The UK Ministry of Defence (MoD) is facing renewed scrutiny after the Public Accounts Committee (PAC) called for a major cultural overhaul in its approach to fraud and economic crime, while Defence Secretary John Healey resigned over what he described as inadequate military spending plans. The developments raise fresh questions about defence governance, procurement oversight and funding priorities.
In a new report, the PAC said the MoD lacks strong and consistent leadership in tackling fraud and economic crime. The committee urged the department to appoint a senior two-star officer dedicated to supporting anti-fraud efforts and warned that the government cannot demonstrate it is doing enough to protect public funds intended for defence.
The report highlighted that, over the past four years, the MoD recovered only 48 pence for every pound spent combating fraud and economic crime, far below the government’s target return of £3 per pound. Although performance improved in 2024-2025, with savings of £1.34 for every £1 invested, the department is not expected to meet the target until 2028.
MPs also raised concerns about the MoD’s estimated £1.5 billion annual fraud risk, citing persistent problems including siloed working, weak accountability and poor coordination across the department. The committee warned that procurement remains particularly vulnerable to fraud and called for a dedicated strategy to deter abuse of defence contracts. It also criticised the MoD for failing to fully exploit new technologies and data analytics to prevent fraud before it occurs.
PAC chair Sir Geoffrey Clifton-Brown said the department was “far behind the curve” in protecting public money and argued that incremental reforms would not be enough to address the problem.
Separately, Defence Secretary John Healey announced his resignation, saying the government’s forthcoming Defence Investment Plan does not provide sufficient resources to address growing security threats. Healey criticised the Treasury for refusing to commit the funding he believes is necessary and warned that the proposed settlement could reduce military readiness and increase risks to personnel.
The government is expected to publish its delayed Defence Investment Plan in the coming days amid mounting pressure to increase defence spending in response to global security challenges.
The combined pressure from parliamentary scrutiny and Healey’s resignation is likely to intensify debate over defence funding, procurement reform and the MoD’s ability to safeguard public resources while maintaining military readiness.
