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MoD blasted by MPs for ‘Cold War’ age supply chain systems

Department signs £803m contract to tackle the problem

The powerful House of COmmons Public Accounts Committee has heavily criticised the Ministry of Defence (MoD) for using a "Cold War" style, heavily-dated raft of supply chain systems, which have meant it struggles to deliver goods to troops.

Many of the 270 different asset management IT systems in use are so outdated that if they fail, troops on the front line will be short of vital kit within four weeks, the PAC said.

The problem is so severe that the government last year signed an £803 million contract with supplier Boeing in order to tackle it, at a time when it was acting to slash large IT contracts elsewhere.

The committee lambasted the MoD as it angrily noted that it had been arguing with the department for over 25 years, without the problem having been resolved. In 1986, the government said it was improving systems, and the committee said the same problems still persist.

The inefficiency of the MoD's supply chain was leading to troops failing to receive equipment, large amounts of stock being untraceable, and forces "cannibalising" planes and tanks to retrieve specialist parts for use elsewhere.

The department's "failure to collect basic data about where supplies are stored" meant the National Audit Office had been unable to fully sign off its accounts for three years, the PAC said.

Margaret Hodge, chairwoman of the Public Accounts Committee, said the MoD had been almost unable to improve the situation because it "does not have the information" to develop its supply chain.

The MoD has finally initiated a major project called Future Logistics Information Services, which is attempting to deliver better systems by 2014. It signed an £803 million, eleven-year deal with contractor Boeing last year for the project.

Under the programme, which has a particular focus on asset management, contractor Boeing is attempting to rationalise and link 270 different systems from 50 contractors.

But there remained a risk that "funding for this project could be reduced" as the MoD "seeks to lower spending and balance its overall budget", Hodge noted. This left IT systems at a "critical risk of failure", she said.

Given the government's record of failed large IT projects, the PAC insisted it report back on the programme's progress every six months.


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