Examination of witnesses (Questions 120
WEDNESDAY 28 FEBRUARY 2001
CLIFFORD and MR
120. If DERA are going to do quite well out
of research maybe you should look again at DARA which is guaranteed
6% of Eurofighter work. Maybe you should have a look, Baroness,
at whether DERA are getting a better deal than DARA or whether
DARA are getting as good a deal as DERA in guaranteed work.
(Baroness Symons of Vernham Dean) I shall report your
remarks to Mr Spellar, who I am sure will take a very healthy
interest in the differences.
121. We have already had some questions on staff
morale and questionnaires. Have you actually finished the split
between the two organisations?
(Sir John Chisholm) Yes.
122. How many people wanted to go one way and
have ended up going the other way?
(Sir John Chisholm) I am glad, Mr Brazier, you asked
that question because Bill and I informed ourselves of that yesterday.
The maximum number that we have been able to run to earth of people
who have raised an issue at this moment is less than half a dozen,
of which only one who is currently in DSTL and wants back into
New DERA has actually raised it in any way informally, actually
not yet a formal complaint but it might well become a formal complaint.
123. Right. How does your staff turnover over
the last 12 months compare with the previous 12 months? Has it
gone up or gone down?
(Sir John Chisholm) Our staff turnover over the last
three years has been pretty much solid. When I talk about staff
turnover, just to define my terms, I am talking about voluntary
staff turnover. Also we have people leaving through retirement
and all sorts of other things but the voluntary staff turnover,
people resigning, has stayed pretty much solid between 5 and 6%.
124. While we are on personnel issues, I would
like to come back to what seems to me to be a very central one
here. There are obviously one or two retained areas where you
are keeping the whole of it and, in fact, Lady Symons mentioned
two earlier on, the defence analysis and the NBC side. Looking
at the vast majority of areas within the retained area you are
inevitably dealing with relatively small numbers of people in
each group as the bulk of the research side has been taken away
and you are more involved with the management side of providing
scientific advice to the Government in the retained areas. The
question I have for Mr Clifford is how many of the remaining areas
of the company are close to critical mass, in other words you
have got one or two people in a particular area providing the
necessary scientific advice and where perhaps one resignation
or retirement or move or whatever could leave you without a capability?
How large and how viable? I see we have a figure of 130 technologies
and scientific areas mentioned earlier on in the whole investigation
(Mr Clifford) Personally I have been involved in the
split, the choice of staff for many months, and in the more sensitive
areas, as Sir John said, have had to operate as Chairman of the
Committee which made final decisions. I take the view that there
are no areas which are currently critical in the way you define
them. One of the issues we have which any technological organisation
has is the maintenance of critical mass and that is something
we are giving a good deal of thought to, both internally in DERA,
DSTL and with our MoD colleagues. I am quite satisfied that on
1 July when DSTL, as it were, launches separate from mother DERA
it will not be critical in the sense you defined in any area.
125. Right. If I understood Sir John's earlier
answer you have only got one person who is actively campaigning
to go back to mother DERA and be part of the brave new world?
(Mr Clifford) Indeed, and I am due to talk to that
person myself in the next week. I do not currently know why he
is so campaigning.
126. On our travels and speaking to governments
and companies involved in defence, Baroness, some shared with
us some concerns about the Chinese walls and how effective and
how robust and sturdy the Chinese walls would be between the two
new organisations. Could you tell us what the process was to facilitate
that, where shared facilities are?
(Baroness Symons of Vernham Dean) I was very concerned
about this when we began to discuss the way in which we would
undertake the separation. From the beginning I was very keen that
the premises should be as separate as we could possibly make them.
We had a great deal of discussion about this over the course of
last year and we decided that it was indeed very important that
the two organisations where they currently share a site in so
far as we can are in separate buildings and over the course of
time actually go to separate sites. It was also very important
to disentangle the information technology systems and a good deal
of time and effort has gone into that, and also of course to disentangle
intellectual property in order to ensure the integrity of both
the organisations. I think we have done a very thorough job on
this. I am conscious of the fact that people will always argue
about costs involved but I did think it was very important indeed
for the confidence of both sides. I am going to ask Sir John to
talk about fire walls now within New DERA because I think that
has been another point of interest, and of course he is the expert
on the fire walls within the new organisation.
(Sir John Chisholm) The fire walls can use various
levels of defence. The first and most important level of defence
is that we create in all our key projects compartments in which
all the data associated with that compartment sits and people
outside the Department have no access to it. Now in making fire
walls work, it is crucial that no layer of management is in both
those compartments so there is no opportunity for any influencing
from a management point of view of what is going on on both sides
of the fire wall. That is the crucial and fundamental separation
that you have got to have in making fire walls work. On top of
that, you can add other means which actually address more the
apparency of the fire wall rather than the actuality of it because
once you have done the first, you have actually separated the
two organisations in a fire wall sense. You can separate them
to make other people more comfortable by separating them geographically,
having them in two buildings or in two sites. You can separate
their information systems, you can separate all sorts of other
things just to make people feel more comfortable about it, but
the key thing is the first one where you create compartments where
all the information associated with that project sits and no level
of management has access to both of them.
(Baroness Symons of Vernham Dean) Can I just make
it clear that ultimately, of course, this is the responsibility
of MoD and we will audit what is being undertaken.
127. Obviously that was going to be my next
question. You must be satisfied naturally.
(Baroness Symons of Vernham Dean) Yes.
128. Have you any feedback from industry? Are
they satisfied? Has any work been done to put their fears at rest?
(Baroness Symons of Vernham Dean) I have not had any
indication to the contrary.
(Mr Jagger) The fire wall between New DERA and DSTL
will be exactly the same as the relationship between the MoD and
British Aerospace, for example, and we can demonstrate that to
anyone who chooses to ask. Fire walls within New DERA will only
happen at the discretion of the MoD customer. The MoD customer
will, exactly as he does now, have complete freedom to withhold
his agreement, and to audit those fire walls and, indeed, normally
he has to seek the agreement of other industries involved. DERA
has, if I may say so, a very good history of running fire walls,
where necessary, with excellent external audit results and industry
129. I was interested to hear what you were
saying, Baroness, about the computer systems, that it is difficult
to separate them. Will they be two completely separate systems
or are they able to speak to each other in any way? How has that
been set up?
(Mr Jagger) They will be able to speak to each other,
I think, in the sense that my MoD central system at the moment
can speak to any other system through a fire wall and an e-mail
service or something like that, but in principle they will be
as separate as your domestic or the House of Commons' system and
the British Aerospace system.
130. They are entirely different.
(Mr Jagger) I confess to not being a technical expert.
I know Bill is actually extremely knowledgeable in this area.
131. Come on, Bill.
(Mr Jagger) He made my e-mail work.
(Mr Clifford) Yes. Terence, however, is as knowledgeable
as he needs to be in this subject.
(Mr Clifford) We have already separate servers, separate
computer banks which hold the information. There comes a point
when one uses British Telecom lines to go from site to site and,
in fact, then we are talking about encrypted data being passed
so it matters not that they are shared facilities. Yes, totally
separate physically, physically separate boxes you can go and
133. On this British Aerospace and MoD, British
Aerospace do not occupy three floors of the main building in Farnborough
I presume. Will they be using the same canteen facilities in Farnborough?
(Sir John Chisholm) As of now we do but we have a
programme of progressive physical separation into entirely self-sufficient
134. How about security? Will it be the MoD
police for the whole site, one head of security for the Farnborough
site, or will you be employing block security on your site and
cutting down costs and MoD using more expensive but more professional
MoD police? In Farnborough what are the security arrangements
or what are they likely to be?
(Sir John Chisholm) Obviously we will have on separate
sites separate security arrangements.
135. In Farnborough?
(Sir John Chisholm) In Farnborough when the separate
DSTL site is established the separate DSTL site will have its
own security arrangements.
136. I would like to follow that with a question
on computers before coming on to my questions on intellectual
property rights. As I understand it the reason why MoD has avoided
the kinds of horrors over the internet which have afflicted the
Pentagon is the physical gap, the air gap, the fact you are not
plugged in. How will that work when you are on the outside?
(Sir John Chisholm) I would very much like to answer
that question, if I can, Mr Brazier, because actually we feel
quite proud of the fact that we have our fire walls, DERA's fire
walls, which actually also protect the Ministry of Defence survived
the "I Love You" bug whereas many other people, who
I would not want to mention here, were not able to.
(Baroness Symons of Vernham Dean)were incapacitated.
137. When your organisation is owned by an outside
company it will presumably be directly on e-mail to that outside
company, it will become part of that.
(Sir John Chisholm) I think you have a different model
of what we are about to the one that I have but when our organisation
is a private company then it will clearly have, as it does now,
its own networks. It will protect its own networks through the
kinds of mechanisms which we know well how to protect.
138. Just a mop up question on the last series
of questions about fire walls. Sir John, you twice used the expression
"no level of management has access to information",
is that a work of art? Does it mean people other than management
do have access beyond fire walls?
(Sir John Chisholm) I was just relating to management
because management might be thought of as having a commercial
interest but actually it is no-one.
139. Right. What has been the cost of separating
the two components of DERA?
(Baroness Symons of Vernham Dean) I would like you
to treat the figures with a certain amount of caution because
we have not bottomed out all the figures at the moment. It is
likely to be of the order of 70 to 80 million.