Category Archives: Defence

Why is MoD spending more on IT when its data is poor?

Posted on June 28, 2012 | Leave a comment

By Tony Collins

The Ministry of Defence and the three services have spent many hundreds of millions of pounds on logistics IT systems over the past 20 years, and new IT projects are planned.

But the National Audit Office, in a report published today – Managing the defence investory –  found that logistics data is so unreliable and limited that it has hampered its investigations into stock levels.

“During the course of our study,” says the NAO, “the Department provided data for our analyses from a number of its inventory systems. However, problems in obtaining reliable information have limited the scope of our analysis…”

The NAO does not ask the question of why the MoD is spending money on more IT while data is unreliable and there are gaps in the information collected.

But the NAO does question whether new IT will solve the MoD’s information problems.

“The Department has acknowledged the information and information systems gaps and committed significant funds to system improvements. However these will not address the risk of failure across all of the inventory systems nor resolve the information shortfall.”

MPs on the Public Accounts Committee, who will question defence staff on the NAO report, may wish to ask why the MoD’s is so apparently anxious to hand money to IT suppliers when data is poor and new technology will not plug information gaps.

Comment:

MPs on the Public Accounts Committee found in 2003 (Progress in reducing stocks) that the MoD was buying and storing stock it did not need. Indeed after two major fires at the MoD’s warehouses at Donnington in 1983 and 1988 more than half of the destroyed stock did not need replacing. Not much has changed judging by the NAO’s latest report.

It’s clear that the MoD lacks good management information. Says the NAO in today’s report:

“The summary management and financial information on inventory that is provided to senior staff within Defence Equipment and Support is not sufficient for them to challenge and hold to account the project teams…”

But will throwing money at IT suppliers make much difference? The MoD plans the:

-  Future Logistics Information Services project, which is intended to bring together and replace a number of legacy inventory management systems; and

-  Management of the Joint Deployed Inventory system which will provide the armed services with a common system for the inventory they hold and manage.

But is the  MoD using IT spending as proof of its conviction to improve the quality of data and the management of its inventory?

Managing the defence inventory

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Posted in cost reduction, Defence, Government IT, IT projects, IT-related failures, oversight, private sector lessons for the public sector, project management, public sector, public services, software quality, supplier relationships

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US state government and defence IT projects face uncertain future

Posted on January 15, 2012 | Leave a comment

By David Bicknell

Local newspapers in the US are offering some insight into the cloudy future of two significant IT projects.

In Salem, Oregon, a planned $92 million upgrade of the state’s Department of Revenue computer system is reportedly on hold because the state can’t afford $13 million in start-up costs.

The Register-Guard website says local officials chose to put the  project on hold rather than ask legislators to make a choice between paying for the computer system and paying for public safety and human services.

The computer system is said to be responsible for processing $7 billion a year and 94 percent of Oregon’s general fund revenue, but officials are apparently concerned about its future effectiveness.

The agency’s ability to collect taxes rests on a “myriad of disparate, aging software applications and databases,” according to a 96-page business analysis the Department of Revenue produced in 2010.

Meanwhile,  in Beavercreek, Ohio, a US Air Force computer modernisation project which has already cost $1 billion, is said to be at risk of Washington defence cuts.

US Air Force officials have acknowledged that the Expeditionary Combat Support System project, on which at least $986.5 million has been spent, won’t be completed in 2016 as had been hoped. Work began in 2007, but the local Springfield News-Sun newspaper reports that the completion date has been repeatedly postponed because of delays.

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Posted in Campaign4Change, Defence, Government IT, IT projects, project management, public sector

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MoD rules out mutual option in reorganisation of Defence Equipment and Support arm

Posted on December 6, 2011 | 2 Comments

By David Bicknell

The Ministry of Defence (MoD) has ruled out choosing a spin-off mutual as one of the three models being considered for a re-organisation of the key Defence Equipment and Support (DE&S) organisation.

Campaign4Change recently received a tip-off from an MoD insider who was concerned that the mutuals option had been ruled out.

The MoD has confirmed that there is no mutuals route, and that its three options will be:

*  A Trading Fund: where DE&S continues to be a part of the MoD but has a hard-charging regime. Its staff are civil service employees. 

* An Executive Non-Departmental Public Body: where DE&S remains in the public sector. Staff are public sector employees but not civil servants.

* A Government Owned Contractor Operated (GOCO): A private sector organisation. Staff are private sector employees with potentially some government secondees.

Asked why the mutuals option had been overlooked,  an MoD spokeswoman said, “Further to our conversation about the options that have been proposed for the future of DE&S, I can confirm that we’re not looking at mutuals. The reason for that is that simply, we do not consider it appropriate.

“We have considered a wide range of options for DE&S and centred analysis on three we believe will most suit the requirements of the organisation.  We have kept all stakeholders, including across central Government, aware of this analysis.” 

The MoD says the three options will be presented to ministers in due course who will decide on a preferred way forward.

Defence Equipment and Support (DE&S) equips and supports the UK’s armed forces for current and future operations. Employing around 20,000 people, with a budget of some £14 billion, its headquarters is in Bristol with other sites across the UK and overseas.

DE&S acquires and supports equipment and services, including ships, aircraft, vehicles and weapons, information systems and satellite communications. As well as continuing to supply general requirements, food, clothing, medical and temporary accommodation, DE&S is also responsible for HM Naval Bases, the joint support chain and British Forces Post Office.

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Posted in Campaign4Change, Defence, mutualisation, mutuals, private sector, procurement, public sector

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MPs criticise PFI value for money and the MoD’s failure to invest in effective logistics systems

Posted on August 19, 2011 | Leave a comment

By David Bicknell

Two parliamentary committees, the Treasury Select Committee and the Public Accounts Committee, have today made strong criticisms about the use of private finance initiatives (PFI) and of IT systems for defence logisitics.

In its report, the Treasury Select Committee suggested that PFI funding for new infrastructure, such as schools and hospitals, does not provide taxpayers with good value for money and stricter criteria should be introduced to govern its use.

The Committee’s chairman, Andrew Tyrie MP, said:

“PFI means getting something now and paying later. Any Whitehall department could be excused for becoming addicted to that. We can’t carry on as we are, expecting the next generation of taxpayers to pick up the tab. PFI should only be used where we can show clear benefits for the taxpayer. We must first acknowledge we’ve got a problem. This will be tough in the short term but it should benefit the economy and public finances in the longer term.

“PFI should be brought on balance sheet. The Treasury should remove any perverse incentives unrelated to value for money by ensuring that PFI is not used to circumvent departmental budget limits. It should also ask the OBR to include PFI liabilities in future assessments of the fiscal rules. 

“We must also impose much more robust criteria on projects that can be eligible for PFI by ensuring that as much as possible of the risk associated with PFI projects is transferred to the private sector and is seen to have been transferred.”

In its report on the defence logistics supply chain, the Public Accounts Committee was critical that the MoD had made little progress in resolving long-standing problems with its supply chain information, despite giving previous assurances to the Committee.

Its recommendations for improving future performance include the following comments:

“The Department accepts that historic underinvestment has meant its management information systems and the underlying IT systems are not up to the task. In particular, its spending on IT systems has not kept pace with the need to upgrade those systems.

 ”The Department has made investments in new data systems – for example £66 million has been spent on the Management of the Joint Deployed Inventory system which tracks equipment in theatre – and more is planned.

“In 2010, the Department signed an £803 million, 11-year contract with Boeing for the provision of the Future Logistics Information Services project. Under this contract, Boeing is required to bring together 270 different data systems operated by 50 different contractors, which should provide a complete and coherent set of data for managers to use.

“Separately, the Department has now approved an additional £75 million to upgrade some of the defence base inventory management systems that are now at critical risk of failure.

“The implementation of the Future Logistics Information Services project, including the additional upgrade to the warehouse inventory management IT system, will not be complete until 2014. The Department told us it would take a long time to upgrade systems and data, in part because of the need to ‘cleanse’ the data – otherwise the poor quality information the Department currently holds would simply be transferred onto a better IT system.

“We are very concerned that, until the systems are fully rolled out in 2014, the high risk of system failure will remain in systems that are critical to supporting front line troops. To ensure that there is no further slippage in this critical area, the Department has provided us with a plan of the scheduled projects for improving data systems and has promised to report back in six and twelve months on how it is performing against its milestones.”

(Tony Collins is away this week.  But he’ll be back shortly to offer his unique insight on Government and public sector IT projects)

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Posted in Campaign4Change, Defence, Government IT, Value

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