The Defence Secretary told MPs that there is quite a variance between his budget for 2011-12 and the cost of his departments planned programmes.
summer fashion 2011
Unless the gap can be bridged, the and the Armed Forces face more cuts, with insiders warning that military personnel may be made redundant.
Last years Strategic Defence and Security Review (SDSR) outlined deep cuts in the Armed Forces, including the loss of 17,000 military posts. But officials said the MoDs annual budget for 2011-12 is still significantly short of the departments commitments for the year.
Speaking to the Commons defence committee, Dr Fox was asked what cuts he will have to make to cover the shortfall. He replied: That is dependent on the resources that we are discussing at the moment with the Treasury.
Dr Fox said that part of the MoDs problem was that its budget was based on the assumption that it would raise more than 500million by selling Eurofighter Typhoon jets to Qatar. Talks on the sale began in 2008, and a deal was expected to be concluded during David Camerons visit to Oman last month.
Asked if the shortfall in the budget was as much as 1billion, Dr Fox replied: That depends on the finance that is available on the other side. If you look at the variance between the missing receipts, the increased costs weve had due to fuel [prices] and currency movements, there is quite a variance. That is something which well talk through with the Treasury in the next two weeks.
Officials said the talks were unlikely to lead to more money being injected into the defence budget because George Osborne, the Chancellor, is determined to make the MoD live within its means.
power balance
The process has raised fears of more military job cuts. Around 11,000 of the 17,000 job cuts already announced will come through redundancy programmes.
Jim Murphy, the shadow defence secretary, challenged ministers to rule out more cuts. He said: The defence review has been rushed and botched. More rushed cuts to capability at this time of great global unrest would be wrong. Ministers must stop and think again.
Ed Miliband, the Labour leader, could be invited to attend some meetings of the National Security Council chaired by David Cameron.
guess handbags
Oliver Letwin, the Cabinet Office minister, said the Prime Minister was ready to invite Mr Miliband to join Cabinet ministers, intelligence agency chiefs and military commanders for briefings on issues of national security.
