Managing major Defence equipment acquisitions that successfully deliver front line capability for the Australian Defence Force represents a significant challenge, which is not unique to Australia. With major Defence equipment acquisition often expensive and technically complex, there are significant risks to delivering the required capability on schedule and within budget.
This third review of the status of selected Defence acquisition projects continues to build on the work undertaken by the Defence Materiel Organisation (DMO) and the Australian National Audit Office (ANAO) to improve the transparency and public accountability for major Defence equipment acquisitions.
The preparation of the Major Projects Report (MPR) has received ongoing support from the Joint Committee of Public Accounts and Audit (JCPAA) and the Government, and has been an area of ongoing interest for the Joint Standing Committee on Foreign Affairs, Defence and Trade. The JCPAA's review of the 2007-08 MPR has contributed to a number of enhancements to this year's report.
The 2009-10 MPR includes a further seven projects, bringing the total number to 22. The report's presentation has been further developed and a greater level of information about each project's performance is now available. This includes data on DMO's assessment of progress towards delivering the key capability requirements involved in each project, which was provided only at a summary level in the DMO section of the 2008-09 MPR. This data provides some insight into a system's likely suitability for planned operational service.
The program is well placed to incorporate another six projects in the 2010-11 MPR to bring the total number of projects to 28; and the DMO and the ANAO are working with the JCPAA to continue to enhance the value of the report.
This year's review continued the strong working relationship between the DMO and the ANAO in the preparation of the report. Defence and industry stakeholders also provided valuable input to assist ANAO with its review.
I would like to again thank the Chief Executive Officer of the DMO, Dr Stephen Gumley AO, and his staff at the corporate and project levels for their considerable work on this third report, and the high level of assistance provided to the ANAO staff in conducting the project reviews.
Ian McPhee
Auditor-General
19 November 2010