UK acquisition reform is showing signs of improving the Ministry of Defence's (MoD's) management of key procurement projects, but delays are still rising.
In its Major Projects Report 2000 (MPR2000), the National Audit Office says that forecast costs for the MoD's 20 biggest projects are £78 million ($111 million) or 0.2% lower than last year. Overall spending is still estimated at 5.7%, or £2.4 billion, up on when the projects received investment approval.
NAO warns, however, that £62 million of the saving is dependent on successful contract negotiations on the Eurofighter programme.
Average delays to the in-service date (ISD)of new equipment continue to slip - the average is now 28 months, three months longer than a year ago.
Some ISD delays, in particular the Alenia Marconi Systems Brimstone anti-armour weapon, the Matra BAe Dynamics ASRAAM short range air-to-air missile and the MBD Conventionally Armed Stand-Off Missile, come as a result of the MoD re-scheduling deliveries to match aircraft (Panavia Tornado GR4) availability.
MPR2000 is the first report to reflect changes as part of the UK's smart procurement programme. In the 10 programmes assessed prior to main investment approval, eight show an average cost variation of 13%. Two, the cancelled Bowman digital communications system and the microwave landing system, are showing such large variations they would make the averages meaningless if included.
Source: Flight International