RPT-UPDATE 1-UK to buy helicopters, cut other areas of defence

( Repeats to additional subscribers)
* Britain expected to order 20 Chinooks over 10 years
* Cuts expected in other areas to help fund purchases
* Watchdog says military faces huge procurement deficit
(Adds report on Chinook order)
By Tim Castle
LONDON, Dec 15 (Reuters) - Britain will announce plans on Tuesday to buy more than 20 Chinook transport helicopters over the next decade but will cut spending in other areas to balance a stretched defence budget, media reports said.
One hundred British soldiers have been killed in Afghanistan this year and the Labour government has been criticised for failing to provide enough helicopters to transport its soldiers, leaving them vulnerable to attacks by roadside bombs.
The Chinook is a twin-rotor, heavy-lift helicopter made by U.S. company Boeing (BA.N).
"It's significant to us. I don't have the details of that to hand, it's about 20," Boeing UK President Roger Bone told BBC radio when asked about the reports.
British forces took delivery of 14 Chinooks in 2001, but eight of them could not be used because software source code needed to certify their airworthiness was not supplied. Access to the code had not been specified as part of the contract.
Britain, which holds an election next year, is facing a record budget deficit this year of 178 billion pounds ($290 billion). The BBC reported that a Royal Air Force base could be shut and thousands of defence jobs lost as the government rebalances its spending.
A parliamentary spending watchdog warned on Tuesday that the defence budget falls at least 6 billion pounds ($9.7 billion) short of spending commitments on aircraft, ships and other equipment.
The National Audit Office (NAO) said the shortfall over the next decade would rise to 36 billion pounds -- equivalent to a full year's military budget -- if defence spending was frozen.
"In either case the budget remains consistently unaffordable over the next 10 years," the watchdog said.
Closing the gap would require "bold action" in a strategic defence review planned after the 2010 general election, NAO head Amyas Morse said. "The Ministry of Defence has a multi-billion pound budgetary black hole which it is trying to fix with a `save now, pay later' approach," he said.
The watchdog said defence chiefs were slowing major procurement projects to achieve short-term savings at the cost of greater overall expense.
A delay in the delivery of two aircraft carriers is forecast to save 450 million pounds over the next four years, but in the long run will cost 674 million pounds more, the NAO said.
Finance minister Alistair Darling has promised to protect key health and education services and has yet to say where he will cut spending to meet his goal of halving the deficit over four years.
Analysts say the defence budget would have to be cut by as much as 14 percent to match the reductions in other public sector spending that are needed.
On Monday Prime Minister Gordon Brown said that 160 million pounds of the defence budget would be switched over three years to help counter improvised bombs in Afghanistan. [ID:nLDE5BD1BP] (Additional reporting by Keith Weir; editing by David Stamp)