Trident refit costs shoot up

The forecast cost of building the Trident submarine D154 refit and refuelling facility in Devonport jumped to £417m by April last year 76% over the original budget a National Audit Office report revealed this week. Earlier this year reports that costs could rise to £450m were derided by DML, the company which owns Devonport. The […]

The forecast cost of building the Trident submarine D154 refit and refuelling facility in Devonport jumped to £417m by April last year 76% over the original budget a National Audit Office report revealed this week.

Earlier this year reports that costs could rise to £450m were derided by DML, the company which owns Devonport.

The rise in costs since the original October 1994 project estimate of £236m was due to various inflation costs, profits not included in the original estimate, project management overheads and, chiefly, the £63m price of specification changes and other costs.

The NAO said in its report on the sale of the Devonport and Rosyth dockyards that the protracted D154 contract talks delayed the project’s start by 26 months. The main facilities are now expected to be ready in January 2002 a 29-month delay.

The NAO said the MoD had agreed to pay a fixed fee of up to £339m to DML. A further £20m management fee would also go to DML.

The dockyard will have to share the rest of the bill with the MoD, although the maximum contract cost to the MoD is £410m, according to its agreement with DML.

The NAO said uncertainty over the future of submarines could further increase costs and reduce savings from the dockyard sale.