Labour’s defence procurement report, launched today (September 22), calls for a number of changes to be made to procurement processes at the Ministry of Defence.
Labour wants the MoD to move to a 10-year financial planning horizon for equipment spending instead of the current four to five year period – giving the defence industry “more information against which it can plan its investment and developments.”
Labour also wants the budgeting system to “address the motivations of the key players in defence procurement, making it a rational decision for the main players to ‘Design to Cost’”.
Included in the report is the proposal to ensure that decisions over whether to develop technology at the MoD or purchase it from outside defence manufacturers are made in recognition of “what type of military capability will be required,” so that best value for money is obtained – wherever the equipment comes from.
Labour wants to encourage competition for defence contracts, but realises that where there is no effective competition, the contracting policy “should aim to set tough cost benchmarks, make actual costs visible and provide significant incentives and penalties to ensure performance.”
The aerospace, defence and security trade organisation ADS’s chairman Ian Godden commented on the procurement report: “We welcome this report as a useful contribution to an important debate and believe it should be given serious consideration.”
“With the defence budget now at approximately half the level of Government spending or of UK GDP that it was 20 years ago, this reform is even more crucial in order that the Ministry of Defence can achieve the best value for money possible,” he added.
You can view the full version of the Labour Party’s defence procurement report here.