SCHEDULE PERFORMANCE: DETERIORATION (ADVERSE COST
AND OPERATIONAL IMPACTS)
10. Although there is evidence that the Department
has begun to control costs better, control of time remains a problem.
17 out of 20 post-Main Gate projects have slipped with the average
project delay increasing by three months in the last year. 
The reasons for these new delays break down into three roughly
equal parts: aligning missile projects with aircraft projects
(24 months), technical difficulties (19 months) and budgetary
deferral (18 months).
11. The Air-launched Anti-Armour Weapon (Brimstone)
will enter service eleven years later than originally planned
and 13 months later than approved at the equivalent of Main Gate.
At an earlier hearing the Department had suggested that the equipment
now expected to enter service would be better than if had there
been no delay.
Pressed on the extent to which improvements in capability which
arose as an accidental outcome of delays could compensate for
the operational and cost penalties associated with the delayed
introduction of equipment, the Department said that the image
recognition which allows the Brimstone missile to discriminate
between various different targets would not have been available
if it had been introduced when originally planned.
The Department conceded that this justification was no basis for
a strategy as it meant that the Armed Services did not have the
right equipment in the frontline
but emphasised that it was important to keep pace with the technological
change. For example, the twelfth Type 45 destroyer would be of
much greater capability than the first.
12. In July 2000, the Department announced it was
not confident that Archer Communications Systems Ltd (ACSL) could
deliver a solution to the BOWMAN requirement and that the competition
would be re-opened, some 12 years after the requirement was first
raised. The Department wished it had stopped working with ACSL
sooner, but insisted that it acted quickly once it received the
final bid on 23 June 2000, announcing the termination with ACSL
on 25 July.
13. In April 1999, the Defence Ministers of the United
Kingdom, France and Italy decided not to proceed with the collaborative
Common New Generation Frigate programme. The Department is now
procuring the Type 45 destroyer as a national solution to the
United Kingdom requirement to provide air defence to the fleet.
The new ships will be equipped with the Principal Anti-Air Missile
System (PAAMS) which is being procured collaboratively with France
The Type 45 is expected to enter service almost 5 years later
than the date forecast for the Common New Generation Frigate and
with some capability shortfalls which will be addressed through
an Incremental Acquisition Programme.
The Department admitted that the collapse of the Common New Generation
Frigate programme left it with a gap in replacing the existing
Type 42 destroyers. It was nevertheless noteworthy that within
not much more than a year of the collapse it actually had on order
a programme of ships to deploy PAAMS.
14. Figure 2 lists some of the capability shortfalls
which have been caused by delays on the case study projects examined
by the National Audit Office. This huge gap in capability has
been going on for many years. The Department re-assured our predecessors
that it always regretted the delay in capability. It was not complacent,
and recognised that the task was to ensure that the situation
in future was very much improved.
Figure 2: Examples of the operational impact of in-service date delay
The Type 45 Frigate
The anti-air missile system deployed on the Type 42 destroyers which the Type 45 will replaceCSea DartCwas not designed as an anti-missile missile. The modifications which have been undertaken throughout its life are designed to enhance its capability against sea skimming missiles and the Department is confident it remains a very effective long range weapon against aircraft. However, the Department conceded that our ships would only be able to defend themselves if the United Kingdom were involved in an operational scenario similar to the Falklands conflict because Sea Dart forms part of a mixed fleet and will be in service with Sea Wolf, which has been designed specifically as an anti-missile missile.
The Air-launched Anti-Armour Weapon (Brimstone)
The weapon Brimstone is to replace, the BL755 cannot defeat modern armour and only half of one percent that went to the Gulf was actually used. The Department said that this version of the BL755 had to be dropped from a height of around 500 feet, limiting its use in that conflict. The weapon has since been updated so that it can be dropped from a much greater height. The Department accepted that BL755 was not as effective against modern armour as it was against other targets but said that it was extremely effective against soft skinned targets.
Analysis conducted by the Centre for Defence Analysis predicted that deploying digitised battlefield command and control systems may reduce the time taken to seize an objective by up to 75 percent. BOWMAN will not enter service until 2003 at the earliest and, until this time, forces conducting and supporting land operations cannot reap the significant benefits expected from digitisation.
Medium Range TRIGAT
The requirement for a medium-range anti-tank weapon has not been cancelled but following the United Kingdom's withdrawal from Medium Range TRIGAT the Army is conducting an Anti-Armour Balance of Investment study. Until this concludes and a solution is procured the Army must rely on MILAN which first entered service in 1979 and represents an increasingly limited threat against modern armour.
15. The Sea Dart anti-air warfare system fitted on
the Type 42 destroyers is undergoing a programme of modifications
so that it can deal more effectively with modern threats such
as sea-skimming and high-diving missiles. The upgrade to equip
Sea Dart with infrared fuses is currently running eight years
Asked what had gone wrong and why the delay was allowed to happen,
the Department said that a number of test firings had shown false
triggers of the fuse. It had been extremely difficult to establish
that these false triggers were caused, among other things, by
the effect of the sun on the upward looking component of the infrared
fuse. The Department was, however, confident that it would soon
prove software arrangements to discriminate successfully against
the sun if it suddenly emerged from behind a cloud at the critical
moment in the engagement.
16. The Sea Dart missile system contains old-fashioned
obsolete components and will be harder to maintain as the missiles
become older. The Department re-assured us that it was taking
enormous efforts to defeat obsolescence on the missile and assured
us that, although it was expensive to make small production runs
of the components, there were no technological barriers to doing
17. Our predecessors asked the Department how the
million of write-offs and additional expenditure incurred on the
Medium Range TRIGAT, BOWMAN, Brimstone and Type 45 destroyer programmes
would affect the provision of defence capability more widely and
sought assurance that they would not result in vital funding being
cut elsewhere in the budget.
responses are summarised in Figure 3.
Figure 3: The effects of the write-offs and additional costs incurred on four projects
The Type 45 Frigate
,565 million additional support costs
The additional support costs were for running on the ageing Type 42 frigates. The Department suggested that the additional costs had not yet been incurred and had been accompanied by a deferral of the Type 45 procurement expenditure. Thus it argued that over the period of slippage the Department would not have to spend more than it planned and so there was no impact on the defence budget during the period.
Write-off of between ,35 million and ,102 million
The Department regretted that the money spent on procuring BOWMAN had been wasted and said that the consequences in terms of the impact on the defence budget would depend on the size of the write-off, and on which contractor won the new competition.
Medium Range TRIGAT
,115 million write-off
The Department suggested that, if the programme had not been conceived, there would have been an alternative anti-tank guided weapon system, although the Chief of Defence Procurement did not believe that the effect on the budget would have been so substantial. The problem was rather that the front line of the armed forces was today relying on MILAN when they had a reasonable expectation of having a modern anti-tank guided weapon system.
18. Seventeen of the 20 projects in the Major Projects
Report 2000 have slipped against the in-service dates set at the
approval equivalent to Main Gate and seven have slipped by a total
of 63 months during the last year. This is an unsatisfactory situation
which has negative cost and performance implications. As new projects
approved under Smart Acquisition principles begin to enter the
Major Projects Report we expect to see the rate of slippage reduce.
19. The Department appears on occasion to excuse
delays by arguing that they may allow improvements to be included
that were not available at the planned in service date. For example,
the Department argued that Brimstone's
image recognition capability would not have been available if
it had entered service on time some 10 years earlier, and that
the missile would now have needed upgrading; but it admitted that
this was an inadvertent consequence of the delay rather than a
planned strategic decision. The Department needs to be clear about
the time it is prepared to wait for new equipment in order to
secure the latest improvements.
20. The Department suggested that it acted quickly
when it decided to withdraw from programmes, for example replacing
the Common New Generation Frigate programme with the Type 45 Destroyer,
and deciding to re-open the BOWMAN competition. In both of these
cases the Department moved fast once the decision was made, but
the time taken to reach the decision itself was too long given
the track record of problems on both programmes. The Armed Services
will not receive, when originally planned, the capabilities which
these equipments would have provided. The Department should make
decisions on when to withdraw from programmes in a more timely
manner in future to prevent such capability gaps occurring.
21. The adverse operational impacts of the delays
in entry into service of all four case study equipments is unacceptable.
Without the Type 45 Destroyer the capability of the Navy will
be less between 2002 and 2007. In the meantime the Sea Dart missile,
supplemented by other systems such as SeaWolf and Phalanx, will
have only limited effectiveness against modern sea-skimming missiles.
Troops still do not have a secure communications system because
of the delays on BOWMAN, the MILAN missile has limited ability
to defeat modern armour and the RBL755 cluster bomb, which Brimstone
will replace, is only effective against soft-skinned targets.
22. Over a number of years our predecessors have
highlighted numerous problems caused by equipments being unable
to operate effectively in the required environment. To add to
this list, the Department has admitted that the upgrade of the
Sea Dart system has been delayed because the software could not
discriminate targets against the sun. The Department should develop
processes to enable it to better anticipate such environmental
difficulties by drawing on its own past experience and the expertise
available to it in DERA and industry.
23. The Sea Dart system was designed in the 1960's
and contains components which are obsolete and which the Department
is having to go to a great deal of effort to replace. Obsolescence
is another example of the Department having to spend more money
because replacement equipment is not available on time. The Department
should ensure that the costs and resource effort required to manage
obsolescence are properly managed and minimised.
24. It is unacceptable that the Department has wasted
million and ,102
million in pursuing an unworkable solution to the BOWMAN requirement.
The precise scale of the write-off is unclear but, even at the
lower end, it would probably cover the cost of the sonar which
the Department now intends to fit on the Type 45 Destroyer.
We expect the Department to minimise the amount written-off and
to be able to demonstrate that it has utilised the results of
the abortive BOWMAN expenditure to good effect.
25. The Department has written off ,115
million of Medium Range TRIGAT development costs. It argued that,
if this money had not been spent on Medium Range TRIGAT, it would
have been spent on an alternative solution. The fact remains that
the Department failed to procure an effective weapons system,
so the money has, in effect, been wasted.
12 C&AG's Report (HC 970 (1999B2000)) para 1.16 Back
13 Q189 Back
Reports (HC 970 (1999B2000)) p31, and HC 613 (1999B2000)) Figure
Report from the Committee of Public Accounts (HC 247 (1999B2000)) Back
17 Q51 Back
18 Q140 Back
Report (HC 970 (1999B2000)) para 3.10 Back
paras 3.11 and 3.14 Back
22 Q18 Back
23 Q269 Back
25 Q32 Back
26 Q54 Back
27 Q56 Back
Report (HC 970 (1999B2000)) para 3.31 Back
paras 3.18 and 3.21 Back
para 3.13 Back
31 Q38 Back
32 Q40 Back
33 Q2 Back
34 Q41 Back
35 Q3 Back
36 Q7 Back
37 Q5 Back
the detail of the fitting of the sonar to the Type 45 Destroyer
see the 6th Report of the Committee B Ministry of Defence:
Major Projects Report 2000CThe Role of the Equipment Capability
Customer (HC 369 (2001B02)) Back