MoD procurement ‘over-optimistic’
By Liz Stephens
The MoD’s procurement of the Type 45 Destroyer was “over-optimistic”, an influential committee of MPs has said.
The public accounts committee (PAC) also said the MoD failed to “take sufficient account of the technical risks involved in such a complex project”.
A series of project management failings and problems mean the Destroyer will now enter service over two years late and £1.5 billion over its original budget.
The PAC report described as “a disgrace” the fact the ship will not achieve full operational capability until 2011.
The Type 45 Destroyer is to form the backbone of the Royal Navy’s air defence capability for the next 30 years. However, the number of ships to be purchased has been reduced from 12 to just six.
The committee said it remained “deeply concerned that the reduction to six ships will make it very challenging for the department to meet its operational requirement to have five ships at sea at any one time”.
Although they accept this is a “manageable risk”, if there are only four ships available the department will have to “juggle and hope”, the MPs found.
Shadow defence secretary, Dr Liam Fox said: “Neglect for our armed forces from this government is nothing new, but incompetence on this scale is staggering.”
The committee did allow that previous project management errors appeared to have been addressed by the MoD. Following a far-reaching review, the contract was renegotiated in 2007 and there have been no further cost increases or delays since then.
The MoD has accepted that it under-estimated the scale of the technical challenge and “identified its inability to identify correctly what a highly advanced ship ought to cost as the real failure on the project”.
The committee stressed lessons must be learnt from both the failures and successes of the project.
