The Department acknowledged that inflation also makes it difficult for suppliers to deliver due to rising staff and material costs.55 As a result, the Department is changing its contractual approach to take account of the inflation risk and avoid suppliers charging a higher premium for continuing to take this risk on.56 47 Q 95 48 C&AG’s Report, para 2.14; Ministry of Defence, The Defence Equipment Plan 2022–2032, P11 49 Q 88 50 Q 89, C&AG’s Report, para 1.15 51 Q 86 52 Qq 79, 81 53 Q 51 54 Q...

The Department acknowledged that inflation also makes it difficult for suppliers to deliver due to rising staff and material costs.55 As a result, the Department is changing its contractual approach to take account of the inflation risk and avoid suppliers charging a higher premium for continuing to take this risk on.56 47 Q 95 48 C&AG’s Report, para 2.14; Ministry of Defence, The Defence Equipment Plan 2022–2032, P11 49 Q 88 50 Q 89, C&AG’s Report, para 1.15 51 Q 86 52 Qq 79, 81 53 Q 51 54 Q 112 55 Q 52; C&AG’s Report, para 2.13 56 Q 88 14 MoD Equipment Plan 2022–2032 Type: conclusion | Number: 21 | Response status: not_addressed Government response: 5.1 The government agrees with the Committee’s recommendation. Target implementation date: September 2023 5.2 The department continuously updates its forecast of the cost of the equipment plan and reviews its affordability through the annual financial planning process, which involves bottom-up costi