Over budget UK defence contractors to be named in procurement reforms

UK defence contractors who are late or over budget on equipment projects will be “named and shamed” as part of a shake up to UK defence procurement.

They will be hauled up in front of a Ministry of Defence (MoD) committee to be grilled on why their project is not running to the timescale and cost that they agreed.
UK defence secretary Liam Fox has vowed to combat the “crazy” practices within the industry in order to overturn decades of mismanagement.  Fox will personally chair a new policing committee called the Major Projects Review Board that will oversee the 50 biggest MoD projects and have the power to publicise names of companies that default.
The dramatic change in defence procurement comes as the department attempts to overhaul the AUD$60 billion black hole in unfunded purchases made by the previous government.

“There must be a real sense of urgency about achieving this goal,” Fox said speaking at the think tank Civitas. “Where projects are falling behind schedule or budget we must take immediate remedial measures. Those responsible will be brought to account in front of the project board.” His speech comes after the Public Accounts Committee said a "cycle of failure" in defence procurement would continue unless MoD was reformed. Every quarter the board will also publish a document labelled “projects of concern”.

He also attacked the “conspiracy of optimism” within defence that has led to spiralling costs after programmes have been under ordered in the knowledge that the Treasury will cover invariably prices rises. For example the Astute submarine programme has gone $2.2 billion over budget, the A400M transport aircraft $955 million and the Bowman radio project has no support funding post 2015.

Ian Godden, spokesman for ADS, that represents major defence companies, welcomed the reforms. “Industry is convinced that, with reform of the MoD procurement process and through partnership with Government, significant improvements can be delivered.”

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