Re: Silly question...
"Surely there are suppliers who would do it at fixed prices?"
Yes, but fixed prices earn them less money, so the can't afford to 'compensate' anyone, hence they don't get any orders.
If you charge cost-plus, there's plenty of money sloshing around in 'discretionary' funds to ensure that your company wins the contract for the next weapons system.
Of course, all of the above is complete fiction and shouldn't be read as an allegation that the defence industry is corrupt. Definitely not insinuating that, don't know how you got that idea, ahem.