Twenty-Second - Improving the performance of major defence equipment contracts

The government agrees with the Committee’s recommendation for greater transparency, committing to ensure future Accounting Officer Assessment letters include more detailed evidence on value for money and that the Permanent Secretary issues annual reminders to SROs by January 2022.

The government accepted the recommendation and committed to writing to the Committee by the end of May 2022. This letter will set out evidence of how it holds suppliers to account and fairly apportions risk and reward across its contracts.

The government accepted the recommendation, committing to provide further detail and a breakdown of the £16.5 billion funding in the upcoming Equipment Plan report in February 2022, clearly distinguishing between new capabilities and existing shortfalls.

The government disagrees with the Committee's conclusion regarding the impact of cost increases on military capability, asserting new funding will address threats. It commits to providing further detail and a breakdown of this £16.5 billion in an upcoming equipment plan report for publication in February 2022.

The government acknowledges the importance of managing supplier performance and risk, citing existing measures such as CAAS, firm price contracts, and liquidated damages. It commits to writing to the Committee by May 2022 to provide evidence of how it holds suppliers to account.

The government accepted the recommendation, committing to ensure future letters to the Committee contain more detailed evidence for value for money assessments and that the Permanent Secretary will remind SROs of their obligations by January 31, 2022.

The government, while disagreeing with the Committee's conclusion on VFM evaluation, agrees with the implied recommendation for transparency and commits to ensuring future letters to the Committee contain more detailed evidence and that the Permanent Secretary issues annual reminders by 31 January 2022.

The government acknowledged the Committee's concerns regarding supplier contributions and risk apportionment. While disagreeing with the specific conclusion, it committed to writing to the Committee by May 2022 to provide evidence on how it manages supplier accountability and risk.

The government states that systems are already in place to identify and share lessons, with ongoing efforts to standardise LfE information. It highlights existing Strategic Partnering and Category Management Programmes and an Acquisition and Approvals Transformation Programme aimed at embedding continuous improvement.

The government states that systems are in place to identify and share lessons, with ongoing work to standardise LfE information. It also points to existing Strategic Partnering and Category Management Programmes and an Acquisition and Approvals Transformation Programme for improving delivery.

The government responded by describing its existing Strategic Partnering Programme (SPP) and Category Management, stating these are based on good practice and are already in place to deliver cashable savings.

The government confirms that category management is in place to deliver £628 million in savings through more efficient ways of working. It also mentions existing systems for learning from experience and the implementation of an Acquisition and Approvals Transformation Programme.

The government accepted the recommendation, committing to build on existing leadership training, introduce specific talent and career management for MOD SROs, and investigate options to reduce SRO turnover, including minimum tour lengths.

The government acknowledged the Committee's observation regarding the lack of clarity on the £16.5 billion funding. While disagreeing with the Committee's conclusion, it committed to providing a detailed breakdown in the February 2022 equipment plan report, distinguishing between new capabilities and existing shortfalls.