Conclusions and recommendations
1. There have been serious shortcomings in
the Department's decision-making on the Chinook Mk3 project which
have had significant consequences for the timely delivery of the
helicopters to troops on the front-line.
The Department took nearly five years to decide on the Fix to
Field project. British troops in Afghanistan would have had the
additional helicopter capability available to them today if procurement
decisions had been made more quickly.
2. The Department fundamentally changed its
approach to delivering the helicopters in a matter of days, without
an appropriate level of analysis and without going through its
established approvals procedures. The
Department was so confident that it understood the risks, costs
and timescale issues associated with the Reversion project that
it did not consult Boeing, the manufacturer of the Chinook helicopters.
This confidence was misplaced and the cost of the project subsequently
increased by 70%. Its post hoc justification that the Reversion
project subsequently passed its regular approvals process is flawed
as, once the decision had been made, it would have compounded
the operational shortfalls and introduced more delays to have
3. The problems with the Mk3 procurement stemmed
from the Department's failure to specify in the contract that
it required access to the software source code in order to assess
the safety risks and establish whether the helicopters would meet
UK airworthiness standards. Given that
software is key to the operation of most modern defence equipment,
this is irresponsible. The Department should specify access to
software as a clear requirement within any contract, especially
where access to proprietary software is needed to provide airworthiness
certification. The Department should also review its airworthiness
approvals process to take into account the safety records of other
nations in using similar software and equipment.
4. In 2003, the Department introduced the
Night Enhancement Package as a short-term, urgent operational
fix. It will not be replaced until 2009 at the earliest, and the
Joint Helicopter Command still assess it as a key safety risk.
The Department has to make difficult judgements to balance the
safety risk of using capabilities like the Night Enhancement Package
against the operational downside of not having it at all. However,
the Department should examine whether its acceptance of the risks
associated with short-term fixes like the Night Enhancement Package
is consistent with the priority accorded to identifying funding
for long-term solutions, the duty of care it has to personnel
and the principles underpinning its approach to airworthiness.
5. Scarce Chinook helicopters are being used
for basic pilot training because the Department has failed to
modify flight simulators to reflect the capabilities of helicopters
currently flying in Iraq and Afghanistan.
To make better use of its Chinook helicopter fleet, the Department
should routinely plan for the simulators to be incrementally upgraded
to match, as far as possible, the current capability and equipment
specifications of the operational Chinook helicopter fleet.
6. The scale of the shortcomings on the Chinook
Mk3 is not representative of all defence acquisitions, but does
highlight some specific areas where the Department needs to revise
its decision-making processes. Given rapidly
changing operational needs, the Department should:
- have agile decision-making
processes (but this is not an excuse to ignore appropriate governance);
- work with HM Treasury to establish minimum analytical
and data requirements to underpin significant investment decisions;
- agree with HM Treasury a formal mechanism for
waiving these standards on the very rare occasions where operational
or other imperatives mean they cannot be achieved;
- analyse what it is doing differently on the Reversion
project and reflect these lessons in the evolution of its existing
acquisition processes, and
- routinely draw on all available sources of knowledge,
including industry partners in making investment decisions.
7. The Department admitted that, particularly
when buying existing equipment 'off-the-shelf', it tends to specify
too many modifications, when what is needed is equipment that
is safe, effective and can be made available for operations quickly.
To better inform future decisions on whether to specify modifications
to off-the-shelf equipments, the Department should analyse all
such recent acquisitions to determine how often technical problems
have arisen or costs increased, and whether these outweigh the
expected and/or delivered operational benefits.
8. The Department, working closely with Boeing,
has achieved 20% increases in Chinook helicopter flying hours
by changing the way the helicopters are maintained.
This approach is being used with some success elsewhere in the
Department and illustrates the scope to get better value from
existing defence assets. The Department should establish knowledge
sharing groups, involving those maintaining other equipment fleets
and key industry partners, to make sure that successes in one
area are shared and applied consistently. To foster this spirit
of collaboration, the Department should monitor the rate of year-on-year
improvement in helicopter availability to help quantify the effects
of innovations as they are introduced.