Contracts jeopardised by lack of data

15 November 2001
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15 November 2001 | Robin Parker

Many defence procurement projects are hampered by a lack of useful information on past contracts, the government's spending watchdog has warned.

Future contracts will suffer unless data focuses on the long-term outcomes of procurement processes rather than price information only, according to the National Audit Office (NAO) report, Non-Competitive Procurement in the Ministry of Defence.

The MoD's "Lessons learned" database, detailing weaknesses and strengths in procurement contracts, has no specific section on non-competitive procurement - where contracts do not go out to competitive tender - the report says.

A "should cost" model to calculate realistic and acceptable prices was part of only 38 per cent of the 58 contracts covered by the survey.

It says the recent Bowman contract for army radios suffered because no accurate benchmarking was available.

John Taylor, MoD director of general information with responsibility for e-business, said information sharing was vital, as was a shift in ideology.

"Driving out cost is increasingly seen as a way to assess non-competitive contracts," he said. "A regime based on this thinking forces you to learn from your mistakes and maintain continuous improvement."

The report praises the improvement of partnering since the MoD's strategic review in 1998 and acknowledges that the target set in 1993 to price 90 per cent of non-competitive contracts at the outset had been met.

SMnov2001

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