MPs brand MoD’s procurement ‘extraordinary failure’

9 Dec 11

The Ministry of Defence failed to deliver any armored vehicles in more than a decade, despite spending £1.1bn on a procurement scheme, the Public Accounts Committee has said.

In a report published today, the PAC found that, since the 1998 Strategic Defence Review, there had been an ‘extraordinary failure’ to produce necessary principal armoured vehicles. These include tanks and other reconnaissance and personnel-carrying vehicles.

The PAC blamed budget cuts, an overly complex procurement process and an ‘unrealistic culture’ where the MoD was demanding cutting edge technology it could not afford.

As a result of the failure to produce vehicles through its core procurement programme, the department needed to be given £2.8bn by the Treasury to buy vehicles for the separate Urgent Operational Requirements programme.

The faster UOR process has been used to deliver mine-resistant vehicles for operations in Iraq and Afghanistan, but these are more expensive, the MPs said.

The PAC’s report, The cost-effective delivery of an armoured vehicle capability, found that among the money wasted was £321m lost on cancelled or suspended projects. As a result, the armed forces will not have enough vehicles until at least 2025, making it more difficult to undertake essential tasks such as battlefield reconnaissance.

The reasons for this were ‘all too clear’, committee chair Margaret Hodge said, because £10.8bn had been taken from the armoured vehicles plans in the last six years as the department sought to balance its budget.

She added: ‘The MoD seems as far away as ever from establishing a clear set of affordable defence priorities. The problem for the armoured vehicle programme is that the department has yet to say how it is going to find the money to buy the vehicles it needs in future to carry out the full range of military tasks.’

Around £5.5bn will be spent on new armoured vehicles in the next ten years, but the report also warns this may be insufficient. It calls on the MoD to set out clearer procurement priorities, and to stop ‘raiding’ the armoured vehicles funding every time it needs to make savings.

This is the latest in a number of PAC reports that have criticised the MoD’s procurement policies. Earlier this year, it concluded that the department was stuck ‘in a cycle of failure'.

Responding to the report, defence minister Peter Luff said that ‘the armoured vehicle programme was left in a mess by the previous government’.

He added: ‘We are now sorting out their unrealistic and unaffordable plans by balancing the budget, investing real money in equipment and reforming outdated procurement practices.’

However, the minister said that the PAC was ‘misrepresenting the facts’ of some procurement deals.

‘It is not true to say the £1.1bnspent on armoured vehicles has not delivered any equipment. It has delivered Titan, Trojan and Viking vehicles, with Trojan and Viking used on operations in Afghanistan.’

He also said that the UOR process has been used correctly to ‘swiftly deliver world-class equipment to the frontline’.


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