Appendix 6 Key recommendations from the NAO report on Maximising the benefits of defence equipment co-operation (March 2001)5

We commend the Department's actions in taking forward the Capability Management initiative and endorse its intention to encourage partners to discuss opportunities for co-operation on the basis of future capability needs rather than specific requirements.

We recommend that the Department:

■  analyses the factors which have contributed to the technological and financial success, or otherwise, of co-operative research programmes and learns the lessons so that future arrangements are identified, established and undertaken efficiently;

■  completes its planned review of the methodology used to assess the benefits of co-operative defence research programmes as quickly as possible and explores the potential to augment the database with information on the Department's expectations when it commits to co-operative research and the benefits of other forms of defence research co-operation;

■  in line with the intentions underpinning the agreements reached with European and United States partners;

  enhances decision-making on where to concentrate international defence research effort and where to rely on mutual interdependence with partner nations by ensuring that plans to include a more clearly defined international dimension to the "Towers of Excellence" model are taken forward. [This model recognises that the department cannot afford to fund world-class research across the complete defence technology spectrum];

  ensures that the potential opportunities to rationalise and integrate the various multilateral research forums are taken full advantage of;

  encourages the co-operative use of research and testing facilities and ensures that in commissioning new facilities or modernising existing ones, full consideration is given to the scope for co-operation.

We recommend that the Department works with its partners and OCCAR6:

■  to identify common success factors in previous defence equipment co-operation;

■  to develop performance measures to ensure that OCCAR is able to demonstrate it is providing cost, timescale and operational benefits compared with past, or alternative, co-operative arrangements;

■  to monitor implementation of the principle of global balancing to ensure that worksharing arrangements do not impose cost and timescale penalties on individual equipment programmes;

■  to assist in developing an equivalent of the Department's Acquisition Management System to underpin the programme management procedures which OCCAR have already produced. Such a system supported with suitable training will help to ensure that the principles already agreed are successfully implemented;

■  ensure the responsibilities of the OCCAR Executive Administration, Programme Offices and nations are clearly delineated to allow the agency to function as proposed.

We recommend that on programmes which fall outside the OCCAR umbrella, the Department works with partners to:

■  learn from past experience to identify common success factors in defence equipment co-operation;

■  build on the discussions which have already taken place to translate the Smart Acquisition principles into working practices which will bring about continuous improvement in the arrangements for executing both existing and new international co-operative programmes; and

■  consider opportunities for co-operative support at an early point in the equipment lifecycle.

We recommend that the Department:

■  ensures that the objectives set for the Defence Procurement Agency and Integrated Project Team Leaders responsible for delivering programmes against defined cost, timescale and performance parameters fully reflect the extra complexity and challenges which co-operative programmes often pose;

■  from the outset of the decision-making process, continues to work closely with other government departments and industry to ensure that all factors affecting decisions on whether or not to co-operate are analysed rigorously with the risks to the defence vote and the full range of anticipated beneficial outcomes quantified to the greatest extent possible;

■  continues to work closely with other government departments to establish mechanisms to assess the achievement of all the beneficial outcomes for the United Kingdom as a whole, anticipated at the time decisions to commit to co-operative programmes are made.

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5  HC 300, Parliamentary Session 2000-01. Other, earlier, NAO Reports have focused on individual collaborative projects, such as Eurofighter.

6  OCCAR is the Organisation Conjointe de Cooperation en matière d'Armement. It is a four nation (Germany, France, Italy, UK) armaments co-operation agency