Babcock and UK MoD at loggerheads over bill for increased Type 31 programme expenses
A rendering of the UK RN's future Type 31 frigate. (Image: UK MoD/Crown Copyright)
Babcock has revealed that it was in a dispute resolution process with the UK MoD over increased costs related to the Type 31 frigate programme.
The shipbuilder is building five frigates for the UK RN under a £1.25 billion contract awarded in 2019, shaking out at around £250 million per ship.
To date, Babcock said it had seen revenues of £600 million related to the project but seen no profit on the programme.
Over the course of FY2023, Babcock said it had been in a dialogue with the UK MoD ‘about the contractual position regarding additional forecast costs resulting from certain material macroeconomic changes that were not foreseen at contract inception’.
The shipbuilder said these had increased the actual and projected programme costs to deliver
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