7 The Department and its suppliers have both contributed to schedule delays across the contracted programmes we examined, resulting in shortfalls in defence capability. While several of the Department's programmes were delayed prior to contract award, delays were more pronounced afterwards. The Department faces cumulative forecast net delays to equipment entering into service of 254 months across 13 of the programmes we examined. These delays were due to a variety of factors, including setting over-optimistic schedules early in projects and programmes, supplier performance, and contract management. Wider departmental affordability also contributed, leading, for example, to delays in order to make short-term savings (paragraphs 2.9 to 2.11 and Figures 5 and 6).
8 Programme cost estimates we examined have increased, but mostly before contracts were let. Where comparable information was available, we found that the forecast cost of nine out of 12 programmes increased between the initial business case and the main investment decision, on three occasions by 59% or more. In some cases, the Department responded to cost increases by reducing the number of units to be procured to remain within budget. Cost increases have been less likely and relatively less significant after contracts were let (although some programmes are still at an early stage). This may be attributable to more certainty around cost estimates following engagement with suppliers, the use of firm-fixed price contracts and improved project controls in DE&S (paragraphs 2.5 to 2.8 and Figure 4).