WIREDGOV

MOD addresses cost pressures in major projects

MINISTRY OF DEFENCE News Release (285/2007) issued by The Government News Network on 30 November 2007

In its annual review of major defence equipment projects, published today, the National Audit Office has recognised the actions taken by the MoD to limit in-year cost increases and minimise delays.

In response to the report Baroness Taylor, Minister for Defence Equipment and Support said:

"The size and complexity of these equipment programmes with their huge challenges in delivery and technology must not be underestimated. The National Audit Office recognises that we are moving in the right direction to keep costs down and minimise delays. But there is more to be done. We are putting the changes in place to improve the delivery of our equipment programmes to our Armed Forces.

"Today's report covers progress on our top 20 projects - but we are also managing some 350 other projects at various stages of concept, assessment, development and manufacture valued at more than £65 Billion. Our teams are also engaged, with industry, on the crucially important task of delivering key urgent operational requirements to Afghanistan and Iraq to counter emerging threats. Some 160 separate Urgent Operational Requirements have been successfully delivered since April 2006."

Thirteen of the top 20 projects have forecast a fall in costs and ten report either no delay or a cut in the forecast in service date. Much of the cost growth forecast in MPR2007 relates to the Type 45 Destroyer and Astute attack submarine programmes. The report acknowledges the work done by the MoD to place these projects on a better footing in the long term.

The MoD continues to take hard decisions about trading cost, time and performance to keep within the limits of budgets and minimise delays, in line with the Committee of Public Accounts recommendations.

Notes to Editors

1. The National Audit Office Major Projects Report 2007 is published today by the National Audit Office.