The Times December 04, 2002
MoD cost-cutting is selling Forces short
By Michael Evans, Defence Editor
THE Armed Forces are having to put up with ageing equipment because the new systems that they have been promised are years behind schedule, the National Audit Office said yesterday. In some areas, the Ministry of Defence had also decided to cut back on battlefield capabilities to save money, the audit office’s report on the MoD’s main projects said.
Although the audit office said that the MoD’s “smart acquisition” policy had introduced better controls, reducing the overall cost of its 20 biggest projects for the third successive year, 14 of them still suffered from either delays or price increases.
In one case, in order to save £319 million, the MoD had ordered only nine defensive systems to be fitted to the European A400M transport aircraft, although 25 have been ordered at a cost of £2.3 billion. The systems help to protect the aircraft from attack.
The in-service date for the new aircraft, which is to replace the Hercules, had also been deferred for a year “on affordability grounds” and would now not be available until 2010. The MoD has been forced to lease four American C17 Globemasters to fill the gap. Now, with the extra year’s delay in the A400M, being developed by Britain and seven other European partners, the audit office said that the MoD was to extend the lease for the C17s by another year.
The Hercules C130K, one of the oldest aircraft in the RAF, was also having its life extended by an extra year.
The MoD said that although only nine defensive systems had been ordered for the 25 A400Ms, not all the aircraft would be expected to operate in a hostile environment. More systems could be ordered if necessary.
The audit office said, however, that it was a case of the ministry deciding to “trade off capability for cost”.
Another aircraft project, the Nimrod MRA4 maritime reconnaissance and attack aircraft, costing more than £2.8billion, was 31 months behind schedule, the report said. The in-service date was now forecast to be November 2005.
The audit office report said the delay meant that the current Nimrod, which first came into service 33 years ago, would have to carry on flying until mid-2008.......
NAO Full Report (pdf) NAO Executive Summary
I note with interst that the cost of the additional year's C-17 lease (+£86 million) is achieved by the "savings" accrued by the A-400M slip (-£87 million) (page 39).
If you look at page 38 this is all smoke and mirror stuff, £81 million is saved by not only the slip but also as they "delete and defer Configuration Items", The remaining £6 million is found by adjusting inflation figures. However down under "contracting process" you'll see they slip in +£160 million due to "improved costing data for Configuration Items available".
All in all, however, by deleting the DAS and other machinations they've stripped £472 million out of the planned budget for the programme.
Note, on page 50, that they've deleted the AAR capability for the ASTOR to save £12 million.
Note, on page 87, the Typhoon is still shown as having the gun deleted and also loses the 1500L underwing tank and the CRV7 rocket. On the good side it gains LLLGB and TIALD. Current unit production cost is £56.9 million.
JSF, page 100, has lost the external carriage of Brimstone and ASRAAM.
Very interesting is that, on page 141, not only has the SHAR been deleted from the list of platforms to receive Successor IFF, but also the GR7.