PLANE CRAZY
Exposed: MoD blows £ 10.5 billion on MILITARY jets it doesn’t need . . . They’re used to fly TOURISTS to the Med . . . as tax payers lose out
THREE military jets – part of a fleet costing taxpayers an astonishing £10.5 billion – are being used to fly holidaymakers to sun-kissed resorts because the RAF has no use for them.
The aircraft are supposed to transport British troops to military bases around the world and refuel fighters and bombers in mid-air during combat sorties.
But a Mail on Sunday investigation can reveal that while the cash-strapped Ministry of Defence shells out tens of millions of pounds a year for the planes, holiday firms Thomas Cook and Jet2 have been using them to fly thousands of tourists to Majorca, Tenerife, New York and Florida.
The aircraft are among 14 Airbus A330s acquired by the MoD under a controversial leasing agreement which costs about £400 million a year. The deal with a consortium of aviation manufacturers called
We paid £10.5bn to lease planes to transport troops and refuel jets . . .
AirTanker allows the commercial group to potentially make millions more by renting up to four of the unused aircraft to holiday firms.
Last week, The Mail on Sunday boarded one of the planes in Manchester and flew with hundreds of tourists on Jet2 package breaks to Tenerife. We also tracked two other RAF planes over the past week as they flew Thomas Cook holidaymakers from Manchester to New York, Seattle, Boston and Orlando.
MoD documents seen by The Mail on Sunday reveal that all three aircraft, which in their military role are called Voyager, remain part of the RAF’s fleet. It is understood they have never been used on operations, although the MoD refused to confirm this last night. We can also reveal that: The MoD is forced to pay more for any of the planes if they fly into war zones because AirTanker does not insure them;
AirTanker charged £94 million for an aircraft hangar which experts say should have cost much less;
The Australian Air Force bought the same model of aircraft for tens of millions of pounds less.
The astonishing revelations come just weeks after Defence Secretary Gavin Williamson threatened to sweep Theresa May from power in a bitter Cabinet row over military cuts, demanding an extra £20 billion over the next decade.
The Mail on Sunday understands Mr Williamson is frustrated about the cost of Voyager, while Lord Dannatt, the former head of the British Army, described the deal as a ‘national scandal’.
A source close to Mr Williamson said: ‘Poor historic deals like this are squeezing the defence budget and leaving no room to manoeuvre. Voyager is one of the reasons we have to fight for more funds to avoid devastating cuts elsewhere.’
The controversial agreement between the MoD and AirTanker was signed off in March 2008 when Gordon Brown was Prime Minister, Alistair Darling was Chancellor and Des Browne was Defence Secretary. They agreed to lease 14 Voyagers from AirTanker, a consortium which included French-based manufacturer Airbus and engine- maker Rolls-Royce, under a Private Finance Initiative (PFI) arrangement.
According to one contract seen by the MoS, Airbus was selling A330s for around £50 million in 2007, so a fleet of 14 would have cost £700 million to buy outright. Our investigation suggests the deal the MoD signed was based on a figure closer to £200 million for each plane, with the rest of the £10.5 billion covering financing, operating the service and infrastructure. The total could even rise to £12.3 billion once staffing and fuel costs are included.
The costs are paid back over 27 years, with repayments expected to peak at £593 million in 2034.
The deal also allows AirTanker to lease aircraft to commercial airlines when the RAF is not using them. But the MoD continues to pay huge sums for the right to take back the planes and use them on military operations if required. Last night, defence officials refused to confirm the cost, claiming the figure was ‘commercially sensitive’.
It takes less than a month to refit the jets to switch between military and civilian use.
The Voyager deal was heavily criticised soon after it was signed. A report by the National Audit Office said it was too expensive, uncompetitive and overly complicated, and that the MoD lacked the expertise to manage the project.
Our disclosures highlight the problems with PFIs, under which the private sector takes on major public projects such as schools and hospitals, but saddles the taxpayer with debts – which some experts say total £300 billion.
The Mail on Sunday also understands that it would cost the MoD £3.5 billion to buy its way out of the Voyager contract.
Military experts say the money spent on this deal would have been better used on equipment which
‘Private consortium has creamed off huge profits’
could have saved soldiers’ lives in Iraq and Afghanistan, such as armoured vehicles t o protect squaddies from roadside bombs.
Last night, former Armed Forces Minister John Spellar said: ‘The bottom line is that bad deals like this cost lives. Voyager has left the MoD so short of cash that troops have gone without top-grade equip- ment. They’ve also been paid less and been forced to live in inadequate accommodation. Billions of pounds have been wasted and a private consortium has been able to cream off huge profits.’
It is unclear how much military service the Voyager fleet has seen. But some aircraft are being used as troop carriers to and from bases in the UK, Cyprus and the Falkland Islands. In April this year, a Voyager refuelled Tornados in the international mission to destroy alleged chemical weapons facilities in Syria.
One of the Voyagers was also given a £10 million refit so it could be used by the Prime Minister, senior Ministers and members of the Royal Family, including Prince Charles, for use on official long-distance trips. Prince William used it for a recent trip to the Middle East.
As part of the deal, AirTanker built a hangar at RAF Brize Norton in Oxfordshire for maintenance work. Its accounts say this hangar cost £94 million, but aviation industry sources believe it could have been built for significantly less. It would also appear cheaper for the MoD to purchase Voyagers directly from the manufacturers. In 2015, the Royal Australian Air Force bought Airbus refuelling and passenger j et s f or j ust over £100 million each.
The Mail on Sunday supplied AirTanker with a detailed list of questions about the Voyager deal, but it declined to comment.
The MoD said: ‘Voyagers are playing a key role in protecting British airspace and in the fight against Islamic State, and while our core fleet is doing the job we need it to, we can call in the extra aircraft at short notice if we need them.
‘When we’re not using them it makes sense to have them performing other roles, as that reduces our costs and means they can be ready for operations quicker than if they were held in storage.
‘This is a cost-effective deal that is delivering an outstanding service for the RAF.’
. . . so why ARE three of them transporting UK tourists?
ONE of the greatest Government scandals of modern times has burst into the open. The Mail on Sunday reveals today that ultra-modern, super-expensive Voyager jets, leased at vast expense for the RAF by New Labour, are now ludicrously being used by travel companies to fly holidaymakers abroad.
This is not being done to save taxpayers’ money – the only conceivable excuse for such a farcical development. On the contrary, we must carry on paying rent for the planes while the holiday cash goes to the AirTanker consortium.
It is caused by the Private Finance Initiative ( PFI), a scheme which allows the Government to hide major spending and borrowing, and pretend that state finances are much healthier than they are.
While Tory Chancellors have dabbled in this dangerous fiddle, it was New Labour’s Gordon Brown who embraced it fervently, loading debts on generations to come as he embarked on huge shiny projects which the country could not really afford.
PFI schemes are almost bound to give contractors the whip hand. In return for making the initial investment and waiting for their money, businesses can and do demand gigantic long- term paybacks, stretching decades into the future.
Realising that New Labour was anxious to spend lavishly and immediately so that the party could look good, AirTanker and many others demanded and got ferocious conditions. The costs of this folly could rise to as much as £12.3 billion, eating permanently into our ability to pay for the rest of our national defences.
The plain greed of AirTanker does not and cannot excuse the failure of Ministers and senior civil servants to drive a harder bargain. They were warned. Lord Dannatt discloses in The Mail on Sunday today that objections were raised by an alert senior officer, but ignored and overruled on political grounds.
Two things went badly wrong here. First was the PFI scheme itself, trying to live beyond our means by borrowing from the next two generations, in some cases before they had even been born.
The second was that Ministers and civil servants allowed themselves to be bulldozed into debts and obligations far beyond what could possibly be described as reasonable.
It may not be feasible – though it ought to be – for the present Government to reopen the Voyager deal. But it must surely be possible to ensure this never happens again, by seeing through and rejecting Labour’s fake generosity with money that does not exist.
The PFI disaster, which will be hung around our necks for many years to come, is the starkest warning imaginable that governments must live within their means, and borrow only what they can afford.