MOD estimates on how much it would cost to raise 3 new btns.

Discussion in 'Current Affairs, News and Analysis' started by jim30, Dec 18, 2007.

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  1. Got this off hansard - anyone here got any views? There seem to be some interesting assumptions within it...

    Armed Services Capacity
    Dr. Fox: To ask the Secretary of State for Defence pursuant to the answer of 3 December 2007, Official Report, column 568, on armed services capacity, if he will place in the Library a copy of the assumptions and methodology used to estimate the cost of three infantry battalions at £700 million; and if he will make a statement. [173734]

    Mr. Bob Ainsworth: While the costs of an infantry battalion are not generally held centrally (as these figures are extensive and spread over a wide variety of budgets), a set of general assumptions on which to base an illustrative costing of adding three infantry battalions has been developed.

    These costings are dependent on the inter-relationship of a range of complex factors. Each of the assumptions that have been made is regarded as the most reasonable for indicative costing. Costs would break down broadly into two categories: the initial start-up and capital investment costs, and the annual running costs.

    17 Dec 2007 : Column 1033W

    Changes to these assumptions (particularly on the unit role or accommodation requirements) could result in significant changes to the overall total.

    The following assumptions informed the costing:

    Three light role infantry battalions, based in the UK, not held at high readiness and consisting of 625 personnel per battalion;

    Three new barracks (furnished and equipped to standard). It is assumed that there are no existing empty barracks that are fit for purpose in which to accommodate the battalions, and co-location on a single site is unlikely;

    The requirement for new single living accommodation (furnished and equipped to standard) (400 SLAs per battalion);

    The requirement for new service family accommodation (furnished and equipped to standard) (225 SFAs per battalion);

    Build is on land currently owned by MOD (therefore, there is no cost assumed for any requirement to purchase land);

    There are no appreciable costs to gain planning permission or prepare the sites and access to them;

    That over the period of implementation, that this will not materially change the totality of Defences demand for personal clothing and equipment;

    There is no impact on the Equipment Customer Capability Programme in that existing and programmed equipments, vehicles and communication items are whole fleet managed;

    Initial recruitment costs are based on a total of 2802 enlistments required to generate a throughput of £1,875;

    Basic and collective training costs(1);

    Annual barrack running costs estimated at 10 per cent. of cost of new build;

    Annual salary costs (pay, national insurance and pensions) based on salaries within a rank structure of a light role infantry battalion;

    No additional cost is assumed for allowances such as operational, separation and education allowances;

    No other running cost is assumed (e.g. annual recruitment and retention and other costs);

    No depreciation and cost of capital charges are assumed;

    Figures quoted are at 2007-08 prices.

    Based on these assumptions, the following costs were derived:

    £ million
    Initial start-up costs (estimated)

    Cost of new barracks (furnished and equipped to standard, including approximately 400 SLA per battalion) (£150 million x 3)

    Cost of building additional 225 (x 3) SFA (estimated at £200,000 per SFA)

    Recruitment costs (given a recruit pass rate of only 61 per cent., a total of 2,802 enlistments are required to generate a throughput of 1,875 (625 personnel per battalion) at a cost of £12,000(2) per enlistment

    Basic training costs (£29,000 per person)


    Annual costs (estimated)

    Annual barrack running costs (estimated at 10 per cent. of cost x 3)

    Collective training costs (£1 million per battalion)

    Annual salary costs (£19 million x 3)


    Overall total

    17 Dec 2007 : Column 1034W
    (1) The battalions will conduct the following collective training (CT): CT levels 1 and 2—individual and sub unit training; CT level 3—unit level training—in this context it is assumed that the battalions will conduct exercises Druids Dance and Wessex Warrior. For the purposes of this exercise CT 4/5 training has been excluded (the all arms overseas training exercise in Kenya) on the assumption that there would be no increase in the incident of currently funded exercises; the key cost drivers are ammunition costs. T and S costs have been estimated as have clothing and textile costs based on usage for units in 1 (UK) Division. No account has been taken of longer separation allowance costs for training activities.
    (2) Costs are calculated on a full cost basis and therefore contain an element of overhead as well as fixed and variable costs.
  2. What would be fascinating would be to compare the total cost of The Army Infrastructure Organisation, Defence Estates, Defence Housing Executive etcand forming three Artisan Regiments, full of brickies, leckies, plumbers (not the crab kind), etc and letting Regional Forces Brigades bid for their services to sort out all the problems we have with infrastructure. Probably less than a third of the cost and the MOD would n't be ripped off by large commercial organisations.
  3. 200K per quarter what the fcuk are they talking of building or is that 20k per quarter and 180k to the contractor.

    and £19Million on wages for approximately 1900 men thats 10k per man me thinks somebody has screwed there sums up somewhere along the line

    edited because the mong didn't read further to find out that its £19M per battalion :roll:
  4. Sorry!!

    these people are balloons,

    they have just paid an absolute fortune to get rid of three battalions of R IRISH,

    and now they have decided they would quite like another three battalions.

  5. This is only year 1 cash. Depreciating the property over 10 years and assuming that you need to recruit an additional 20% of the Btn strength every year gives an annual cost of the 3 Btns as nearer £180 million

    Of course if they hadn't been disbanded in the first place, the cost would have been far less.

    (and £200k to build a new property when the MOD already owns the land seems a little steep to me - not commenting on the £450 million to build three new barracks, but seems high too)

  6. Errrm......kinda like a regiment of Royal Engineers?
  7. There's a thing. And maybe they could get some chefs, put them in uniform and call them the Army Catering Corps, or something like that. Then they would cook where they were told, when they were told, and people would get fed decent food...OK, maybe going a bit far :oops:
  8. I thought that infantry recruiting and retention was bad at the moment. That being the case how will they raise another three battallions?
  9. "
    and now they have decided they would quite like another three battalions"

    Sorry - didn't clarify myself - the Tories have been asking how much it would cost to raise 3 new btn's, which the Govt is opposed to. They used the figure of £700m to show why it would cost too much - so naturally the Tories asked for the breakdown to show the costs.
  10. Just a thought. Ive we lose a btn a year because of drug use, why not have a junkie btn? The germans have the stomach regiments at the battle of the bulge, why cant we have a Junkie regiment?

    E Coy, 1st Btn, The Needles.
  11. What a complete loads of Ballcocks on behalf of the Gubmint, we are suposed to be fighting a couple of wars are,nt we, so that means we need an Army does,nt it?, so where is the problem in finding the money to do it?. Bottles Broon can find Dosh for Illegals to get grants to go home with and start businesses, doshg for busted banks, dosh for screwd pensioners etc etc, but no dosh for the motre important stuff like defence of the realm, paying and housing the troops and their families, paying the cops, paying the O.A.Ps a decent pension. For Chisake how soon are this bunch of Shitkickers going to get the message and just GO, the whole sorry stinking bunch and the lousy festering crowd called the Labour Party. To think I used to be an ardent Labour Voter just makes me cringe now, but NEVER AGAIN WILL THEY GET MY VOTE.
  12. So in other words, about a fifth of what it costs to bail out a bank that can't do their sums?
  13. PB, I thought property would normaly apreciate, neglects maintainance but surely offset by increase in paper value? I know the treasury prefers to argue that it does indeed depreciate so we have to pay them for the privilage but that rather proves my point!

    I agree with all your other sentiments however. Interested to see the assumption that 'theres nowhere suitable' (Because its all been sold off) but that they would be built on MoD land (is there any left?!)

    What an unbeliveble bunch of f**king t*ssers we have running the country. :evil:

    Acounting rules make the assumption that any asset you buy has a useful life. You can then spread the payment over a number of years which has the effect of smoothing your expenses. It also makes sense because you are generally going to be using the asset for a number of years so it's appropriate to pay for it over the same period.

    For example if you buy a car for £20,000 and you reckon that it'll last five years, you would depreciate the car at £4,000 per year so that after the five years are up it's valued as worhless. That's the accounting treatment, in reality, you still have to fork out the £20k to start with.

    I have assumed a 10 year life for the buildings, which is pretty agressive, but it makes for easy maths. That would imply that the buildings (excluding the land that they're built on) would be worthless after that time, which is probably not going to be the case. In the accounting world what you could do is revalue the property, which rebases the whole thing, but accounting does not necessarily have to reflect reality as any accountant will tell you :D .

    Maintenance can be treated as either a capital or an expense item according to various accounting rules and conventions that I won't go into here.

    At the corporate level, you will often find that companies will often try and depreciate assets over a shorter timeframe as this has the effect of reducing their tax bill.

    There are lots more wrinkles that any good accountant (and I'm not) will be able to explain to you in excrutiating detail.
  15. Not wishing to outrage you any more but I make it nearer 1/80th of the cost of bailing out the bank who can't do sums! You don't happen to work in a ban.......................... no of course not!

    (according to the BBC the figure for NR is £57B divided that by c£700M)