Memorandum from the Ministry of Defence
THE EQUIPMENT
PROGRAMME/EQUIPMENT
PLAN
1. When is the "short examination of
the equipment programme" expected to be completed by? If
already completed, when will the results of the review be announced?
As Sir Bill Jeffrey told the Committee on 4
November, we hope to resolve the remaining issues arising out
of our examination of the equipment programme over the next few
weeks. We expect its results to provide an important input to
our 2009 planning round, which will be completed in Spring 2009,
but Ministers have undertaken to inform Parliament of significant
decisions affecting projects as soon as they are able to do so.[2]
2. RUSI Acquisition Focus reported in RUSI
Defence Systems Spring 2007 that "The equipment plan has
been estimated as underfunded by some £15 billion or more
over its 10-year period". What is MoD's estimate of the extent
to which the Equipment Plan is underfunded?
The MOD is conducting Planning Round 09 which
will help in ensuring that the equipment plan is realistic, affordable
and matched with our priorities for the coming years.
DEFENCE EQUIPMENT
CAPABILITIES/EQUIPMENT
PROGRAMMES AND
EQUIPMENT PROJECTS
3. A list of the Defence Equipment Capabilities.
The list to set out the key current and future equipment programmes
which currently deliver/are planned to deliver these capabilities
A list of the Defence Equipment Capabilities,
setting out the key current and future equipment programmes is
at Annex A to this Memorandum.
4. The definition of an equipment programme
and an equipment project. Details of the number of equipment programmes
and equipment projects which DE&S are responsible for delivering.
What assessment has the MoD made of whether the current number
of equipment programmes being acquired is (a) affordable and (b)
can be managed effectively by DE&S? Is the MoD examining options
to rationalise the number of equipment programmes?
Following the Capability Review of the MOD published
in March 2007 and the subsequent planning to Streamline the Head
Office, a review of how the Department delivers capability was
carried out in the first half of 2008. The review was led by the
Equipment Capability Customer and included DE&S, the User,
the MOD's Science, Innovation and Technology branch and the MOD
Centre; the overall grouping being known as the MOD Unified Customer.
During the review, the Department consulted the guidance[3]
produced by professional bodies such as the Office of Government
Commerce (OGC) and Association of Project Management (APM). Based
on this consultation, the following definitions will now be adopted:
Projects are unique, transient endeavours
undertaken to achieve a desired outcome. Projects bring about
change and project management is recognised as the most efficient
way of managing such change. Project management is the process
by which projects are defined, planned, monitored, controlled
and delivered such that the agreed benefits are realised.
Programmes. What constitutes a programme
will vary across industries and business sectors but there are
core programme management processes. Programme management is the
co-ordinated management of related projects, which may include
related business-as-usual activities that together achieve a beneficial
change of a strategic nature for an organisation.
In the Defence context, programmes are characterised
by the following:
(a) Focused on the delivery of outcomes, and
therefore the coordinated delivery of all Defence Lines of Development
(training, equipment, people, infrastructure, etc), necessary
to achieve the required capability.
(b) Usually comprised of several related projects
which need to be coordinated in order to manage the dependencies
and achieve the required overall outcomes.
(c) Structured such that the capability outcome
can be clearly and simply defined and accepted, and the group
of key stakeholders is manageable, but not so granular that the
adoption of programme management adds no value to the management
of the component projects.
(d) Normally be aligned to "Capability Integration
Groups" (groupings in the Front Line Commands) to optimise
the integration of capability into operational service and the
through life management of the capability after acceptance.
DE&S is currently managing some 350 projects
at various stages of the acquisition cycle. In addition, there
are currently some 300 Urgent Operational Requirements in which
DE&S is involved.
As stated in serial 2 above, the question of
affordability of the Equipment Plan is being addressed in Planning
Round 09. In addition, availability of suitable resources within
DE&S to manage the delivery of a project is a key consideration
when investment decisions are made. The current portfolio of projects
is considered to be manageable, although work to support current
operations through the delivery of Urgent Operational Requirements
has inevitably required the re-prioritisation of some tasks; this
has been done in conjunction with the customer. The effective
management and deployment of resources, particularly those with
specialist skills, is a key challenge for effective project management.
To improve its ability to better manage the deployment of people
to meet business priorities, DE&S is introducing Flexible
Resourcing. This will improve the visibility of the skills people
have, where they are deployed and the tasks on which they are
engaged, allowing a more agile approach to the deployment of resources
to aid the efficiency of project delivery.
As part of the review of how capability is delivered
referred to above, it was recommended that the overall number
of programmes should be rationalised to ensure that the benefits
of a fewer number of broader programmes could be delivered. In
line with this we are seeking to rationalise the number of programmes
to approximately 40-50 across the whole of the Equipment Plan.
The implementation of this approach is scheduled to commence in
early November 2008 with the first tranche of programmes acting
as "pilots" for the remainder.
UPDATES ON
EQUIPMENT PROGRAMMES
5. A short progress report on the following
equipment programmes:
— Joint Strike Fighter (JSF);
— Future Rapid Effect System (FRES);
— Military Afloat Reach and Sustainability
(MARS);
For the above programmes which have passed
Main Gate, the progress report to include:
— The Current Forecast Cost (against
Approved Cost at Main Gate).
— The Current Forecast In-Service
Date (against Approved In-Service Date at Main Gate).
For each of the above programmes, the progress
report to include:
— A summary of the key events/decisions
since the Committee last examined the programme[4]
and the key events/decisions expected in the near future (next
six months).
Future Carrier—the progress report
should set out the current position regarding French involvement
in the programme, including any potential savings for the UK programme
from such involvement.
FRES—the progress report should set
out the key developments following the announcement on 8 May 2008
that Piranha 5 had been selected as the preferred design to be
taken forward to the next stage of the Utility Vehicle programme
and set out when the package of work on risk reduction is expected
to be completed.
A400M—reports in the press have suggested
that the A400M programme has experienced further delays. The progress
report should set out the options which the MoD is considering
for bridging the capability gap caused by these delays.
ASTUTE
| | Original MG
Approval (90%)
| Current Forecast
(50%) |
Difference
|
| Cost (£m) | 2,578*
| 3,806 | +1,228 |
| ISD | June 2005 | May 2009
| +47 (Months) |
| * Approval only given at 50% confidence level
| | | |
| |
| |
Progress Report
Over the last 12 months, several technical issues have affected
HMS ASTUTE's programme. These included damage sustained to Turbo
Generator bearings during testing, replacement of a main coolant
pump that was not performing to the required standard and quality
issues on some components.
In July 2008, a detailed programme taking HMS ASTUTE through
to her In-Service Date (ISD) was worked up between MOD and BAE
Systems, encompassing lessons learnt from the test and commissioning
programme to date, and incorporating expert advice from across
the submarine build and support enterprise, including expertise
from Babcock Marine (Devonport) and the US (NAVSEA and Electric
Boat). This has shown that the Astute Boats 1-3 schedule will
require re-approval by the Investment Approvals Board (IAB), work
on which is already underway—a detailed Review Note is planned
for early 2009.
As part of the re-approval process, programme reviews are
being conducted on Astute Boats 2 and 3 (AMBUSH and ARTFUL) to
determine if there are any consequential schedule and cost implications
arising from HMS ASTUTE's delay.
Construction on Astute Boat 4, AUDACIOUS, started in May
2007 under a contractual limit of liability. The intention is
to extend this contract in Spring 2009 to cover delivery of AUDACIOUS
into service under a target cost incentive fee arrangement. By
that time the required £160 million of savings will sufficiently
mature to be contained within the contractual price.
Contract for procurement of long lead items for Boat 5 were
placed in January 2008. A Review Note is on its way to the IAB
in October 2008 seeking permission to procure Boat 5 and long
lead elements of Boat 6.
Key Events/Decisions since March 2008
— ASTUTE Core Load completed in July 2008.
— ASTUTE undocked on 16 October 2008.
— AMBUSH—Pressure hull and bridge completed.
Key Events/Decisions expected in the next six months (to April
2009)
— Continuing ASTUTE's test and commissioning programme.
— IAB, Ministerial and Treasury re-approval of the
Boat 1-3 programme.
— IAB, Ministerial and Treasury Approval to procure
Boat 5 and Boat 6 LLI's.
— AMBUSH—Starting first phase of testing preparations.
— ARTFUL—Main Propulsion Machinery Package
assembly complete.
— Agree Target Cost Incentive Fee contract for AUDACIOUS.
— Start of construction on Boat 5.
FUTURE CARRIER
| | Original MG Approval
| Current Forecast | Difference
|
| Cost (£m) | 3,900
| 3,900 | — |
| ISD | 2014 & 2016 | 2014 & 2016
| — |
| |
| |
Key Events/Decisions since HCDC Report on CVF in January 2008
3 July 2008—It was announced in Parliament that contracts
valued at around £3 billion had been placed with the newly-formed
Joint Venture company (BVT) and the Aircraft Carrier Alliance
for the construction of two 65,000 tonne aircraft carriers for
the Royal Navy.
Sub-contracts (valued at approximately £400 million)
have been placed for the following:
— (placed before contract signature) The modification
of Rosyth dockyard, 80,000 Tonnes of Steel, Blown Fibre Optic
Cable Plant, Reverse Osmosis Equipment, Aviation Fuel Systems
Equipment, Manufacture of Aircraft Lifts. (see bullet points below
for further details).
— (placed after contract signature) Highly Mechanised
Weapons Handling System, Uptakes and Downtakes Systems, Air Traffic
Control Software, Wholeship Pump Integration, Emergency Diesel
Generators, Power and Propulsion Systems. (see bullet points below
for further details).
February 2008—Sub-contract placed for the modification
of Rosyth dockyard £35 million, (widening entrance etc) in
preparation for the assembly of the aircraft carriers.
March 2008—Sub-contracts placed for: Supply of over
80,000 tonnes of steel for manufacture of the two ships (placed
with Corus Construction & Industrial/Dent Steel Services Ltd)
£65 million, Blown Fibre Optic Cable Plant (BFOCP) (placed
with Brand-Rex Ltd) £3 million, Reverse Osmosis Equipment
(placed with Salt Separation Services) £1 million, Aviation
fuel systems equipment (placed with Fluid Transfer International)
£4 million.
April 2008—Sub-contract placed for the manufacture
of Aircraft lifts for the two new aircraft carriers (placed with
MacTaggart Scott) £13 million.
August 2008—Sub-contracts placed for: Highly Mechanised
Weapons Handling System (placed with Alstec Ltd) £34 million,
Uptakes and Downtakes Systems (placed with Darchem) £8 million,
Air Traffic Control Software (placed with Cobham plc) £5
million, Wholeship Pump Integration (placed with DESMI Ltd) £3
million, Emergency Diesel Generators (placed with Wartsila Lips
Defence) £1 million.
October 2008—Sub-contracts placed for Power & Propulsion
Systems (£240 million) including gas turbines, shaft lines,
propellers, platform management system, power generation and transmission
equipment. Thales UK, being responsible for project management
and integration, formed a Sub-Alliance and placed sub-contracts
with Rolls Royce, Converteam and L3 Communications to meet the
Power & Propulsion requirement.
UK/FR Carrier Co-operation—As part of a wide ranging
Defence Review, France has elected to postpone the decision concerning
a second aircraft carrier until 2011-12. They have already made
a series of staged payments (totalling £70 million) in recognition
of the investment the UK has already made in the design, with
a further payment (£45 million) being dependent on France
proceeding to manufacture with our design. In budgeting for CVF,
it was always recognised that the final payment was not guaranteed.
Key Events/Decisions expected in the next six months
Order for Goliath crane (which will be installed at Rosyth)
to be placed shortly (£15 million).
Central Upper Blocks—Bids have been received, decision
due at end of October 2008 (worth £300 million).
Late 2008—Lower Block 01, Pre-fabrication work begins
at Babcock's Appledore yard, North Devon (not to be confused with
First Cutting of Steel).
First Cutting of Steel for HMS Queen Elizabeth (CVF01) is
expected to commence in early 2009 (mid 2010 for HMS Prince of
Wales (CVF02)), this corresponds with the start of production
in the main shipyards.
JOINT STRIKE FIGHTER
| | Original MG
Approval (90%)
| Current Forecast
(50%) |
Difference
|
| Cost (£m) | 2,236
| 1,834 | -402 |
| ISD | No formal ISD will be set until the programme is sufficiently mature.
| |
| |
| |
Key Events/Decisions since 2007
— First flight of the first development STOVL JSF
in June 2008.
— JSF programme is progressing to plan with both
the CTOL and STOVL variants completing in excess of 60 sorties
to date.
Key Events/Decisions expected in next six months
— January 2009—DE&S will seek approval
to purchase three JSF to allow the UK to participate in the Operational
Test and Evaluation of JSF in the USA.
Progress on Production, Sustainment and Follow-On (PSFD) Arrangements
The UK continues to work closely with the US to secure the
commitments it requires with regards to operational sovereignty.
Progress is being made in this area by the UK's inclusion in the
JSF Operational Test and Evaluation (OT&E) development planning,
continued presence and increased access of UK SME's within the
JSF programme in the USA and proposals to increase the level of
access to JSF information for UK Industry.
TYPE 45 DESTROYER
| | Original MG Approval
| Current Forecast | Difference
|
| Cost (£m) | 5,475
| 6,464 | +989 |
| ISD | November 2007 | November 2010
| +36 (months) |
| |
| |
Key Events/Decisions since the Committee last examined Type
45
— April 2008—First of Class DARING successfully
completed second set of sea trials, proving propulsion systems.
— June 2008—First test firing of Principal
Anti-Air Missile System (Sampson) (PAAMS(S)) from the Longbow
test barge off of the French coast successfully completed.
— September 2008—DARING successfully completed
third and final set of sea trials prior to Acceptance Off Contract.
These trials focused on the Combat System, marking a shift to
delivery of the all important fighting capability of the warship.
— September 2008—The Main Gate Business Case
for Phase 1 of the Type 45/PAAMS(S) Full Support Solution approved
by DE&S Investment Board.
Key Events/Decisions expected in the next six months
— The Main Gate Business Case for Phase 1 of the
Type 45/PAAMS(S) Full Support Solution is currently planned to
be presented to the Investment Approvals Board before the end
of 2008. Ministerial and HM Treasury approval will be subsequently
sought.
— The second ship, DAUNTLESS, will begin her first
set of sea trials in November 2008.
— The fourth ship, DRAGON, will be launched on the
Clyde in November 2008.
— DARING to be Accepted Off Contract in December
2008, and custody of the ship passed from BVT Surface Fleet Limited
to the MOD. DARING will then transit to her base port (Portsmouth)
and begin 12 months of MOD led trials prior to entering service
(expected to be late 2009).
— Second PAAMS test firing from Longbow planned
for December 2008.
— Third (and final) PAAMS test firing from Longbow
planned for May 2009.
FUTURE RAPID EFFECT SYSTEM (FRES)
UTILITY VEHICLE
On 8 May 2008, the Ministry of Defence (MoD) announced selection
of PIRANHA V offered by General Dynamics (UK) Ltd as the preferred
design for the FRES (Future Rapid Effect System) Utility Vehicle.
Acknowledging that there were significant issues to be resolved
during negotiations, the MoD took the step of making General Dynamics
(UK) Ltd's preferred bidder status provisional. Their conversion
to full preferred bidder status was dependent upon the agreement
of acceptable commercial terms followed by the successful completion
of a package of work on risk reduction.
As PUS said at the HCDC evidence session on 4 November 2008
we are still discussing exactly how to pursue the relationship
with GDUK.
SPECIALIST VEHICLES
The Specialist Vehicle element of the FRES programme continues
to make good progress.
In June 2008, Departmental approval was given for the Specialist
Vehicle Assessment Phase. The aim of this phase is to refine the
requirement, develop programme options for delivering the FRES
Specialist Vehicle capability and to understand and mitigate technical
risk. The Assessment Phase includes the placement of a range study
of contracts with industry. We are also currently developing the
Acquisition Strategy for future stages of the Specialist Vehicle
programme.
MILITARY AFLOAT REACH AND SUSTAINABILITY (MARS)
| | Original MG approval
| Current Forecast | Difference
|
| Cost (£m) | N/A
| N/A | N/A |
| ISD | N/A | N/A
| N/A |
| |
| |
Key Events/Decisions since Initial Gate approval (July 2005)
— July 2005—entry into Assessment Phase announced
via Written Ministerial Statement. The Procurement Strategy at
the time was the formation of an Alliance, comprising the MOD,
an Integrator, a Design, Outfit and Build Alliance Partner and
a Through Life Support Partner.
— May 2007—Minister(DES) approved a decision
to review the Procurement Strategy to take account of changing
market conditions and the opportunities generated by the delivery
of the Defence Industrial Strategy (DIS).
— December 2007—Following approval of open
competition by Minister(DES), advertisement placed in the Official
Journal of the European Union (OJEU) seeking expressions of interest
from companies who wish to compete for the design and build elements
of the MARS Fleet Tanker (FT) programme.
— May 2008—Minister(DES) approval to down
select to four bidders (Fincantieri, Navantia, Hyundai and a consortium
of BVT/BMT/DSME) to enter into Competitive Dialogue over the MARS
FT programme.
Key Events/Decisions expected in the next six months
— 2009—The main investment decision for the
MARS FT programme is currently expected to be made during 2009.
A contract for the FT procurement will be placed with industry
after that decision has been taken.
A400M
| | Original MG
Approval (90%)
| Current Forecast
(50%) | Difference
|
| Cost (£m) | 2,744
| 2,632 | -112 |
| ISD | December 2009 | December 2011
| +24 (Months) |
| |
| |
Progress Report
A400M remains a key element of the UK's future defence capability,
providing both tactical (intra-theatre) and strategic (inter-theatre)
airlift capabilities. The programme remains on track to deliver
against its performance targets and the UK is satisfied that the
A400M will be an extremely capable platform.
Development delays announced by Airbus Military (AMSL) in
2007 led to a nine month slip in the ISD to December 2011. AMSL
have recently announced further delays to first flight of the
A400M prototype. We are pressing industry for further information
so we can make a detailed assessment of the impact on production
deliveries and also understand the scope of possible recovery
actions.
The Design and Production Phase (DPP) contract for delivery
of 180 A400M aircraft (including the UK's order of 25) was placed
in 2003 between AMSL and OCCAR, acting on behalf of seven Partner
Nations (Germany, France, Spain, UK, Turkey, Belgium, Luxemburg).
Key Events/Decisions since March 2008
— Roll out of the first A400M Prototype in June
2008 in Seville.
— Draft issue to Airbus of our In-Service Support
Request for Proposal.
Key Events/Decisions expected in the next six months (to April
2009)
— First Flight of the Engine Flying Test Bed.
— Initial In-Service Support Proposal from Airbus
Military.
The A400M will replace the Hercules C-130K, the out of service
date for which remains 2012. We are naturally concerned by delays
to the A400M programme and will be monitoring the situation closely
in the coming months. The Department regularly reviews its transport
airlift requirements and is considering various contingency plans
to mitigate any potential capability gaps. These include:
— Reallocating assets, dependent on changing operational
requirements (eg Herrick drawdown).
— Extending the out-of-service dates of C130K. The
potential costs and limitations of this option are recognised
and critical investment decision points have been identified.
We will remain adaptive to emerging information on the A400M programme.
— Leasing or procuring additional assets (C-17/C130).
NIMROD MRA4
| | Original MG Approval
| Current Forecast | Difference
|
| Cost (£m) | 2,813
| 3,602 | +789 |
| ISD | April 2003 | December 2010
| +92 months |
| |
| |
Key Events/Decisions since March 2008
— One of the trials aircraft (PA03) completed its
contribution to the flight test programme in March 2008 and has
since been utilised for Reliability, Maintainability and Testability
work in aid of the Future Support programme.
— The first polar navigation by a Nimrod MRA4 was
successfully completed by a trials aircraft (PA02) in June 2008.
This involved a flight of more than 12 hours and 4,000 nautical
miles.
— Trials aircraft deployed to Istres in Southern
France in August 2008 to utilise the long runway and reliable
weather conditions.
— Aircraft production remains on programme to meet
an In Service Date of 2010.
Key Events/Decisions expected in the next six months
— A Main Gate submission proposing the strategy
for the support of MRA4 is planned for Spring 2009.
A decision on the number of trials aircraft that can be converted
to a full production standard is expected to be taken in Spring
2009.
FUTURE LYNX
| MG approval
(70% confidence)
| 50% Forecast
at MG | Current Forecast
(50%)
|
Difference |
| Cost (£m) | 1,966.4 |
1,901.0 | 1,911.2 | +10.2
|
| ISD | — | January 2014*
| January 2014 | 0 |
* This is the ISD for the British Army's Battlefield Reconnaissance Helicopter and is defined as 4 force elements at readiness to deploy on a small scale focussed intervention operation.
| | | |
|
| |
| | |
Key events decisions since approval
The programme is proceeding within current approvals.
— June 2006—FLynx Contract awarded to AgustaWestland,
along with the signing of the Strategic Partnering Agreement and
the Business Transformation Incentivisation Arrangement.
— October 2007—First metal cut for the FLynx
Trials Installation aircraft.
— January to March 2008—First appearance in
Major Projects Report.
— May 2008—Air vehicle Critical Design Review
held.
— June 2008—Verification of the tail rotor
concept complete.
— July 2008—Mission System Preliminary Design
Review held.
— September 2008—Successful Production Readiness
Review held.
(Note: There has been recent speculation about the MoD's commitment
to the Future Lynx programme. As a significant MoD project, Future
Lynx is being reviewed as part of a wider examination of the Department's
financial planning process. No decisions have been taken).
Forthcoming key events/decisions
— November 2008—delivery of 1st Aircraft Structure
from GKN Structures to Agusta Westland Build line.
— August 2009—Air Vehicle and Mission System
Critical Design Review.
— November 2009—More Effective Contracting
Gate Review 1.
— December 2009—First Flight of trials installation
aircraft.
HELICOPTERS
6. A note setting out:
— the current UK military helicopter fleets (broken
down by type/mark eg Sea King Mk 5), the number of helicopters
currently in each fleet, and the forecast out-of-service date
for each helicopter fleet; and
— the UK military helicopter fleets (broken down
by type/mark) expected to be operating in 2020 and the number
of helicopters expected to be operating in each fleet.
The table below provides a breakdown of the 594 aircraft
currently in the military helicopter fleet (as at 1 October 2008),
excluding helicopters that the Ministry of Defence operates but
does not own, and sets out the respective out of service dates
(OSDs).
71 of the 594 helicopters are categorised as non-effective.
These aircraft are still on the Military Register but they are
redundant, declared as surplus, awaiting disposal and consequently
are not expected to be flown.
Without life extension work, the service life of the majority
of the helicopters in our current fleets will cease before 2020.
Where a life extension programme is planned to extend the out
of service date of a helicopter, the resulting extended OSD is
set out in brackets.
We also expect to complete a number of helicopter procurement
programmes in advance of 2020. The capabilities currently provided
by the Lynx fleet will be provided by the Future Lynx from the
middle of the next decade, the Sea King Mark 3, 3A and 5s will
be replaced under a PFI arrangement for Search and Rescue and
the first tranche of our Future Medium Helicopter capability should
have been introduced. In addition the eight Chinook helicopters
reverted from Mark 3 standard to the 2/2A standard are also not
included in the table but will have been introduced into service.
Broadly, we expect to sustain the levels of medium and heavy
lift capability. We do expect to reduce the number of platforms
used in lighter roles, such as currently provided by the Gazelle
and Lynx. In the battlefield environment, the light helicopter
fleet is in transition as a result of the introduction of the
Apache which has reduced our reliance on Lynx in the attack role
and improvements in communications and ISTAR coverage by other
assets has reduced the numbers of Rotary Wing aircraft needed
for battlefield reconnaissance. For such reasons we have already
decided that we would not anticipate deploying Gazelle on operations
overseas before it goes out of service.
As with all Defence programmes, it is not until Main Gate
approval has been obtained that decisions such as the final aircraft
numbers, the timescales for the upgrades and the revised out of
service dates are confirmed. As such, the information provided
in the table below is susceptible to change and we cannot be precise
about the number and type of helicopters that will be in service
in 2020. It is also important to recognise that our delivery of
capability (which may include by contracting for availability)
is the primary measure of success and so a focus on overall numbers
alone can be misleading.
HELICOPTER FLEET NUMBERS—BREAKDOWN AS AT 1 OCTOBER
2008
Aircraft
type/mark |
MOD
Departmental
Fleet |
Effective
Fleet
|
Non-Effective
Fleet | Current
Planned
OSDs
|
Comments |
| Augusta 109 | 4 | 4
| NIL | 2009 | It is expected these aircraft will be replaced during 2009 by 4 EC 365N3s.
|
Apache | 67 | 67
| NIL | 2030 | We expect to have to invest further in this aircraft (eg to address obsolescence and meet emerging requirements) during the next decade, in order to sustain its service life up to 2030.
|
Chinook Mk2
Chinook Mk2a | 34
6
| 34
6 | NIL
NIL
| 2015
(2040)
2025
(2040) |
We expect to have to invest further in these aircraft (eg to address obsolescence, meet emerging requirements and extend the planned date of their retirement to 2040) during the next decade, although no investment decisions have yet been made.
|
Gazelle | 99 | 64
| 35* | 2012 | Where there is an enduring requirement for the capability currently provided by Gazelle we are exploring arrangements based on leased aircraft.
|
Lynx Mk3
Lynx Mk8 | 34
34
| 30
33 | 4
1 | 2013
2015
| It is expected that these aircraft will be replaced by the Surface Combatant Maritime Rotorcraft (SCMR) variant of Future Lynx from 2015.
|
Lynx Mk7
Lynx Mk9 | 84
24
| 74
22 | 10
2 | 2013
2013
| It is expected that these aircraft will be replaced by the Battlefield Reconnaissance Helicopter (BRH) variant of Future Lynx from 2014.
|
Merlin Mk1 | 42 | 42**
| NIL | 2029 | We are currently preparing to upgrade these aircraft through the Merlin Mk1 Capability Sustainment Programme.
|
Merlin Mk3
Merlin Mk3a | 22
6
| 22
6 | NIL
NIL |
2030
2030 | We expect to have to invest further in this aircraft (eg to address obsolescence and meet emerging requirements) during the next decade, in order to sustain its service life up to 2030.
|
Puma | 43 | 34
| 9*** | 2012
(2022) |
We expect to have to invest further in this aircraft to extend the planned date of its retirement to 2022, when it is expected that the capability provided by these aircraft will be replaced by the Future Medium Helicopter programme.
|
Sea King Mk3/3a | 25 |
25 | NIL | 2017 |
It is expected that the capability provided by these aircraft will be replaced by a joint PFI service with the Maritime and Coastguard Agency.
|
Sea King Mk4 | 37 | 37
| NIL | 2012
(2018) | We expect to have to invest further in this aircraft to extend the planned date of their retirement to 2018, whereupon it is expected that the capability provided by these aircraft will be replaced by the Future Medium Helicopter programme.
|
Sea King Mk6c | 5 | 5
| NIL | 2010 |
|
Sea King Mk5 | 15 | 15
| NIL | 2017 | It is expected that the capability provided by these aircraft will be replaced by a joint PFI service with the Maritime and Coastguard Agency.
|
Sea King Mk7 | 13 | 13
| NIL | 2018
(2022) | We expect to have to invest further in this aircraft to extend the planned date of their retirement to 2022.
|
This table excludes the eight Chinook Mk3s undergoing Reversion Programme.
| | | |
| |
| | |
| | |
MoD Departmental Fleet:
All MoD owned aircraft currently on the Military Register.
This is all "effective" and "non-effective"
aircraft.
Effective Fleet:
Those aircraft expected to be flown by the MoD. This is all
aircraft in Forward and Depth. Depth to include depth maintenance
and repair, those undergoing modification, trials aircraft (other
than manufacturers'), storage (including attrition/reserves) and
surplus aircraft awaiting classification as "non-effective".
Non-effective Fleet:
Aircraft no longer expected to be flown by the MoD. Aircraft
still on the Military Register that have been declared surplus
and are awaiting disposal, plus Ground Instructional Aircraft.
Explanatory notes:
* Gazelle—8 "attrition" aircraft were mistakenly
included in the non-effective figures. These have now been correctly
accounted for in the effective figures, Non-effective. The Non-effective
fleet currently includes 30 a/c for disposal and 5 ground training
a/c.
** Merlin—4 of these aircraft are in storage and have
been cannibalised heavily ; 1 has been extensively modified as
part of a joint MOD/Industry technology demonstrator programme.
Recovery to a fully serviceable condition would take significant
time and investment. These aircraft are, under today's definitions,
classified as effective until such time that a decision is taken
to dispose of them.
*** Puma—2 aircraft at the contractor for repair were
previously wrongly classified as part of the Non- effective Fleet
these have now been correctly accounted for as Effective. The
Non-effective fleet include 5 x Cat 5s plus 4 x Cat 4s not expected
to fly as Puma HC1 a/c.
DE&S PERFORMANCE/PERSONNEL
7. The MoD Annual Performance Report for 2007-08 states
that "procurement performance declined, failing to meet our
in-year Public Service Agreement sub-targets for cost and time,
and only partly meeting the overall target". What were the
key factors behind the decline in procurement performance in 2007-08?
How did the need to support current operations affect DE&S's
procurement performance in 2007-08?
The key factors for cost and time variation in Financial
Year 2007-08 can broadly be grouped into three categories:
(a) decisions taken by the Department in the broader context
of the defence needs (this would largely include elements of changed
requirement; changed budgetary priorities; procurement strategy);
(b) factors outside the Department's direct control (this
would largely include international contracting process and procurement
strategy issues, accounting adjustments and re-definitions; inflation
and exchange rates); and
(c) factors reflecting the realisation of unplanned or low
level/high impact risk for the Department and/or Industry (technical
factors).
On this basis much of the in-year cost variation falls to
factors either outside the Department's direct control, with international
factors being the single most significant element, or the realisation
of unplanned low level/high impact risk. We have sought to mitigate
the impact of these risks by taking decisions that can be managed
within the broader context of defence.
The impact of international collaboration on performance,
cost and time is something that it is currently hidden amongst
the factors normally ascribed to change. UK Defence benefits enormously
from international collaboration. Not only does collaboration
increase military inter-operability for coalition operations but
provides a means of sharing development expenditure and production
economies of scale. Indeed, capabilities such as Typhoon, Joint
Combat Aircraft, A400M and the Guided Multiple Launch Rocket System
would probably be unaffordable on a UK-only basis. However, within
international collaboration, we are only one customer amongst
several and our influence is inevitably diluted; we are subject
to the influence of the intricacies of programming decisions in
each of the member nation's defence programmes; and we are often
obliged to pursue more traditional means of procurement compared
with our generally more innovative and progressive approaches.
Five projects—Naval EHF/SHF Satellite Communication
Terminals (19 months), Soothsayer (16 months) and Terrier (27
months) Replacement General Service Respirator (22 months) and
Precision Guided Bomb (18 months)—account for a high proportion
of the total in year slippage. Taking the broader approach to
reasons for variation outlined above, nearly all of the change
appears to result from factors ascribed to international programmes
with the remainder relating to the realisation of unplanned risks.
This latter factor still obscures the fact that, where such risks
emerge, the Department does have a choice over a lower standard
of capability or performance, to cancel the project, or to trade
time to ensure delivery of capability. Because of the demonstrable
need for the capability the latter option is likely to offer the
lowest risk solution.
The extent to which the Department makes deliberate trades
in performance, cost and time is not adequately reflected at present.
An example this year is the Beyond Visual Range Air to Air Missile
where we have revised the definition of In-Service Date to preserve
delivery of the missile as a key project milestone but slipped
the point of integration on Typhoon to avoid additional costs.
We did this in the knowledge that we would not create a capability
gap—recent analysis shows existing systems can meet the
requirement during such a pause.
Supporting operations, not least through the procurement
of equipment to meet Urgent Operational Requirements, has been
the Department's highest priority. Resources within DE&S have
been prioritised accordingly. It is not, however, possible to
assess to what extent, if any, this effort has impacted on our
performance against the procurement targets.
8. How is DE&S performing in 2008-09 against the three
sub-objectives under "PI 3.1 Procuring and Supporting military
equipment capability through life"?
The current DE&S position has highlighted a number of
risks to Time and Cost, and options to recover these are being
investigated.
9. How many DE&S personnel were in post at 30 September
2008 and how many are expected to be in post at the end of March
2009? Is it still the target to reduce the number of DE&S
personnel to around 20,000 by 2012? Has this target been re-examined
to take account of the need to continue to support current operations?
On 30 September 2008, there were approx 23,400 personnel
of full time equivalent (FTE) employed within DE&S (17,800
civilian and 5,600 military). It is anticipated that the FTE strength
at 31 March 2009 will be approx 23,300 FTEs (17,700 civilian and
5,600 military).
DE&S is currently reviewing its manpower requirements
as part of the PR09 process. Based on current PACE (Performance,
Agility, Confidence, Efficiency) manpower requirements, it is
planned to reduce to a figure of around 20,000 by 31 March 2012
with resources re-prioritised where necessary to enable the effective
delivery of our outputs.
10. What progress has DE&S made to upskill its staff?
How did DE&S perform against its target of staff completing
a minimum of six training days in 2007-08 and against the "further
target of four days for Continuing Professional Development in
the key acquisition disciplines of Commercial, Finance, Programme
and Project Management, Engineering and Logistics"?[5]
DE&S must continue to develop and acquire skills needed
for the future. The funded Upskilling programme has been expanded
to embrace the wider functional community as well as broader acquisition,
leadership, management and core competence skills. In year some
£10 million has been allocated to fund a range of skills
interventions. The Skills Directors appointed for each discipline
have drawn up skills plans to improve the skills capability in
each of the functions and are on track to meet Professional Posts
targets to ensure key designated posts are filled by suitably
qualified individuals.
Over 70% of the DE&S workforce met the 6+4 training days
target last year (2007-08). The current levels of achievement
against the 6+4 target are twice as high this year than for the
same period last year.
Achievements in the programme include:
Project and Programme Management—Project Management
Level 3 Licence development commenced with a pilot of the Certificated
Project Manager (CPM) qualification; 25 Professional Post holders
are undertaking the pilot which will complete in March 2009. A
total of 484 Project Management Licences (which are linked to
the Association of Project Management) have been issued, including
80 at Level 2.
Finance—Over 55% of staff in DE&S finance
professional posts are qualified accountants. To improve the future
position, the Training Accountant Development Scheme (TADS) has
been increased and 22 new graduates commenced the development
programme in September 2008. Existing TADS achieved 100% pass
rate in the May 2008 CIMA exams, with two TADS achieving a mark
that brought them into the "top 10 worldwide". A further
39 have been accepted for Association of Accounting Technician
training.
Commercial—Over 70% of DE&S commercial professional
posts are filled by individuals with the relevant Chartered Institute
of Purchasing and Supply (CIPS) qualification. The target of 100%
of Commercial Directors with MCIPS or on the Professional Development
Programme is currently at 75%. The target of 100% is expected
to be reached by 31 March 2009. The B2 conversion 2007-08 intake
graduated in September 2008.
Logistics—New Defence Academy learning courses
have gone live. Inventory Management Licences have been launched
with 500 passes to date. Ten Supply Chain Management courses are
being delivered.
Engineering—Twenty one DESG Graduates commenced
the development programme and a further 51 have been given an
offer of contract. Delivery of places achieved on Land Systems
Post Graduate Certificate. Delivery of modular Aerospace Engineering
Technology & Systems Engineering awareness courses. Increase
to apprentice recruitment, September 2008 intake expected to be
in excess of 40.
11. What progress has DE&S made in "producing
a Workforce Strategy during 2008|. and introducing Workforce Plans
in support of Business Plans to identify opportunities for recruitment,
interchange and partnering with industry in order to develop a
strong and sustainable skills capability"?[6]
DE&S has been engaged with other MOD Top Level Budget
areas on the development of a pan-Departmental approach to Workforce
Planning during 2007-08. This resulted in the adoption by the
MOD's Director General Civilian Personnel (DGCP) of the MOD Guide
to Workforce Planning. The DE&S Workforce Plan seeks to identify
critical skills that will be required to deliver DE&S outputs
over two, four and 10 year horizons and the risks associated with
recruiting and retaining those resources. Since January 2008,
DE&S DG Human Resources has been engaged with the DE&S
2-star Clusters through their HR Business Partners to undertake
Workforce Planning within business areas. The Workforce Planning
process was trialled with DG Information Systems and Services,
and DG Safety and Engineering from February—June 2008 to
test the methodology. The lessons learned from these trials were
incorporated into the roll out of Workforce Planning across DE&S
during June 2008. The Workforce Plan is focussing on the identification
of critical roles and skills to the business, whether these will
grow, shrink or remain constant and the gaps or surpluses that
will arise in these role/skill areas. The DE&S Workforce Plan
will seek to aggregate together role/skill issues from across
the TLB. Once TLB critical roles/skills have been identified,
the Workforce Strategy will be produced to identify interventions
to meet the critical shortfalls. In some business areas (eg Naval
Bases), measures enabling staff to work alongside partners to
develop knowledge and skills are in hand. Work is currently in
train to identify "near-term" recruitment requirements
to meet critical resource shortfalls within the business over
the next 6 -18 months. It is planned that co-ordinated recruitment
activity to meet identified resource requirements will be launched
in November 2008.
Additionally, DE&S has been engaged, through DGCP, in
the Defence Sector strategic workforce and skills planning programme.
The aim of this is to enable the Defence Sector to identify common
"skills demand signals", exert more influence on the
national training and education system and establish joint methods
of reducing common skill gaps.
DEFENCE INDUSTRIAL
STRATEGY
12. In December 2006, the MoD provided the Committee with
a "Summary Progress Report on significant DIS Milestones"
which was published in the Committee's Report "The Defence
Industrial Strategy: update" (Sixth Report of Session 2006-07,
HC 177). The Committee would be grateful for an updated version
of the Summary Progress Report
An updated Summary Progress Report on significant DIS Milestones
is at Annex B to this Memorandum.
13. Where does responsibility for promulgating and implementing
the DIS fall within the MoD?
The Defence Commercial Director (DCD) is the Senior Responsible
Owner for the DIS, charged with overseeing its implementation
and execution, and for seeing that it is refreshed, current and
relevant to the business needs of MOD and industry. The Defence
Acquisition Change Programme (DACP) is responsible for implementing
the majority of internal change programmes that resulted from
the DIS. It is the responsibility of DE&S, and its sector
clusters, to implement the sector strategies of the DIS.
UPDATED VERSION
OF THE
DEFENCE INDUSTRIAL
STRATEGY
14. What is the latest position regarding the publication
of the updated version of the Defence Industrial Strategy? What
assessment has the MoD made of how the delay in publishing the
updated version has affected industry?
The Department remains firmly committed to the Defence Industrial
Strategy and has engaged closely with industry to develop it further.
Work continues on developing the policy framework and examining
the medium and long term equipment programme issues that will
inform the industrial sector strategies. We are discussing the
revision of the Strategy with the National Defence Industries
Council; and through bilateral meetings with individual companies
at all levels.
We do not believe that the lack of an updated version is
having a significant impact on the achievement of the original
DIS objectives, where we continue to make good progress. The principles
set out in the original DIS still underpin all MOD's acquisition
activity and are driving transformation that will deliver equipment
to the front line at value for money for the taxpayer.
UK/US DEFENCE TRADE
COOPERATION TREATY
15. What progress has been made with the UK/US Defence
Trade Cooperation treaty and when does the MoD expect the Treaty
to be ratified?
HMG has been working closely with the US Administration to
achieve ratification of the Defence Trade Cooperation Treaty.
Unfortunately, the US Senate Foreign Relations Committee was unable
to consider the Treaty during the closing sessions of the 110th
Congress due to a number of other high priority issues also being
dealt with by the Senate staff. The Committee chair, Senator Biden,
has made it clear that the Treaty will be dealt with as a priority
in the early part of the 111th Congress, due to start in late
January 2009. While this is clearly disappointing news, we understand
that the SFRC continues to fully support the aims of the Treaty
and that they are content with the way it will be implemented
and enforced. The MOD will continue to work with the US Government
to ensure the Treaty remains a priority issue and can be brought
into force as quickly as possible upon ratification.
DISPUTE RESOLUTION
16. How does the MoD usually seek to resolve disputes with
defence equipment contractors? What assessment has the MoD made
of other approaches to dispute resolution, such as the sorts of
approach offered by bodies such as the Winchester Group?
The MOD seeks, where possible, to resolve disputes by negotiation
as early as possible. It is our preferred approach as it is the
most efficient in terms of time management, costs, and control
of process. Where negotiation fails to produce a settlement that
is acceptable to the parties, the MOD will seek the agreement
of the contractor to use alternative methods to settle the dispute.
These alternative methods might include a contract pause period
coupled with Alternative Dispute Resolution (ADR) which comprises,
amongst other techniques, mediation, neutral evaluation and expert
determination. Should these fail the parties are then able to
resort to arbitration, or litigation. Where ADR is used, an ADR
organisation will be selected under whose auspices the dispute
resolution will be conducted. A wide range of these alternative
methods is now available and the MOD considers along with the
contractor in dispute which is most suitable for each dispute
as it arises and when it is most suitable to deploy the chosen
method. A number of different approaches have been used to solve
real life disputes with contractors such as Early Neutral Evaluation.
For example, on the Survey Vessels project, at the MOD's suggestion,
the Winchester Group were engaged to assist in resolving a dispute
between the MOD's contractor and one of its sub-contractors which
was preventing one of the vessels from being delivered.
Annex A
DEFENCE EQUIPMENT CAPABILITIES (SERIAL 3)
There are 12 Director of Equipment Capability (DEC) areas.
Each DEC has responsibility for specific Capability Management
Groups.
The key current and future equipment projects which deliver
or are planned to deliver these capabilities are listed in the
table below. "Current" can be difficult to be precise
about, but has generally been taken as those projects underway
which are close to reaching the In Service Date. The term "key
equipment projects" has generally been interpreted as the
Category A projects ie those with an expected total procurement
cost in excess of £400 million (or which are subject to the
same level of scrutiny due to risk, complexity, precedence or
similar reasons), with the exception being DEC Chemical, Biological,
Radiological and Nuclear whose largest project is Category B.
DEC—Capability Management Groups
| Current and Future Capability Projects for Planning Round 09
|
DEC Above Water Effects
The ability to provide Control and Denial of the Above Water Battlespace to allow Joint Commanders to utilise the seaward flank in military operations.
| Current Projects
None
Future Projects
Destroyers Directorate—Type 45 Destroyer
Capital Ships—Future Carrier (CVF)
Surface Combatants—Future Surface Combatant (FSC)
|
DEC Deep Target Attack
The ability to deliver effects against land based targets from all environments supported by their embedded enablers.
| Current Projects
Joint Land Forces Engagement—Munitions Acquisition, the Supply Solution
Complex Weapons
Future Projects
Joint Land Forces Engagement—Future Indirect Fire System (FIFS)
Indirect Fire Precision Attack (IFPA)
Joint Strike—Joint Combat Aircraft (JCA)
SUAV(E)—Deep & Persistent Offensive Capability (DPOC)
Surface Attack Heavy—Future Long Range Direct Fires Capability (FLRDFC)
Surface Attack—Medium—Selective Precision Effects at Range (SPEAR)
|
DEC Under Water Effects
The ability to deliver coherent and cost effective decisive military effects from and within the under water environment both to deny the enemy's and to allow own forces' freedom of manoeuvre above and below the water to deliver capability requirements set by other capability areas which achieve their goals through exploitation of the under water environment's unique qualities.
| Current Projects
None.
Future Projects
Nimrod—MRA4
Initial ASTUTE Support Solution
Submarine Production—ASTUTE
Director Surface Combatants—Future Mine Countermeasures Capability (FMCMC)
Merlin IPT—MERLIN Capability Sustainment Programme (CSP)
FSM IPT—Maritime Underwater Future Capability (MUFC)
|
Directorate of Strategic Requirements
The ability to deliver a UK operationally independent, continuous and invulnerable strategic nuclear deterrent capability that is capable of launching nuclear strikes worldwide when ordered.
| Current Projects
None.
Future Projects
Nuclear Propulsion—Core Production Capability
Next Generation Nuclear Propulsion Plant (NGNPP)
Strategic Weapon System—Missile Compartment
Nuclear Warhead—Nuclear Weapon Capability Sustainment Programme (NWCSP)
Successor SSBN Platform
Trident D5 Life Extension Programme
|
DEC Command Control and Information Infrastructure
The ability to Command, Inform and Manage the Battle and Business space collaboratively from the strategic functions of the Department of State to individual military platforms over a defence-wide network.
| Current Projects
Skynet 5—military satellite communications system
Bowman Combat, Infrastructure and Platform—tactical radio communications system
Future Projects
Defence Information Infrastructure—Future Deployed
Falcon—Formation level land communications system to support headquarters from Corps to Brigade and RAF deployed operating bases.
Joint Command and Control Support Programme (JC2SP)
Joint Military Air Traffic System
Future Logistics Information System (FLIS)
Future Core Network
|
DEC ISTAR
The ability to provide accurate, timely and appropriate information and intelligence capabilities, and deliver influence and information effects through information.
| Current Projects
PICASSO—a classified programme that provides a national capability to exploit imagery.
Future Projects
ASTOR—The Airborne Stand Off Radar (ASTOR) system
HELIX—to sustain the UK's airborne electronic surveillance capability
WATCHKEEPER Tactical UAV system
SKASaC (Sea King Airborne Surveillance and Control) Capability Sustainment Programme (formerly Maritime Airborne Surveillance and Control)—delivery of maritime ISTAR force protection for the Carrier Strike capability
DABINETT—to address the UK's future ISTAR requirements
|
DEC Special Projects
Counter Terrorism
| Project Information not included due to classification.
|
DEC Expeditionary Logistics and Support
The ability to deploy and redeploy a Force to a theatre operations and to support and sustain it for the duration of operations in accordance with Defence Strategic Guidance and other Departmental Policy.
| Current Projects
Strategic Manoeuvre—C130 (ongoing work taking place)
Future Projects
Maritime Sustainment—MARS Fleet Tanker
MARS Fleet Solid Support Ships
MARS Joint Sea Based Logistics Ships
Strategic Manoeuvre—A400M
Future Tanker/Transport Aircraft
Future Comms Fleet
Theatre Ground Sustainment—
Support Vehicles
Operational Utility Vehicles
|
DEC Theatre Airspace
Theatre Airspace's vision is Joint Forces protected from all air threats; fully prepared and protected air power: To provide the Front Line of today and tomorrow with affordable, agile, interoperable and battle-winning capabilities which enable effective and secure air operations and give a joint force the freedom to operate without interference from threats to and from the air environment.
| Current Projects
Typhoon
Beyond Visual Range Air to Air Missile
UK Military Flying Training System
Advanced Jet Trainer
Future Projects
Network Enabled Air Defence and Surveillance
Mission Training Through Distributed Simulation
|
DEC Air and Littoral Manoeuvre
The ability to deliver the landing force from the sea; and attack, lift and find elements by air, to contribute to campaign success as part of a joint and/or coalition force.
| Current Projects
Air Manoeuvre—FRC (Future Medium/Heavy/SAR H lift Rotorcraft Capability)
|
| Battlefield Reconnaissance Helicopter/Surface Combatant maritime Rotorcraft.
Attack Helicopter Future Support Arrangements.
Littoral Manoeuvre—Landing Craft Rationalisation and Transition to Over The Horizon Operations (Cat tbd)
Future Projects
Littoral Manoeuvre—Future Amphibious Assault Ships
|
DEC CBRN (Chemical, Biological, Radiological and Nuclear)
The ability to enhance survivability and reduce degradation of individuals and equipment in order to maintain operational tempo.
| Current Projects
Medical Countermeasures
Future Projects
CBRN Protection (Cat B)
|
DEC Ground Manoeuvre
The ability to deliver decisive close combat effects in the Land Close Battlespace for the Army, Royal Marines and RAF Regiment.
| Current Projects
TERRIER
Future Projects
Challenger 2 Capability Sustainment Programme
Warrior Capability Sustainment Programme
Future Rapid Effect System
Future Integrated Soldier Technology
Hard Kill Defensive Aid System
Next generation Light Anti-armour Weapon
|
| |
Annex B
SUMMARY PROGRESS REPORT ON SIGNIFICANT DIS MILESTONES
(SERIAL 12)
Sector |
DIS Commitment
| Original Milestones and Public Milestones for 2007
|
Updated Position |
| Maritime (1) | We will immediately start negotiations ... to achieve a programme level partnering agreement with a single industrial entity for the full lifecycle of the submarine flotilla.
| For the award of the contract for the fourth and subsequent Astute class submarines. (2007)
| Ongoing
A range of options is being considered, however a Joint Venture (JV) is likely to be the most beneficial, subject to satisfactory arrangements and a commitment to continuous efficiency improvements.
A collaborative arrangement is in place for the Successor submarine concept phase.
|
| | |
Construction on Astute Boat 4, AUDACIOUS, started in May 2007 under a contractual limit of liability.
|
| This will be matched by the implementation of a unified submarine Programme Management organisation within the MOD.
| | Achieved
Since April 2006 submarine programme management within MOD has been unified, and sits within DE&S under the Director General Submarines.
|
| | Agree a route map to a Long Term Collaboration Agreement between MOD and key Industrial Partners covering full submarine life-cycle by Summer 2007
| Achieved
The Submarine Enterprise Collaborative Agreement (SEAC) team was established in April 2007, and has been developing collaborative concepts with BAES, Babcock Marine (BM) and Rolls-Royce (RR). A Public Policy Exclusion Order (PPEO) was laid before Parliament in July 2008 to enable the necessary information sharing. In parallel, MOD is putting together the evidence that would support the selection of a preferred delivery option for SECA. This work has involved working closely with industry.
|
| Maritime (2) | For surface ship design and build, we aim within the next six months to arrive at a common understanding of the core load required to sustain the high-end design, systems engineering and combat systems integration skills ...
| Within six months from publication June 2006
| Achieved
MOD and BVT have agreed a coherent view or "common understanding" of the loading on industry and the skill base that underpins it based on analysis by the RAND Corporation that identified what skills are key to preserving the UK's ability to design and build complex warships.
Progress was made possible by establishment of the BAE Systems/VT Joint Venture (BVT Surface Fleet Limited) on 1 July 2008.
|
| | Agree the core load required to sustain the high-end design, systems engineering and combat systems integration skills by Summer 2007.
| Ongoing
The agreed coherent view of the core work load required to sustain high-end design, systems engineering and combat systems integration skills is part of work to agree a new MOD/BVT Terms of Business Agreement (TOBA) which will transform the UK naval shipbuilding sector and establish MOD's commitments to sustainment of key design and build capabilities and future activity (the core workload). We hope to conclude the TOBA in Spring 2009.
|
| | Achieve an affordable programme following robust industry commitments to consolidation and performance improvement by Summer 2007.
| Achieved
The establishment of BVT Surface Fleet Limited on 1 July 2008 meant that MOD was able to announce placement of the CVF manufacturing contracts with BVT on 3 July 2008 and offers the opportunity, outlined in the TOBA Heads of Terms, for industrial rationalisation, representing a significant efficiency for CVF and the future warship building programme.
|
| | Industrial restructuring for Surface Ships which delivers potential cost improvements across the maritime programme Summer 2007.
| Achieved
Significant industrial restructuring has taken place in the UK maritime sector. Babcock's acquisition of DML at Devonport in June 2007 and formation of BVT on 1 July 08 offers significant opportunities for industrial rationalisation and transformation and cost reduction of warship build and support.
The TOBAs with BVT (expected in Spring 2009) and Babcock Marine (expected in Summer 2009) will see incentivised delivery of efficiencies; encouraging the two companies and MOD to co-operate and work together more closely; sharing in the risks and rewards.
|
| | Validate the core load requirement against the surface build programme and rationalisation proposals for build capability by Autumn 2007.
| Ongoing
Managed rationalisation of the UK's surface ship build capacity is needed to balance supply and demand in the longer term post-CVF. The MOD/BVT Heads of Terms identified the long term build capability needed to support the MOD forward programme. The process of finalising the TOBA refines those assumptions in terms of skill levels but does not change the underlying principles.
The MOD/BVT TOBA will seek to transform the business, incentivising improved performance, cost and timeliness.
|
Maritime (3) | For surface ship support, we will start immediate negotiations with industry with the aim of exploring alternative contracting arrangements and the way ahead for contracting the next upkeep periods, which start in the autumn of next year. Key maritime equipment industrial capabilities will be supported by the production of a sustainability strategy for these key equipments by June 2006.
| June 2006 | Achieved
The Department has moved forward with the dockyard companies (Babcock Marine and BVT) to put alternative contracting arrangements in place. To assist this process, competition policy has been suspended.
MOD and the (then) three dockyard companies signed a Memorandum of Understanding (MOU) in September 2006.
In Spring 2008, following the completion of two years exploratory and analysis work by the SSS project, MOD agreed that an alliance was the optimum solution to deliver future surface warship support.
|
| | Throughout 2007 and early 2008, complete individual contract negotiations for the refits and docking periods (known locally as the "Gloucester X" upkeeps) due to commence between Spring 2007 and Spring 2008.
| Achieved
The Contracts for the first five upkeeps to be managed by MoD and the dockyard companies, known as the "Liverpool 5", were awarded in Autumn 2006. Contracts for the second group of upkeeps, known as the "Gloucester Batch", have also been awarded (Spring 2007 through Summer 2008). The work share has been agreed between MoD and industry on the third batch of upkeeps (the "Ark Royal Batch").
|
| | By Spring 2008, subject to both approvals and consultation, establish the Surface Ship Support Alliance (SSSA).
| Achieved
MOD confirmed than an "alliance based" option was the preferred strategic end-state for the delivery of future surface ships in Summer 2008. A formal Trades Union consultation process was completed in September 2008.
The Surface Ship Support Programme will drive forward a four year incremental change programme to deliver complex warship support through an alliancing arrangement with industry.
|
| Key maritime equipment industrial capabilities will be supported by the production of a sustainability strategy by June 2006.
NOTE: There was an error in the original publication of DIS milestones which ran together equipment sustainability and SSS milestones.
| Arrive at a sustainability strategy for key Maritime equipment industrial capabilities by Summer 2007.
| Ongoing
Key industrial capabilities have been defined for platform (tier 1 supplier) design and build. Both BVT and Babcock Marine recognise the need to maintain healthy supply chains (for innovation and value for money) and increased MOD visibility of make/buy strategies. This will be part of the respective TOBAs.
|
| Fixed Wing (1) | ... we will work with BAE Systems and the other companies in the defence aerospace sector so that it can reach the appropriate size and shape for demand ... we aim during 2006 to agree the way ahead—which will be challenging given the scope of the scale of the transformation that is required—and to implement it from 2007.
| Agreement of LTPA in 2006. Implementation from 2007 onwards
| Ongoing
MOD and BAE Systems agreed the aims and objectives of a possible future LTPA in 2006 and entered into a Foundation Contract in 2007.
At the end of the Foundation Contract both parties agreed that more time was required to de-risk a full LTPA and to work together to build on the good progress made.
|
| | Achieve signature of a Foundation Contract to establish the feasibility of and de-risk the proposed long term partnering agreement (LTPA) by Early 2007.
| Achieved
Contract signature completed March 2007.
|
| | Reach a firm decision on the viability, shape and scope of the proposed LTPA by the End of 2007 and be positioned to place relevant supporting contracts as appropriate.
| Ongoing
Recognising the lessons learned at Foundation Contract stage, both parties agreed that a phased approach is more appropriate so that risks can be progressively tackled and success assured. Both parties are now actively negotiating the next phase of the programme.
|
Fixed Wing(2) | ... we intend to move ahead with a substantial Uninhabited Aerial Vehicle Technology Demonstrator Programme in 2006.
| In 2006 | Achieved
Contract awarded December 2006 for a programme to build an experimental Unmanned Air Vehicle. "TARANIS", a jointly funded Technology Demonstrator Programme
|
| |
| (TDP) between MoD and a BAE Systems led industry team comprising Rolls Royce, GE Aviation (formally Smiths Industries) and QinetiQ.
In addition, MOD has agreed to jointly fund a proposed spiral development programme, MANTIS, with BAES. This is an Advanced Concept Technology Demonstrator programme, aimed at providing the foundation for a near future UK sovereign capability for an Armed Deep and Persistent ISTAR Unmanned Air System (UAS) in the 2013 timeframe, capable of flight in non-segregated airspace. MOD will initially fund £9 million of the first phase of the programme, intended to prove concept development through to flight demonstration.
Discussions are underway to identify capability through potential future spirals.
|
AFVs | We will be working hard with BAE Systems ... to give effect to the long term partnering arrangement ... We intend to establish a joint partnering team within the early part of 2006 and to establish a business transformation plan underpinned by a robust milestone and performance regime.
| Early part of 2006 | Achieved
An AFV Partnering Agreement between MOD and with BAE Systems Land Systems was signed on 15 December 2005.
Two Joint Business Plans and Industrial Sector Strategies have been developed that identify the issues facing the Sustainment of industrial capability in the AFV Sector and propose a strategy for addressing them.
|
| | Agree a strategy for sustaining the current and future Armoured Fighting Vehicle (AFV) fleet by Spring 2007.
| Achieved
The DIS Sustained Armoured Vehicle Coherence Pathfinder defined a strategy for sustained coherence of the AFV Fleet in March 2007. The BAE Partnering Agreement published a sustainment strategy as part of the Joint Business Plan (JBP).
Industrial Sector Strategies have now been published for two successive years working through an effective AFV Industrial Associate Group.
|
| | Implement the strategy for procurement of the FRES system by Spring 2007 including initiation of a competition to provide the FRES Utility Variant
| Achieved
The FRES Acquisition Strategy was announced by the then Minister (Defence Procurement) in November 2006. A System of Systems Integrator (SOSI) preferred bidder was appointed in October 2007 and a Utility Vehicle provisional preferred bidder in May 2008.
|
| Helicopters | We hope that by the Spring 2006, subject to value for money having been demonstrated, we will have reached agreement on a Strategic Partnering Arrangement (SPA) ...
| Spring 2006 | Achieved
A Strategic Partnering Arrangement (SPA) and contractually-binding Business Transformation Incentivisation Agreement (BTIA) were signed with AgustaWestland (AW) on 22 June 2006.
These agreements enshrine the demanding partnered relationship envisaged by the DIS and include challenging measures and targets to maintain effective business transformation both within AW and the MOD.
|
| | Continue to build upon early success with the Strategic Partnering Arrangement (SPA) to improve efficiency and reduce dependency on UK Government contracts for its long term viability.
| Ongoing
The SPA, signed in June 2006, is underpinned by a contractual Business Transformation Incentivisation Agreement (BTIA) which encourages both partners to work together on improving aircraft availability, schedule adherence and responsiveness, while bearing down on cost and ensuring AW sustains core Design Authority skills onshore to support MoD helicopter fleets.
Performance against the BTIA has been good during its first two years. Work continues, including through the launch of the MOD/AW Joint Modification Service in March 2007, to improve delivery to the front line.
|
| | Reach decision on preferred bidder and transfer of responsibility for operation of DARA (RW and Components Business Units) and initiate action to place appropriate contracts and agreements by Summer 2007.
| Achieved
Vector Aerospace were selected as the preferred bidder for the purchase of the DARA Rotary Wing and Components businesses at Fleetlands in Hampshire and Almondbank in Perthshire on the 25 July 2007.
|
| | |
Vector Aerospace subsequently assumed ownership of the businesses on 1 April 2008.
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| Complex Weapons | We will establish a multi-disciplinary team charged with working with all elements of the onshore industry to establish how we might together seek both to meet our ongoing requirements and sustain in an industrially viable manner the critical guided weapons technologies and through life support capabilities that we judge to be so important to our operational sovereignty ... Our intention is that we should have a clearer way ahead by mid-2006.
| Mid-2006 | Achieved
Team CW, consisting of MBDA UK, Thales Air Defence Ltd, Thales Missile Electronics, Roxel and QinetiQ,were formed in July 2006.
The formal Assessment Phase (AP) for Team CW commenced in July 2008 with the aim of delivering military capability, while sustaining indigenous industrial capabilities, achieving VFM, and delivering industrial transformation in the sector. Work in examining strategic options for the delivery and support of underwater weapons with BAES Insyte is also underway.
|
| | Issue the Complex Weapons Sector Strategy in Early 2007.
| Achieved
The Complex Weapons Sector strategy was publicised in July 2006 through a statement by the then Minister (Defence Procurement). The commencement of the Team CW AP represents the first step in the implementation of this strategy.
|
| | Achieve Signature of a Complex Weapons Strategic Partnering Arrangement (SPA) by end 2007.
| Changed
This milestone has been overtaken by events. MOD and the industrial Team CW members jointly signed a Teaming Agreement for the AP, and two enabling contracts with the two Team CW prime contractors (MBDA UK and Thales UK) in July 2008.
|
| General Munitions | We will be taking forward Project MASS, with a view to making decisions on how best to sustain our required access to general munitions in the summer of next year... We are also actively pursuing partnering arrangements with other suppliers.
| Summer 2006 | Achieved
A long term MASS (Munitions Acquisition the Supply Solution) partnering contract worth potentially over £3 billion was signed with BAES LSM in the Summer of 2008. This followed work with BAES LSM to improve efficiency and create a viable future for general munitions production in the UK.
|
| | Confirm the preferred commercial strategy for meeting this requirement in Summer 2007.
| Achieved |
| | Achieve contractual commitments in support of this before Spring 2008.
| Achieved in Summer 2008 |
CBRN | | Complete the CBRN Industry Capability Matrix and share the findings with the Home Office in Early 2007.
| Achieved
Industry Capability Matrix shared with the Home Office in February 2007
|
| | Continue to build on the concept of Team CBRN by creating a Joint Focus Group which delivers an Initial Gate Business Case for CBRN sector transformation by Mid 2007.
| Achieved
A joint MoD-Industry Steering Group (Team CBRN) has been formed leading to increased co-operation and transparency with industry. The project has entered a pilot phase to assess the strategy. Working with industry, the MOD will trial the future business processes. MOD hosted a sector transformation Industry Day in October 2008 with over 100 companies attending.
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14 November 2008
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2
MOD memorandum of 20 October responding to HCDC advance questions
on the Annual Report and Accounts 2007-08 (question 14). Back
3
APM Body Of Knowledge Definitions and OGC's Managing Successful
Programmes. Back
4
The Committee last examined the Astute submarine, Future Carrier,
JSF, Type 45 Destroyer, FRES, A400M and Nimrod MRA4 programmes
in its Report Defence Equipment 2008 (Tenth Report of Session
2007-08, HC 295) published on 27 March 2008. Back
5
Government Response to the Defence Committee's Report Defence
Equipment 2008 (Tenth Report of Session 2007-08). Back
6
Government Response to the Defence Committee's Report Defence
Equipment 2008 (Tenth Report of Session 2007-08). Back
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