House of Commons - Defence

Select Committee on Defence Sixth Report

SIXTH REPORT

The Defence Committee has agreed to the following Report:—

THE APPOINTMENT OF THE NEW

CHIEF SCIENTIFIC ADVISER

1. On 4 January 2000, Professor Sir Keith O'Nions took up his duties as the Ministry of Defence's Chief Scientific Adviser (CSA), replacing Sir David Davies.[8] The CSA heads the Department's central scientific staff and is responsible ultimately for all advice given to Ministers on science, technology and operational analysis.[9] His principal areas of work include—

Defence Research: The CSA is the budget holder for the MoD's £450 million expenditure on 'corporate' and 'applied' research[10] (we described these components of research in our report last Session on Defence Research[11]). CSA staff also assist, and provide advice to, other organisations within the MoD which set the requirements for new defence equipment and weapon systems, and those who procure such equipment and support it in-service.

Equipment approvals: The CSA chairs the MoD's 'Equipment Approvals Committee' which makes procurement recommendations to Ministers.

Nuclear safety and effectiveness: The CSA is responsible for advising Ministers on the safety of Royal Navy nuclear propulsion systems and the UK's strategic nuclear deterrent, as well as acting as the MoD 'customer' for the nuclear warhead intellectual capability at the MoD's Atomic Weapons Establishment (AWE).

2. The last of these has been much in the news lately, with the Secretary of State for Defence reviewing the safety implications of proceeding with the recently let contract to run AWE sites.[12] The contract had been awarded to the AWE Management Ltd consortium which included British Nuclear Fuels Ltd, the operator of the Sellafield reprocessing plant. On 29 March, the Minister for the Armed Forces announced that the Nuclear Installations Inspectorate was satisfied that AWE Management Ltd were able to operate AWE facilities safely and effectively,[13] and that Ministers had decided that the consortium would operate the sites, as contracted, from 1 April 2000.[14] The CSA's involvement in this affair is not significant[15] and we have not dealt with these matters in this report.

3. The CSA's organisation is closely involved in the work of the Defence Evaluation and Research Agency (DERA) which is responsible for the majority of the MoD research programmes. We have during this Parliament closely monitored the MoD's changing approach to research and the role played by DERA. Most recently, in our Defence Research inquiry we raised a number of concerns about the MoD's research strategy, including the low level of defence research funding and the challenge of accommodating the lead being taken by the private sector in some areas of technology. In our report we also recommended that the MoD's then current plans for a public-private partnership for DERA should not proceed,[16] primarily because of the likely adverse implications for the MoD's ability to remain an 'intelligent customer' for its research, its collaborative research programme (particularly with the US) and value for money. The Government's January 2000 response indicated that the MoD was still examining the way in which a public-private partnership might be taken forward,[17] and on 17 April the Minister for Defence Procurement announced revised plans for such a scheme. We will be examining these closely in a separate inquiry.

4. Against that background, this brief inquiry served two main purposes.

First, we wished to review the appointment of Sir Keith and the work of his organisation, in pursuit of our objective of examining key new appointments in the Department.[18] Unlike some other parliaments, the House does not have any formal role in confirming public appointments, which we see as an omission. Nonetheless, we consider it important that the House has an opportunity—presented by this report—to be informed about his appointment.

Second, we took this opportunity to sustain our monitoring of the further development of the MoD's research strategy, picking up some of the outstanding issues from the Government's response to our Defence Research report, in view of the Chief Scientific Adviser's central role in taking this strategy forward.

The New CSA's Appointment

5. Sir Keith O'Nions was appointed as Chief Scientific Adviser after an open competition.[19] His contract is for three years, with an option for it to be extended by mutual consent for a further two years[20] (and over many years, the trend has been for appointments to last for five years).[21] His salary of some £110,000 a year[22] is not performance related.[23]

6. When we examined the appointment of the Head of Defence Export Services, questions of conflict of interest were important because that postholder usually came from industry and his MoD organisation[24] was involved in supporting the products of particular firms in particular markets. However, with the bulk of the MoD's research placed with DERA rather than directly with academic institutions, such issues have much less significance in the case of the CSA's recruitment from academia. Sir Keith had to give up his membership of the Council of Science and Technology because of that organisation's requirement for its members to be independent,[25] and there were other activities that he volunteered to give up.[26] Given the importance of keeping current his scientific expertise and perspectives, however, we were pleased to hear that he had not been required by the MoD to relinquish any of his existing academic positions on taking up the post.[27]

7. The previous CSA, Sir David Davies, left the Department in Easter 1999. The appointment of his successor—Sir Keith—was announced in July 1999, and he took up his post in January 2000.[28] We asked why such an important post had remained unfilled, and the MoD told us that another candidate had been identified at interview but had then declined to take up the appointment. This required the Department to relaunch the recruitment exercise, as a result of which Sir Keith was selected in May 1999.[29] Although Sir David Davies agreed to stay on until 30 April, Sir Keith's other commitments prevented him taking up the post until this year.[30] Sir Keith told us, however, that from last August he was able to devote about a day a week to briefings, making visits to DERA and getting up to speed with some of the key issues, and thus helping to minimise the gap in the provision of advice for the Department.[31]

8. Sir Keith comes to the MoD having had a distinguished career in earth sciences, including holding the Chair of Physics and Chemistry of Minerals and head of the Department of Earth Sciences at Oxford University since 1995,[32] and work in geology and geochemistry faculties of universities in the UK, Europe and North America.[33] When we asked whether such a specialisation would allow him to deal with the technologies perhaps more typically associated with defence equipment, he told us that—

9. The CSA has traditionally been recruited from outside the MoD, not least in order to benefit from such external perspectives on scientific issues.[35] We believe this practice has merit, but we trust in future competitions for this post that internal candidates will not be ruled out. Sir Keith has had no previous involvement in military matters,[36] but he believed this could present advantages. He highlighted areas like operational analysis, which involved not just analysis of specific defence scenarios but also mathematical and modelling methodologies which do not need a grounding in defence knowledge.[37] He told us that so far he had not found a lack of experience of defence to be any hindrance.[38] He also considered that skills developed outside the MoD bring a difficult dimension to scientific advice compared to that available to staff within the MoD.[39] The scope of the science covered by MoD research requires the Chief Scientific Adviser to have a depth and breadth of knowledge. Sir Keith seems well-equipped to bring a wide range of expertise to bear on his new work.

The CSA's Role

10. The CSA's organisation plays an important role in all stages of the equipment procurement cycle[40]—the definition of requirements, scientific research, acquisition and in-service support. The CSA is responsible for the corporate research programme managed by his deputy[41] and the applied research programme which he delegates to the newly established Deputy Chief of the Defence Staff (Equipment Capability).[42] CSA staff are also involved in integrated project teams in the Defence Procurement Agency and Defence Logistics Organisation, which are responsible for the through-life acquisition and support of particular classes of equipment. This involvement in project teams is not extensive, however, and Sir Keith did not see any danger of conflicts of interest within his organisation when equipment programmes were presented to the Equipment Approvals Committee for consideration.[43]

11. These various CSA roles have been reshaped in the last year or so, as reforms introduced by the Strategic Defence Review (SDR) have been put in place—the establishment of the Defence Procurement Agency, Defence Logistics Organisation and the Equipment Capabilities organisation, and working within a framework of the new procedures of the smart procurement initiative.[44] Sir Keith believed that if the MoD stuck rigorously to the philosophy of smart procurement it should lessen significantly the chance of things going badly wrong after an equipment project's so-called main gate[45] approval by the Equipment Approvals Committee.[46] He had found the methodology used in technical risk assessments to be sound. He considers that, although the risk would never be reduced to zero, if smart procurement principles were operated across the board the MoD should be able to secure significant reductions in project risks.[47] More generally, he believed that the MoD's smart procurement initiative and other organisational changes arising from the SDR had produced a healthier climate for managing procurement, with CSA staff being closely involved with those in the applied research programme, the equipment capability area and in integrated project teams.[48] The new procedures and organisational structures of smart procurement should indeed produce a healthier environment for managing the equipment programme, and in our recent inquiry on the MoD annual reporting cycle we heard examples of some of the potential savings envisaged by the Department.[49] Whether risks will be reduced to such an extent that projects will no longer go off the rails, however, will become apparent only when projects exposed to the new regime are delivered. We will continue to monitor closely the MoD's performance in managing risk in its equipment programme.[50]

12. Within the equipment cycle, one of the CSA's most important and high-profile roles is as chairman of the Equipment Approvals Committee (EAC), which evaluates and approves equipment procurement programmes. In addition to the CSA, the Committee comprises: the 2nd Permanent Under Secretary, as the MoD's Accounting Officer's representative; the Chief of Defence Procurement, as the provider of the equipment to meet the requirement; the Chief of Defence Logistics, representing those who will maintain and support the equipment once in-service; and the Vice Chief of the Defence Staff, representing the equipment's user. The Committee has a collective responsibility for advising Ministers on major procurement decisions, and as its chairman the CSA's contribution is to bring an independent perspective to procurement considerations, encompassing scientific aspects, the choice of technologies, assessments of risk, and the adequacy and appropriateness of supporting operational analyses.[51]

13. Procurements worth less than £400 million are usually delegated to meetings of the subordinates of the Equipment Approvals Committee members.[52] Although only two months in post, the new CSA had already had to chair a meeting at which the Committee had considered two very important programmes: the Beyond Visual Range Air-to-Air Missile (BVRAAM) for the Eurofighter/Typhoon and the MoD's strategic airlift programmes. As chairman, the CSA's job is to "ensure that the advice that goes to Ministers is comprehensive and balanced".[53] He considered that the quality of the analysis and scrutiny in cases submitted to the Committee had made consensus decisions quickly achievable,[54] although this represented the reconciliation of often conflicting views at lower levels in the Department. He believed that—

14. The bottom line for the EAC, we were told, is value for money—an assessment of technical capability and the costs of the project.[56] As part of its advice to Ministers the Committee draws attention to the views of other Government departments such as the Department of Trade and Industry[57] and the Treasury on, for example, the implications of a particular decision for UK industry.[58] Ministers, however, "may well give a different emphasis to some of those elements",[59] and inter-departmental consultation also takes place at Ministerial level once MoD Ministers have considered an EAC recommendation.[60] Sir Keith therefore drew a careful distinction between the responsibilities of his Committee and those of Ministers—

The careful limitation of the Equipment Approvals Committee's role to that of an independent source of advice on equipment cost-effectiveness is important and right—it would be wrong for it to have to assess the weight of factors which depend essentially on political judgements in making its recommendations. If Ministers follow a course that does not reflect their advisers' recommendations which are based on value for money, they are required to give a direction to the MoD's Accounting Officer,[62] who is currently obliged to notify the Treasury and the Comptroller and Auditor General, and thereby the Committee of Public Accounts. While that Committee is primarily concerned with the propriety and value for money of departments' expenditure, our remit extends to wider matters including policy considerations.[63] We recommend therefore that in future such Directions are also submitted to the Chairman of the Defence Committee.

The Status of Science in the MoD

15. The CSA's role is an important one, and his organisation needs to be well positioned to ensure that scientific advice gets a proper hearing within the Department. One of his tasks is to chair the Defence Research Committee,[64] which is required to review and endorse the overall balance and content of the Department's research programme. Its responsibilities involve ensuring that the research programme reflects evolving defence policy and procurement priorities; advising on the appropriate balance between shorter and longer term research; and promoting value for money in defence research.[65] The Defence Research Committee is due to report to the Secretary of State later in the Spring on the overall health of the MoD research programme, but when we asked for this report we were told that it constitutes 'advice to Ministers'.[66] We are disappointed that once again the MoD has declined to let us see such an important document, at the heart of a select committee inquiry, citing such grounds. If this is still the Department's position when the Defence Research Committee's report is prepared, the MoD must at the very least distil for us those matters that summarise the state of health of the programme, leaving out if necessary the recommendations and other 'advice' it provides for its Ministerial audience.

16. Sir Keith highlighted his own position within the decision-making machinery of the Department, including his membership of the top level committees in the Department—the Finance Planning and Management Group and the Defence Council—and his personal direct access to the Secretary of State.[67] This, Sir Keith told us, meant that the CSA had—

17. Amongst the 130 staff in the CSA's organisation there are a large number of people across a wide range of scientific disciplines, many of whom have already had substantial careers in science and technology in defence establishments, such as DERA.[69] In our Defence Research report, we highlighted the risk that the public-private partnership then proposed for DERA might prevent the scientific expertise of central MoD organisations, like the CSA's organisation, being refreshed with staff from DERA.[70] The issue was not properly addressed in the Government's response to our report,[71] so it was gratifying to note that in this area Sir Keith shared our analysis—

18. In addition to the CSA and the Defence Research Committee, there are a number of other sources from which Ministers receive external perspectives on the MoD's research programme and the state of science in the Department. Perhaps the most significant of these is the Defence Science Advisory Council, which comprises over 150 external independent advisers across a number of areas of science and technology, drawn from industry and academia.[73] It peer-reviews the MoD's research programme and meets regularly to formulate advice for the CSA and the Secretary of State.[74] Other external advisory committees deal with nuclear safety and effectiveness, Gulf War illnesses, biological and chemical countermeasures, research ethics and animal welfare.[75]

19. Sir Keith believed that the Ministry of Defence set a high store on science and technology informing its policy—probably, he thought, more than any other government department.[76] It is heartening to hear praise for the strength of the MoD's science and technology base coming from a relative newcomer to the Department. The future high profile of these critical elements depends on a sound and adequately funded research strategy.

The MoD's Research Strategy

20. Our defence research report of last year described work under way by the MoD and industry to establish an overarching defence research strategy. Its aim was to lay a knowledge foundation across a broad area of research and technology, so that the MoD could remain an 'intelligent customer' for defence equipment and know-how, and then to identify 'towers of excellence' in particular technologies which should rise above such a foundation. Critically, the strategy seeks to establish for each of these towers of research expertise whether it should be led by industry, the MoD or by others. In our report, we welcomed the methodical approach being adopted, but warned that it would be a missed opportunity if the exercise were not undertaken in a logical manner, with research funding following the strategy rather than the other way around.[77]

21. Since our report, discussions have continued between the MoD and industry to develop further the towers of excellence model, and are expected to continue throughout this year.[78] In its response to our report the MoD told us that—

However, in terms of the strategy's implications for research funding, the MoD said that it—

22. The CSA's message to us was similarly double-edged, indicating that he was prepared to defend his research budgets, but that at this early stage in the post he did not see any glaring gaps in the research programme—

23. Against the background of the size of the budgets that the MoD makes available for defence research, the new CSA saw it as an important part of his work to facilitate international collaboration[82] on defence research[83]—

24. Underlying the whole debate about research budgets, and the future status of DERA, is the inherent difficulty of evaluating the cost-effectiveness of defence research. Sir Keith told us that he wants to be able to develop the measurement of research's value for money—an area where outcomes have been difficult to establish, in the wider research environment as well as in the MoD.[85] He told us that he was—

25. The question of value for money and the funding of research is closely tied up with the wider issue of DERA's ownership, which we have discussed extensively elsewhere.[87] Private ownership may well influence the availability of finance, but it may also have consequences for the MoD's intelligent customer capability, and thus in time for the cost-effectiveness of its research expenditure. The MoD's response to our defence research report acknowledged that impartiality of advice is essential to support intelligent decision-making, and that the only way to ensure this was through direct public funding of core research.[88] The ability of the MoD to retain its intelligent customer status had been raised by many stakeholders during the last consultation process for the originally proposed public-private partnership,[89] however, and Sir Keith acknowledged that ensuring the research foundation layer remained sufficient for this purpose would be a challenge.[90] Across the research budget more generally, however, the CSA was more relaxed about the ability of the private sector to provide impartial advice—

The Chief Scientific Adviser is the figurehead of the MoD's publicly-funded, impartial, scientific advisory capability. He will not be able to discharge his functions properly if he is deprived of access to sufficient staff, of sufficient expertise and with sufficient experience, to enable him to provide advice of the right quality. The continued ability to retain impartial scientific advice is, as we have made clear time and again, a crucial criterion by which we shall judge whether the future plans for DERA's ownership and structure are appropriate. We wish Sir Keith well in his new post, and trust that he receives the support he needs to discharge his duties effectively.

8 MoD Press Notice 276/99; 6 July 1999 Back

9 Ev p 21, para 2 Back

10 'Corporate Research' covers work with a military potential but currently without a defined military need, or work with a multiplicity of military needs (such as a research on corrosion). 'Applied Research' is aimed at developing solutions for specific military needs, including the development of capabilities for future equipments. Back

11 Ninth Report, Session 1998-99, Defence Research, HC 616, para 15 Back

12 HC Deb, 21 February 2000 c1223 Back

13 HC Deb, 29 March 2000 c159w Back

14 ibid Back

15 QQ 147, 148 Back

16 Ninth Report, Session 1998-99, op cit, para 121 Back

17 HC (1999-2000) 223 Back

18 Last Session, we took evidence from Mr Tony Edwards soon after he took up his duties as the Head of Defence Export Services, and reviewed the work of his Defence Export Services Organisation (Second Report, Session 1998-99, The Appointment of the new Head of Defence Export Services, HC 147) Back

19 Ev p 21, para 3 Back