MoD cuts equipment orders to save £700m

[Mr C Hinecap]

From the Telegraph this very day. Perhaps we should have a small, no-cost, out of core hours celebration at the savings made:


The Ministry of Defence saved £700 million in the past year by cutting back on aircraft, missiles and technology, the National Audit Office said yesterday.

The annual audit of the MoD's equipment programmes found that savings were made by reducing the size of orders and downgrading some specifications.

Although the new Nimrod MRA4 maritime patrol aircraft programme has saved millions by cutting the order from 18 to 12 aircraft, its costs have overrun by £215 million in the last year, the NAO's major projects report said.

The final price is expected to be £3.8 billion - almost £1 billion over budget - with the aircraft to enter service in 2010, seven years late.

Similarly, the Joint Combat Aircraft, an American-made fighter-bomber, has had provisions for extra weapons' capabilities removed to save £428 million. Other savings had been made by cutting orders for Meteor air-to-air missiles.

The Type 45 destroyer has also had its "capabilities reduced" to save £145 million.

[Roland Pulfrew]

But of course prOOne will be along shortly to assert that these aren't cuts, these are merely savings measures and the money saved is re-invested in the ever growing Defence budget.;) :yuk:

[Clockwork Mouse]

If you look at it closely you will see that they haven't actually made any saving on the Defence budget. By reducing the capability of the equipment on order they have reduced the amount of overspend by £700 million. Scarcely grounds for rejoicing.

[mary_hinge]

Interesting reading (for a quite cold day in the office)

http://www.nao.org.uk/publications/nao_reports/05-06/0506595_I.pdf

FSTA “current forecast assessment” now at £24m, up from the initial £13m

[Roland Pulfrew]

CM - My point exactly

MH - That is only the assessment phase costs that you are quoting for FSTA. IIRC you are allowed to spend up to 10% of the project funding under Smart Procurement or is that Smart Acquisition or is that Smart B:mad:ks? So at present given whole life costs of some £13B then £24M is peanuts!! More interesting is that the NAO document you quote shows FSTA as going for Main Gate in September 2005 - Oh yes that was 2 months ago! And that had slipped from Dec 2003, June 2004, Dec 2004......... so when can we expect main gate? Or more reasonably just when are they going to ditch this PFI too far and BUY some KC30s?:ok:

[mary_hinge]

RP

I agree with you, but given that the assessment phase was some 80% light, how safe is the £13 B ?

[BEagle]

Highly risky..... At a guess.

An RP, not the KC-30 but rather the A330 MRTT.

Whichever, not under the bolleaux of PFI :mad:

[tucumseh]

The sad thing is that this report is the usual mixture of facts, half truths and omissions.

MoD dismisses the facts as being based on a snapshot many moons ago and says they have improved since then. They say this every year and staff are told to take this line.

The NAO haven’t got the remit to look wider and dig deeper, don’t ask the right questions, so the answer is a disingenuous half truth. This applies to all Government committees.

And the MoD can’t believe their luck at the projects which aren’t looked at, particularly those that are dependant on the ones that are.