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This report analyses MoD's annual report and accounts 2004-05 (published in October 2005 - later than planned - as HC 464, session 2005-06, ISBN 0102935424) which combines MoD's annual performance report and the consolidated departmental resource accounts. Overall MoD's performance against its seven Public Service Agreement (PSA) targets has been mixed: three were "met", two were "partly met", one was "on course" to be met, and one was "not yet assessed". On recruitment and retention (partly met) all three armed services are suffering from critical shortages in various specialist trades, including aircrew and medical personnel. Although MoD reported £400m of savings in the operating costs of the Defence Logistics Organisation, the Committee criticizes the fact that not all of them could be validated. On procurement, MoD did not meet the targets relating to project time slippage. Cost decreases of £699 million were reported on the top 20 major defence equipment projects, but much of this was a result of cuts in the numbers of equipment ordered or in the capability of equipment. Losses reported in MoD's Financial Accounts totalled some £400 million, a lower figure than the previous year but still a substantial sum. Reported losses on the Landing Ship Dock (Auxiliary) programme, which involves the procurement of four transport ships, were some £100 million and further losses might arise. Another loss totalling £147 million related to a building project at the Atomic Weapons Establishment at Aldermaston. The building was unable to meet the requirement and no other use could be found for it. It is another example of substantial waste which has to avoided in the future.
This report analyses the Annual Report and Accounts 2006-07 of the Ministry of Defence (MoD) (published as HC 697, session 2006-07, ISBN 9780102946369). The MoD's assessment of its expected achievements against its six Public Service Agreement (PSA) targets, which run until the end of March 2008, has deteriorated since the previous year's Annual Report and Accounts. At the end of 2007, the MoD did not expect to meet the target relating to generating forces and expects "only partly" to meet targets relating to recruitment and retention, and defence equipment procurement. The failure to meet the target for generating forces is a consequence of the continuing high levels of deployment of the Armed Forces. The Committee is concerned that the Armed Forces have been operating at or above the level of concurrent operations they are resourced and structured to deliver for seven of the last eight years, and for every year since 2002. Achieving manning balance in all three Service continues to be a challenge. Shortages remain within many specialist trades in all three Armed Services, but especially in the Army Medical Service. The report notes the failure to meet harmony guidelines in the Army and the Royal Air Force - another indicator of the pressure on the Armed Forces from the continuing high level of operations - and another target missed by all three services is for ethnic minority recruitment. The MoD continues to experience substantial forecast cost increases on equipment programmes, and the report notes delays in delivering equipment programmes to the planned in-service dates. The MoD faces difficult choices in the face of expected cuts in the defence programme and the management of a streamlining exercise to reduce civilian posts in the headquarters.
UK operations in Iraq and the Gulf : Fifteenth report of session 2007-08, report, together with formal Minutes
For the sixth successive year, the Ministry of Defence Accounts were qualified. The Qualifications covered non-compliance with international reporting standards on the treatment of some contracts; lack of audit evidence on the valuation of inventory (worth some £3 billion) and of capital spares (worth some £7 billion); and on the regularity of the Accounts because of the failure to obtain approval for the remuneration package of the Chief of Defence Materiel. The MoD was also five months late in submitting its audited accounts to Parliament. The National Audit Office had found errors in its sample examination of accruals and so the MoD decided to resolve these problems before submitting the accounts. The MoD said they did not have the necessary expertise to manage the financial complexity that featured in the implementation of the Strategic Defence and Security Review so sought assistance. The MoD should ensure its people have the right skills to deal with all financial problems so that they do not need to bring in expensive external accountants. There is also concern about the MoD's reluctance to estimate the full costs of its operations in Afghanistan, Iraq and Libya. The NAO did not consider that the MoD has adequate information, especially with respect to recording the cost of its activities and outputs, to run its business effectively. The MoD should set out its commitment to improving its management information. It is also vital that defence spending remains at more than 2 per cent of GDP in line with the UK's NATO commitment.
Recruiting & retaining the right number of well-trained personnel is vital for the continuing success of the United Kingdom's Armed Forces. Yet recruitment and retention targets are not being met. There is particular concern about shortages in 'pinchpoint' trades - trades or areas of expertise where there is not enough trained strength to perform operational tasks without encroaching on the time provided between deployments for recuperation, training and leave. This report sets out to examine the factors which hamper recruitment and retention in the Armed Forces and reservists & identify what the MoD is doing to improve these. There is also concern and exmination of the issue of why ethnic minority personnel form such a low proportion of the Armed Forces.
The Defence Committee states that the forthcoming Strategic Defence Review should take account of the current low readiness levels of the Armed Forces and the need for their effective recuperation. The Armed Forces have been involved in operations in Iraq and Afghanistan for many years while maintaining key standing tasks such as the strategic nuclear deterrent and UK air defence. They have been deployed above the Defence Planning Assumptions, the level at which they are structured and funded, for seven years. Nevertheless, the Committee considers it unsatisfactory that readiness levels have been allowed to fall to the extent that they have and recommends that the Strategic Defence Review reviews the utility and content of the Defence Planning Assumptions and readiness targets. Recuperation is the process by which force elements are returned to target levels of readiness. It involves all the underlying components: manpower; equipment; training; and logistics support. The drawdown of troops from Iraq should provide the MoD with an opportunity to recuperate the Armed Forces and to reverse the fall in readiness. But there have also been pressures on personnel, with significant numbers of the Army and the Marines and those in key "pinch point trades", such as medical personnel, being deployed more frequently than the MoD would wish - breaking harmony guidelines. If readiness is to be improved, then the Army must return to being deployed within harmony guidelines as soon as practicable.
The Committee investigated the provision of healthcare for the armed forces, and examined six key areas. The first was the treatment of personnel seriously wounded on operations, and the procedures for caring for them, from the point of wounding to evacuation to and treatment in the United Kingdom. The second area was the rehabilitation work for those with serious musculo-skeletal or neurological, injuries. The third was the relationship between the Ministry of Defence and the National Health Service in terms of delivering healthcare. The fourth area examined was the care for veterans and service families. The fifth issue was mental healthcare, both for service personnel and for veterans. Finally, the report examines the role of reserve personnel in the Defence Medical Services. Clinical care provided by the Defence Medical Services (DMS), in conjunction with the NHS, for personnel injured on operations is world-class. Rehabilitation work is also found to be exceptional. Services to the armed forces are delivered by the DMS, NHS, charities and welfare organisations, and this helps link the community with service personnel. The Committee would like a wider debate on which services are most appropriately provided by each sector. The Ministry of Defence's decision to base its secondary care around units embedded in NHS Trust is supported, but there is scope for more sharing of best practice between the DMS and the NHS. With veterans, the Committee is not sure adequate procedures are in place to identify veterans and to ensure priority access to services. Mental health is a vital responsibility for DMS, but a robust tracking system for veterans is needed. The reserve forces' contribution to the delivery of military healthcare is praised, but there is a danger of being overstretched.
The Ministry of Defence needs the capability to transport personnel, equipment and stores from the UK to operational theatres across the globe. This capability, known as Strategic Lift, can by delivered by sea, land or air, and its annual cost to the MoD is almost £800 million a year. The Committee's report examines the progress of the MoD in delivering the Strategic Lift requirements set out in the Strategic Defence Review and whether these requirements need to be revisited given the experience of the operations in Afghanistan and Iraq. Findings include that good progress has been made in improving strategic sea-lift, particularly in relation to Ro-Ro ships and the acquisition of Landing Platform Dock (Auxiliary) vessels. However, strategic air-lift is a particular concern given the age of many of the aircraft, and the report looks at the progress of two major equipment programmes designed to deliver new transport aircraft (the A400M transport aircraft) and new tanker aircraft (the Future Strategic Tanker Aircraft).
On 23 March 2007 15 Royal Navy personnel from HMS Cornwall were captured by the Iranian Revolutionary Guard while conducting a boarding operation on a merchant vessel in shallow waters near the mouth of the Shatt al-Arab waterway, between Iraq and Iran. They were taken to Iran, paraded before the international media and detained until their release and return home on 5 April. On their return, the Royal Navy staged a press conference for some of the detainees: two of them subsequently sold their stories to the media. Lt General Sir Rob Fulton was appointed to inquire into the operational circumstances and factors leading to the capture of the Royal Navy personnel. His report was confidential and not published but the Defence Committee was allowed to see it to ensure Parliamentary scrutiny. The Committee reports that Fulton robustly identified serious weaknesses in intelligence, communications, doctrine and training. Whilst there were insufficient grounds for courts martial, formal administrative action has been taken against a number of Service personnel. The Government has made good progress towards implementing Fulton's recommendations. The Committee also considered the findings of the Hall report into media access to Service personnel (available at www.mod.uk). The decision to allow the Service personnel to sell their stories was a serious mistake and deeply damaging to the reputation of the Royal Navy. The Secretary of State for Defence has accepted responsibility and apologised. This should not absolve others from blame.
This report sets out the work of the Committee during 2007. The report highlights aspects of the Committee's working practices which depart from previous practice or which may otherwise be of interest. In particular it draws attention to the webforum held during its inquiry into Medical Care for the Armed Forces; its taking of evidence outside Westminster, in Birmingham and Edinburgh; and the growing amount of informal activities of the Committee. It also underlines the importance of visits to the Armed Forces on operational deployments. Whilst the MoD was commended for overall timeliness in responding to the Committee's inquiries, in one inquiry: 'UK Defence: commitments and resources'; there was a delay which hindered the progress of the Committee