The Tragedy of Ajax... Thoughts on the NAO Report

 

 

The UK National Audit Office has published a difficult report into the state of the British Army Ajax programme. This complex vehicle procurement, which has seen over £3bn of public money spent on 589 vehicles, of which 26 have been delivered, has become a byline for failure in defence procurement.

To read the report is, at best, uncomfortable. It remorselessly picks apart the project, how it was conceived, how it incorporated a huge number of new and technically unfeasible requirements and how the MOD decided to push ahead with this, despite the requirement numbers plummeting from over 3000 vehicles to under 700, and the British Army undergoing radical change at the same time.

Image by Ministry of Defence; © Crown copyright

The outcome is a vehicle that right now has reportedly caused hearing damage to its users, cannot operate at night, or fully enclosed, or carry munitions, or discharge any weapons other than the main cannon. Even though these will change over time, the simple fact is that the vehicle is years late, doesn’t seem to meet the requirements set of it, and meanwhile the vehicles it is intended to replace continue to soldier on, long past their intended retirement date (some are so old, they will soon genuinely qualify for a pension).

However you want to look at it, the Ajax is not a good look for the MOD. It reinforces to outsiders the tired cliches of defence budgets overrunning, of projects going wrong, and of public money being wasted on what feels like fools errands, and that the nation is weaker as a result. Is this a fair perspective, and if not, what is a better view to take?

The fundamental challenge facing Defence is that Defence Procurement is, and always has been, exceptionally difficult to do. At its heart, procurement is about taking a series of concepts and requirements drawn up based on how mid-level staff officers think the world may look in 20-30 years time, and trying to bring together the technology to meet the needs of the armed forces in this timeline.

It then requires a solution from industry that can be built to support the UK defence industry, which is affordable but at the same time doesn’t trade off too much or compromise to an extent that makes the platform vulnerable. It then calls for the project to survive many years of funding challenges, remain affordable and viable, and still meet the wider strategic challenges facing the nation, and then be delivered into service into an environment where there is both a need for it, and ensure that it works as planned.

This is, to put it mildly, a tall order. It is easy to make light of defence procurement and mock it, but this is perhaps unfair. Defence procurement is fundamentally about taking some of the most advanced technology on the planet, and trying to make it work for a demanding customer where you are the lowest priced bidder…

It is easy to compare project management of large physical infrastructure projects to defence procurement and complain that it seems overbudget. Equally it is easy to point to the costs paid by the MOD for an item and compare this to what a small private company is paying.

To do this though ignores that there is a vast difference between infrastructure projects with fixed locations and timescales and clearly defined requirements, or a small company which will only use an item in one specific way in one environment, and which doesn’t have to think about how it could use it globally. The MOD has to purchase equipment ready for global use, against a hugely complex, and constantly evolving set of conditions.

A wider issue facing MOD is that it must develop its capability requirements against the backdrop of an eternally changing strategic threat that is hard to predict. In the last 12 years the UK has identified in Defence Reviews a need to withdraw from Germany, regenerate from Afghanistan, focus on the Asia Pacific region and deprioritise NATO, delete fixed wing ASW and then reacquire it, and then now focus not just on providing training teams, but be ready to send the heavy army to operate with NATO in Germany and the Baltic.

The sheer speed of change in international relations and the strategic environment vastly outweighs the speed of procurement decision making. Projects like Ajax, which have their roots many years ago have seen the world and the role that they need to fill change many times over – going in and out of vogue, but remaining unclear as to whether there is a need for this or not.

This is allied to the bigger problem of huge uncertainty in financial planning, with the MOD procurement budget being constantly in flux as problems arise. The endless rounds of reprofiling how equipment will be funded, moving projects about in and out of years, and trying to save X million in one year, despite knowing it will cause cost inflation and delay in three years time makes balancing the budget difficult. Major programmes like Ajax are very much at the mercy of planning decisions taken to keep the whole of Defence solvent, which can cause major delays if not properly managed.

Image by Ministry of Defence; © Crown copyright

A major challenge too is that the MOD is very much bound to buy British, or at least come under considerable pressure to do so. This is a legacy of the time when the UK had a substantial defence industry that would not only build large numbers of vehicles for the UK, but also other export orders too. Just look, for instance, at the success of the Centurion or Chieftain tank, that has seen service across the globe.

The issue now is that while the UK defence industry remains exceptionally capable, much of its skills lies in the electronic and other ‘soft’ assets, rather than necessarily the assembly of manufactured vehicles. This means any desire to ‘buy British’ places a hefty burden on manufacturers to work out a bid that is compliant with policy, and produce an outcome that is probably more expensive than buying a foreign design from abroad and conducting limited integration at home.

We are, as a nation, perhaps at the point where we need to have a serious conversation about whether ‘British is Best’ when it comes to every aspect of our defence arsenal. On the one hand there is clearly huge value and importance in maintaining a sovereign defence industry in a wide range of areas – military shipbuilding, aerospace, communications and cryptology are all areas where it is right to maintain both the industry and the preference to buy locally.

The question though is whether this should apply to all cases or just some? In the case of the Army, there is a strong argument that could be made that what the Army needs both operationally and economically as a buy of platforms that link into wider NATO peers, are well supported and where upgrade costs would be less due to the sheer number of platforms in service.

Without wishing to delve too deeply into the realms of ‘fantasy forces’, there is a lot of exceptional equipment out there – for example the M1 Abrams or Leopard 2 tanks, or IFVs or artillery that could be acquired with relative ease and substantially cheaper than the cost of upgrading the existing forces.

It is telling that for the money spent, without result on Ajax and the Warrior upgrade, the UK could probably have completely reequipped the field army with modern armour, artillery and IFVs.

That’s not to say that buying ‘off the shelf’ is automatically a good idea. Anything brought into service would need integration with UK systems (e.g. comms, munitions etc) and require extensive trialling and adaptation. But this is doable if the will is there.

The problem is that to do this effectively takes the UK out of the sovereign armoured vehicle capability on a permanent basis, and makes the UK reliant on foreign providers for its ground military needs. Is this an acceptable compromise, allowing timely replacement in larger numbers of vehicles, or is it better to keep a UK domestic capability going, supporting jobs and a sovereign industrial capability?

This gets to the heart of the problem – is the UK able, as a medium sized military power (albeit one with far more influence and capability than its peers) to retain an ability to domestically source industrial outcomes for all of its major defence needs, and if not, where does the change happen?

From a purely operational perspective, the best short term thing that could be done to improve the lethality of the Army would be to buy Leopard or Abrams tanks, which are both arguably far more capable than the Challenger 2 is (there is though wider discussion to be had on merits of Challenger 3 versus both designs). But the political and media uproar of the perspective of British troops being forced to use ‘German Panzers’ would be such that any deal would be unlikely to progress. What is the outcome sought here – is it to provide genuinely ‘best in class’ capability, or is to be seen to support the wider domestic industry?

The management of programmes like this also highlights the wider issue of trying to get qualified people in to properly lead and deliver a project like Ajax. It is likely that hundreds, if not thousands of people have played a role in Ajax related posts over many years, yet very few remain in post. The constant churn of the military posting cycle means that just as staff are getting good at their role, they are quickly moved on and the cycle begins anew.

A telling example of this was the discovery that in the last 10 years, the programme has seen no less than five Senior Responsible Owners, four project directors and six project managers at a senior level – that represents an enormous amount of churn in an incredibly short timeframe.

There is an issue in Defence with delivery of complex projects where there is a constant need to move staff for career purposes. By constantly moving people every 2 years, or sooner ‘in the needs of the service’, there is no long term stability or corporate memory. Ajax is a massive multi-billion pound programme being delivered by a team that seems to have near 100% staff turnover every two years.

Perhaps the time has come to look again at the military career model and ask whether it is better to lock people in for longer tours (perhaps with a promise of certain promotion) to build long term corporate experience? Appoint someone for 4-5 years, and you stand a much better chance of getting things delivered. There is also a reduced likelihood of the classic response on taking up a new post, which is to launch a strategic review (other PowerPoint based activities may be available), or put in place attempts to study rather than deliver.

At the same time effort needs to placed on understanding how to better incentivise Civil Servants to stay for the long haul. If you want project managers, technical specialists and others who have niche skills in a market which places a high demand on such skills, then incentivise them to stay. Pay them far more (possibly even market rates) and treat them as an integrated arm of the project, not like extras from the Office who are just ‘f*cking civvies’…

Trying to deliver complex projects requires more than a punchy hand of command and some Sandhurst leadership training. The problem is that the MOD is trying to deliver 21^st century military technology with a 19^th century career model to resource its staff for it, and this isn’t helping. Putting in place better methods to recruit and retain staff will be critical to help deliver projects like Ajax.

Perhaps the biggest overall problem ahead for major projects is that they are time consuming, expensive and require a clear set of purpose and role. For the RAF and the RN this has perhaps been easier to define – Dreadnought is being built because the UK needs to deliver the nuclear deterrence, while F35 makes sense as a means of delivery of strike from a variety of locations in support of national policy.

The challenge for Ajax is that it feels like the British Army itself remains institutionally uncertain of what it is that it wants to be. We’re now as far away from the start of OP HERRICK as that was from the 1990 invasion of Kuwait that triggered OP GRANBY – the latter saw significant change in role and purpose in a short time, from BAOR to delivery of COIN in Afghanistan, via two divisional sized operations in the Middle East.

Yet the following 16 years have seen a loss of confidence and certainty – what is the threat, how is it countered and what role does the Army play in trying to fix this? We have seen the emerging Russian threat and sense that somehow land elements must play a part in stopping this, but is it deterrence in the Baltic via CABRIT, short term training teams elsewhere or being ready to operate against entirely different threats instead?

The missions open to the Army have changed far more radically than the corresponding RN and RAF ones, which arguably have remained relatively constant. At the same time, the Army itself seems unable to decide what identity it wants to don and why – various reform programmes have seen it try on various structures, akin to a customer in Mr Benns fancy dress shop trying on different costumes but not deciding which adventure it prefers.

It is perhaps unsurprising that Ajax remains troubled for one senses that the Army itself is not entirely clear what it is that it wants from this vehicle. We are now at the stage where the Army has already spent around £4bn on Ajax and the Warrior CSP and expects to spend a further £1.5bn on Ajax – in other words, it will have shortly spent almost the same cost as the RN has spent on acquiring and delivery HMS QUEEN ELIZABETH and PRINCE OF WALES, and arguably has so far got nothing to show for its investment.

Until the Army can define what it wants to be, the credible role it really wishes to fill and put in place the equipment to do this, it will remain an organisation that seems to struggle for assurance. Trying to balance off the need to define what a 70,000 strong organisation can do in the context of a wider reinvigorated NATO, and whether ‘buying British’ or going abroad makes sense for equipment and determining if what matters more is a British answer for the British Army, or delivering something that works now matters is also key.

There is huge uncertainty ahead, arguably it is debatable whether Ajax will ever enter service – the news seems to indicate it is very much on ‘death row’. But if this is the case what will replace it and will this mark a change of direction in how the UK invests in its defence industry? Much like the Greek hero Ajax, this story could yet involve heroism and ultimate tragedy…