I think you are over emphasising the difference in size between the Type 23 and Type 26 as some example of Govt wastage, whereas I would suggest its just a reflection of necessity in design mission.
Take an excellent ASW vessel in the Type 23, fully loaded its close to 5000 tonnes and 133m. The Type 26 is only supposed to be 141m, not a lot bigger.
If its sensible to be able to operate a bigger helo and/or a UCAV then you do need a wider hanger, hence a beamier hull, hence a greater displacement. Then add a mission bay which might be cost effective long term, equals a certain shapd hull form at the rear.
The Type 23 has a pretty bespoke VLS, relatively short. It is sensible to design the Type 26 with the ability to carrier a bigger sized VLS, that alone is a big factor in the hull shape, hence displacement, most modern ships that carry VLS are big for that reason.eg F100 equals 5800 tonnes.
Then the propulsion system, that used on the Type 45 uses up a large aount of internal hull volume, not sure what the Type 26 will have .
The upper works look pretty sleek and stealthy, so more spaces/ work areas are probably located in the hull itself, sensible if its aimed at survivability. Again it means more volume in the hull.
Add the probability that the world may one day be vying for polar oil sources and you need a big ship able to take the punishment of those sea conditions, and there the bigger and stable the better.
If we are to spend a vast some on a new class, I would prefer it to be upgradeable, lets do a hypothetical, imagine the cash was there in the T23 design phase and they had squeezed another 1000tonnes on it and added a extra 32 cell Mk41 VLS, that would have opened up a whole range of options and weapons systems, so bigger in the long run would have been better? We might have flogged a Type 23 to some other navies maybe able to handle Standard etc.