PAC: MoD unable to manage projects
The Ministry of Defence (MoD) is still unable to properly manage defence procurement projects, an influential committee of MPs has said today.
The Public Accounts Committee (PAC) reports that, while there has been a reduction in the cost of major projects, this has come with decreases in the amount of weaponry provided and an easing up on quality standards.
“The MoD is still unable consistently to manage individual defence projects so that our servicemen and women have the new equipment they need, when they need it and to cost,” said Edward Leigh, chairman of the PAC.
The PAC points out that the total forecast cost of these projects is now £29 billion, ten per cent over budget.
However, this is an improvement on last year, as since 2005 the MoD has cut the projected cost of its 19 largest projects by some £700 million.
“But this is not the good news it seems,” Mr Leigh said.
“Cuts have been achieved mainly by reducing the amount of weaponry on order or by being less demanding about the specifications of the kit.”
And while cutting back on quantity and quality, the projects are still getting later.
Overall, the 19 largest projects are running 375 months late – 45 months longer than in 2005. On average, each project has now been delayed 20 months.
“The MoD is continuing to put some of its poor performance down to a number of ‘toxic legacy’ projects,” Mr Leigh said.
“This hand wringing has gone on far too long. It is now time for the department finally to get a firm grip on these projects and provide truly realistic performance, time and cost estimates.”
However, the MoD rejected many of these findings – labelling some aspects of the PAC report “disappointing”.
Defence procurement minister Lord Drayson commented: “The MoD has recorded significant improvement in acquisition performance since 2003, reducing the overall cost of major projects by some £642 million.
“The committee’s views are well respected, but this is old news, and we have implemented many of the sensible recommendations they have made over previous years.
“I am disappointed that in an attempt to grab sensational headlines the committee has chosen to attack the MoD for trading performance in order to meet time and cost parameters.”
He pointed out that in the past the PAC has praised the MoD for its policies in negotiating between cost, performance, and time.
“I expect that we will continue to show that we’re bearing down on costs and time when we publish our results for the last financial year,” Lord Drayson added.
