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Major Equipment Procurement Programmes

Volume 520: debated on Monday 13 December 2010

11. What arrangements are in place to monitor the progress of his Department’s major equipment procurement programmes. (29887)

14. What arrangements are in place to monitor the progress of his Department’s major equipment procurement programmes. (29890)

I receive monthly reports and quarterly detailed project health checks on the Ministry of Defence’s largest projects. Last year, discounting deliberate policy decisions made by the previous Government, the MOD met all its targets to deliver its major projects to cost, time and performance. This year looks equally encouraging. The top 30 major projects are also reviewed annually by the National Audit Office and in this year’s report the Comptroller and Auditor General said:

“In-year performance on the majority of large defence projects which we examined has been encouraging".

But we should not wait for the NAO to tell us how we are doing at the end of the year. That is why I can announce to the House today that the Secretary of State and I are forming a major projects performance board that will review our most significant projects regularly.

I thank the Minister for that reply. Does he agree that in a long line of procurement failures from the previous Government, the £38 billion overspend in the defence budget takes the biscuit? Will he reassure the House on what steps will be taken so that that level of commercial failure will be, like the idea of a Labour Government, a thing of the past? [Interruption.]

I hear howls of protest from those on the Opposition Front Bench, but over the weekend I heard the shadow Secretary of State fessing up to major failures in procurement. I strongly agree with my hon. Friend.

I am happy to tell you, Mr Speaker, that I cannot comply with your request for short answers and do justice to my hon. Friend’s question because we have a range of measures in place to achieve precisely that outcome, including stronger controls over the entry for new projects in the equipment programme; a formal project start-up process that considers requirement risk, technical viability risk, affordability and deliverability; improving key skills; working closely with the NAO; and reaffirming our commitment to regular defence reviews. All that will achieve exactly the outcome that she so rightly desires.

Historically, one of the fundamental problems with procurement has been a disconnect between Ministers, civil servants, uniformed personnel and the defence industry. How do we intend to address that problem in the future?

My hon. Friend is absolutely right. We talk of a conspiracy of optimism in these major projects that has so often characterised procurement decisions in the past. The list I rattled through in answer to my hon. Friend the Member for Devizes (Claire Perry) partly addresses the concerns of my hon. Friend the Member for Milton Keynes North (Mark Lancaster). I am sorry that I said it so fast, but it was important to get it on the record. If I do not deliver on that, I think my job will be on the line.