HALF of the Royal Navy is to be “mothballed” as it bears the brunt of cuts imposed after a series of expensive procurement projects and the hidden costs of the conflicts in Afghanistan and Iraq.

Six destroyers and frigates and two other vessels are expected to be put into reduced readiness, known as mothballing, to achieve urgent savings of more than £250m. It can take up to 18 months to bring mothballed ships back into service.

The armed forces have been told to save more than £250m this year, and £1 billion by April 2008, amid a “rebalancing” of the Ministry of Defence’s (MoD’s) spending plans, defence sources disclosed.

The MoD will also cancel the last two of the eight Type-45 destroyers the navy was supposed to get. The navy was promised the government would provide these in exchange for cutting 15 major ships in 2004, sources said.

Julian Lewis, the Tories’ defence spokesman, said the fresh cuts were “absolutely devastating stuff” and that cutting the number of Type-45 destroyers would be “catastrophic”.

“You can’t have a navy without ships. This government is absolutely hellbent on the destruction of the Royal Navy,” said Lewis.

Admiral Sir Alan West, the then first sea lord, has said he only accepted the cuts in return for the “jam tomorrow” of the eight Type-45 destroyers and two large new aircraft carriers he was promised.

Adam Ingram, minister of state for the armed forces, admitted this month that 13 of the Royal Navy’s 44 main vessels were already in mothballs to save cash.

A total of 13 were at sea, and a further 18 in port and ready to go to sea at any time. But the decision to mothball another eight ships will mean that 21 of the 44 are not available. Ingram refused to say which ships were out of action, admitting that this would “enable deductions to be made that could be prejudicial to national security”.

Measures to save money that are already under way include a review of the Royal Navy’s three main remaining bases at Plymouth, Faslane and Portsmouth.

At the height of its power in the 19th century, the Royal Navy was as large as the seven next biggest navies combined. Even as the US and German navies grew at the start of the 20th century, it remained twice as large as its nearest rival.

But the 2004 cuts reduced it to its smallest since before Trafalgar in 1805, and there are suggestions it now needs only two major bases.

The decision last month to renew the Trident nuclear deterrent, based at Faslane, saved the Scottish base and made Portsmouth the favourite for closure.

Mike Hancock, the Liberal Democrat MP for Portsmouth South, said the cuts were “as potentially damaging as the (then defence secretary, Sir John) Nott cuts of the early 1980s, which preceded the Falklands conflict. Closing the Portsmouth dockyard, the most important of the bases, would be an historic mistake. This government keeps cutting back on equipment without cutting back on commitments. It is putting more on crews and undermining the navy.”

The problems with the defence budget are largely caused by cost overruns in procurement projects such as the RAF’s Eurofighter Typhoon, the Bowman communications system, and the Navy’s Astute submarine and Type-45 destroyer programmes. The Eurofighter Typhoon programme costs about £1 billion a year, which will rise in the next financial year to £1.3 billion. The other major programme costs are: the Type-45 destroyer £600m, Bowman £545m and Astute £415m.

The cost overruns on procurement are exacerbated by the Treasury’s refusal to refund the costs of training for operations in Afghanistan and Iraq and up to 40% of the cost of actual operations. The Treasury claims to meet the full cost.

The MoD said it was not prepared to provide details of internal government budget discussions but it did not expect to see an overspend in this financial year and no budget had been set for next year.

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