The government does not comment on market movements. The reserves are managed to ensure the policy objectives set out in the Exchange Equalisation Account Act 1979 can be met at all times.

The government does not comment on market movements. The reserves are managed to ensure the policy objectives set out in the Exchange Equalisation Account Act 1979 can be met at all times.

The impact of changes in the foreign exchange rate have been mitigated by the department's use of forward purchasing arrangements. At this time we estimate that this activity has limited the increase in cost to the Chinook programme to £37 million.

We do not routinely release forecast figures regarding exchange rate movements for the current or future financial years.

The focus of the EP22 is to produce a reliable assessment of affordability of the Department's equipment programme. We remain confident in the resilience of our spending decisions, as well as our levels of contingency and risk, despite now living in a more volatile environment.

The Department builds appropriate levels of contingency and risk into the Defence Budget and Equipment Plan. Risk of increased costs due to exchange rate changes are addressed as part of routine financial management of the Defence programme, including the use of forward purchase arrangements to mitigate this.

I refer the right hon. Member to the answer given by my predecessor on 19 October 2022 to Question 62718.

I refer the right hon. Member to the answer given by my predecessor on 19 October 2022 to Question 62718.

I refer the right hon. Member to the answer given by my predecessor on 19 October 2022 to Question 62718.

We continue to work closely with the Bank of England, Financial Conduct Authority, Debt Management Office and others to monitor markets.

We do not routinely release forecast figures regarding exchange rate movements for the current or future financial years.

The MOD builds appropriate levels of contingency and risk into the Defence budget and equipment plan. We carefully monitor fluctuations in currency markets and take steps to protect our budget from short term volatility, including through forward purchase arrangements.

The Department continues to monitor recent fluctuations in currency markets and has built appropriate levels of contingency and risk to protect our budget from short term volatility, including through forward purchase arrangements.

The Equipment Plan for years 2022-2032, which sets out the funding requirements, is currently due for publication later this year.

The Department continues to closely monitor and mitigate the impact of short-term fluctuations in exchange rates. We have no update to the figure previously provided.

The increase in costs related to USD rate fluctuation at the beginning of the Department's latest ten year planning period was £513 million over ten years. This has been reflected in adjustments to budget holders' budgets.

As at 5 April 2021, 14% of 10-year forecast spending on Defence Equipment was expected to be placed in US Dollars. There was no expected spending in Australian Dollars. This is consistent with data used in the 2021 Equipment Plan report.

It is Ministry of Defence policy to place Sterling denominated, firm price contracts wherever possible, placing the management of the exchange rate risk with the most suitable party. However, certain purchases are undertaken in US Dollars where this is mandated by the US such as Foreign Military Sales, and in US Dollars or other currencies for other Government-to-Government arrangements, or for direct commercial sales where this is assessed to deliver the most viable procurement approach or optimum value-for-money.

The position in respect of these programmes is as follows:

F-35B Lightning: The F-35 programme is managed through a US Government F-35 Joint Program Office (JPO) based in the USA. The F-35 JPO places all of its contracts under US law and US federal acquisition rules and regulations. Consequently, all of the JPO's contracts are denominated in US dollars and the UK makes its payments to the JPO in US dollars. The F-35 JPO places the F-35 contracts with the F-35 industry/suppliers and makes the contractual payments to the F-35 industry/suppliers on behalf of the F-35 Partner Nations.

AH-64E Apache: The aircraft procurement and initial support is through a Foreign Military Sales (FMS) case with the US government and UK has no direct contract with the manufacturer. The FMS case and payments are denominated in US Dollars. The Long Term Training and Support Service to provide support to the fleet is through a contract with Boeing UK. The contract and payments are dual denominated in Pound Sterling and US Dollars according to each specified line-item.

E-7 Wedgetail: The acquisition contract is denominated in Pound Sterling, US Dollars and Australian Dollars. Payments to the contractor are made in the currency denominated in the contract.

CH-47 Chinook: The majority of contracts supporting the current fleet are priced in Pound Sterling. Boeing, as the Design Organisation of the Chinook Aircraft, and US based sub-contractors, do attract US Dollars payments and therefore some of the contracts are dual denominated. Payments are therefore made in both Pound Sterling and US Dollars in accordance with the terms of the contract. Separately, the Chinook Capability Sustainment Programme, which is the acquisition of 14 new Extended Range (H-47(ER)) aircraft via a FMS arrangement with the US Government, is priced and payments are made, in US Dollars.

Trident Missiles: The supply of the Trident Weapon System is managed through a government-to-government arrangement under the Polaris Sales Agreement (as amended for Trident in 1982) and payments are made to the US Department of Defense in US Dollars. Related in-service support contracts with UK companies are paid in Pound Sterling.

Protector UAV: Protector is being acquired through a combination of Direct Commercial Sales contracts with General Atomics - Aeronautical Systems Inc. and FMS. The contracts are denominated, and payments are made, in US Dollars.

The position in respect of these programmes is as follows:

F-35B Lightning: The F-35 programme is managed through a US Government F-35 Joint Program Office (JPO) based in the USA. The F-35 JPO places all of its contracts under US law and US federal acquisition rules and regulations. Consequently, all of the JPO's contracts are denominated in US dollars and the UK makes its payments to the JPO in US dollars. The F-35 JPO places the F-35 contracts with the F-35 industry/suppliers and makes the contractual payments to the F-35 industry/suppliers on behalf of the F-35 Partner Nations.

AH-64E Apache: The aircraft procurement and initial support is through a Foreign Military Sales (FMS) case with the US government and UK has no direct contract with the manufacturer. The FMS case and payments are denominated in US Dollars. The Long Term Training and Support Service to provide support to the fleet is through a contract with Boeing UK. The contract and payments are dual denominated in Pound Sterling and US Dollars according to each specified line-item.

E-7 Wedgetail: The acquisition contract is denominated in Pound Sterling, US Dollars and Australian Dollars. Payments to the contractor are made in the currency denominated in the contract.

CH-47 Chinook: The majority of contracts supporting the current fleet are priced in Pound Sterling. Boeing, as the Design Organisation of the Chinook Aircraft, and US based sub-contractors, do attract US Dollars payments and therefore some of the contracts are dual denominated. Payments are therefore made in both Pound Sterling and US Dollars in accordance with the terms of the contract. Separately, the Chinook Capability Sustainment Programme, which is the acquisition of 14 new Extended Range (H-47(ER)) aircraft via a FMS arrangement with the US Government, is priced and payments are made, in US Dollars.

Trident Missiles: The supply of the Trident Weapon System is managed through a government-to-government arrangement under the Polaris Sales Agreement (as amended for Trident in 1982) and payments are made to the US Department of Defense in US Dollars. Related in-service support contracts with UK companies are paid in Pound Sterling.

Protector UAV: Protector is being acquired through a combination of Direct Commercial Sales contracts with General Atomics - Aeronautical Systems Inc. and FMS. The contracts are denominated, and payments are made, in US Dollars.

The figure of 66% provided is based on forecast spending of 11.6 billion US dollars over 10- years for the procurement costs of projects in the Air Support, Combat Air and Helicopters sectors. This forecast is for the 10 years from 2020-21 and is consistent with data used in the April 2020 Equipment Plan report.

The planned expenditure with United States suppliers over the next 10 years is estimated to be 7.5% of the Submarine Delivery Agency's equipment programme.