Supplementary memorandum from the Ministry
of Defence
ANSWERS TO
THE HOUSE
OF COMMONS
SELECT COMMITTEE'S
FOLLOW UP
QUESTIONS ON
THE GOVERNMENT
RESPONSE TO
THE MINISTRY
OF DEFENCE
2007-08 SPRING SUPPLEMENTARY
ESTIMATES
1. At what point in FY 2007-08 did it become
clear that there was going to be a more offensive campaign in
Afghanistan in that FY that would require more expenditure than
was envisaged at the time of the WSE?
The additional manpower deployment required
to increase operational tempo in Afghanistan was approved by Ministers
towards the end of July 2007. This was too late to be included
with any certainty in July forecasts, upon which the WSE resource
request was based. The increased operational tempo was sustained
until December 2007. The forecast costs for operations for the
SSE were based on end November estimates which included the costs
for the increase in the campaign.
2. At what point in FY 2007-08 did it become
clear that increased buildings and vehicle protection in Iraq
would be required in that FY and which would require more expenditure
than was envisaged at the time of the WSE?
The estimates for the cost of operations in
Iraq for WSE were based on end July forecasts; those for the SSE
were based on end November forecasts. The costs for the increased
buildings protection in the central operating base were established
in November. The costs for the increased vehicle protection were
identified as part of the Capability Review held in September
2007.
3. Is the MoD content that the forecasts
in the WSE for the Direct Resource and Capital costs of Iraq/Afghanistan
operations would have proved robust had not the unexpected requirements
outlined in questions 1 and 2 above materialised?
The forecasts in the WSE represented the best
estimate of the likely costs of Iraq and Afghanistan when the
Estimate was submitted. As we explained in the Government response
to HC140, the Defence Committee's report on the Spring Supplementary
Estimates 2007-08, operational costs are difficult to forecast
and sensitive to changes in operational policy and the operational
context. There is always likely to be a variation between the
forecasts used to inform Winter Supplementary Estimates and those
to inform Spring Supplementary Estimates.
4. Given the volatility of operations in
Afghanistan and Iraq, is the MoD content that it has the correct
procedures in place to assess and quantify changes in forecast
costs as quickly as possible?
The Department is always seeking to improve
its processes. As we reported in the Government response to the
Committee's report on SSE we have introduced a new methodology
for capturing the non-cash costs of operations. In addition we
have made enhancements to the existing reporting system to enable
more effective monitoring of UOR expenditure and set up a specialist
working group, which will enable the Department to track costs
more robustly. We will continue to improve our reporting systems.
5. Has any thought been given by the MoD
to providing interim data, between Estimates, to Parliament or
to the Defence Committee setting out an outline of likely changes
in forecast costs should changes in operational tempo/stance occur?
In practice, forecasts of the costs of operations
are passed to Parliament in Winter Supplementaries in November
and Spring Supplementaries in February. A further forecast could
be provided to the Committee between Supplementaries if the Committee
would find that helpful.
5 June 2008
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