UK Government Writes Off £6.6 Billion in Cancelled Projects

The committee examined spending across the 17 main ministries, using data from the National Audit Office, which audits government accounts and reports on value for money. It found that write‑offs, abandoned assets and fraud together accounted for the £6.6 bn figure. Write‑offs occur when spending is recorded as a loss because a project is cancelled or an asset is retired without delivering the intended outcome. The report described the pattern of cancelling projects after large outlays as a "particularly egregious" example of poor value for money.

The Ministry of Defence accounted for £1.6 billion of the total, mainly from retiring assets or policy shifts after the July 2024 change of government. The Home Office lost £290 million on the Rwanda deportation scheme, which the new Labour administration terminated. The Department for Transport wrote off £472 million from eight cancelled road projects, including the proposed A303 tunnel under Stonehenge. Labour MP Clive Betts, the committee’s deputy chair, said hard‑working taxpayers should be "rightly aggravated" by the waste. The report also noted that material levels of fraud contributed significantly, citing persistent overpayments in the Department for Work and Pensions that have reached £9.3 billion over 36 years.

The £6.6 bn loss represents money that could have funded public services or reduced borrowing. While the Treasury insists it will not tolerate fraud or waste, the report urges action to curb complacency and improve oversight of project initiation and cancellation. It also highlights that compensation schemes owed by the government have risen to £73.4 billion, up £11.8 billion from the previous year, raising questions about whether value for money was considered in their design.

Parliament will receive a formal government response to the PAC’s findings, and future budgets may show tighter controls on major infrastructure and defence programmes, as well as increased scrutiny of long‑running fraud in benefit payments.