107. If, as the White Paper indicates, the Government
does indeed decide to retain and renew the UK's submarine-based
strategic nuclear deterrent, the procurement of a new platforma
successor to the Vanguard-class submarinemay represent
the biggest MoD acquisition project and the most complex to date.
108. In previous procurement programmes, for the
Polaris and Trident boats, the MoD established and maintained
sizable and dedicated organisations to manage the projects. These
teams no longer exist, posing questions about the capacity of
the MoD to deliver a project of this scale.
109. We asked Lord Drayson how the Ministry of Defence
was preparing to manage the procurement of a successor to the
Vanguard submarine. He told us that he was "confident"
the MoD could deliver such a project. That confidence, he told
us, came from the fact that "we start from the good position
that we have the infrastructure and the know-how in place for
the existing system and we have the recent experience
the Astute". It also came "from initiatives we have
been putting in place within the Ministry of Defence to strengthen
[its] general competence across defence procurement in terms of
project management". These initiatives, Lord Drayson argued,
were "as applicable to a project such as a major submarine
project as they are to other [defence procurement] projects".
110. Lord Drayson conceded that "what we have
recognise that we are going to need to recruit
into the project team additional people with expertise".
In this respect, he believed that the MoD would be competing with
the civil nuclear industry in some areas. He felt that, on the
whole, "we judge that it will be possible for us to do this".
111. David Gould admitted that procuring a Vanguard
successor would be "a massive enterprise", but he argued
that the absence of dedicated project teams of the kind used for
Polaris and Trident did not mean, in itself, that the MoD lacked
the capacity to deliver such a programme. Instead, he told us
that the Polaris and Trident teams were, in many ways:
precursors of IPTs because they were big organisations
which brought all the necessary internal skills together to manage
over a long period of time an extremely complex and challenging
programme. That is actually what IPTs do; it is a question of
scale more than anything else.
112. Mr Gould told us that the MoD now did less "in
house" than it used to and that it would be necessary to
set up an Integrated Project Team (IPT) of the kind currently
managing the future carrier programme "where we bring ourselves
and people from outside industry together into a joint team to
execute a programme of this size". The key factor would be
to "resource it properly, not just in terms of money but
in terms of the internal skill".
113. We asked Mr Gould why, given the likely challenges
of a Vanguard successor programme, there was not a project management
team already up-and-running, in the event that the Government,
as it indicated in the White Paper, decides to renew the UK's
submarine-based nuclear deterrent. Mr Gould told us that setting
up a project team would be easier once a decision on the future
of the deterrent had been taken. But he added that, in any event,
"because of what has been happening on investigating options
and so forth
.quite a few of the elements of that sort of
team are really in existence". Nevertheless, he conceded
that "clearly we will have to grow very considerably to manage
a programme of that size".
114. Industry appeared to share the MoD's confidence
in its ability to manage a Vanguard successor programme. Mr Easton,
of BAE Systems, stated that although the MoD had fewer people
available to manage the programme "we co-operate very, very
closely with them, and it is a very constructive dialogue with
the Ministry of Defence, in terms of resources, demands and, therefore,
Steve Ludlam, of Rolls-Royce, was equally optimistic about the
preparedness of the MoD to manage the enterprise. He told us that
a great deal of collaboration with the MoD: the joining
of teams, the co-location of teams, the secondment of MoD personnel
into particular jobs within our industries, all to make sure that
we retain the skill that is necessary to take this
a Vanguard successor would be a huge undertaking. It is essential
the MoD has the capacity to manage such a programme effectively.
Any shortfall in preparedness must be addressed as a matter of
priority. The MoD's shortage of systems engineers and project
managersskills essential at the start of a programme of
this kindis a cause of serious concern. If the decision
is made to renew the deterrent, it is essential the MoD commit
sufficient resources to the programme from the beginning. It will
be desirable to bring in skills from industry. We recommend that
the MoD state, in its response to this report, how it intends
to address its skills shortages.