Brickbat and bouquet for MoD efforts

23 Nov 00
The Ministry of Defence is finally beginning to get to grips with overspending on major equipment procurement projects, but its timetable for delivery is falling further into arrears, according to the National Audit Office.

24 November 2000

Its inspection found that the average delay on the ministry's 20 largest projects, compared with their projected in-service dates, was 28 months. This is three months slower than the 25-month slippage revealed by the 1999 annual inspection.

Seventeen of the 20 projects are running behind schedule. In 13 cases the capabilities of the armed forces have been affected as a result.

The NAO report identifies technical difficulties, budgetary restraints and the changing requirements of the armed forces as the major reasons for the delays.

Public Accounts Committee chairman David Davis said: 'We will want to know what strategies the department has to get to grips with the problem of delays, which can seriously impair the UK's defence capability.'

However, the NAO did find evidence that budget overspends were being reined in, highlighting a £78m cut in last year's £2.4bn cost overrun total.

It also found that when the equipment eventually enters service it is expected to meet 98% of the military's requirements.

The report examined a further ten projects currently in the initial assessment phase, introduced under the government's 'smart' procurement regime, and found the MoD had not yet decided on the targets that projects would be measured against.

It concluded there was scope for running the assessment phase more efficiently, but said it was too soon to assess the overall impact of the new system.

Defence procurement minister Baroness Symons said the NAO's findings recognised the progress that the department had made in tackling its problems. 'It will take time for our new working methods to be translated into improvement in the headline figures,' she said.

'The new assessment phase being introduced into the procurement cycle will help achieve this by reducing risk in projects at an early stage and allowing us… to set costs and timetables we can keep to.'


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