The Ministry Of Defence

Readiness is the term used to describe the means by which the Ministry of Defence holds its military forces at varying levels of preparedness to respond to emerging operations. An effective system for assessing and reporting military readiness is a key part of modern armed forces capability, in order to manage risks and address any deficiencies and plan for the future. This has become increasingly important in recent years given the unpredictable nature of the current security environment. This NAO report finds that the MoD has a good system for reporting the readiness of its armed forces, although there is scope for further improvement, both to better define and measure its Public Service Agreement target for readiness, and to manage the main areas of risk, such as logistic support.

The Ministry of Defence (MoD) is unaware of the location of radios worth £184 million, and is unable to provide evidence of the existence and condition of assets worth £6.3 billion. This shortfall in accounting is reflected in the decision by the National Audit Office to qualify the MoD accounts for the fourth successive year. The Committee thinks this year's qualification should have been foreseen, given that it was a clear requirement on all Government departments to adopt the relevant reporting standards from 2009-10. It is unsatisfactory that the MoD expects their stock control problems to continue for another two to four years. The report notes the period of intense change that the MoD is going through, and recommends that any cuts to staffing levels must be appropriate for future business need and managed with care. The Committee will study the outcomes of the report of the Defence Reform Unit (ISBN 9780108510663) to ensure that the MoD retains the right skills. This will need to be reflected in decisions on redundancies through voluntary exit and otherwise so that the Department is not left without the right skills and experience required for effective performance. The Committee wishes to be assured that decisions on the scrapping of assets before the end of their useful life have been made on the basis of a sound cost-benefit analysis, taking into account the savings to be achieved and the effect of the loss of capability.

The Defence Reform was launched in August 2010 as a fundamental review of how Defence is structured and managed. Many of the issues are not new and have been noted by similar reviews. The Steering Group believes an effective MOD is one which builds on the strengths of the individual Services and the Civil Service and does so within a single Defence framework that ensures the whole is more than the sum of its parts. A key driver for this review has been the Department's over-extended programme, to which the existing departmental management structure and management structure and behaviours contributed. Many of the Steering Group's proposals are designed to help prevent the Department from getting into such a poor financial position in the future and to put it in the position to make real savings. There are 53 recommendations the key ones of which are: to create a new and smaller Defence Board chaired by the Defence Secretary to strengthen top level decision making; to clarify the responsibilities of senior leaders, including the Permanent Secretary and the Chief of the Defence Staff; make the Head Office smaller and more strategic, to make high level balance of investment decisions, set strategic direction and a strong corporate framework; focus the Service Chiefs on running their Services and empower them to perform their role effectively with greater freedom to manage; strengthen financial and performance management throughout the Department to ensure future plans are affordable; create a 4 star led Joint Forces Command; create single, coherent Defence Infrastructure and Defence Business Services organisations; manage and use less senior military and civil personnel more effectively, people staying in post longer, more transparent and joint career management.