UK defence projects too late, over-budget -report

LONDON, June 27 (Reuters) Britain's Ministry of Defence is failing to get value for money from defence contracts, which are being delivered over-budget and increasingly late, parliament's accounts watchdog said today.

The ministry ''has yet to demonstrate that it can consistently manage individual projects to deliver the planned operational benefits to the Armed Forces to cost and in time,'' the Public Accounts Committee reported.

Although defence ministry bosses have managed to shave the forecast costs of 19 of their biggest weapons projects by 700 million pounds over the past year, they did so by buying fewer and less powerful weapons, not by improving their performance, the comittee said.

The 19 giant projects are still a combined 29 billion pounds ( billion) over-budget and a total of 375 months late, 45 months later than last year.

The 2005 Major Projects report looked at the 20 biggest UK defence programmes, omitting that of the Eurofighter Typhoon jet, because its costs are considered a commercial secret.

''The MoD is still unable consistently to manage individual defence projects so that our servicemen and women have the new equipment they need, when they need it,'' said committee chairman Edward Leigh, a member of the opposition Conservative Party.

In a statement, he said the ministry has blamed its performance on older, so-called ''toxic legacy'' projects that have long since fallen so far over budget and behind schedule that they skewed the figures.

''This hand-wringing has gone on far too long,'' Leigh said.

''It is now time for the department finally to get a grip on these projects and provide truly realistic performance, time and cost estimates.'' The government's minister in charge of defence procurement, Lord Drayson, dismissed the criticism and said the ministry was improving since setting out a new strategy in 2003.

''The Committee's views are well respected, but this is old news, and we have implemented many of the sensible recommendations they have made over previous years,'' Lord Drayson said in a statement.

''I expect that we will continue to show that we're bearing down on costs and time when we publish our results for the last financial year.'' Reuters SK VP0520