The Ministry of Defence has been ordered to take greater control of its construction projects after cost increases of almost 拢300m on the Devonport nuclear submarine facility in Plymouth.
Police are investigating allegations of fraud on the project by subcontractors on the project.

A report published last week by the National Audit Office, parliament's spending watchdog, found that construction costs had escalated from 拢650m to an estimated 拢933m.

Sir John Bourn, head of the NAO, said the MoD had agreed to fund most of the cost increases. He said: "Departments need to learn the lessons from this project and minimise the risk of this happening in the future."

The NAO report said the MoD should allocate risk to the contractors best able to manage it. It recommended that where a project is considered to pose a significant risk, MoD officials should draw up contingency plans to deal with the risk.

The report said that all parties in a project should be made to understand the elements of a project that were crucial to success at an early stage. It said: "Departments should recognise the potential difficulties involved in capitalising overspends on capital projects."

Although estimated at 拢650m in February, the facility was originally supposed to cost 拢237m. Some project observers believe the scheme could crash through the 拢1bn barrier.