14. Capita has missed the Army's targets for recruiting new soldiers each year since 2013.14 The Department suggested that the fundamental deficiencies in Capita's performance did not become fully apparent for about three years.15 It told us that it was initially focussed on training in preparation for the war in Afghanistan and then on meeting the Prime Minister's target to increase the size of its reserve force to 30,000. The Department could not, though, explain how senior management were monitoring performance during this period. Given the Parliamentary interest in recruitment figures, we are extremely surprised at the Army's failure to recognise the scale of Capita's performance problems and at the passive approach to managing the contract before 2016.16 This is particularly the case since this Committee published a report in September 2014 on Army 2020 which covered these issues. In that report, the Committee commented that the recruitment contract with Capita was not established on the basis of a clear understanding of the scale of the recruitment challenge, that shortfalls in Army recruitment were increasing the risk of capability gaps emerging in some parts of the Army's structure and that a huge step up in performance was required if the Army was to hit its ambitious targets.17
15. In April 2017, the Army agreed to revise its contract with Capita, lowering performance targets and resetting the contract's penalties. It believed that continuing to apply the maximum service credit deductions would not give Capita an incentive to invest in improving its performance.18 We are concerned, however, that the Army gave away a lot at this point and that this was a good deal for Capita, with the potential for big wins in the future. In particular, the Army did not amend the contract to secure the intellectual property for the online recruitment system that it had co-developed and co-funded. The Army could not explain why - despite Capita's poor performance - there had been no pushback on these issues and it did not use its leverage to secure additional benefits.19 The National Audit Office report shows that Capita has not even achieved the reduced targets for the number of new recruits since the contract was reset.20
16. The Army and Capita have failed to simplify the recruitment process. In 2017-18, half of applicants took 321 days to complete the recruitment process - from application to starting basic training - and one third took over 400 days. The Army and Capita have not, however, made any substantive changes to the recruitment process and recruitment times have not reduced since 2014-15. While some applicants complete the process quicker and others like to pace themselves through the process, there are also applicants that are not fit enough to meet the Army's requirements and need to spend time preparing to get through the physical assessments.21 Applicants have also had long waits for medical records to be obtained from their general practitioner. However, the Army and Capita have also introduced some changes - such as the use of primary health care records - without trialling them and subsequently found that these changes slowed recruitment times.22
17 The length of time to complete the recruitment process affects the conversion of applicants into new recruits. Capita estimated that just 14% of applicants actually join the Army and 47% voluntarily dropped out..23
18 The Department accepted that the time it takes to recruit new soldiers is too high and that it needs to streamline the recruitment process across the three frontline services. It has begun to trial new initiatives, including taking more risks at the beginning of the process and running different stages in parallel. It is also reviewing its policy and approach to obtaining medical records, including working with NHS Digital to obtain documentation more quickly, and assessing the value of the online medical questionnaire. Overall, the Army aims to reduce recruitment times to three months - from application to the offer of a post.24
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14 C&AG's Report, para 5
15 Q 27
16 Qq 60, 63, 66
17 Committee of Public Accounts, Army 2020, 11th report of Session 2014-15, HC 104, 5 September 2014
18 C&AG's Report, paras 3.6 - 3.7
19 Qq 111-112, 114
20 C&AG's Report, para 3.8
21 Qq 52, 53; C&AG's Report, para 14
22 C&AG's Report, paras 2.18 and 2.20
23 Qq 53, 54
24 Qq 67, 68