may tank
British PM Theresa May passes tanks as she visits at Bulford Camp near SalisburyReuters

The British Ministry of Defence (MoD) is reportedly "fast-tracking" a £3bn (€3.33bn) arms deal with Germany because of the sharp fall in the pound's value following Brexit. Since June's EU Referendum vote, the Pound dropped to a 31-year low on Monday (10 October) and fell 17 percent against the dollar.

The weaker currency is expected to cost the MoD up to £2bn over five years from overseas shipments, a spokesman from the McKinsey global management consultancy told The Times.

As a result, the MoD is reportedly pushing through the deal with Germany — which will bring a fleet of 800 eight-wheeled armoured vehicles to Britain — to mitigate against the prospect of further drops in the Pound.

Five companies were originally bidding for the British Army's Mechanised Infantry Vehicles (MIV), including a British company, however military sources have told the publication the tendering process has been scrapped in favour of a deal with Rheinmetall of Germany.

Patria of Finland, Nexter Systems of France and ST Kinetics from Singapore were among the other contenders involved.

Though the deal would benefit the MoD's future liability to the Forex market, it has been criticised for bringing up the cost of the purchase by £1bn and putting hundreds of British jobs at risk.

Conservative MP Bernard Jenkin who supported Britain's departure from the EU, criticised the move. He said: "The idea of rushing to spend money in case you lose it is the wrong way to do procurement."

Another source, who did not wish to be named, said the MoD was "at risk of making a very poor decision, and making it for all the wrong reasons".

They said: "A single-source contract would be pursued only because it's an easy and quick option."

The source said that procurement could bring the £3bn price tag of the purchase down by 40 per cent.

A spokesman for the MoD confirmed to IBTimes UK: "While no decision has been taken on the acquisition strategy for MIV, our approach is competitive procurement wherever possible."