Downing Street has been unable to say how the full £200m cost of Boris Johnson’s controversial royal yacht will be met amid reports the Treasury does not want to foot the bill.
On Monday, the prime minister’s official spokesperson said the successor to the Royal Yacht Britannia would be paid for out of the defence budget despite it being a trade vessel and not a warship.
But with the Ministry of Defence (MoD) facing a funding black hole of £17bn, the spokesperson on Tuesday could only say the department would meet the “initial cost”.
It follows a Sunday Times report on a “huge row” within government over who will pay for the flagship, which the prime minister committed to following a sustained campaign from Brexit-backing newspapers.
No.10 was unable to say what the “initial cost” being paid by the MoD would amount to, and could not guarantee that the boat would be fully taxpayer funded.
Questions over funding for the yacht comes amid wider suggestions of tension between chancellor Rishi Sunak and Johnson, with the Treasury reportedly concerned about the PM making unfunded spending pledges.
Health secretary Matt Hancock insisted on Tuesday the flagship will “pay for itself many, many times over”.
Asked what evidence that was based on, the PM’s spokesperson said: “Well, he was simply referring to the fact that this is a ship that will promote UK trade and drive investment back into our country, so we expect any costs of building and operating the ship will be outweighed by the economic benefits it brings over its 30-year lifespan.”
The spokesperson was also unable to say whether any business groups or exporter organisations had called for a trade yacht.
They rejected the suggestion made by former chancellor Ken Clarke that the new yacht was “silly populist nonsense”.
The spokesperson said: “Obviously we totally reject that, the new national flagship will boost British trade and drive investment into our economy.
“It will be used to host high-level trade negotiations, for trade shows, and will sail all over the world promoting British interests.”
Asked whether there were better things to be spending money on, the spokesman said: “We are investing a great deal of money into the country on a number of issues important to the public, be it our NHS or policing.”
Recent polling has indicated that a majority of the public are against spending money on a new trade ship.
A YouGov survey in April found that 51% of people questioned were opposed to replacing the Britannia with an updated vessel, with only 25% in favour.
Similarly, 57% said spending on a new vessel could not be justified, versus 26% who thought it could be.
The vessel will be used to host trade fairs, ministerial summits and diplomatic talks as the UK seeks to build links and boost exports following Brexit.
It will be the first national flagship since Britannia, which was decommissioned in 1997, but the new vessel will be a ship rather than a luxury yacht.