12 November 2004
The Ministry of Defence came under far-from-friendly fire again this week over its procurement record when the National Audit Office slammed new budget and time overruns.
The NAO's annual evaluation of MoD procurement revealed that the costs of the 20 biggest equipment projects increased by £1.7bn, while each was delayed by an average of three months.
Performance had improved slightly on the previous year, when the NAO reported a £3.1bn cost overrun, but the largest programmes are now expected to come in at £50bn — 14% higher than originally forecast.
Auditors found little evidence that the 'Smart Acquisition' procurement scheme was being well used. Tim Banfield, who led the NAO's study team, said: 'In our view, the principles [of Smart Acquisition] remain valid. The real problem is they haven't been consistently applied.'
Insufficient time and resources were spent on understanding risks in initial assessment phases, he said.
The MoD said the NAO's figures were 'disappointing'. A senior defence official added that the Defence Procurement Agency needed a culture change.
PFnov2004
