http://defenceconsultations.org.uk Defence Consultation Papers Fri, 09 Dec 2011 16:22:52 +0000 hourly 1 http://wordpress.org/?v=3.1 http://defenceconsultations.org.uk/2011/10/10/key-recommendation-7/comment-page-1/#comment-492 Mike Parsons Fri, 09 Dec 2011 16:22:52 +0000 http://defenceconsultations.org.uk/?p=684#comment-492 Given that the SSRO is charged with “promoting value for money for the taxpayer” it is beyond fundamental that we understand what value for money for the taxpayer actually means. After all “if you don’t know where you are going how are you going to get there”. The report does not define this properly indeed seems to believe that it is about how much is paid. The attempt at a definition of value for money (note the taxpayer is not mentioned) in clause 94 raises more questions that is answers. Value for money is in the “eye of the beholder” the answer will be different depending on who you are, for example, VFM for the MoD is likely to be different to VFM for the taxpayer yet both are used in the report. As a taxpayer I am not only interested in how much is paid but also the value the UK economy receives from my investment because I will also benefit from a thriving UK economy. As the MoD I may be more concerned with a cheaper price because then I have money left to spend on something else. Given that the SSRO is charged with “promoting value for money for the taxpayer” it is beyond fundamental that we understand what value for money for the taxpayer actually means. After all “if you don’t know where you are going how are you going to get there”. The report does not define this properly indeed seems to believe that it is about how much is paid. The attempt at a definition of value for money (note the taxpayer is not mentioned) in clause 94 raises more questions that is answers. Value for money is in the “eye of the beholder” the answer will be different depending on who you are, for example, VFM for the MoD is likely to be different to VFM for the taxpayer yet both are used in the report. As a taxpayer I am not only interested in how much is paid but also the value the UK economy receives from my investment because I will also benefit from a thriving UK economy. As the MoD I may be more concerned with a cheaper price because then I have money left to spend on something else.

]]> http://defenceconsultations.org.uk/2011/10/10/ancillary-recommendation-23/comment-page-1/#comment-449 Ian Barrett Wed, 26 Oct 2011 19:19:25 +0000 http://defenceconsultations.org.uk/?p=716#comment-449 It may be observed that, while France and the UK have broadly similar defence industries and national budgets, the UK reportedly has 12.5% of the global defence export market as against 6% for France. Thus it is not immediately obvious that the the UK should adopt this aspect of the French model, particularly when its more general application is rejected by the report. More importantly, it is unclear how in practice the recommendation could be implemented. If it is to have any practical effect it would mean that MOD capability requirements would be different. They might be set higher than would otherwise be the case, in which case the MOD budget would incur an additional cost. If they end up being set lower, MOD will have a reduced capability (possibly with some cost saving). In either case the capability requirement definition process will need to have explicit guidance on the trade-off between the value of enhanced defence exports and increased cost to MOD or reduced capability. Unless there is an intention to provide this trade-off guidance, the recommendation cannot be given practical effect. It might be argued that taking in to account export potential would be a "win-win" change for MOD, as it would lead to more attractive cost/capability combinations being identified as Industry would offer costs to MOD that reflected the greater export potential. But if that argument is valid there would be no need for MOD formally to consider export potential as it is already open to Industry to propose alternative cost/capability combinations. It may be observed that, while France and the UK have broadly similar defence industries and national budgets, the UK reportedly has 12.5% of the global defence export market as against 6% for France. Thus it is not immediately obvious that the the UK should adopt this aspect of the French model, particularly when its more general application is rejected by the report.
More importantly, it is unclear how in practice the recommendation could be implemented. If it is to have any practical effect it would mean that MOD capability requirements would be different. They might be set higher than would otherwise be the case, in which case the MOD budget would incur an additional cost. If they end up being set lower, MOD will have a reduced capability (possibly with some cost saving). In either case the capability requirement definition process will need to have explicit guidance on the trade-off between the value of enhanced defence exports and increased cost to MOD or reduced capability. Unless there is an intention to provide this trade-off guidance, the recommendation cannot be given practical effect.
It might be argued that taking in to account export potential would be a “win-win” change for MOD, as it would lead to more attractive cost/capability combinations being identified as Industry would offer costs to MOD that reflected the greater export potential. But if that argument is valid there would be no need for MOD formally to consider export potential as it is already open to Industry to propose alternative cost/capability combinations.

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