Conclusions and recommendations
1. We
strongly regret the MoD's refusal to supply us even with a classified
summary of the information against which it assesses the success
of its military operations. This makes it impossible for us to
assure the House of the validity of its assessment. The Annual
Report is strong on describing what the Armed Forces have been
doing but weak on explaining how this is judged to have contributed
to the achievement of its objectives. We hope that the MoD is
right in assessing that it is on course to achieving its military
objectives in Iraq and Afghanistan but the Annual Report does
not provide us with the evidence to support this assessment. We
accept that there are limitations to what can be said in public
but do not believe that this absolves the MoD from the responsibility
to provide a proper account of its performance against this key
target. We recommend that, in future Annual Reports, the MoD publish
clear performance indicators against which performance against
target 1 is to be judged. If it cannot provide evidence for its
performance against the target, the MoD must accept that, in this
form, it is not a sensible target for PSA and Annual Report purposes.
(Paragraph 10)
2. It is useful to
have a joint peacekeeping target given the joint nature of the
Government's undertaking in many areas of operations. But the
performance indicators in target 2 are too outcome-oriented to
be very effective as a measure of the MoD's performance. (Paragraph
12)
3. The MoD's performance
against its force readiness targets has deteriorated in recent
quarters on account of the current level of operational deployments.
In the circumstances this is understandable. Over 30% of units
are showing serious or critical weaknesses against both their
peacetime readiness levels and their ability to generate from
peacetime readiness to immediate readiness for deployment. This
gives us cause for concern. (Paragraph 16)
4. We remain concerned
at the availability of serviceable battlefield helicopters, especially
support helicopters, in Iraq and Afghanistan. We welcome the MoD's
response that the potential use of private lease helicopters would
remain under consideration. In Afghanistan the MoD should first
press NATO partners to provide additional helicopter support.
(Paragraph 24)
5. We are concerned
about the reliability of the airbridge between operational theatres
and the UK, which has implications both for morale and for operational
effectiveness. If the MoD is committed to the expeditionary approach,
it must ensure that it has sufficiently reliable transport aircraft
to deliver its troops to theatre. We look to the MoD to provide
the case to the Treasury for a significant increase in investment
in the transport fleet. (Paragraph 27)
6. The MoD broadly
achieved manning balance in 2005-06 but this is largely explained
by the fact that the manning requirement had been reducing. The
crucial question is whether the manning requirement is sufficient.
(Paragraph 37)
7. We note that the
Armed Forces have been operating at levels well above the Defence
Planning Assumptions. The manning requirement has not been adjusted
to take this into account. The MoD can no longer rely on the current
level of operational deployments being a temporary aberration:
it should revise its manning requirement upwards to fit the realistic
need. (Paragraph 39)
8. While overall exit
rates have risen slightly over the last two years, there is no
evidence that reported overstretch has led to a mass exodus. Nevertheless
there is a risk that pressures rise to a point at which Service
personnel—or their families—feel that enough is enough.
The MoD must monitor closely any indications of retention problems
arising. (Paragraph 45)
9. We welcome the
MoD's decision to introduce financial initiatives to aid retention.
(Paragraph 46)
10. We welcome the
MoD's decision to pay an operational bonus to Armed Forces personnel
and trust that it will be annually uprated. (Paragraph 47)
11. While the overall
manning balance may be within acceptable levels the number of
trades experiencing shortages of personnel has increased since
2004-05. Although we have received no evidence that our Armed
Forces are operating with anything other than their usual professionalism,
the growing number of manning pinchpoints risk impacting on long-term
effectiveness. (Paragraph 51)
12. We welcome the
decision of the MoD to implement the recommendations of the Armed
Forces Pay Review Board to increase the pay of medical personnel.
We consider the decision to remove the disparity between the pay
of Service medical personnel and their civilian counterparts to
be helpful in addressing shortfalls in this key skill area. We
look to the MoD to address other manning pinch points in a similarly
imaginative way. (Paragraph 53)
13. We are concerned
that the Royal Navy and Army information systems which record
individual Separated Service are inadequate. We look forward to
the speedy and effective implementation of the Joint Personnel
Administration programme. (Paragraph 58)
14. It is clear that
the current level of commitments is impacting on training. Over
time this will impact on military effectiveness and in the Armed
Forces' ability to "fight the next war" which could
present entirely different challenges. In view of the crucial
importance of training to the quality of our Armed Services, this
is of the deepest concern to us. We expect the MoD to address
the shortfall in the provision of training for contingent operations
as a matter of urgency. (Paragraph 61)
15. Nearly one fifth
of Armed Forces personnel were deployed on operations and military
tasks in 2005-06 and this level has been maintained into the first
quarter of 2006-07. While it is anticipated that there will be
a force drawdown in Iraq during 2007, operations in Afghanistan
and Iraq are at vital stages and success in either operation is
not assured. The level of demand on our Armed Forces could well
continue throughout 2007 and beyond. The possibility of significant
additional resources being deployed to Afghanistan, in particular,
remains real. The current level of deployments poses a significant
risk to the MoD achieving success in its military objectives.
(Paragraph 66)
16. Whether UK Armed
Forces are stretched or overstretched is a matter for continued
debate. What is certain is that they are operating in challenging
conditions in insufficient numbers and without all the equipment
they need. With problems of undermanning continuing, there is
a clear danger that the Armed Forces will not be capable of maintaining
current commitments over the medium-term. (Paragraph 67)
17. To some extent
this strain on our Armed Forces reflects the inability of some
NATO allies to generate forces. This is regrettable and raises
a question over whether this new direction for NATO is sustainable.
Minister should make strong representations to those allies to
ensure they understand the implications of failure of the Alliance.
(Paragraph 68)
18. We restate our
support for the MoD's efficiency programme and the need for MoD
to proceed in consultation with staff representatives, particularly
those staff employed by the DPA and DLO. (Paragraph 69)
19. We are very disappointed
by the MoD's poor performance against its diversity targets. The
UK Armed Services should reflect the people it serves and despite
years of good intentions, the MoD has failed to achieve this.
In addition the MoD seems to have little grasp of the reasons
behind its failure to recruit black and ethnic minorities in sufficient
numbers. We look to the MoD to give the issue of black and ethnic
minority recruitment greater priority and recommend that it conduct
research into why the Royal Navy and RAF in particular are failing
to recruit sufficient numbers of ethnic minorities. We also recommend
that the MoD learns from the experience of other organisations
such as the Police who have increased their intake of ethnic minority
personnel over recent years. (Paragraph 74)
20. Recent increases
in the number of women entering the Services are welcome, and
we accept that it will take time for this to impact on the number
of women in senior ranks. The MoD should monitor the situation
closely to ensure that there are no barriers to the career progression
of able Servicewomen. We recommend that in future the MoD include
in the Annual Report a table giving statistics for women in the
Armed Forces by Service and by rank. (Paragraph 77)
21. We note the alarming
levels of recorded sexual harassment experienced by women in the
Services. We also note the MoD's determination to address the
problem. We look to the MoD to make significant progress in reducing
the incidents of sexual harassment in the Armed Forces and intend
to monitor this issue closely. (Paragraph 79)
22. We are disappointed
that the MoD continues to miss its diversity targets in relation
to civilian personnel. (Paragraph 82)
23. The future focus
of the new Defence Equipment and Support Organisation will be
on the through-life support of equipment and there is a case for
the MoD's PSA targets reflecting this. However we recommend that
the MoD continue to report separately on its performance on equipment
procurement so that year-on-year performance can be monitored.
(Paragraph 84)
24. We are pleased
to learn that the MoD has made improvements to its method of measuring
claimed efficiency savings: it is important that reported savings
are based upon robust data. (Paragraph 87)
25. We congratulate
the MoD for exceeding the efficiency gains expected in 2005-06
relating to the 2004 Spending Review Efficiency Target. We look
to the MoD to continue to improve the way efficiency savings are
measured, evidenced and validated to ensure that reported efficiency
savings are accurate and complete. (Paragraph 89)
26. We would expect
the merger of the Defence Procurement Agency and the Defence Logistics
Organisation to result in efficiency gains. We look to the MoD
to announce the likely scale of these efficiency gains and monitor
whether they are delivered. (Paragraph 90)
27. We accept that
the arguments for giving parts of the Ministry of Defence separate
agency status are finely balanced, and we are not opposed to the
removal of agency status from small agencies. But we have two
concerns. First, it would worry us if the trend against agencies
was a symptom of a wider centralist tendency in the MoD, denying
managers the freedom to manage effectively. Secondly, we are concerned
that it may lead to a loss of transparency, if the ex-agencies
no longer produce separate annual reports and accounts. (Paragraph
96)
28. We recommend that
ex-Agencies continue to publish an account of their annual activities.
The MoD must ensure that the apparent trend against Agency status
does not lead to a loss of information and accountability. (Paragraph
97)
29. We commend the
Department for the improved presentation of agency performance
data in the Annual Report. (Paragraph 98)
30. While the appropriate
number of targets may vary according to the nature of an Agency's
responsibilities, we look to the MoD to ensure greater consistency
in the number of targets set for Agencies and the level of challenge
which they present. (Paragraph 99)
31. We intend to continue
our programme of scrutiny of the work of Defence Agencies on a
regular basis. (Paragraph 100)
32. We note that this
is the third year running in which the MoD's resource accounts
received an unqualified audit opinion and commend the Department
on its achievement. (Paragraph 101)
33. We note that the
MoD fulfilled its commitment to publish the Annual Report and
Accounts 2005-06 before the Summer parliamentary recess. We look
forward to the MoD publishing future Annual Reports in a similarly
timely fashion. (Paragraph 102)
34. We congratulate
the MoD for winning the 'Building Public Trust Award' for its
Annual Performance Report. We look to the MoD to make further
improvements in the presentation of the Annual Performance Report
next year. A more extensive index, and greater use of cross-referencing,
would be helpful. (Paragraph 103)
35. We note that losses
reported in the MoD's 2005-06 Resource Accounts have reduced compared
with the previous year. We look to the MoD to continue to take
action to minimise losses in the future. (Paragraph 106)
36. Losses resulting
from the UK government's decision to withdraw from the Medium
Range and Long Range Anti-Tank Guided Weapon System programmes
total some £310 million. We accept that withdrawing from
equipment programmes to reflect changing requirements can be a
sensible management decision. We look to the MoD to ensure that
the knowledge gained from participation in these programmes is
utilised and that opportunities which may result in a return on
the investment from the sale of these two equipments are pursued.
(Paragraph 109)
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