A400M, Nimrod and JSF face delays as MoD’s ‘woeful’ procurement record is slammed by government watchdog

The UK Ministry of Defence’s continuing failure to deliver major weapons programmes on time and within budget may mean severe delays or even cancellation for several projects, according to the latest report from the government’s public accounts committee.

Nimrod Flight

Cost overruns of £4.8 billion ($8.45 billion) have been identified in the largest programmes, which include the Nimrod MRA4 maritime patrol aircraft, A400M transport and Joint Strike Fighter (JSF). “This will put further pressure on an already tightly stretched budget…it is likely that the Ministry of Defence will have to cancel or delay projects to compensate for the substantial cost overruns,” says the committee.

“The MoD’s promises to improve its performance in delivering defence projects to cost and time look increasingly threadbare,” says public accounts committee chairman and member of parliament Edward Leigh. He says that, while the new procurement rules introduced in 1998 remain “broadly sensible”, the MoD has failed to apply them effectively. “Doubtless their failure in this respect is never held against them and they proceed in their careers without censure.”

Leigh claims there is an “extremely steep hill to climb” despite recent reforms intended to reinvigorate the procurement process. “This report once again records the woeful performance of the department in procuring defence equipment.”

Figures released in November 2004 by the National Audit Office detail the increasing costs of defence programmes. The £2.57 billion JSF programme is £782 million over budget, although savings worth £445 million have been identified. The increase includes £384 million for “better understanding of the integrated nature and requirements of the aircraft systems”. The £3.6 billion Nimrod MRA4 programme is £780 million over budget, £408 million of which occurred in 2003-4. “Slower technical progress than originally envisaged, particularly with wing mass”, is cited as one reason.

The MoD says the report reveals “nothing that was not forecast last year”. Its chief of defence procurement, Sir Peter Spencer, questioned by the committee, said: “We are actually doing a lot of things to turn procurement performance around, but it will take time before the results show in this population of projects”. He explained that most programmes “were not adequately de-risked before we set the time and cost parameters” and estimated it will be at least a year before programmes come under more cost control.


Source: Flight International