Fresh doubts over St Athan defence academy
Fresh doubts have been raised over the prospect of a huge defence training academy going ahead in south Wales.
BBC Wales has been told that the St Athan project is unlikely to happen on the scale envisaged at a cost of £14bn.
A UK government source close to the decision-making said: "The logic for something on that site remains compelling: the model does not."
The model envisages centralising training for the armed forces through the private finance initiative or PFI.
A private consortium would be given a 30-year contract to run the scheme.
Its fate is being decided as part of the UK government's strategic defence and security review.
The source said: "It's not impossible that something will go ahead - but it won't be a gargantuan PFI."
The final decision is expected to be revealed when the Strategic Defence and Security Review (SDSR) is published at the end of next month.
Welsh Secretary Cheryl Gillan has already said she not could confirm before the defence and general spending reviews whether the £14bn defence training academy would go ahead but has said she was committed to the plan.
The St Athan plan would centralise training for the armed forces in one location, but has led to controversy due to the closure of other bases in the UK.
The SDSR is being carried out alongside the UK government's overall comprehensive spending review, which is due to report next month.
The consortium behind the planned development, Metrix, said they had nothing to add to statements made last week.
Chairman Charles Barrington said: "Technical training for the UK armed forces will still be required in some form, whatever the outcome of the Strategic Defence and Security Review".
He said the proposal for training at St Athan "drives forward a number of key efficiencies and a level of responsiveness to change which the current training capability cannot match".
Mr Barrington said a main benefit from the academy on one site is that it would be that it would free up 1,200 sailors, soldiers and airmen to return to operational duties, so it would be "illogical" for the MoD not to "embrace these obvious benefits".