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In recent years, researchers and analysts in the UK, the USA, Australia and some continental European countries have examined the performance of high profile, high value defence procurement projects to determine the cause of the budget overruns and project delays that have beset the market, and the mega- projects in particular. This has resulted in the publication of a number of insightful reports that also inform the wider debate on project delivery and management, procurement and contract design.
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| Allocation and Management of Risk in Ministry of Defence PFI Projects (PDF) |
| National Audit Office (NAO), 2008 |
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| This study examines the allocation and management of risk in defence PFI projects. It is based on a detailed examination of eight diverse case study projects covering transport, power, armoured vehicles, telecommunications, animal centre, facilities management, and water. |
| 9780102953121 |
| UK |
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| Review of MoD PFI Projects in Construction and Operation (Word) |
| Ministry of Defence Private Finance Unit (MOD PFU), 2005 |
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| The review found PFI in the MoD generally delivers projects on time and within budget. The projects are performing well, delivering the services required, and long-term contracts are flexible enough to accommodate future change and deliver on a sustained basis. It notes a number of lesson learnt and examples of best practice and discusses ways in which the MoD could secure additional procurement outcome benefit. |
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| UK |
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| Ministry of Defence: Major Projects Report 2005 (HC 595-I Session 2005-06) (PDF) |
| National Audit Office : Report by the Comptroller and Auditor General, 2005 |
| London: The Stationery Office Ltd. |
| This report covers cost, time and performance data for 30 defence equipment projects, in the year ended 31 March 2005. It finds that overall, the performance of projects has improved but performance is not consistent across all projects and challenges do remain. |
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| UK |
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| Ministry of Defence: Managing the Defence Estate (HC 25, Session 2005-06) (PDF) |
| National Audit Office : Report by the Comptroller and Auditor General, 2005 |
| London: The Stationery Office |
| This report covers the development of contracting models used in managing the defence estate. It finds that good progress has been made in developing a strategy to meet new requirements and in rationalising defence estates to deliver good quality estates. It concludes, however, that risk needs to be better managed and there needs to be greater focus in changing culture in order to fully realise benefits. |
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| UK |
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| Ministry of Defence: Major Projects Report 2004 (HC 1159-I Session 2003-04) (PDF) |
| National Audit Office : Report by the Comptroller and Auditor General, 2004 |
| London: The Stationery Office |
| This analysis covers the cost, time and procurement data for MOD procurement projects in financial year 2003-2004. It finds that problems continue to emerge in defence equipment projects and barriers remain to improving acquisition performance. There is little evidence that project performance has improved in recent years, but there have been examples of successful projects. |
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| UK |
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| Ministry of Defence: The Management of Defence Research and Technology (HC 360, Session 2003-04) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2004 |
| London: The Stationery Office |
| This report examines the Ministry of Defence’s new approach to Research and Technology – from one of creating the Technology Base to one which accesses and exploits it. The report covers a number of issues, including competition in defence research and technology, and difficulties in measuring research outcomes. |
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| UK |
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| Ministry of Defence: Major Projects Report 2003 (HC 195 Session 2003-04) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2004 |
| London: The Stationery Office |
| This report provides cost, time and technical performance data for defence procurement projects in financial year 2002-2003. It finds that projected cost and time performance has deteriorated in-year. The approach to the Assessment Phase continues to develop but some projects have passed insufficiently de-risked. |
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| UK |
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| Military Operations: Contractors Provide Vital Services to Deployed Forces but Are Not Adequately Addressed in DOD Plans (GAO-03-695) (PDF) |
| Report to the Subcommittee on Readiness and Management Support, Committee on Armed Services, U.S. Senate, 2003 |
| Washington D.C.: United States General Accounting Office |
| This report examines the extent of contractor support, the extent to which contractors are considered in UD Department of Defense planning and the adequacy of DOD’s guidance and oversight mechanisms in managing its overseas contractors. The report discusses the issue of developing contingency plans in case contractors’ essential services delivered by contractors become unavailable. |
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| USA |
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| Missile Defence (HC 290-I First Report of Session 2002-03) (PDF) |
| House of Commons Defence Committee, 2003 |
| London: The Stationery Office |
| The Committee’s report sets out its views regarding the debate surrounding the US request of technology and software upgrades at RAF Fylingdales (Serco’s longest standing contract) as part of the proposed US Missile Defence system. This report gives an overview of missile defence and the UK’s approach. It concludes that the government should agree to the request, but condemns the manner in which public debate has been handled by the Ministry of Defence. |
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| UK |
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| Ministry of Defence: Major Project Reports 2002 (HC 91 Session 2002-2003) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2002 |
| London: The Stationery Office |
| This report contains analysis of cost, time and procurement data for Ministry of Defence procurement projects in financial year 2001-2002. The report concludes that there has been a continuing improvement in project performance, but that maintaining this improvement will be challenging. It also gives three brief case studies of C-17 Heavy lift aircraft, Type 45 Destroyer and Skynet 5 Satellite Communications System. |
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| UK |
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| Ministry of Defence: The Joint Services Command and Staff College (HC 537 Session 2001-2002) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2002 |
| London: The Stationery Office |
| This report analyses the progress of the Joint Services Command and Staff College, looking at how it has succeeded, and where there is scope for further improvement. The study concluded that the PFI deal for the College’s permanent home was ‘good value for money’ and provides useful lessons for the future. |
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| UK |
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| Ministry of Defence: Major Projects Report 2001 (HC 330 Session 2001-2002) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2001 |
| London: The Stationery Office |
| The report gives an analysis of cost, time and procurement data for MOD procurement projects in financial year 2000-2001. The report concludes that there is evidence of continued improved cost control, the delays are beginning to be brought under control, and the Ministry of Defence is still expected to meet the majority of the technical requirements of customers. |
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| UK |
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| Long-Run Costs and Performance Effects of Competitive Sourcing (CRM D0002765.A2) (PDF) |
| Clark, Frances; Rosenblum, Cheryl; Coast, Murrel; Smallwood, Elaina, 2001 |
| Virginia: Center for Naval Analyses |
| This report sets out to assess the long-term costs associated with outsourcing and competition decisions, looking at both observed and effective cost; and post-competition performance. It finds that savings are real and sustained and performance is satisfactory. |
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| USA |
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| Ministry of Defence: Major Projects Report 2000 (HC 970 Session 1999-2000) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2000 |
| London: The Stationery Office |
| Covering the period to 31st March 2000, this report analyses cost and time performance of the Ministry of Defence, and provides information on the progress of a number of projects. It concludes that the Department is meeting the technical requirements of its customers but not necessarily within approved time and cost. |
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| UK |
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| Government Contracting Options: A Model and Application |
| Keating, Edward G., 1999 |
| Defence and Peace Economics, Vol. 10, No. 2 (May 1999), pp.191-223 |
| This paper models and analyses a principal-agent contracting model. It looks at cost-sharing, pricing models, competition and how best to devise contracts. It concludes that the best contracting approach combines a lump-sum payment and a contractor-provided availability guarantee. |
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| UK |
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| Medium Support Helicopter Aircrew Training Facility: PFI Case Study |
| Treasury Taskforce, 1998 |
| Office of Government Commerce |
| This report is a case study examining the PFI contract for the provision of aircrew training for the RAF Support Helicopter force. The project was felt to offer valuable lessons, being the first PFI contract involving defence-specific assets that had been awarded by the Defence Procurement Agency (DPA). |
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| UK |
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| Base Operations: Challenges Confronting DOD as it Renews Emphasis on Outsourcing (GAO/NSIAD-97-86) (PDF) |
| Report to the Chairman, Subcommittee on Military Readiness, Committee on National Security, House of Representatives, 1997 |
| Washington D.C.: United States General Accounting Office |
| This report examines the extent to which the DOD and the services emphasise outsourcing of support services, the factors that influence savings in the process of outsourcing and impediments to outsourcing. The report recognises that savings may be made, but it questions the magnitude of these savings. |
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| USA |
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| Defence Outsourcing: Challenges Facing DOD as it Attempts to Save Billions in Infrastructure Costs (GAO/T-NSIAD-97-110) (PDF) |
| Statement of David R. Warren, Director, Defense Management Issues, National Security and International Affairs Division. Testimony before the Subcommittee on Readiness, Committee on National Security, House of Representatives., 1997 |
| Washington D.C.: United States General Accounting Office |
| This testimony discusses past experience of the Department of Defense in achieving infrastructure savings, and the challenges that the DOD faces in reaching future goals. While this report finds that there are opportunities to reduce infrastructure costs, it questions the magnitude of the saving that can be realised within the current strategy and structure. |
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| USA |
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| Case Studies in DoD Outsourcing (CAB 96-62) (PDF) |
| Tighe, Carla E. with: Jondrow, James M., Keenan, John D., Marcus, Alan J., Moore, Carol S., Reeger, (LCdr.) Christopher M., Robinson, Matthew T., Trunkey, R. Derek, 1997 |
| Virginia, Center for Naval Analyses |
| This report presents case studies of private sector involvement Department of Defense outsourcing experiences, covering training, housing, maintenance, and base operating support. |
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| USA |
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| Defense Depot Maintenance: Privatization and the Debate over the Public-Private Mix (GAO/T-NAIAD-96-146) (PDF) |
| Statement of David R. Warren, Director, Defense Management Issues, National Security and International Affairs Division. Testimony before the Subcommittee on Readiness, Committee on National Security, House of Representatives., 1996 |
| Washington D.C.: United States General Accounting Office |
| This report discusses issues related to the allocation of depot maintenance between the private and public sectors, including privatization initiatives. It finds that future shifts to workload to the private sector, if not managed effectively, could exacerbate existing excess capacity problems and inefficiencies. And that privatisation is not likely to achieve the expected savings, it may even be more costly. |
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| USA |
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| Cost Case Study - Amberley RAAF Base (Web Page) |
| Appendix F, Competitive Tendering and Contracting by Public Sector Agencies, Industry Commission Inquiry Report, Report No. 48, 1996 |
| Melbourne: Australian Government Publishing Service |
| This case study appeared as an appendix to a cross-sectoral Industry Commission study of competitive tendering and contracting (CTC) by public sector agencies. The case study examined the change in cost to the Royal Australian Air Force and the Department of Defence resulting from the contracting out of several aircraft maintenance and repair services at RAAF Base Amberly as part of the Commercial Support Programme (CSP), and the sources of any changes. |
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| Australia |
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| Submission to the Industry Commission Inquiry into Contracting Out |
| Department of Defence, 1995 |
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| The Australian Department of Defence’s submission to Competitive Tendering and Contracting by Public Sector Agencies (available above), the Industry Commission Inquiry into the nature, scope and extent of contracting out. |
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| Australia |
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| Competition in the Provision of Support Services |
| Committee of Public Accounts, 1992 |
| The Stationery Office |
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| ISBN: 010213393X |
| UK |
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| A Pilot Study of the Impact of OMB Circular A-76 on Motor Vehicle Maintenance Cost and Quality in the U.S. Air Force |
| Berry, Sandra H., Stolzenberg, Ross, 1985 |
| Rand Corporation/Rand Report |
| This report analyses the impact of the A-76 procurement approach, designed to encourage the use to private firms to provide services to the government where this is viable. This study, using interviews and administrative data, finds that the application of A-76 leads to significant savings on cost with no effects on quality. |
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| USA |
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