Why don't we buy our military aircraft from....

[ShotOne]

Almost all our military aircraft are built by European consortia or the U.S. As the world now stands, is there perhaps an opening, even a necessity, to take a wider view? Initial posturing prior to negotiations proper, suggest we're in for hard Brexit whatever we want so looking after our interests isnt a priority for them, to say the least. Several areas of the world have vibrant aerospace industry without ever featuring in our inventory; SE Asia, Brazil ((thentucano worked out ok) Is it even so unthinkable we buy stuff from the Russians?

[sandiego89]

Is it even so unthinkable we buy stuff from the Russians?


I would offer that is a very dubious path, with questionable supply chains and factory support all subject to political whims. Several buyers of Russian equipment have been very displeased with spares support. I would also be worried about source codes and possible hidden lines inside the software.

[ShotOne]

Ah, so you don't think our Chinese power station's such a great idea?..

Interesting point you raise. Arms sales are a huge deal, one of the few bright spots in the Russian economy. If there was the remotest hint of them being liable to "selective sabotage" through software or whatever, any prospect of overseas sales would be over. Would they really sacrifice a key industry for a very temporary military advantage?

[Wetstart Dryrun]

i Guess they let people out for Christmas

[Royalistflyer]

ShotOne has a point - and anyway - there is such a thing as building under licence - which would increase employment in this country and ensure we controlled the spares and the software.

[ShotOne]

If you disagree, wetstart you could always make your own point rather than a catcall. Anyway this isn't principally about Russia; its a big world. Expanding our traditional shopping area could have a double benefit if it made those new suppliers more disposed to considering buying British

[A_Van]

IMHO the idea is not so crazy as it is seen at the first sight.
Of course it will never happen with UK and other NATO members, but technically it is possible.
Look e.g. at Israel. They take MiGs as a platform only, throwing out obsolete radars and other avionics, add a weapon control system with interfaces to non-Russian missiles and sell worldwide.
And in this case the issue of malicious lines in the source code can be eliminated.

[AtomKraft]

Which MiGs do Israel operate.....?

None!

They may update the FISHBED, and flog it about, but they sure as heck don't buy their operational fighters from Russia!

[A_Van]

AtomKraft, you do not read attentively.
The word "operate" was not used. Instead, the key words were "sell worldwide". And again, I was only addressing technical issues. From the political point of view the whole topic does not make sense.

[AtomKraft]

Do you mean we should buy from Israel then? Or Russia?

You said, look for example, at Israel...

Well, THEY don't buy from Russia. Israel is an example of a country that flogs things that they wont use themselves!

[ShotOne]

Again, let's not get strung up on Russia. We DO buy from Israel (watchkeeper). I'm interested why you feel this is politically impossible Avan; there have been big political upheavals in recent months.

[muppetofthenorth]

Because the political upheaval both here and in the US has been largely about reducing ties, not increasing them.

The people who'd be kicking up a fuss would be agitating towards doing it ourselves, not farming out the work to someone else.

[Fareastdriver]

Several buyers of Russian equipment have been very displeased with spares support.

The third world is littered with derelict Russian equipment. Even the Russian Far East Air Force suffers the same problem. Low TBOs and a lack of spares leads to continuous cannibalisation.

[FJ2ME]

Are you actually serious? We are told by people like RUSI that there will be future conflicts involving Russia and China, we are already fighting a pseudo-proxy war against/around them in the middle east and you want to be beholden to their spare parts chain and back up? Madness. Is it Apr 1?

[downsizer]

and a lack of spares leads to continuous cannibalisation.

Are we talking about the RAF now?:\

[ShotOne]

Hmm, we've really got hung up on Russia. Its a big world; is shopping outside our usual confine really an April 1 scenario?

[PDR1]

We have already seen people looking to prosecute (and more to the point sue) the MoD where its procurement of UK equipment came with less than optimum safety case documentation. What sort of safety case do you think we'd get with an Israeli or Chinese aeroplane? Do you think there would be a fully 00-970 and 05-123-compliant set of performance analyses to support a rigorous RTS?

I know some parts of america have legalised smoking that stuff, but we should try to practice abstinence when considering serious issues...

:E

PDR

[ShotOne]

But we ARE buying (remotely piloted) aircraft from the Israelis already. Are you saying only Euro or US types are capable of certification? How is Tucano certified then?

[Heathrow Harry]

That new Brazilian freighter looks very interesting..................

[FJ2ME]

Stop bringing up Tucano now please, it's a relatively small non-complex training aircraft, built under licence by a UK firm, and was procured well before the regulatory environment we now find ourselves in existed. If you don't like the Russia focus, which producer did you have in mind for these purchases? Israel, China, Brazil, Switzerland? That's about it isn't it if we're considering 'traditional' suppliers from Uncle Sam (incidentally some of his are hardly MAA compliant either..).

[glad rag]

See what happens when you disturb the status quo...

[red admiral]

But we ARE buying (remotely piloted) aircraft from the Israelis already. Are you saying only Euro or US types are capable of certification? How is Tucano certified then?

We're not actually.

Hermes was operated under a service agreement that was theatre specific. Not a good lobg term solution.

Watchkeeper is a different airframe and system; there isn't much Israeli content actually left in it - this is one of the reasons its so expensive. Buying from the Israelis direct wouldn't meet airworthiness standards.

This isn't just an Israeli problem. It also exists with US equipment as they have both different standards and don't release evidence. Look at Airseeker - no airworthiness case at all as the US wouldn't release evidence, hence SoS carries ownership of the risk. This sign off is the only reason we're flying now.

The MoD response to Haddon-Cave has not been good.

[A_Van]

To be serious, I wonder why Gripen from Sweden is not considered?
It is not as perfect as Typhoon, but costs about a half only. And could be a good "lighter" complement to Typhoon. Instead, a much more costly F-35 had been chosen...

[Heathrow Harry]

"Hermes was operated under a service agreement that was theatre specific. Not a good lobg term solution"

you mean it was delivered when we needed it & it worked ............. heaven forbid we fall into THAT trap again.........................

[PDR1]

But we ARE buying (remotely piloted) aircraft from the Israelis already.

No, we are buying an aeroplane BASED on an Israeli design which has been reworked and documented by others (at rather extraordinary cost, but that's another story) to meet the certification needs for UK use.

Are you saying only Euro or US types are capable of certification? How is Tucano certified then?

Tucano is a simple aeroplane procured many decades ago when the regulatory touch was "lighter". A better example might be the Mk3 Chinook...

PDR

[ehwatezedoing]

Just built your own stuff like you used too...

And like the French still do :p

[Royalistflyer]

BAE should be quite capable of designing and producing any aircraft we need. If the MoD found a few competent people to keep a very tight rein on BAE there is no reason for costs to get out of hand as they have with F-35.

[glad rag]

Tantris is an example of modern from the round up design by BAe..however I doubt it is incompetence that had led to F35 price escalation...

[Royalistflyer]

Possibly not after all - way back in history: The final cost of the first 310 Spitfires, after delays and increased programme costs, came to £1,870,242 or £1,533 more per aircraft than originally estimated. Production aircraft cost about £9,500. The most expensive components were the hand-fabricated and finished fuselage at approximately £2,500, then the Rolls-Royce Merlin engine at £2,000, followed by the wings at £1,800 a pair, guns and undercarriage, both at £800 each, and the propeller at £350.
£1500 more per aircraft was a whole lot in 1938.
Taranis is a good example - it is in many ways a full sized aircraft - just lacking a human capable cockpit. So BAE are quite capable.

[Cpt_Pugwash]

Ok, I'll bite.
During the FLA competition which eventually was won by the A400M, a derivative of the An-70 was considered but the issues raised above (certification, spares support etc. ) ruled it out.

RoyalistFlyer said "If the MoD found a few competent people to keep a very tight rein on BAE there is no reason for costs to get out of hand as they have with F-35."

I was present ( as possibly was Tucumseh) in the mid-90s, when the then CDP, Sir Robert Walmsley stated in a Town Hall address at Shabbywood that there was no place in his Procurement Executive for technical experts. That's when the rot set in, and contractorisation for technical expertise took over, and in-house competence declined.

[Octane]

Design and build your own stuff! The UK has a proud history of producing very good aircraft and imagine the expertise/ industry/ job losses that would occur otherwise....

[Phil_R]

Not to be too literalist, but it occurs that we buy military hardware from where we do because the object is not to actually acquire appropriate military hardware at a competitive price, but to further various economic goals.

For instance, it seems to this uninitiated civilian that the aircraft carriers are an absolutely absurd and asinine decision, a worst-of-both-worlds disaster, one so completely irredeemable that only corruption or criminal stupidity could explain it. Similar things can be said about the F-35 purchase, the Type 45 destroyers, Nimrod MRA4, and others.

I am a civilian with only a passing interest, but this much is clear to me. Final decisions on these things are made by politicians who have not been selected for this sort of decision-making, who probably don't see themselves as particularly invested in the results, have significant vested interests as regards short-term popularity among select groups, and probably don't have a passing interest in military affairs.

So, in short, don't we get a terrible, awful deal which risks lives and wastes hundreds of billions... because we're not really trying to avoid those outcomes?

Instead, we're trying (for instance) to get Gordon Brown reelected.

[riff_raff]

I hope you all realize that a significant amount of US military equipment is produced by UK owned subsidiaries operating in the US. Rolls-Royce Indianapolis is one such example.

[Arclite01]

.............and of course if we build it ourselves the capital cost (and associated risk) has to be included in the price and borne initially by the manufacturer. In theory the CAPEX is recouped in the unit cost of production and in later batches once this is paid off the profit margin increases.

But in the UK we don't like spending money up front nowadays and therefore don't really do high volume manufacturing on these sort of things by ourselves any more. Hence the various consortiums to spread the cost and the risks around a bit............

Also UK only orders will not underpin this type of model. If you took the P8 for example we are capable of building this mission platform from scratch. Or modifying an Airbus platform to complete the role. But an order of 8 or 12 airframes and development of various systems and modifications means it's just not going to be viable. So we pay a fair chunk more and buy an off-the-shelf option............reduce the risk and accept that the supplier is recovering his CAPEX from us (or taking the profit associated with a mature product)

Our Victorian forefathers who ran the industrial revolution would laugh at our incompetence with regard to production runs and CAPEX versus risk profile analysis. And lucky for us they never thought this way or we'd have no railways, sewers, roads, canals or anything else for that matter...........

A-VAN - I too have often wondered why the RAF has never brought Gripen - even if it was just for use in the UKADR/QRA scenario where we are really interested in numbers more than just technology to achieve the intercept..........

Arc

[PDR1]

Our Victorian forefathers who ran the industrial revolution would laugh at our incompetence with regard to production runs and CAPEX versus risk profile analysis. And lucky for us they never thought this way or we'd have no railways, sewers, roads, canals or anything else for that matter...........


Our victorian forefathers mostly went bust. Most of the original railways suffered the "sunk envstment syndrome" in which a large number of investors sunk money into the project to build a railway. The company then went bust, and someoine else bought it for under 1p in the £1 (or more probably 1/4d in the £1 in those days). The original invetsors lost their shirts, and the subsequent owners & users benefitted from the free development.

In the UK we don't build military equipment as "speculative developments" because the specific requirements of each user as so different. So the business model used is one of being contracted to design and develop tro a user requirement. That's why the government funds the development programme and the manufacturing tooling. The balance to that is the permitted profit margins on the production and support phases are tiny compared to what would be deemed "normal" in other areas of commerce. The cutom,er also chooses whether the contractor tools up for large or small production volumes - there is no business case for the contractor to investy in larger volume tooling with a customer who almost never follows through with repeat orders while the production line is still open.

The downside is that the user feels free to both (a) continually change the requirement and then blame the contractor for the spiraling cost of change, and (b) at any time cancel the whole project on a whim (veruy common in the UK defence sector). Given that a project may be completely cancelled at any time, and that on cancellation only the costs of contracted expenditure can be demanded as a cancellation fee, there is absolutely no business case for a contractor to invest a single penny more than actually contracted.

The lack of a business case means that if the contractor's directors decided to spend company money on these things, and it results in a loss, they have failed to discharge their legal obligations in regard to the shareholder's money. The company's shareholders can therefore sue the directors personally to recover the loss, because they have acted contrary to their legal duty and so are not protected by the limited liability status.

It was stumbling blocks like these that made it necessary for the CV(F)/QEC contract to be a 15-year guarranteed ship-building contract rather than a specific contract to design and build two missile magnets. The up-front investments required could not be made due to the risks of cancellation - risks that showed to be all too real because the Camoron government tried very hard to cancel the QEC build in the 2010 SDSR, and would have succeeeded (leaving the cointractor cash-negative to the tune of a few hundred million) had it been contracted "conventionally"...

PDR

[Arclite01]

Hi PDR

Good points made.

Ultimately it comes back to the old 'risk versus reward' argument and I think that currently in UK there is less appetite for risk than in previous time periods.

WRT to the Victorians I agree with what you say, although technically the situation is the same for shareholders now as it was then and is linked directly to my point above.

Arc

[Phil_R]

And yet getting BAE to build everything continues to be seen as lower risk, despite endless, brain-numbingly expensive lessons to the exact contrary.

Again, I say: it's either deliberate malfeasance, or it's a level of stupidity so extreme that heads should be rolling.

[PDR1]

And yet getting BAE to build everything continues to be seen as lower risk, despite endless, brain-numbingly expensive lessons to the exact contrary.

WHich lessons would those be?

PDR

[tucumseh]

Good posts PDR1. I suppose the worst experience I had was 3 years of hoop jumping running a supposedly open competition for a programme; then being told by politicians to award it to a company who didn't even bid. Which just so happened to be in the Minister for Defence Procurement's constituency. Who were then bought by a company who had withdrawn from the original bid on the grounds the job was too difficult; and 6 months in asked to be released from the contract because they couldn't hit the first milestone. There isn't a single thing anyone in MoD can do about such machinations. Thank goodness for the likes of Boscombe, GEC-Marconi and Westland, who dug us out.

[Phil_R]

I was thinking of the things I mentioned above. The carriers, MRA4, Type 45, Astute class submarines, all beset by gigantic problems, years late, so overbudget that I barely know how how to describe it without resorting to Edvard Munch.

I could go off into a justification of why all of these projects seem to me to be an unmitigated disaster, but the destroyers are the topical example. They don't even work as oceangoing vehicles, let alone as warfighting machines. My understanding is that they are or soon will be effectively unarmed against any target other than (radar-observable) aircraft or stationary targets on land.

As far as I know once Harpoon goes out of service, the UK will have no ability to attack enemy shipping other than bombing it, which rather assumes a lack of anti-aircraft capability on the part of the enemy, or or torpedoing it. And there are only seven attack submarines in the navy.

I honestly don't want to come off as an unqualified whiner, but when this is the case, and the government attitude is constantly "no problem, BAE, have another couple of hundred million," questions have to be asked.

Edit - Posts like tucumseh's, above, go some way to reinforcing my point of view.

P

[sitigeltfel]

Just built your own stuff like you used too...

And like the French still do :p

Has anyone ever thought of stealing the plans for an advanced design from another country and copying it......

.....oh, wait!

[PDR1]

I was thinking of the things I mentioned above. The carriers, MRA4, Type 45, Astute class submarines, all beset by gigantic problems, years late, so overbudget that I barely know how how to describe it without resorting to Edvard Munch.


Indeed, but the causes of these do not lie uniquely, largely or (in one of these cases) even "at all" with BAES. The carriers (fregsample) were the subject of continuous and major requirements change up to and beyond the point where keels were laid and metal was cut. The repeated switches between STOVL, Cat/Trap and STOBAR opt6ions are things whose implications are not minor, and these were not BAES decisions.


...but the destroyers are the topical example. They don't even work as oceangoing vehicles, let alone as warfighting machines.


AIUI the specifications and the final choices of the propulsion systems for these ships were owned by the MOD, and those choices were made (again AIUI) against the technical advice of BAES.


My understanding is that they are or soon will be effectively unarmed against any target other than (radar-observable) aircraft or stationary targets on land.


The choice of, and funding of, air defence weapons on these ships is an MOD decision - BAES has no control over them.


As far as I know once Harpoon goes out of service, the UK will have no ability to attack enemy shipping other than bombing it, which rather assumes a lack of anti-aircraft capability on the part of the enemy, or or torpedoing it.


Failure to address this obsolescence issue is an MOD (not BAES) responsibility.


And there are only seven attack submarines in the navy.


Indeed, and whose decisions led to that? Orders were not placed in a timescale that permitted it to be otherwise.


I honestly don't want to come off as an unqualified whiner, but when this is the case, and the government attitude is constantly "no problem, BAE, have another couple of hundred million," questions have to be asked.


I honestly cannot remember any time when that attitude was displayed. BAES accepted its share of the responsibility for the MRA4 and Astute over-runs, and took an £800m hit for it. The MOD also accepted their share responsibility for both of these and they also took an £800m hit.

Have Boeing yet paid up for the Chinnook FADEC issue? Have the Chinnook IPT staff paid for their incompetence in taking in the DA and TA roles and then procuring a helicopter which could not be certified for use in the UK? Have LM paid any compensation for slips in the F35 programme?

I'm not sure there is much actual evidence to support your position!

PDR

[tucumseh]

Have Boeing yet paid up for the Chinnook FADEC issue? Have the Chinnook IPT staff paid for their incompetence in taking in the DA and TA roles and then procuring a helicopter which could not be certified for use in the UK?

To be fair to Boeing, they had nothing to do with the FADEC issue, having been frozen out by MoD's procurement strategy. However, one could legitimately ask how the Mk2 had a valid safety case when FADEC had no certificate of design; but again, Boeing would simply point out MoD didn't provide it. And, that MoD's own system worked, in that both Boscombe and DHP stated the aircraft was not permitted to fly. This was mandated upon ACAS.

To be fair to the Chinook IPT, it was formed in 1999 and the decisions regarding the Mk3 were made at least 3 years earlier. The individuals concerned did not transfer to the IPT in 99. Someone in DHP was indeed the TA, and this is proper; but one should ask if he was suitably qualified and experienced (or even knew what a TA is). DHP did not declare themselves DA, but did make decisions that normally rest with the DA. The key question is - did anyone in DHP see the Director of Flight Safety's 1992 report which called into question Boeing's ability to act as a DA? Their boss, the Chief of Defence Procurement has stated he didn't see the report, as it was concealed by the Chief Engineer, ACAS and CAS.

If one wanted to point a finger at Boeing, the ZA721 accident in the Falklands in 1987 is the obvious case.

[PDR1]

Good points, and I'm not really looking to point a finger at anyone. I'm just countering the apparent belief that BAES is responsible for every disaster since the Romans invaded. Unfortunately the facts don't really align with Phil_R's rant.

PDR

[Phil_R]

My intention is not particularly to point the finger at BAE. In order for these things to happen, someone had to order it, design it, and build it, and someone had to pay for it.

My understanding of the relative level of involvement of politicians, the military, and contractors in the decision-making process is hazy, and presumably somewhat variable on a case by case basis anyway. What irks me is that an absolutely staggering series of cock-ups has been perpetrated, on a scale so vast that it defies easy description - and it's happened so much that it's now pretty much accepted as normal procedure.

I couldn't possibly care less about the intercine squabbling of the organisations involved. Hideous, unforgivable incompetence has been committed, again and again, and those responsible should be punished -and more to the point replaced, to minimise the likelihood of any further billion quid dropped bricks. I don't care who they work for.

[Royalistflyer]

“Operational sovereignty depends on indigenous industrial capacity,” said Iain McNicoll, former chairman of the RAS’s Air Power Group and a former Air Marshall in the RAF.
“The defence aerospace sector should be treated the same as nuclear, shipbuilding and complex weapons are – ie it is vital to sustain UK industry in this sector. Without a high-end design-and-build capacity in aerospace, we would lose a critical national capability.”
He accepts the UK is “unlikely” to build another manned combat aircraft alone and that “any high-end project requires European collaboration”. However, he warns that a reliance on being part of US-led programmes could hit the UK’s sovereignty because of America’s ITAR scheme, which controls sharing technology.
McNicoll believes one of the best hopes for Britain retaining high-end aerospace skills and technology is the £1.5bn that the UK and France have committed to developing a prototype Future Combat Air System (FCAS) – an unmanned warplane that could be the basis of future European air forces.

[PDR1]

What is often portrayed as an "overspend" (so the Daily Wail fraternity can have their daily dose of hurrumph) is in most cases either one or more of:

1. The increased cost associated with changes in the requirement which are themselves simply the result of the facts that (a) we do not live in a static world, and (b) even the most dedicated servicemen and women do not have calibrated crystal balls. These costs are identified, challenged and justified in a pretty rigorous manner as a matter of course.

2. The detail that the original cost has been taken by the press (and cynical people with axes to grind) to be "firm fixed prices" when they are usually either ROM prices or the raw cost before Risk. As a project progresses some of the risks occur and so the *spend* rises above the baseline *cost*, but only in so far as the original risk cost was not included in the press report. This is all understood by the people who matter - the contractors, the MOD (uniformed and civilian) and the Treasury, but is frequently wilfully misrepresented to the public by people with axes to grind.

3. The consequence of naive contracting - there have been cases where to reduce the "headline price" the MOD has elected to take ownership of all risks and only contract for the minimum baseline cost. This approach is actually allowed by the guidelines, but only where the contract has an initial "Risk Reduction" Phase before the full funding is committed. There have been times where this approach was taken but the MOD refused to have a Risk Reduction phase - MRA4 was a classical example. In this case the "cost overrun" would actually be more accurately described as "the true cost of what they were trying to achieve becoming apparent after contract award". If the contract has not been sold the risk content then the costs of those risks occuring vest firmly with the MOD - that's kinda the way it works.

4. Someone somewhere screws up. It happens, but in my experience it's comparatively rare. Even in these cases it's usually someone trying to do something for what they perceive to be the best of reasons, but not appreciating the magniotude of the task or its ramifications. The glass-cockpit Chinook and one service-engineered weapon system upgrade on the Jag would be examples of this. BAES screwed up to some extent on the MRA4 and Astute programmes, which is why they took those £800m losses on those projects.

But I would contend, based on experience from the inside, that in >>95% of the times where Something Goes Wrong in the UK it is the result of people trying to do the right thing but failing rather than neglect, incompetence, fraud or shady dealing. And even in those cases it is very often the case that the "Error" is only "obvious" with 20/20 hindsight - a detail which is invariably glossed over by the hecklers who criticise the work of others but have never actually delivered anything themselves.

€6.66 supplied, YMMV,

PDR

[tucumseh]

I agree it is annoying when people talk of overspends. In my experience the two most common issues are:




Failure on the part of the Service to quantify the requirement. To cost, one must first quantify. On one of my last projects before retiring, the Service (Army) actually articulated the technical requirement very well. They’d costed the unit cost accurately, at £xM. I was given £xM. But the “requirement” spoke of multiple users so I asked “How many do you want?”. “20”. One of the programme elements was a 9 month development task, yet the required ISD was 3 weeks after approval. By the time I added in little things like systems integration, training, spares, demonstrating it actually worked, vehicles to hump it around, buildings, etc. the actual endorsed funding was about 2% of the fair and reasonable cost. Yet it got through every level of so-called scrutiny (and given the requirement, CDS would have been tea boy at the approval meeting, which is why we were kept out of it until after approval); but of course we were to blame.
Resourcing projects or programmes to cost, not content. The RN once had an aircraft programme that was just under the Cat A limit of £400M. Had it succeeded in getting one more aircraft upgraded, it would have been over £400M and the job would have been afforded a honking great team. As it was under, it was allocated as a minor task. The extra aircraft would have made no difference to workload, the only difference being an extra cab fed in to Fleetlands for conversion, long after the procurer’s job was finished. This failure to differentiate between volume and non-volume related tasks is common.


I agree with most of what is said, but a couple of the examples chosen are poor. The reasons why Nimrod failed, and Chinook Mk3 was delayed for 10 years, were well known, and advised to senior staff – Nimrod in 1995, Chinook a year or so later after the job was split Mk2/Mk3. 20/20 hindsight doesn’t apply when MoD’s own auditors, and the RAF’s Director of Flight Safety, have flagged the precise problems years before the programmes were approved. And then the latter again, in 1997/8. And one must always bear in mind the role of the Chief Scientific Advisor, who advises the Chief of Defence Procurement on technical risk. Any inquiry should start with what this advice said and, if different to the advice from MoD(PE) and RAF engineers, why did CDP heed CSA?



I’ve never known anyone in procurement set out to screw up. But I’ve known plenty who were told they were about to screw up, but hubris made them carry on. I’d say Nimrod and Chinook are classic examples, and the people who had to deal with the fallout have been castigated ever since, when one should be looking a little farther back in time at those charged with management oversight and scrutiny.

[Phil_R]

Changes in the requirement: well, yes. They should stop doing that, it's really expensive if you start messing a contractor around after they've started work on something. This applies to everything from combat aircraft to wallpaper. The argument I would have with this is that trying to predict what's going to happen in the future has been shown (by the problems we're discussing) to be effectively impossible. So, don't try: instead, build something reasonably general-purpose. I saw an interview with someone involved with Tornado operations recently in which it was pointed out that the thing has never actually done what it was intended do - interdict the Warsaw Pact - but had been successful nevertheless. To some extent, yes, if all you have is a hammer everything looks like a nail, but at least make it a flexible hammer and don't keep messing the spec about.

Cost before risk: sorry, this is just balls. Heads the contractor wins, tails the taxpayer loses? That's exactly the sort of madness I'm talking about. I know BAE is effectively a monopoly, but that's what this thread is about. It's their problem to characterise the risks and contract accordingly. Deals where they make all the money but the taxpayer shoulders the risks are insane (and typical of PFI, and PFI-style contacts in general.)

But as I say, the argument is not only with the contractor. The argument is with the decision to omit catapults and arrestor gear from the carriers, making the air wing more expensive but much less effective. The argument is with ignoring engineering advice on Type 45. These are not normal contractual issues, if any of these are (they're not.) These are stupid decisions made by idiots and it is not okay.

[Lonewolf_50]

To some extent, yes, if all you have is a hammer everything looks like a nail, but at least make it a flexible hammer and don't keep messing the spec about. Flexible hammers are more expensive than regular hammers. The flexibility feature of the hammer is indeed a spec or increased requirement, or a later mod -- either of which costs more money than a regular hammer. ;)


For the extreme case of a requirement for a flexible hammer, I offer you the F-35. :}

[PDR1]

...and flexibility or "general purposeness" in mission capability isn't the only cost driver. It has to fit within the operations and support infrastructure which has both physical and organisational constraints. And these constraints keep changing.

And the more you use off the shelf products (or parts of products,or technologies) the more you have to compromise your organisation and infrastructure and the more yyou become exposed to risks of obsolescence.

Cost before risk: sorry, this is just balls. Heads the contractor wins, tails the taxpayer loses? That's exactly the sort of madness I'm talking about.

I'm genuinely mystified as to what you're trying to say here - could you expand on that?

Deals where they make all the money but the taxpayer shoulders the risks are insane

Well they would be if they existed - I've never seen one. The core problem is that defence contracting caps profit at a level that barely provides a meaningful return on the cashflow, let alone the investment. Any excess profit must be handed back (it's a thing called "QMAC"). But while the MOD cap profits they generously allow losses to be of any size. This asymmetry means that the normal business process (where in a well run business the losses on one project will be balanced by the profits on another) cannot happen.

But Risk management and risk pricing is a normal approach to business in any contract bigger than the procurement of a big mac with fries. These are the aspects that keep planning in the real world and costs to a minimum, so I'd be very interested to see your clarification here.

PDR

PS - there is no field in which BAES is a monopoly, even in the UK.

[tucumseh]

Any excess profit must be handed back (it's a thing called "QMAC"). But while the MOD cap profits they generously allow losses to be of any size.


Well said. I recall, in 1999, we were gathered together and told that CDP's favourite contractor was anticipating a loss that year, so stop applying pressure to meet contractual commitments, let them deliver crap (or nothing at all), sign the invoices (i.e. commit fraud) and money would be made available to contract someone else to fix it (again, fraud).

[Cpt_Pugwash]

PDR1.
The QMAC ( Questionaire on the Method of Allocation of Costs) is only part of the issue. It would be great if every contract had a properly processed one, or even one at all in some cases.
I'm retired now, so shouldn't really give a stuff.

[Phil_R]

As to flexibility, I'm not proposing that designs should attempt to be a solution to all problems simulateously. Instead, I'm proposing that over-specialisation should be avoided because it provokes frequent, late specification changes that cost time and money and probably don't yield results which stay finely-tuned for long.

And the more you use off the shelf products (or parts of products,or technologies) the more you have to compromise your organisation and infrastructure and the more yyou become exposed to risks of obsolescence.

Fine. That's a much less serious risk than the current situation, which provides warships that aren't ships and can barely make war.

But Risk management and risk pricing is a normal approach to business in any contract bigger than the procurement of a big mac with fries.

I think that might be a bit of a generalisation, but that's not the problem. The problem is that, again, this is being used as an excuse to practically guarantee a terrible deal for the UK.

Ultimately the argument PDR seems to be advancing is that it's normal and acceptable for more or less everything to be many times overbudget, years or decades late and borderline nonfunctional, because... er... excuses.

This is, literally, incredible. It is not credible that any organisation (by which I mean the UK military-industrial complex as a whole) could foul anything up this badly, this obviously, this publicly, for so long, so many times, and have it not be an issue of either incompetence or malfeasance.

P

[tucumseh]

Phil

Does MoD follow its own rules for making material and financial provision, and ensuring it matches the stated requirement?

Are the procedures for scrutiny adhered to and enforced?

Does MoD learn from the many projects that are delivered with effortless competence?


No! A possible solution emerges.

[Cpt_Pugwash]

To pick up from Tucs post above, just one of the procurement rules is that all projects should have a Post Project Evaluation (PPE) conducted, and that resource provision should be made at the start of the project for the collection of the appropriate data to enable this.
In fact this is seldom done, unless a lot has changed in the last four years.

[Pontius Navigator]

The argument I would have with this is that trying to predict what's going to happen in the future has been shown (by the problems we're discussing) to be effectively impossible

I was at a meeting concerning EFA in 1988. The subject under consideration was the moving map display. Should it be north orientated or track orientated? If the latter would it be necessary to realign the text to track orientation? The display would be limited to 16 colours.

Move on a couple of decades and for virtually pocket money you could buy a pocket GPS, plenty of colour, track up an option and text automatically oriented.

Do you freeze with obsolescent technology or hand in there and try and keep it at the bleeding edge?

[Phil_R]

There's a number of answers to that, but I think that the best one is: that's hardly a problem unique to aeroplanes.

[tucumseh]

just one of the procurement rules is that all projects should have a Post Project Evaluation (PPE) conducted

Precisely. It is (allegedly) the way MoD learns from experience. The rule also says you prepare the PPE around 2 years after ISD, by which time anyone who knows anything about the project is long gone. Not once did I get any feedback about a PPE.

Pontius. As Phil says, there are many answers, one of which is the Defence Scientific Advisory Council, whose reports direct to Secy of State are usually secret; except when quietly handed to favoured contractors to "help" them with bids. People look at it different ways. At least your example is only obsolescent, not obsolete. The latter is common, so be thankful for the former!

[Cpt_Pugwash]

"Precisely. It is (allegedly) the way MoD learns from experience. The rule also says you prepare the PPE around 2 years after ISD, by which time anyone who knows anything about the project is long gone. Not once did I get any feedback about a PPE."

The point I was trying to make is that PMs know that a PPE is required, and the good ones make provision for it right at the outset, allocating resources for data collection,storage and evaluation, as the project progresses, so that all the information needed to compile the report is available, even when personnel have changed. Sadly, good PMs are few and far between, since the training and development which used to take place no longer happens and procurement posts are seen as stepping stones to higher things.

One other thing, I have seen some good PPEs and a lot of useless ones, clearly cobbled together at the last minute by people who didn't know the project. One of the good ones was drawn to the attention of a particular PM, a graduate, new in post and keen to make his mark. He discounted the previous projects PPE as not relevant, so just a touch of Schadenfreude when his project didn't make the first hurdle, for a reason outlined in that earlier PPE.

[tucumseh]

Cpt P

Agreed. Project History Sheets / Diary.

particular PM, a graduate

A contradiction in terms!

keen to make his mark

I recall one making his mark. Grade skipped after one short posting, he sent an e-mail to everyone in the Directorate General telling them to pay attention, he was about to hand down his vast experience gained on his successful Chinook HC Mk3 programme. That set a new benchmark for how many millions wasted was regarded as a success. Later surpassed by Nimrod (same DG).

[Out Of Trim]

Perhaps we could buy some Sukhoi PAK 50s - looks pretty nice so far!

[msbbarratt]

I've always considered that most procurement problems arise from the high rate of staff churn, post swapping and departures. The chances of a team coming together, staying intact for a whole project's lifetime and then going on to do the next one together is zero. The chances of there being anyone in the team who was there at the beginning of a project is pretty low too. I reckoned that the average in-post time was less then 2 years. Maybe it's a bit better in the supplier base, but in the PE it was pretty bad, not helped by the military's pathological hatred of leaving anyone in post for more than 3 years and the civil service's outdated views on staff skills, post mobility ("any grade 7 is qualified to do any grade 7 job anywhere in government"), etc. Too easy to transfer out of a doomed project.

In an environment like that a lot of mistakes are going to be made, and no one is going to be left there to learn from them. Consequently it's like everything that gets done is being done by people who are almost by definition amateurs in any one particular domain of military capability.

I remember one guy bemoaning the number of different types generators they had. Right answer would be been 1. The actual answer wasn't 1, not even close.

It's not helped by the slow pace of procurement and politics making a mess of things. Guess what - build a lot of stuff quickly and keep doing it and there's a good chance it'll get better.

[Heathrow Harry]

Same in a lot of industries these days msb

When a CEO is in place for an average of less than 5 years it's all short -term decisions

[KenV]

Perhaps we could buy some Sukhoi PAK 50s - looks pretty nice so far!That would be a nice trick seeing as not even the Russians can buy them. So far only prototypes have been built. They're not even in low rate initial production yet.