS probably had every intention of signing the RTS, and the RAF of flying the aircraft, the Mull of Kintyre Review forcefully reminded both that they were not permitted to if the Aircraft Project Director said they couldn't. In old speak, the CA/MA Release was mandated upon them. This is what went wrong on Chinook - CA said "no fly", ACAS ignored him and signed an illegal RTS; and the rest is history.
(Edited to clarify that the evidence accepted by the MoK Review had been submitted and accepted some time beforehand. The actual report just confirmed this).
As for which Hammond version is true, I think it unlikely he would admit another airworthiness fiasco if untrue. Lack of approval to spend money is always the final reason (which is not the same as lack of money), but it is not the cause.