Britain’s Treasury is expected to agree to spend more than £30bn on defence equipment later this week.

UK newspaper The Times reported negotiations on the military’s budgets are almost complete – with Armed Forces’ pay the only outstanding issue to be resolved.

The Army’s plans for new armoured vehicles, The Future Rapid Effect System (FRES), is expected to be confirmed after doubts about cuts to the MoD equipment programme.

The Defence Equipment Minister Baron Drayson is now in agreement with the Chief of the General Staff, General Sir Richard Dannatt, that the proposed in-service date of 2012 for the first batch of vehicles is ‘non-negotiable’.

The huge FRES programme, which will see 120 utility vehicles ordered in the first phase, will spark competition between British firm BAE Systems and its American rivals for a contract that could be worth £50bn over 30 years.

Also expected to be included in the budget are two aircraft carriers for the Royal Navy, at a cost of £3.8bn and six Royal Navy destroyers worth £3.6bn.

By staff writer