2.13 As at 31 March 2015, the Department had paid Ascent £143.3 million. Ascent is paid for syllabus design, procuring new aircraft and managing the system. It is also paid a separate availability payment when training work is provided (paragraph 2.39). Ascent's contract lets the Department apply financial deductions if Ascent does not meet its responsibilities. For example, if training courses overrun. We found that the Department has struggled to apply performance deductions, with some agreed only after many months of negotiation. Since the contract began in 2008, the Department has deducted £308,000 from payments to Ascent.
2.14 Between 2008 and early 2012, the Department considered Ascent's performance to have been poor. The Department had concerns about cost and schedule control, the quality of core provision, and governance and leadership within the Ascent team. The Department was also concerned that Ascent was showing corporate and individual behaviours that undermined its partnering abilities.
2.15 The Department raised these concerns with Lockheed Martin and Babcock, the shareholders of Ascent, in late 2011. Ascent's shareholders and board accepted these concerns and acted to address them. For example, it:
• introduced a new senior management team;
• restructured Ascent to encourage clearer accountability for programme management, training design and commercial direction;
• agreed to work with the project team and the Royal Air Force to improve the approach to partnership working; and
• committed to recruiting staff to address its lack of subject-matter expertise.
2.16 The Department considers that, since early 2012, Ascent has improved its performance. It has noted an improvement in the quality of its work and a more constructive working relationship with the project team and the Royal Air Force. The performance of all parties will be tested more fully due to the challenging timetable for implementing the remaining training packages (paragraphs 1.14 to 1.18).