Examination of Witnesses (Question Numbers
180-199)
GENERAL SIR
KEVIN O'DONOGHUE,
DR ANDREW
TYLER AND
MR GUY
LESTER
1 DECEMBER 2009
Q180 Chairman: Once you have decided
how many to buy, how quickly can they be brought into service?
General Sir Kevin O'Donoghue:
I think pretty quickly. We are pulling off, as you know, up to
150 out of a total build of some 3,000. It is not like a UK-specific
programme with all that design and development. That is going
on at the moment. I do not think it will be that difficult. They
will come off quickly.
Q181 Chairman: I have said this before,
and it is perhaps a bit mean, but we all know what "up to
150" means—it means fewer than 150, particularly nowadays
with the pressure that there is on defence budgets. Do you have
any sort of rough ballpark figure? If you were putting this "up
to" figure into ministerial speeches now, what would be it
be?
Mr Lester: It would be up to 150,
I think. One thing I can say is there has been some speculation
that we have cut the number of JSF we are planning on buying,
but we have not, so up to 150 is still right. There has not been
a cut which is somehow buried within that figure.
Q182 Chairman: But you know what
you are planning on buying, do you?
General Sir Kevin O'Donoghue:
Up to 150.
Q183 Chairman: You know what you
are planning on buying. You said, "There is some speculation
that we have cut the number of JSFs we are planning on buying."
Mr Lester: What I am saying is
that there are a lot of variables in how many airframes to do
with how we train and what the capability of the aircraft turns
out to be once we start trialling them, but what we have not said
is this is a capability that we are going to cut the numbers against.
Q184 Mr Jenkins: The interesting
date about 2015 when we start ordering, do we have to put a total
order in at that date or can we take them in tranches?
General Sir Kevin O'Donoghue:
We will take them in tranches.
Q185 Mr Jenkins: You can order 30,
30, 30, over a period.
General Sir Kevin O'Donoghue:
Yes.
Q186 Mr Jenkins: So the last order
might be 2025, for instance.
General Sir Kevin O'Donoghue:
It could be. Of course, what is a huge advantage with Joint Strike
Fighter is that when we bought Harrier we had to buy what we call
the "attrition buy" as well—we bought a certain
number of aircraft which included an attrition buy—but with
Joint Strike Fighter, because it is such a big programme, we do
not need to buy those until we need them. So, absolutely, it will
go on for quite some time.
Q187 Mr Jenkins: When we start ordering
them, of course, there will be some trials, sea trials, for these
things to land. We will not want large numbers; we will want a
small number.
General Sir Kevin O'Donoghue:
We have ordered three. We have three on order, which are the OT&E
aircraft (operational test and evaluation aircraft). They have
been ordered. They will come in at 2012.
Dr Tyler: They are being delivered
into the test programme in the next a couple of years, yes.
General Sir Kevin O'Donoghue:
They will be flown by Royal Air Force pilots as part of the operational
test and evaluation programme.
Q188 Mr Jenkins: These three cannot
land on the carrier because the carrier will not be there until
2015?
Dr Tyler: They are going into
a test programme in the US.
General Sir Kevin O'Donoghue:
They will join with the US Marine Corps with their STOVL aircraft
as part of the test and evaluation programme.
Q189 Mr Jenkins: We will be sending
these pilots over to the US to get their training.
Dr Tyler: During the test programme
we will have our test pilots over there operating within an integrated
test programme alongside the United States.
Q190 Mr Jenkins: When do we intend
to put the simulators in place in this category for the pilots?
Dr Tyler: I do not know. I would
have to come back to you on that.
General Sir Kevin O'Donoghue:
It will be sequenced so that we have the operational test and
evaluation flight training programme, test programme. We will
get the simulators in.
Q191 Mr Jenkins: We have thought
of ordering the simulators, unlike the Apache where we did not
order the simulators for a couple of years, did we?
General Sir Kevin O'Donoghue:
Indeed.
Q192 Chairman: I have no idea who
is in charge of that.
Dr Tyler: We do.
General Sir Kevin O'Donoghue:
May I interrupt you? On the carrier, one of the reasons we are
being slightly hesitant over numbers is that there is a submission
going through the MoD at the moment for a re-approval of the carrier
costs. Our numbers are not clear at the moment, and they will
not be clear until the IAB and Ministers have approved them, and
that will be out fairly shortly. I would not want you to think
that we are being evasive for the sake of it, but our figures
are, as we speak, being refined and a paper submission will go
through.
Q193 Chairman: When do you think
that paper will come out?
Dr Tyler: A small number of weeks.
General Sir Kevin O'Donoghue:
I think it will go to the IAB in December, this month.
Q194 Chairman: So it will go to Ministers
in, what, January?
General Sir Kevin O'Donoghue:
At the latest, I would imagine, yes.
Q195 Chairman: And it will be made
public?
General Sir Kevin O'Donoghue:
Yes, it will feature in the MPR10.
Q196 Chairman: When is that going
to conclude?
Dr Tyler: The numbers close at
the end of this financial year. You will first see it in the Ministry
of Defence's accounts and then you will subsequently see it in
the MPR.
Q197 Chairman: Not meaning to use
rude words, the Bernard Gray report says that the planning process
is broken, badly broken. Would you disagree with that?
General Sir Kevin O'Donoghue:
No, I do not think it is broken. I think there would be better
ways of doing the planning process, and I do not think I would
disagree, I think we might have to get the budget in balance with
the requirement. We have to get our cost estimation much better
to give to the programmers so that they have got a clearer idea
of what the overall through-life cost will be of some of these
programmes.
Dr Tyler: One of the challenges
we will always have with the larger programmes, the more complex
programmes, is that the costs of those programmes does genuinely
mature through time. For many years there was a lot of uncertainty
as well as a lot of risk in the programme, which is always going
to challenge the costing. That is not to say we cannot do better,
because I definitely think we can. In the case of the carrier,
for example, one of the things that we did was we pushed Main
Gate as far right as we could but we also said that we would agree
the final target cost, the cost against which industry is going
to be ultimately incentivised. We would agree that two and a half
years after Main Gate, and that will be June of next year where
we will strike a final target cost which will be the number, if
you like, it will be the noose around the neck of the CVF Alliance
in terms of delivery, and for me that seems like a very sensible
way, and very consistent with Bernard Gray's report, to get oneself
to a point where you really have got a thoroughly good understanding
of what it is you are buying and the risks associated with it
and you have got rid of a lot of uncertainty, as opposed to the
risk, to then being able to confirm and stick to a number. One
of the things that we have constantly done to ourselves over the
years (and it has been self-inflicted harm in many ways) is trying
to commit ourselves to a number long before we really credibly
should be able to.
Mr Lester: One of Bernard Gray's
criticisms in relation to the planning process was some of the
behaviours it engenders. I think there he was quite shrewd. A
lot of the measures we are taking to improve our process are about
sorting out behaviours and forcing us to be more honest, I guess,
and making it less prone to vested interest is too strong a term,
but to make sure that we have robust—
Q198 Chairman: Perverse incentives
would be fair, would it?
General Sir Kevin O'Donoghue:
Yes.
Mr Lester: Perverse from the wider
defence point of view. It probably would be fair, yes.
Chairman: And that is not vested interests!
Q199 Mr Jenkin: Can I ask about how
planning rounds operate? Is one of the reasons the programme has
got overheated because there has been too much wishful thinking
about programme costs in order to squeeze them through the Treasury
mangle, and the only way to get the Treasury to sign things off
is to pretend they are going to be cheaper than they are?
General Sir Kevin O'Donoghue:
No, I do not think that is correct. There is certainly what, you
will remember, Peter Spencer used to call the conspiracy of optimism,
but I do not think it is to get through the Treasury. It is a
genuine lack of understanding about what things will really cost,
and that is why—what I was talking about earlier—the
cost estimation process that I have down in Abbey Wood, which
I hold on behalf of the Department as a whole, has to be able
to give independent costings which everybody then accepts and
people do not shave bits off because, with a bit of luck, the
risk will not materialise. It is accuracy in costing, sticking
with that cost, putting in management risk funding because it
will certainly materialise as the project unfolds.
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