MoD to face £700m in extra costs, post Brexit

Expert from the Royal United Services Institute (RUSI) have warned that the Ministry of Defence (MoD) is facing extra costs of up to £700 million per year, as a result of leaving the EU.

RUSI made the comment after seeing a fall in sterling where military equipment purchases have been made.

The news comes after the pound fell to its lowest level against the dollar in more than 30 years, following Brexit.

In an interview with the BBC, Prof Trevor Taylor, from the RUSI think tank, said the extra costs could lead to a ‘budget black hole’. Meanwhile, other military experts have warned the stretched funding to result in a ‘perfect storm’ that may well push the MoD to ‘breaking point’.

The UK has committed to spending two per cent of GDP on defence, a minimum set by Nato.

Commenting on the news, the MoD maintained that it took ‘appropriate financial precautions in all its procurement contracts" and "remained committed to the procurement set out in last year's defence review.’