Select Committee on Defence Written Evidence


Common New Generation Frigate, CNGF—Horizon and its Principal Anti-Air Missile System, PAAMS

  The Common New Generation Frigate, a collaborative programme with France and Italy, was planned to replace the UK's Type 42 destroyers in the early part of the next century. While the contract for the development and initial production of the Principal Anti-Air Missile System has been initialled by industry, the "Horizon" project, the frigate and its other systems, has not progressed satisfactorily. The three nations agreed on 25 April that they would proceed quickly to signature of a contract for the missile system, but that it would not be cost-effective to pursue a single prime contract for the ship. The UK will now take forward its ship programme through a national prime contract, building on the tri-national project work already carried out and pursuing opportunities for co-operative procurement in equipping the ships.

OPERATIONAL REQUIREMENT

  1.  CNGF has comprised two distinct collaborative programmes: the Principal Anti Air Missile System, PAAMS, and the ship with its other systems, Horizon, both derived from the single Tri-Partite Staff Requirement for CNGF. The requirement was approved by the three participating nations, the UK, France and Italy, in December 1992. The UK requirement was, and continues to be, for a ship to provide effective area air defence against aircraft and missiles, to replace the Type 42 destroyers. At the start of Project Definition for Horizon in 1995, the intention was that PAAMS would provide an anti-air warfare capability sufficient to meet the most stressing threat foreseen. It was subsequently agreed that the initial capability sought should be sufficient to meet the most stressing threat forecast at the in-service date for CNGF, but that a growth path to provide the capability necessary to address future predicted threats would also be identified as part of this work.

TRADE-OFFS

  2.  The principal cost/capability trade-off in the PAAMS programme has been the acceptance of a capability sufficient to meet the threat at ISD, rather than beyond. Studies into cost/capability and programme/capability trade-offs for Project Horizon to achieve an affordable CNGF are under way as part of Phase 1 of its programme which is scheduled to be completed by 31 October. This work will be carried forward into the UK's national programme.

NUMBERS

  3.  The UK planning assumption is for the acquisition of 12 CNGF. This number would be tested by operational analysis to support the main Gate submission for Full Scale Engineering Development and Initial Production, FSED&IP, for the warship.

  The Horizon Memorandum of Understanding assumed French and Italian procurement of four and six ships respectively.

STRATEGIC DEFENCE REVIEW

  4.  The requirement to replace the Type 42 destroyers was scrutinised in the Strategic Defence Review. No changes were made to the operational case underpinning Project Horizon which will now be addressed by a national warship contract.

MILITARY CAPABILITY

  5.  The replacement for the Type 42 destroyers equipped with PAAMS would provide area defence against aircraft and missiles, including local area defence against modern anti-ship missiles, to protect lightly armed or unarmed ships. In this role, the warships would support maritime assets across the range, from Ro Ro vessels through amphibious assault ships to aircraft carriers, in both UK national and allied/coalition operations. In addition, the Type 42 replacement—would be a multi-role, general purpose platform capable of operations across the spectrum of tasks, from peace support to high intensity warfare.

EQUIPMENT REPLACED AND IN -SERVICE DATE

  6.  The warship and PAAMS are planned to replace the Type 42 destroyer and its GWS30 Sea Dart weapon system. The Type 42s are scheduled to leave service at approximately 6 monthly intervals, starting in late 2006, with the exception of HMS Birmingham, which leaves service in 1999.

  7.  The ISD for CNGF was defined as the completion of Part IV Trials, which indicate the ship is fit to enter service. The original estimated ISD was December 2002. This slipped, largely owing to the need to synchronise the warship and combat system programmes, and the internationally agreed ISD for CNGF was amended to June 2004. The latest offer from industry pointed to a UK first of class being further delayed until 2007. We are confident that a national programme can be delivered within a similar timescale.

PROCUREMENT APPROACH

  8.  PAAMS is to be procured from an international joint venture company, EUROPAAMS, acting as the prime contractor. This was also the intention for Horizon through the Horizon International Joint Venture Company, HIJVC. Details of membership are at Annex, along with membership of competing consortia for certain key equipments. Prime contractor members were nominated by their governments, with the exception of the GEC-led consortium forming the UK element in the HIJVC, which was selected by competition. UKAMS, the UK member of EUROPAAMS, began as a jointly owned subsidiary of Siemens Plessey, GEC and BAe SEMA, who were selected on their industrial capabilities to provide the equipment required. Following subsequent restructuring, UKAMS is now a wholly owned subsidiary of Matra BAe Dynamics.

  9.  The full development and initial production for PAAMS is to be let by single tender under French law. The MoU requires, however, that the prime contractor holds competitions for as many of the sub-contracts as possible. Partners have agreed on common procurement of several sub-systems, including the PAAMS launcher and long-range radar, but have decided to procure different multi-function radars. France and Italy are procuring the Empar radar, already developed for the Franco-Italian Famille de Systemes Sol-Air Futur, FSAF, family of ground-to-air missiles, from which PAAMS will be developed. The UK is procuring the more advanced Sampson radar.

  10.   The UK national warship will be procured from a single prime contractor empowered to manage the overall programme—including integration with PAAMS. Wherever possible the results of the Horizon Phase 1 work—including equipments selected through competition—will be incorporated into this overall contractual arrangement.

ALTERNATIVE PROCUREMENT OPTIONS

  11.  Before the 1996 MoU was signed, the UK considered a number of procurement options, including life extension of Type 42s and acquisition of off-the-shelf alternatives. Whereas PAAMS appears still to offer the best available balance of cost and operational effectiveness. Horizon has not demonstrated its viability, see paragraph 16. Since satisfactory progress has not been made, the UK is to proceed with a national solution. Phase 1 of the Horizon programme (Project Definition and Initial Design) will, however, be completed as planned later this year so that its deliverables are available to benefit the design and build of a national warship.

COLLABORATION

  12.  The CNGF MoUs were signed in July 1994 for the Horizon programme and in March 1996 for the PAAMS programme, plus supplements to both programmes detailing work in the forthcoming phases. The two programmes have been managed by separate tri-national government project teams—the Horizon Joint Project Office in London and the PAAMS Programme Office in Paris—reporting to tri-national steering committees. A PAAMS/Horizon Charter set out arrangements for co-ordination between the two programmes.

  13.  At 1 April the Horizon Joint Project Office, including its tri-national satellite offices in Rome and Toulon, had a total of 86 staff—37 UK, 26 French and 23 Italian Supplement 1 to the Horizon MoU set its budget at £118 million for phase 1, Design Definition and selection of sub-contractors, split equally between the participants. The budget for phase 2, Full Development and Initial Production, for which a further MoU supplement would have been required, had not been set. The tri-national Joint Project Office will monitor the completion of Phase 1 until it disbands. Until then the Head of the Joint Project Office reports to a 2-star tri-national Steering Committee which receives advice on the user requirement from a 2-star tri-national Naval Committee, and on technology issues from the "Co-operative Technical Assistance by Governments" team.

  14.  The PAAMS Project Office has a staff of 21—eight UK, four Italian and nine French. The UK share of the costs of FSED&IP will be higher than those of France and Italy because of the costs of developing the Sampson radar, used only in the UK variant, and because the UK will make a contribution to the cost of Franco-Italian technology for PAAMS.

  15.  The aim has been to delegate as much programme management work as possible to the Joint Project Office and PAAMS Project Office. A directorate within the MOD Defence Procurement Agency has been co-ordinating UK policy and funding for both PAAMS and Horizon. It has an annual running costs budget of £4.3 million, including the salaries and expenses of UK staff working in the Joint Project Office and the PAAMS Project Office.

  16.  The PAAMS contract, to be placed on behalf of the three nations by France under French contracting laws, has been initialled by industry. However, the Horizon International Joint Venture Company was unable to put forward proposals for an affordable ship that would deliver the capability and in-service dates required. It did not demonstrate that it had established itself as a strong prime contractor with a robust supporting industrial structure that could manage the development and build of the warship and its main systems. The UK will now pursue a national prime contract and seek the maximum benefit from collaboration over equipment for the ships.

EXPORT POTENTIAL

  17.  Export potential is necessarily constrained by the system's high technological specification and cost. The Sampson multi-function radar, and its single faced variant, have export potential worth perhaps several billion pounds over the next 15 years. PAAMS should have export potential for the entire system or elements of it. There could be prospects in refit programmes as well as in new build hulls.

INDUSTRIAL FACTORS

  18.  For Horizon, the GEC-led consortium, including BAe and Vosper Thorneycroft, was selected by competition against a VSEL-led consortium. The French and Italian members of the International Joint Venture Company are both state-owned monopoly warship contractors. For PAAMS, the Matra Bae Dynamics UKAMS consortium was formed out of the companies possessing the technologies crucial to the programme—notably the existing FSAF contractors and the Sampson supplier Siemens Plessey Systems, now BAe Defence Systems Ltd. The International Joint Venture Company would have been responsible for selecting the suppliers of equipments for Horizon, and for doing so strictly on the basis of value for money and UK Government contracting standards. This will now be the responsibility of the national prime contractor. Tri-national consortia, listed at Annex were competing for each of the Combat Management System, Fully Integrated Communications System and Electronic Warfare System.

  19.  The Horizon MoU states that the primary consideration is value for money and thus, as a general principle, no formal work share is defined. Work share would, however, broadly equate to cost share throughout the duration of the programme, with the aim of achieving an overall balance, with consideration also being given to the quality of work shared by the industries of the three nations.

  20.  PAAMS work share is constrained by existing FSAF arrangements, but the aim is to achieve equitable work share throughout the life of the programme as far as possible, subject to considerations of cost-effectiveness and competition.

SMART PROCUREMENT

  21.  Work on the warship programme will now be taken forward by a MoD integrated project teamworking closely with industry in accordance with Smart Procurement principles for the effective management of affordability, timescale and risk. The work completed on Horizon to date will be incorporated where possible in the national programme.

ACQUISITION PHASES

  22.  PAAMS completed Project Definition in 1993 and is ready to enter Full Systems Engineering Development and Initial Production. Supporting R&D activities centre on the FSAF programme and the UK multi function electronically scanned radar programme, which is contributing to Sampson development. Risk reduction work has been carried out, including modelling by the Defence Evaluation and Research Agency to demonstrate the achievability of the PAAMS performance objectives.

  23.  Under Phase 1 of the Horizon programme, competitive Project Definition contracts for the Full Development items within the combat system were placed and combat system and platform equipment selection was being processed. Now that the decision has been taken to proceed with a national programme for the warship, the intention is to make as much use as possible of this work done under Horizon Phase 1, due to be completed in October.

MILESTONES AND COSTS

  24.  Future milestones will depend on decisions still to be taken on the placing of contracts. Table 1 below shows the currently planned milestones and approved budget.

Table 1
OriginalCurrent
Approved expenditure£198 million £194 million
Start of PAAMS FSED/IPSeptember 1996 May 1999
Completion of Horizon Phase 1July 1998 October 1999


  25.  Delays in the PAAMS programme were largely related to the slow progress in agreeing a procurement strategy with partners, and then in negotiating a satisfactory contract; progress on Horizon was delayed by the need to maintain alignment with PAAMS and, more recently, by lack of progress by the International Joint Venture Company. Cost reductions have been achieved by management of the detailed requirement.

  26.  Table 2 below shows expenditure to date. Forward commitment amounts to £15 million in 1999-2000. For the PAAMS Full Systems Engineering Development & Initial Production and national warship contracts, the total cost is expected to be of the order of ***. The years of peak expenditure are expected to be 2005-06 to 2008-09.

Table 2
Spend to date
Pre 1996-971£101m
1996-97—Start of Horizon Phase 1 £8m
1997-98£12m
1998-99 forecast£19m


1 Includes aborted NFR90 programme costs, around £7 million.

  27.  Under the terms of the MOU, the UK carries liabilities in respect of additional expenses associated with winding up the Horizon Joint Project Office/International Joint Venture Company.

IN -SERVICE SUPPORT

  28.  A common support arrangement for spares and maintenance was proposed for CNGF. Under the national programme, opportunities for co-operative procurement will be pursued, including any opportunities for shared support.

  29.  Ship staff training and spares storage are potential bottlenecks. Increased use of experienced Type 42 crew would reduce the load on pre-joining training, and thus the training bottleneck, when the Type 42 replacement comes into service. Use of computer based training will reduce disruption to operational programmes. "Just In Time" stock management techniques will reduce the volume of spares to be held, thus minimising the need for new storage facilities during the transition period.

FRONT LINE, STORAGE AND RESERVE

  30.  Assuming a class of 12 ships, nine or 10 would on average be available at any one time to the Commander in Chief Fleet for tasking, while two or three would be undergoing maintenance, including one or two in full refit. It is not planned to hold any ships in storage or as in-use reserves.

INTEROPERABILITY

  31.  Commonality of the majority of PAAMS systems and sub-systems, including in particular the Aster missile, will ensure a good level of interoperability with both France and Italy. In the warship context, the requirement for interoperability, will be re-examined under the revised procurement strategy, but given the primary Force Anti-Air Warfare role of the ship this will remain a high priority.

DISPOSAL OF EQUIPMENT REPLACED

  32.  The sales potential of Type 42s is being considered.

IN -SERVICE LIFE

  33.  The Type 42 replacement is planned to have an in-service life of 25 years.

DEVELOPMENT POTENTIAL

  34.  The Type 42 replacement's systems and sub-systems will be updated as appropriate throughout the life of the system to take account of developments in the operational environment. It is likely that the Future Surface Combatant and Future Carrier programmes, currently in the early stages of concept development, may both draw on major elements of the Type 42 replacement.

INDUSTRY GROUPINGS

Annex

ContractConsortiumCompanies NationComments
Warship Prime ContractorHorizon IJVC Ltd GEC Marconi

BAeSEMA

Vosper Thornycroft Ltd

DCN International

Orizzonte SpA:
Fincantieri and Finmeccanica
UK

France
Italy
Nominated Horizon Prime Contractor
HORIZON
CHORUS
BMT
UK
Selected March 1995
following competition
JPO Support
Agency
  
SRTI Systemes

CISDEG
France
Italy
  
PAAMS FSED/IPEUROPAAMS
not yet legally
formed
UKAMS: MBD
EUROSAM:
Thomson-CSF,
Aerospatiale,
Alenia
UK

France

Italy
Nominated PAAMS
Contractor
Combat Managment System PDHEPICS GEC-MRDS

CSEE Defense, Matra Cap
Systeme, Dassault-
Electronique
Datamat
UK
France

Italy
Competitive Tenderer with EuroCombat
EuroCombatBAeSEMA

Thomson-CSF
AESN (Alenia)
UK
France
Italy
Competitive Tenderder with HEPICS
Fully Integrated Comms System PDNICCO Ltd Redifon, GEC-Marconi
Thomson-CSF,
Elmer
UK
France
Italy
Competitive Tenderer with ITALTEL
ITALTELBAe Defence Systems,
Racal
Bull SA Europe,
Dassault Electronique,
ITALTEL, Bull HN
Information System
UK

France

Italy
Competitive Tenderer with NICCO
Electronic Warfare System PDARCEO Racal Defence Systems

Matra Defence Equipment
and Systems
Alenia
UK
France

Italy
Competitive Tenderer with JANEWS
JANEWSGEC-MRDS

Dassault-Electronique,

Thomson-CSF

Elettronica SpA
UK
France

Italy
Competitive Tenderer with ARCEO


Sea Lift Assets: Roll-on Roll-off Ships

  The Strategic Defence Review identified a need for four additional Roll-on Roll-off vessels, making a total of six, to support the deployment of the Joint Rapid Reaction Force. At the end of March we issued invitations to four selected companies to negotiate about a Public Private Partnership arrangement, with a view to a decision on the procurement route at about the turn of this year; the award of a contract in summer 2000; and the start of the service, if practicable, by autumn 2000.

OPERATIONAL REQUIREMENT

  1.  The Strategic Defence Review concluded that, in addition to the two Roll-on Roll-off RoRo ships already approved for the Joint Rapid Deployment Force, JRDF, there was a requirement for further vessels. Operational analysis established that a total of six RoRos would be required for the timely deployment of early entry equipment for the Joint Rapid Reaction Force. JRRF.

  2.  The requirement is for guaranteed delivery of JRRF equipment and for availability of the service for worldwide delivery at sustained speeds of 18 knots. The vessels to meet this requirement will be commercial vessels without military enhancements. Ship size will depend on balancing optimum load carrying capacity against the need to operate to small ports without specialist facilities such as RoRo berths and craneage, and limited or "no deep draught" berths.

TRADE-OFFS

  3.  Readiness of the sixth ship has been extended from 20 to 30 days to allow industry more scope to earn commercial revenue and thus offset costs to the MoD. Trade-offs between operational risk and value for money will be tested in negotiations.

NUMBERS

  4.  The long-term requirement is for a capability of six vessels in total.

STRATEGIC DEFENCE REVIEW

  5.  Operational analysis in the SDR subsumed earlier studies of strategic lift to identify the number of RoRo vessels, and aircraft, required.

MILITARY CAPABILITY

  6.  The RoRo ships will provide guaranteed sealift for the leading elements of the JRRF. They can be used across the full range of missions and military tasks that require deployment of UK forces into theatre througha seaport of disembarkation. The vessels will either be deployed as part of a maritime task group or operate independently, subject to the nature of any military threat. EQUIPMENT

TO BE REPLACED AND IN -SERVICE DATE

  7.  The RoRo vessels do not replace any existing platforms, but provide a capability which otherwise would have to be found by chartering ships taken up from trade.

  8.  The ISD for the RoRos is defined as the provision of a six-vessel service at the defined JRRF readiness, which we aim to achieve in the autumn of 2000. The date will be reviewed later this year. The full long-term service will be provided on a phased basis, allowing the interim ships, see paragraph 10, to be withdrawn in a co-ordinated fashion.

PROCUREMENT APPROACH

  9.  For the original JRDF requirement, a market survey showed that, although there were a few RoRos available on the charter market, their quality was variable. The MoD could not therefore rely on suitable specialist vessels being available at short notice. There was a pressing need to provide at least some sealift capability to support the JRDF on, or around, the time when the force would become operationally available, so a three phased approach was adopted.

  10.  In phase one, the MoD surveyed vessels immediately available for charter. RFA Sea Crusader, formerly MV Celestine, was accepted on a two-year charter from Oceanarrow (UK) Ltd, starting in October 1996, with an option for a third year, which was subsequently taken up. In phase two, further work was undertaken on an interim solution. The option selected was a bare-boat charter of two RoRos from Stena UK. This was subsequently modified to the charter of one RoRo. RFA Sea Centurion, from Stena and the running on of RFA Sea Crusader for a further period. Phase three, to analyse the options for meeting the requirement in the long term, is now proceeding to identify solutions to the larger post-SDR requirement. We hope that it will be possible to meet the requirement cost-effectively through a Public Private Partnership, PPP, arrangement.

ALTERNATIVE PROCUREMENT OPTIONS

  11.  The interim requirement could not be met by new-build or purchase/conversion and the selection was, therefore, made from vessels either available, or likely to become available, for charter on the commercial market. The options considered included time or bare-boat charter. In the event, bare-boat charter offered best value for money. For the long-term requirement other options are being considered.

EXPORT POTENTIAL

  12.  The issue of export potential does not arise directly in the circumstance of this procurement.

INDUSTRIAL FACTORS

  13.  Both the interim and long-term requirements are being addressed through competition. The long-term requirement may involve a new build by the selected PPP contractor. In such circumstances—the build of commercial, non-warlike vessels to be owned by a PPP contractor, rather than procured by the MoD—the competition has not been restricted to UK yards.

SMART PROCUREMENT

  14.  The programme will be managed using a Smart Procurement approach.

ACQUISITION PHASES

  15.  The initial requirement was met through the charter of RFA Sea Crusader in October 1996. This was augmented by entry into service, in October 1998, of RFA Sea Centurion, Sea Centurion's sister ship, Sea Chieftain was due to enter service later this year in place of Sea Crusader. However, difficulties with the build of Sea Chieftain have led to the cancellation of the contract with Stena for this vessel, and the retention instead of Sea Crusader.

  16.  The long-term RoRo requirement will, if practicable, be met through PPP arrangements. After advertisement in the Official Journal of the European Community and the MoD Contracts Bulletin, a Pre Qualification Questionnaire phase was conducted in 1997-98 for the pre-SDR requirement for two ships, in order that suitable companies could be identified for receipt of the detailed invitation to negotiate ITN. Following the SDR, discussions were held with industry to confirm that there is a tender field fully capable of meeting the increased requirement. The ITN was issued on 31 March to Andrew Weir Shipping, the Maersk Group, Novomar SA and Sealion, which includes the Kvaerner Group.

MILESTONES AND COSTS

  17.  Key milestones as currently planned are:
Initial Gate approval of Outline Business
Case and Statement of Requirements Issue of ITN


March 1999
Assessment of bidsAutumn 1999
Main Gate approval of
Full Business Case
End 1999/

Early 2000
Contract awardSummer 2000
Commence serviceAutumn 2000


  18.  Our estimate of the likely cost of a conventional charter arrangement for six vessels is *****. We would expect a PPP solution to offer better value for money than commercial charter. Financial commitment to date is around £0.1 million largely for external advice. Under PPP arrangements service payments should be fairly constant, barring surges for operational reasons or major exercises.

  19.  A claim for damages for delay in the delivery of Sea Chieftain is being pursued against Stena.

IN -SERVICE SUPPORT

  20.  Under PPP arrangements, the contractor would be expected to carry out in-service support. Several crewing options, embracing Royal Fleet Auxiliary, commercial/Sponsored Reserve manning and mixtures of these options are available to bidders and decisions will depend on the value for money of the solutions offered. The contractor will be responsible for crew management and training, except possibly for some operational training of Sponsored Reserves.

"FRONT LINE" NUMBERS

  21.  The intention is that all six ships, under a PPP arrangement, with optimum risk transfer, should be at the graduated readiness required for the JRRF. This readiness will be tested to explore best value for money balanced against operational risk. There is a very high usage requirement currently foreseen for three ships and a relatively low usage for the other three.

INTEROPERABILITY

  22.  Other nations are showing a keen interest in the UK approach to strategic sealift although, to our knowledge, none has firm plans to acquired its own capability. Other European nations may request assistance from UK RoRo ships to lift their military equipment for training and operations, and such use of spare capacity could offset costs to the MoD.

DISPOSAL OF EQUIPMENT REPLACED

  23.  The currently chartered RoRo ships will be returned to their owners on entry into service of their replacements.

IN -SERVICE LIFE

  24.  A PPP arrangement for six ships would be for approximately 20 years to establish a long-term arrangement that delivers best value for money.

DEVELOPMENT POTENTIAL

  25.  We shall keep under review the level of service provided by the RoRo ships.

Bowman

  Bowman will provide a secure, robust data and voice communications system in support of land operations, to replace the Clansman combat radio and the HQ infrastructure element of the Ptarmigan trunk system. It will also play a key role in the MoDs Battlespace Digitization initiative. A risk reduction programme is currently under way under a contract with Archer Communications Systems Ltd. It is planned to seek approval to place the first production contract in 1999.

OPERATIONAL REQUIREMENT

  1.  Bowman is required to provide a secure combat communications system for the Army and elements of the other Services, in support of land and littoral operations. It will serve as the primary means of voice and data communication for tactical level operations, where operations are characterised by mobility and are undertaken by many individual platforms and by dismounted individuals.The system will, therefore, be based on radio communications that can operate without relying on fixed infrastructure. As well as manportable versions, Bowman will be an integral part of the communications fit of major equipments such as the Challenger 2 Main Battle Tank, the attack helicopter, and warships. In addition to radios, Bowman will also provide a local area subsystem. That subsystem will distribute information within key platforms and around deployed divisional, brigade and unit level headquarters, as well as providing the inter-connection between Bowman and other military and civil communications systems. A management information system will enable operational deployment of the system to be planned and managed.

  2.  The requirement for Bowman was first endorsed in 1988 as a two-stage project; stage one to provide a replacement for the Clansman capability with a simple vehicle harness, and stage two to enhance this new system to allow for increased data and interoperability requirements. Approval was given to enter a competitive Project Definition phase for stage one, PD1 and a simultaneous Feasibility Study phase for stage two, FS2. The latter concluded that the system demonstrated in PD1 would not support the data demands of the number of information systems that would be in service with Bowman and which would be needed to support the digitization programme. The requirement was therefore revised to include additional capacity for data transmission and the computing infrastructure to support new information systems. These included the local area subsystem, an additional radio, known as the High Capacity Data Radio, and computer terminals. FS2 also demonstrated that it would be lower risk for the communications harness for Bowman, known as the Vehicle Integrated contractor rather than provided by the MoD as a separate project. This system was, therefore, merged with the Bowman requirement in 1997.

TRADE-OFFS

  3.  Close liasion with the prime contractor has led to agreement on a series of cost/capability/time trade-offs. In particular, the delivery of capability will now be staged elements of the system that are assessed to require prolonged development to reduce risk will be delivered after the in-service date. Some detailed reductions in functionality have also been agreed. Commercial off-the-shelf, COTS, computer terminals will be used. Where feasible, BOWMAN will be certified to less stringent US Military Build Standards rather than to UK Defence Standards, which increases the degree of commonality with US systems on which some elements of the system will be based. More limited protection against jamming and interception of transmissions will be accepted for some radio types.

NUMBERS

  4.  The number of combat radios required depends primarily on the force structure and numbers of vehicles and other platforms in service. The current assessment is that about 55,000 manpack and vehicle mounted radios will be procured. BOWMAN radios would be installed in some 23,000 vehicles, 43 major ships and some 450 battlefield and support helicopters and transport aircraft. These numbers are subject to review.

STRATEGIC DEFENCE REVIEW

  5.  The Strategic Defence Review highlighted the importance of effective command, control and communication systems and confirmed the requirement for BOWMAN. Force changes arising from the SDR are likely, however, to have an impact on the numbers of equipment required and the programme for converting units.

MILITARY CAPABILITY

  6.  As the primary means of communication at the tactical level for land operations, BOWMAN will be used across the spectrum of conflict, for all missions and at all scales of deployment. BOWMAN will be central to the command and control, and therefore the effective deployment, of forces used for military tasks ranging from disaster relief to regional conflicts.

EQUIPMENT TO BE REPLACED AND IN -SERVICE DATE

  7.  BOWMAN will replace the Clansman family of combat radios, which has been in service since the 1970s. It will also replace those elements of the Ptarmigan trunk communication system within tactical headquarters, that is vehicle borne HQs at divisional, brigade and unit, ie, battlegroup, level.

  8.  BOWMAN was orignially endorsed against an ISD of December 1995. In 1993 this was revised to June 1999 as a result of budgetary constraints and an increased understanding of the technical complexity of the project gained from the Phase 1 Feasibility Studies. During the competitive PD1 phase, the ISD was revised to April 2001 for budgetary reasons. Following the completion of PD1, the ISD was slipped to March 2002 as a result of the revised procurement strategy and the re-definition of the ISD to reflect the delivery of a true operational capability. Since August 1998 the ISD has been defined as the date when a brigade HQ and two battle groups are equipped and capable of deploying on operations other than war. *** The Clansman family of combat radios, and the relevant elements of Ptarmigan, will progressively removed from service over the period 2002-08, as BOWMAN is introduced.

PROCUREMENT APPROACH

  9.  Development of the system was carried out by two competing consortia YEOMAN, led by Siemens Plessey Systems, now British Aerospace Defence Systems, and Racal, and CROSSBOW, led by ITT UK Ltd. Following international competition in 1993, contracts were placed with these two consortia for both PD1 FS2. The opportunities for international collaboration at system level were also assessed at that time, but the timing of the UK's requirement did not coincide with that of any of our major NATO partners. However, it was decided that the contractors providing other nations new combat radio systems would be invited to bid for BOWMAN.

  10.  Following completion of PD1 in late 1996, the competing consortia announced their intention to form a joint venture company, known as ARCHER Communications Systems Ltd, to bid jointly for the BOWMAN supply contract. This resulted in a review of the procurement options open to the MoD, namely continuing with either one of the consortia, continuing with ARCHER or finding a new prime systems integrator. A revised, single source, procurement strategy for BOWMAN and the remainder of the risk reduction work was approved in March 1997, and a risk reduction contract was placed with ARCHER in August 1997.

  11.  Following that work, the supply phase has been separated into three packages of work, linked to the incremental introduction of technology and the staged delivery of capability. Each package will be contracted for individually. Before the first supply contract is awarded, further risk reduction work, known as Package 0, is being undertaken to ensure that the necessary systems integration and demonstration of progress can be acheived before contractual commitment. The contract for Package 0 was placed in October 1998 at a value of £185 million.

  12.  In order to achieve best value for money for sub-system solutions. ARCHER is required to hold competitions wherever possible. Some 60 per cent of sub-contracts will be subject to competition. Where sub-contract competition is not possible, the MoD applies NAPNOC, no acceptable price no contract conditions.***

ALTERNATIVE PROCUREMENT OPTIONS

  13.  The options of upgrading Clansman or procuring an austere or enhanced military off the shelf solution were examined, but were considered to be less cost-effective options for meeting the requirement. Collaboration was also considered, but not found to be viable, see paragraph 9.

EXPORT POTENTIAL

  14.  There will be marketing opportunities in those countries operating VHF and HF radios bought from the selected Bowman suppliers, ITT and Racal, which might be upgraded using elements of the Bowman system, or in those countries which wish to improve their capability at Brigade level and below. The sophistication and cost of Bowman will limit the market for the total system, but there will be scope for supplying parts in many countries.

INDUSTRIAL FACTORS

  15.  Of the procurement options considered, only Archer combined all aspects of design, manufacture, assembly, systems integration and support in the UK and would maintain a significant UK capability in all these areas.

SMART PROCUREMENT

  16.  The project is now following Smart Procurement principles, including a "partnering" approach with Archer. It will use technology and modules developed in Project Definition and for other customers. A contract strategy of incremental acquisition is proposed.

ACQUISITION PHASES

  17.  FS1, FS2 and PD1 have been completed. The award of the package 0 contract in October enables Archer to complete subsystem definition and subcontractor selection, prepare for and commence system integration, and prove the platform installation design process prior to full commitment to "Supply and Support". On completion of this work, it is planned to award the first of the production contracts, Package 1, later this year. The principal area of risk is the integration of subsystems supplied by a number of different sub-contractors. A further key risk is the timescale for contracting for installation design, certification and conversion in over 200 platform types with complex existing design rights.

MILESTONES AND COSTS

  18.  Key milestones now in prospect for this project are:

Approval for Supply phase:
late 1999
Placement of Supply contract:late 1999

COST SUMMARY.  APPROVED STAGES AS AT 31 MARCH 1998 AT 1998-99 PRICES
Breakdown of procurement costsDevelopment ProductionTotal
Current estimate of costs£139 million £139 million
Estimate of costs at MOD approval£122 million £122 million
Difference£-17 million £-17 million


  Reasons for difference: costs resulting from changes to the scope of work undertaken in the early phases, +£11 million accounting adjustment; +£1 million slippage of PDI work; +£5 million. Expenditure at 31 March 1998 was £115 million. An additional contract, valued at £185 million was placed in October 1998.

  *** The years of peak expenditure are likely to be 2002-03 and 2003-04 onwards.

  The revised ISD for Bowman has resulted in additional costs of £9m to run on Clansman longer than originally planned.

IN -SERVICE SUPPORT

  19.  There are two aspects to Bowman support: the provision of initial spares and facilities to support operations, which will be provided with the prime equipment and installations, and on-going support that enables re-provisioning, corrective action and contractor support to ensure sustainability of the deployed system. The planned single Supply and Support contract will encompass both aspects. The level of support required is being determined using integrated logistic support principles. The importance of reliability and spares availability, and their impact on equipment sustainability, is reflected in the draft contract. The use of existing spares and equipment, where appropriate, has been mandated. Training is being addressed under the tri-Service Training Needs Analysis, which will identify, the recommended training methodology, including training media.

  20.  The Bowman conversion programme is a major task that will be carried out over a period of eight years. Conversion will be by operational grouping, principally brigade, there is therefore a vital link between conversion planning and the Army's Formation Readiness cycle. Units will be converted in their "other tasks" year. The Bowman Fielding Plan addresses the requirement to provide support to both the new system and that being replaced. Dual Clansman and Bowman training will be needed at certain locations.

FRONT LINE, STORAGE AND RESERVES

  21.  In accordance with the principles of whole fleet management, Bowman equipment not assigned to the front line will in effect be held in reserve, although there will be no formal war reserve. Spares to support Bowman will be held in storage, under arrangements still to be decided.

INTEROPERABILITY

  22.  National interoperability for land operations will be achieved, since all elements of the three Services that take part in the land or littoral battle will be equipped with Bowman. International interoperability with other nations is more difficult. The intention is that Bowman should meet currently agreed and likely future NATO standards. Use of extant US national protocol standards was considered, but was not judged to offer an acceptable degree of protection for the lifetime of Bowman. A standard for encryption has been agreed by certain countries, including the US and UK, and will be adopted by Bowman. Standards developed for Bowman could be made available for adoption for the next generation of US tactical radio communications, or as future NATO standards.

DISPOSAL OF EQUIPMENT TO BE REPLACED

  23.  Defence Export Services will consider the most appropriate disposal route, sale or scrap, for Clansman equipment that is no longer required. Relevant parts of Ptarmigan will be retained as spares to support the Ptarmigan elements remaining in service.

IN -SERVICE LIFE

  24.  Bowman is planned to be in service for at least 25 years.

DEVELOPMENT POTENTIAL

  25.  Given the pace of change in information systems technology, it is likely that there will be developments that require technology insertion over the course of Bowman's service life, and the system is being designed accordingly.


 
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Prepared 10 November 1999