Chair's statement on defence acquisition

Making defence acquisition better is vital to national security and so it is deeply concerning that the Ministry of Defence has got it so badly wrong, throwing away £33 million of taxpayers’ money on botched reforms.

After two and a half years of work, the Ministry has had to abandon its plans to set up its kit purchasing company, Defence Equipment and Support, as a Government-owned Contractor-operated company – a GoCo. Poor governance and unclear messages on how risk would be shared between the government and private sector meant that its competition to run the GoCo failed disastrously with just one contractor putting in a bid, forcing the Ministry to keep its defence acquisition company in-house.

I worry that the Ministry’s recruitment of expensive contractors has cancelled out the savings it had achieved by cutting permanent jobs, and worse still, it does not know if it is getting value for money from these contractors. If it is to be successful in reforming defence acquisition, the Ministry needs to sharpen up and address criticism that it is inefficient in how it uses the skills of its staff.

I expect the Ministry to tell my Committee how it intends to deliver affordable defence equipment when it appears before us on March 2.

Further information

• National Audit Office report: Reforming defence acquisition
• About Parliament: Select Committees
• Visit Parliament: Watch committees