Second supplementary memorandum from the
Ministry of Defence
The Department's responses for information following
the Committee's session with the Chief of Defence Materiel on
1 December 2009 are set out below:
1. A description of the four main areas of
skill shortages which CDM started to list in his oral evidence.
[Q8]
DE&S in seeking to continuously improve
its skills and is focused on doing so in the following four areas:
1. Cost Assurance, including:
(a)Cost Forecasting (develop cost models and
forecasts to support decision making around capability options);
(b)Cost Engineering (providing cost estimates
and contract pricing in the absence of competition to support
value for money considerations); and
(c)Cost Certification (including negotiating
and agreeing rates and verifying contractor payments during and
post contract).
2. Technical Assurance (Technological and Engineering
advice and support to project teams).
3. Financial skills (in particular Management
Accounting skills); and
4. Complex Programme Management (Managing projects
in their widest context).
2. How many MoD people are involved in buying
helicopters? [Q20]
2.1 As at 30 November 2009 the DE&S Helicopters
Operating Centre had 858 crown servants (military and civilian)
in post. Of these approximately 420 directly manage work on Apache,
Lynx, Merlin, Sea King and Wildcat helicopters for which AgustaWestland
is the main contractor, addressing "buying" issues such
as: commercial, engineering, finance, in-service support, core
and UOR project management, requirements and safety. The remaining
438 manage similar work with other Companies, such as Boeing,
Eurocopter and Lockheed Martin, plus Operating Centre business
management.
3. Comments on the data on staff rotation provided
in the graph on p184 of the Gray report, including the MoD's own
data for staff rotation on project teams. [Qq57-68]
3.1 Data on staff tenure in project team leader
appointments is not held in a form that would permit meaningful
analysis or comparison with the graph on page 184 of the Bernard
Gray report. Work will be undertaken to produce an analysis and
the results will be provided to the Committee in the New Year.
4. A description of the methodology used to calculate
the estimates of £21 billion and £6 billion for the
extent of over-programming. [Q77]
4.1 The Defence Budget until 2010-11 reflects
the 2007 Comprehensive Spending Review settlement (CSR07). The
projected Defence Budget thereafter assumes a level budget in
real terms, based on an annual 2.7% increase from 2010-11, adjusted
to exclude an element of ring-fenced expenditure which was provided
as part of the CSR 07 settlement.
4.2 The future Defence Programme is costed using
generic Corporate Planning Assumptions for inflation. Inflation
indices for specific industrial sectors are used where it is appropriate
to do so. It is assumed that, consistent with the 2006 White Paper,
the future strategic deterrent will be funded beyond 2010-11 in
such a way that would not be at the expense of the conventional
capabilities our Armed Forces need.
4.3 Costs for projects in the forward Equipment
Programme are based on analytically generated estimates. Each
project is costed at a 50% confidence level. Statistically, those
projects exceeding their estimated cost should be balanced by
those undershooting.
4.4 At the start of Planning Round 09 the cost
of the future Defence Programme exceeded the projected Defence
Budget by £21 billion over the 10 year planning horizon.
After changes resulting from the Equipment Examination and Planning
Round 2009, an excess of £6 billion remained between the
costed programme and assumed budget at the end of Planning Round
2009. This is being addressed in the current planning round and
the forthcoming defence review.
5. Spend to date on the FRES programme. [Q143]
5.1 The total spend on the FRES programme to
30 October 2009 was £189 million (inclusive of non-recoverable
VAT). None of this money has been wasted. The knowledge gained
has refined our understanding of the requirement; reduced technical
risk; and up-skilled the project team with specialist management
and integration skills. This all continues to have a direct or
indirect benefit to the FRES programme as it moves forward. The
table below gives the breakdown of this spend for the Utility
Vehicle and Specialist Vehicle programmes, and the benefits derived.
The table does not include the £6 million spent on the Concept
Phase, which established the baseline for all subsequent work
in the FRES programme.
Category |
Utility Vehicle (£m inc non-recoverable VAT)
| Specialist Vehicle (£m inc non-recoverable VAT)
| Benefits |
Assessment Phase Activities | 54
| 44 | The primary outputs of the Assessment Phase so far include: the development of the detailed requirement; technology management; and systems and engineering integration studies. The outputs of this work will enable the Utility Vehicle programme to progress rapidly to Demonstration once the programme restarts. Much of the Utility Vehicle Assessment Phase work was of direct benefit to the Specialist Vehicle programme.
These figures also include engineering and technical support to the MoD project team in managing the above activities. These skills were successfully transferred to MoD personnel in the project team and are of significant benefit to the management of the programme as it moves forward.
|
Systems of Systems Integrator (SOSI) | 9
| 1 | The SOSI formed part of the project team and aided the management of the complex multi-platform and wider battle-space integration issues. SOSI personnel were engaged to provide Systems Integration, Engineering Integration and Through Life Capability & Technology Management expertise. Again, these skills were successfully transferred to MoD personnel in the project team and are of significant benefit to the management of the programme as it moves forward.
|
Technology Demonstrator Programmes (TDPs) |
68 | 5 | TDPs are studies into technology that could be used through life on FRES vehicles. These included Electronic Architecture, Protection, Chassis and drive concepts. The output of these studies provides vital technology risk reduction work and technical information of significant value for all the FRES vehicle families.
|
UV Trials of Truth | 2 |
n/a | These were the assessment of the three contending vehicles for the Utility Vehicle Design role. The results of these trials provided a detailed understanding of capabilities of the vehicles involved, a good insight into the capabilities of industry, and physical evidence of the further work needed to mature the vehicles. This will be of significant value to the Utility Vehicle programme when it restarts.
|
Total | 133 |
50 | |
6. The rationale originally for having 12 Type 45s in the equipment programme [Q218]
| | | |
6.1 The requirement for 12 Type 45 Destroyers was first set
out in the 1998 Strategic Defence Review. The SDR confirmed the
need to maintain plans to modernise the destroyer and frigate
force, but reduced its size from 35 to 32. The need to meet a
broad range of operational demands required a balanced fleet of
Destroyers and Frigates, and it was judged that 12 Destroyers
would be sufficient to meet this requirement with acceptable military
risk against the planning assumptions and policy baseline at that
time.
7. When will the Type 45s be fitted with close range weapons
systems [Q220]
7.1 The Phalanx Close in Weapon System (CIWS) will be fitted to
HMS DARING prior to her first operational deployment. On current
plans, this is scheduled to take place during her first maintenance
period in the summer 2010.
8. What examination has been given to the lack of accommodation
in the Portsmouth area prior to the base port changes to accommodate
additional vessels and also to the security considerations of
having most of the fleet in one location? [Q231]
8.1 Work continues to greater understand the implications
of any potential future change to warship base porting arrangements
at Portsmouth and Devonport. A number of key stakeholders, including
representatives from Portsmouth and Plymouth City Councils as
well as Naval Base staff, are involved in this work and have been
invited to join a Working Group to support Warwick University
in developing a socio-economic model on behalf of MoD. On current
plans, the aim is to have the model ready in early 2010 which
will then be used to inform debate and the decision making process.
Separately, but coherent with this modelling work, the likely
impact that base porting changes might have on accommodation and
infrastructure at the two Naval Bases is also being assessed.
8.2 Security measures are constantly reviewed to take into
account the prevailing threat conditions and number of assets
to be protected and, as such, appropriate security measures will
be implemented accordingly.
9. When will the full capability of the Nimrod MRA4 programme
be available? [Q236]
9.1 On current plans, the ninth aircraft is due to be delivered
by the end of 2012. As the Secretary of State announced in the
House on 15 December, however, we are planning to slow the rate
of introduction of the MRA4 force by reducing flying activity
in the early years following delivery of the aircraft. We will
be discussing with industry how this can best be managed, and
until this work has been completed we cannot give a definitive
assessment of when Full Operating Capability will be achieved.
10. Are any UK subcontractors working on the Puma LEP? [Q242]
10.1 There is a total of 8 UK sub-contractors working on
the PUMA Life Extension Programme. They are: Qinetiq, Thales Avionics
Ltd, Selex Sensors and Airborne Systems Ltd, Thales UK Ltd, Chelton
Ltd, GE Aviation Systems Ltd, Rockwell Collins UK Ltd and HR Smith
(Technical Developments) Ltd.
16 December 2009
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