The British Treasury wants to put the Global Combat Air Programme (Gcap), a joint project between the UK, Italy, and Japan to develop the sixth-generation combat system with entry into service planned for 2035, under control.
According to the Financial Times, the UK Treasury is preparing to take a more decisive role in controlling Gcap spending. The move comes amid internal government debates on the new ten-year defense investment plan and as London considers further increasing resources allocated to the project.
Also the British financial daily reported last month that London is preparing to allocate about £6 billion (around €7 billion) to support the program. The funding would allow the three partners to sign a multi-year contract with industry covering design and development, after months of delays and diplomatic pressure from Tokyo. Again, the Financial Times revealed last March that Japanese authorities are increasingly doubting London’s commitment to the project.
All the details.
WHAT GCAP IS AND ITS CURRENT STATUS
The Gcap program started with the agreement signed between the UK, Italy, and Japan in December 2023, which established a governmental organization (Gigo) and an industrial alliance with a JV among the lead companies (Leonardo for Italy, Bae Systems for the UK, and Mitsubishi Heavy Industries for Japan), formed in December 2024, operational since last June under the name Edgewing.
Within the framework of developing the new sixth-generation fighter, there has been a delay in signing the contract between the three governments involved in the program and the industries involved. Edgewing was supposed to secure the first design contract by the end of 2025. However, the signing was postponed due to delays in publishing the Defence Investment Plan, the UK’s multi-year defense plan, which was supposed to include the necessary funding for the program. The first contract, worth £686 million, was instead awarded in April.
THE UK TREASURY’S CONTROL OVER THE GCAP PROGRAM
Now, according to the Financial Times, the British Treasury intends to strengthen its oversight of Gcap as part of the final negotiations on the Defence Investment Plan, the multi-year plan that will define the UK’s military spending priorities for the next decade.
The decision comes as negotiations on the long-delayed government’s ten-year military funding plan enter their final phase, adds the FT. Moreover, the initiative reflects the Treasury’s desire to monitor more closely the financial progress of one of the UK’s most ambitious defense programs, avoiding possible uncontrolled cost increases that have characterized other major military projects in the past.
THE DEBATE ON DEFENSE RESOURCES
Prime Minister Keir Starmer is expected to announce a military spending increase of about £15 billion by 2030. This figure represents a compromise between the £12 billion that Chancellor of the Exchequer Rachel Reeves had tried to impose and the £18 billion that Defence Secretary John Healey and British military leaders had indicated as the minimum acceptable, according to sources from the financial daily.
UP TO £6 BILLION FOR THE PROGRAM
As already mentioned, the agreement under discussion should provide up to £6 billion allocated to Gcap. As part of the agreement for the injection of new funds, the Treasury proposes to take control of the program’s spending, according to FT sources. Supporting this move, the ministry cites the program’s complexity and structure, which involves international partners, as well as the Ministry of Defence’s poor track record in terms of budget overruns on major military projects.
The Treasury’s push for control would indeed imply greater oversight, although some government sources have stated that the program’s international structure and the status of external contracts will make spending containment difficult, the Financial Times further notes.
NOT ONLY COSTS, TIMELINES ARE ALSO A CONCERN
Gcap represents one of the most strategically important programs for the defense industry of the three partner countries and aims to develop by 2035 a new air combat system intended to replace the current new-generation fighters in service with their respective armed forces.
However, the British financial daily recalls that the UK government’s internal projections on Gcap’s cost have risen and some British officials believe delivery risks slipping beyond the date set when the three countries announced plans to develop a joint stealth fighter in December 2022. Industrial representatives remain firm: the Gcap project is on schedule.
