In a report released today, Wednesday the 15th of July 2020, the Public Accounts Committee highlights the Ministry of Defence’s continued “lamentable failure” to “get a grip” and deliver on key defence capabilities needed by the UK’s Armed Forces.
Despite PAC and NAO warnings “year after year” the MoD still hasn’t established a stable basis for making an affordable military Equipment Plan, or a realistic approach to delivering efficiency savings.
The MoD admits it has encouraged a culture that prioritises hitting internal targets above delivering defence capability, with a short-term focus on managing annual financial pressures that reduces the UK’s military capabilities yet further, while increasing overall costs.
Echoing its recent report on failures in the MoD’s nuclear defence programme, the Committee urges the MoD and HM Treasury to consider moving to a system of managing strategic programmes on a multi-year basis – with the MoD to demonstrate “why it should be trusted” with this new approach as it is rolled out. Together the MoD and HMT should report to the Committee on the development of this new strategy by the end of the year.
Covid-19 has worsened existing concerns about the financial resilience of some defence equipment suppliers with the potential to worsen the already lengthy delays to the delivery of many key capabilities.
Meg Hillier MP, Chair of the Committee, said:
“The MoD knows what it’s getting wrong. We know what it’s getting wrong. For years we have made concrete proposals to improve delivery of key strategic priorities and here we are again, with the same gaps in our national defence and the same risk to our armed forces personnel, year after year. We are saying to the MoD and to the Treasury now: come back to us by the end of the year with a concrete plan for how you are going to turn this around, how you are going to do this differently, from now on. The nation and the armed forces that protect us are owed that much.”
The report summary reads as follows:
“The Ministry of Defence’s (the Department’s) 10 year Equipment Plan (the Plan) continues to be unaffordable despite this Committee and the NAO consistently highlighting serious affordability issues in the Plan year after year. The 2019–2029 plan is too expensive by between an estimated £2.9 billion and £13 billion. The Department has still not made the hard choices necessary to balance the Plan and address the affordability gap, which arises in part from a failure to fully fund ambitions set out in the 2015 Strategic Defence and Security Review.
The Department is instead stuck in a cycle of managing its annual budget, using additional funds to offset financial pressures, and making short-term decisions which result in poor, long-term value for money. Plans for efficiency savings remain totally unrealistic; for example £4.7 billion of savings are assumed without plans for how they will be delivered.
The Department has also struggled to deliver key military capabilities, including equipment, to anything like their required timescales. Of 32 of its top priority programmes, a third are at serious risk of not being delivered on time and capabilities are reaching the full operational stage on average over two years late. The most common cause of delays is late or faulty equipment delivered by suppliers, a problem exacerbated by the impact of COVID-19. Ongoing Departmental transformation programmes to improve capability delivery lack clear metrics to measure their success. We are extremely frustrated that we see the same problems year after year and that, despite repeated departmental assurances that it will make progress, there appear to be no consequences for failure to deliver.”
You can read the full report here.