Select Committee on Environment, Transport and Regional Affairs Appendices to the Minutes of Evidence

Memorandum by National Air Traffic Services Ltd (NATS 02)


  1.1  The Sub-Committee is to conduct a further inquiry into recent developments in National Air Traffic Services Limited (NATS), and has requested information on:

    —  progress on the New En-Route Centre at Swanwick;

    —  progress on the New Scottish Centre project and the current position on the replacement of the Oceanic Flight Data Processing System; and

    —  recent computer problems at West Drayton.


  2.1  Following detailed re-planning of the project during 1998, the Committee was advised in October 1998 that Swanwick was expected to begin operational services in Winter 2001/02. The Defence Evaluation and Research Agency (DERA) confirmed in their report to Government in November 1998 that a Winter 2001/02 target date was feasible in their view. Subsequently, the NATS Board approved a detailed Plan to Completion for the project in February 1999.

  2.2  The project continues to achieve the major milestones set in February 1999, and remains on track to achieve the Winter 2001/02 target. The date on which operations will start at Swanwick was confirmed at the July meeting of the NATS Board as 27 January 2002. The Chairman and Chief Executive of NATS subsequently briefed staff at West Drayton on 12 July.

  2.3  The next major milestone in the programme is Technical Handover (TH), which is scheduled for 20 December 2000. TH represents the point of final hand-over of the system from the project manager to the operations manager. The Centre is certified to be fully operationally capable and is permanently connected to the ATC infrastructure. Following TH, the main focus of activity moves to ATC conversion training on the new system. This activity starts in January 2001, leading to the start of operational services in January 2002.

(Feb 99)
Full Technical Transfer (TT7)
Mar 99
Mar 99 (c)
Start of Large Scale Simulations Phase 1
Mar 99
Mar 99 (c)
Complete Large Scale Simulations Phase 1
Jun 99
May 99 (c)
Commence Baseline Interface Test (Non FDP) Run For Record
Aug 99
Aug 99 (c)
Commence Baseline Interface Tests (FDP) Run For Records
Dec 99
Feb 00 (c)
Commence Large Scale Simulations Phase 2
Nov 99
Nov 99 (c)
Complete NAS 2609 Development
Mar 00
Mar 00 (c)
Complete Large Scale Simulations Phase 2
May 00
May 00 (c)
Baseline Combined System Testing Run For Records Complete
Aug 00
Aug 00 (c)
Incremental Operational Verification 1 Complete
Aug 00
Aug 00 (c)
Incremental Operational Verification 2 Complete*
Sep 00
Nov 00 (f)
Incremental Operational Verification 3 Complete*
Oct 00
Dec 00 (f)
Technical Handover
Oct 00
Dec 00 (f)
Operational Readiness Demonstration Complete
Dec 00
Mar 01 (f)
Commence ATC Conversion Training
Jan 01
Jan 01 (f)
Transfer Of En Route Operation to Swanwick
Nov 01
Jan 02 (f)

  (c)=Completed    (f)=Forecast

  *  IOV2 and 3 are deferred to November and December respectively to improve the overall robustness of the test programme.

  2.4  In addition to confirming the feasibility of the Winter 2001-02 timetable, the DERA Report made a number of observations and recommendations on the key risk areas within the project. DERA noted that, from a technical viewpoint, the main concern was the backlog of outstanding software changes. DERA also noted that establishing controller confidence in the system and an effective process of communication within the Company would be vital to the success of the project. Given the scale of the tasks remaining at the end of 1998, DERA were clear that achievement of the Winter 2001-02 target would require firm project management.

  2.5  These areas have all been addressed in depth by NATS. The key risk areas within the project continue to be closely monitored by the NATS Board. Major changes have been made in project management arrangements within the Company both in respect of the project and, more generally, in preparation for implementing the NATS Long Term Investment Plan. The services of independent experts have been retained to provide advice to the Board both on the Swanwick project and other aspects of project management and software design. In addition, Bechtel are now supporting NATS on the implementation of the project programme.

  2.6  As with any large complex project, there are risks to the overall schedule. The major area of risk within the project continues to be the delivery of a stable software system which is fit for purpose. This includes the incorporation of system changes, elimination of system faults (known as Programme Trouble Reports or PTRs), and alignment of the Swanwick system with the National Airspace System (NAS) at West Drayton.

  2.7  Change request (CR) status:  Three software builds are planned for deployment prior to the start of operational services. Build 1.37 has now been delivered and is in the test phase. Testing on Build 1.37 indicates that the software is of high quality and robust. Build 1.38 is packaged and work is progressing on the definition of the CRs for Build 1.39. The content of Build 1.39 will be agreed and committed to software development by mid-October.

  2.8  PTR status:  The PTR situation is continuing to improve, with necessary reductions in PTR numbers looking achievable for both TH and for the start of operational services. It is not realistic to expect that the number of PTRs can be reduced to zero; the aim is to eliminate all PTRs that might affect the quality of the operational service in any significant way.

  2.9  NAS update:  Changes are required in NAS to support Swanwick in operational service. NAS Version 26.09 is targeted for operational service in November this year. Software development is complete and 26.09 is in its test phase. The last formal build of NAS before Swanwick enters operational service will be Version 26.10. Version 26.10 is due to enter service in April 2001.

  2.10  Controller availability:  A key requirement is to have sufficient validated controllers in place for the start of operational services at Swanwick in January 2002. Manpower projections indicate that the supply of controllers will be sufficient to meet operational requirements. The conversion training roster for all LATCC Area Control staff has now been published, including over 21,000 individual allocations of staff to activities.

  2.11  Controller acceptance:  Controller acceptance is a critical requirement in achieving the successful introduction of the system into service. Following completion of the programme of simulations, there is now general acceptance within the controller community that the system is viable.

  2.12  Swanwick costs have been contained within budget during the past two years and continue to remain in line with the £623 million estimated cost to completion identified in the report by Arthur D Little. Project costs are approved on an annual basis, with the capital element being subject to DETR and HM Treasury approval. Costs in the period to 31 March 2000 were as follows.

Contract costs
Programme management, associated costs and internal costs capitalised

  2.13  The budget for the year to 31 March 2001 is £34.7 million (capital £10.2 million and revenue £24.5 million) in respect of contracts between Lockheed Martin, Frequentis, Logica and NATS, inclusive of capitalised internal labour. Forecast costs for the current year remain in line with the approved budget.


  3.1  Proposals for the New Scottish Centre (NSC) were first submitted to Government in 1992 and EFL cover was provided for the project. Subsequently in the 1993 Budget statement, the Government announced that the project would be financed under the Private Finance Initiative (PFI) and EFL cover was withdrawn. Throughout the period from 1993 NATS worked closely with departmental and Treasury officials to try to make a success of the PFI initiative while continuing to make the point, first in private and from 1994 in public, that PFI was not the right way forward. The NSC PFI was finally abandoned in 1999.

  3.2  Work on the NSC is now progressing well. Following termination of the PFI contract with Sky Solutions, a new Master Agreement was negotiated with Lockheed Martin for the systems element of the project and this was signed in February this year. The building design element of the project has been re-tendered. The project is now proceeding on the basis of conventional funding. The new Centre is currently targeted to enter operational service in the winter of 2007-08, subject to the outcome of detailed planning and the letting of contracts. NATS and the DETR jointly appointed Bechtel in June 1999 to manage the NSC project.

  3.3  The building:  Work on the design of the NSC building is in progress. Two firms are competing during the first 120 days of the building "outline" design phase, covering such matters as site layout, building shape, mechanical and electrical systems and landscaping. One of the firms will be selected in December this year to complete the detailed design. Construction is due to begin on site in the first quarter of 2001.

  3.4  The systems:  The NSC will benefit from the use of the software already developed for NERC. Under the Master Agreement, components of the project will be separated into individual contract line items each of which will be subject to negotiation. The contract line items already agreed cover the definition and development of the new platform for NSC to operate the Swanwick software, and the baselining of the essential changes necessary for Scottish operations.


  4.1  The FDPS2 project was designed as a replacement for the existing Oceanic flight data processing system based at Prestwick. Its objective was to provide improved system reliability and functionality, enabling the implementation of ICAO satellite based concepts for the management of air traffic over the North Atlantic. The project was let as a PFI contract in 1997.

  4.2  Following the Critical Design Review (CDR2) milestone at the end of May this year, NATS has taken steps to terminate the contract with EDS. CDR2 was a contractual milestone at which point the contractor was required to demonstrate that its designs met NATS' requirements. The NATS Board has yet to decide on the best alternative procurement strategy, however the outline plan is to procure a "core" FDP product off-the-shelf to provide a minimum requirement FDP replacement system for 2004. Thereafter, NATS will develop added value functionality as and when there is a business need for it.

  4.3  The timescale for implementing a replacement Oceanic FDPS system has been extended as a result of decisions by ICAO. In particular, satellite based procedures will not be required before 2005 as the airlines need to equip their aircraft with the necessary equipment to enable new separation standards to be introduced. There has also been a marked improvement in the reliability of the current system. These two factors, and planned capacity improvement, will allow the existing system to meet forecast demand at least until 2006.


  5.1  There have been four failures of the National Airspace System (NAS) this year at West Drayton. The failure that occurred on 17 June resulted in substantial air traffic delays. Two less serious failures occurred in June and another in August. The failures were caused by unrelated software design faults.

  5.2  By way of background, aircraft are required to file a flight plan before departure. NAS stores these flight plans and produces flight progress strips, which controllers then use to control aircraft movements. In the event of a major system failure, safety must be assured and controllers are trained to revert to manual methods of operation, which require flight strips to be written by hand. This slows the throughput of traffic and hence can result in significant delays, but the safety of the system remains uncompromised. When the failure occurred on 17 June NATS controllers, support staff, engineers and managers performed outstandingly, keeping disruption to a minimum consistent with maintaining high safety standards. Their actions were commended in Parliament by DETR Minister, Nick Raynsford, who said, "While I very much regret the failure, NATS staff did a first-rate job in responding to difficult circumstances when the software failed. They put in place standby arrangements to ensure that safety was paramount at all times which must be the main consideration."

  5.3  The NAS system was originally procured in 1974 but has been upgraded on a number of occasions. The computer hardware was replaced in 1989 and is due to be replaced again within the next 12 months. NAS has proved to be extremely reliable over the years and, prior to these failures, had operated with availability in excess of 99.9 per cent throughout the 1990s.

  5.4  New versions of the NAS software are installed annually and occasionally more frequently. In addition, adaptations are made to the database and its configuration parameters on a monthly basis tied in with the world-wide AIRAC cycle, to notify changes in the airspace environment and aircraft routeings. Two days prior to the failure on 17 June, new configuration parameters had been installed on the system to improve flight strip printing for controllers at Prestwick and this triggered a latent design fault in the software. However the main reason for the extended delay in restoring full service was the failure of linked communications systems and the need to rebuild the data in these systems.

  5.5  The causes of the failures were established within a short time of each event and a combination of software fixes and other preventative actions have been identified, tested and implemented. Following the events on 17 June, new system design constraints were introduced to prevent the failure of linked systems. These were proven to be effective during the course of the failure on 12 August when the system was recovered within an hour. Since then there have been no failures. It is not possible to guarantee that there will never be failures in a system as complex as NAS, but the changes made since June have enhanced the resilience of the system.


  6.1  Over the past 12 months NATS has made good progress in many areas:

    —  the Swanwick project remains on track;

    —  the New Scottish Centre project is now moving forward;

    —  new contracts for airport operations have been won in open competition;

    —  safety performance has been maintained, and average delays remain at low levels despite the continuing increase in traffic;

    —  charges to users have again been reduced; and

    —  preparations for the Public Private Partnership have continued.

  6.2  NATS continues to seek further improvements in the safety, quality and cost of its operational services and the delivery of the project programme. This has been a busy, and generally very successful, year for the Company and it is appropriate, in conclusion, to pay tribute to the competence, skills and dedication displayed by staff throughout NATS in this period.

National Air Traffic Services

29 September 2000

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