Oral evidence: Land Acquisition, HC 978

Oral evidence, 11 January 2023.

Witnesses

Alex Chalk, David Williams, Lt. General Nesmith and Major General Crook.

Chair

Welcome to this Defence Committee hearing on Wednesday 14 January 2023. We are delighted to be discussing land acquisition today, which we have broken down into three themes—the Army requirements, the Army’s acquisition, and then we will be looking at lessons from Ukraine. I am pleased to welcome Minister Alex Chalk, the new Procurement Minister; welcome to our discussions here today, and happy new year to you and your colleagues. David Williams, welcome back as well—the permanent secretary at the MoD—and we have Lieutenant General Sharon Nesmith, who is the Deputy Chief of the General Staff, and Major General Darren Crook, who is the director of land equipment at DE&S in the Ministry of Defence. Welcome to you all. As I mentioned in our private session, we just have a few short and sharp questions to begin with, then we will go into the main body of our questions. I invite Mark Francois to kick us off.

Mr Francois

Thank you, Chairman. Minister, this is an all-party Committee; we are all very concerned about the distressing reports we have read about the failure of the FDIS contract to provide the maintenance of service family accommodation. It is simply unacceptable. Ministers have been hinting in public for some weeks—including you at the Dispatch Box—that you might be actively considering junking that contract and looking at some other solution instead. Now that you are here, briefly, can you please give the Committee an update on that, and say whether that is a real prospect or not?

Alex Chalk

Thank you, and thank you for raising the issue with me personally, as you have done, and on the Floor of the House. I know that the FDIS contract is something that you have taken a particular interest in, so thank you, and thank you to other members of the Committee, who I know take this extremely seriously. You are right; it is completely unacceptable. I do not want to go over old ground, but we have talked about Pinnacle, Amey and VIVO, and their performance has not been anything like what it should be. As I said in the UQ, all options, of course, are being considered. Act 1, scene 1, if I can use that expression, is to ensure that the immediate issue is being addressed. As you would expect, and as I said at the Dispatch Box, we have been getting daily updates on the specific problems; I am thinking particularly about hot water and heating. Anticipating, of course, that you might ask this question, Mr Francois, I have looked at the figures from 16 December, and the position then was that the total without heating was 389. The position in the latest figures I have is 65. Now, I have to break that down a little bit, because, of course, heating does occasionally break down. The key issue is whether people are being left without heating or hot water beyond the 48 hours, which, of course, is the service requirement. The position, at present, is that the total number without heating for more than 48 hours is down to 18. It was previously 163, so it has gone from 163 down to 18, and I am assured that, by the end of this week, it will be down to single figures. So, you ask the specific question, “That is all well and good; what are you going to do about this contract?” The short answer is that we will keep all matters under consideration. What I can tell you is that, even within this contract, by 23 January, we will be in a position, under the terms of that contract, to see what we should or should not do, in terms of withholding profit. That is a matter that, I hope this Committee can take from me, is receiving the most anxious consideration.

Mr Francois

Just quickly, Minister, because we are always tight for time, by 23 January, you are deciding whether or not to withhold some payments to the contractors—

Alex Chalk

Correct.

Mr Francois

But that is not the same as changing the contract.

Alex Chalk

Correct.

Mr Francois

You are right that it is unacceptable. FDIS is fatally flawed and will never work, so what is the likelihood, on a scale of one to 10, that you will actually abandon that contract and do something different? Is it nine, or one, or something in the middle?

Alex Chalk

I don’t want to be evasive, but we have to take this in stages. The counter-position is this: what is much more important than the structures is the service that these guys are receiving. The thing that has been moderately encouraging—it is no more than that—is that it seems that some of the things that should have been sorted out at the beginning are now working. For example, what was being received by Pinnacle was not being properly communicated to Amey and VIVO because the IT systems were not working. It seems that there are aspects of this that are improving. However, although we have been talking about heating and water, we have not been talking about damp, for example. One of the things I am commissioning this week is to see where we are at in respect of some of those issues. The short answer is that all options are open and we will consider them. I do not want to give you a steer that would be unhelpful, but I meant what I said at the Dispatch Box: everything is being considered.

Mr Francois

Minister, just lastly—look, we call our service personnel heroes, and they are. But we don’t treat them like that, and then we wonder why they leave. I’m afraid all you have given is a classic Minister’s dead-bat answer; you have not really told us anything about what your future intentions are. I am sorry, but it is a really disappointing answer. Our service personnel deserve better. You are the Minister in the hotseat. Try harder, would you, please?

Alex Chalk

Nothing is from lack of effort; I can tell you that absolutely clearly. Every single day, we are absolutely on this, and I want to know the precise figures every day. There have been repeated meetings with these people and I can indicate that the conversation was—I hope you would agree if you had been there—commendably robust. There is absolutely no short selling on that. We do have to ensure that it is actually delivering what we want it to deliver. It is ultimately that which matters more than structures, but I am not ruling anything out.

Chair

Okay. Thank you.

Dave Doogan

Very quickly on the back of that, Minister, I can hear how frustrated you are about this, but it is catastrophic failure. We are not talking about quite a bit below target; we are talking about a monumental failure of the contract or the contractors to deliver acceptable accommodation. I just want to give you the statistics for the failure to prepare properties for moving in the year to date, up until November 2022. Amey managed to prepare only 41% of homes for moving, and VIVO managed only 60%. Amey missed 10,500 urgent repairs, and VIVO just over 4,000. It is not even close, so what is the Department going to do? First, I would like to hear you accept that it is catastrophic. Secondly, what is going to be the extraordinary effort to turn this disaster round?

Alex Chalk

The performance that we have seen is not just a little below what was acceptable or, indeed, what was contracted for; it is far, far below. That is why, as I said at the Dispatch Box in answer to a question from Mr Francois, we will consider all options—including, by the way, the very option that he himself talked about in his paper in advance, because he made certain warnings that I accept—and I absolutely meant it. I would also say, in answer to your specific point, that yes, in terms of the proportion of homes that have been of a required standard, it is far below what we expected. It has now, by the way, ticked up to about 80%, but it is still not at the acceptable level of performance. The question that someone in the hotseat, as was described, has to decide is, if you rip the whole thing up, is that a great thing that gets you a headline—sorted—but actually makes the experience worse? Or is the situation that, in fact, you are quite close to things being significantly better for the service personnel who we all we want to do right by? That is the judgment that we have to make.

Dave Doogan

What is your judgment?

Alex Chalk

The situation at present is that, by the end of this week, there will be single figures who have not got heating or hot water within 48 hours.[1] If that had been the position at the beginning of the contract, you would say, “They’re a little bit in breach of this contract, but it’s not catastrophic,”—to use your word. But at the beginning, it was much closer to that adjective. We have to make a judgment. By the way, Amey and VIVO have recruited loads more people, and Pinnacle has as well. It has new IT systems, new protocols and so on—all the stuff that should have been in place at the beginning but is now in place. The question is: what do you do at this stage? That is the judgment we have to make.

Chair

Okay. The purpose of flagging this up—you have heard the tone, concern and passion here—is simply to ensure that you are aware that this needs to be detailed, and I hope that you will come back to the Chamber in due course to say what progress has been made. We have three other very short questions, and the answers will need to be a lot shorter than you have just given. I am looking at the Defence Equipment Plan. Very simply, on Boxer and Challenger 3, can you tell me when the in-service date will be for both those vehicles? Have they been costed? What are the overall costs?

Alex Chalk

Certainly. These are not short points, but let me go through them. Do you want Boxer first?

Chair

They are very simple questions. Given the fact that Challenger 2 is a couple of decades old, this is simple to understand. As I say, I cannot pluck it out from the Defence Equipment Plan. When will Challenger be operational? How much will it cost?

Alex Chalk

The cost of Challenger will be £1.4 billion, but it is right to say that there will need to be additional funding in respect of the active protection system. I can get into the detail of that.

Chair

Is that funded?

Alex Chalk

No—the active protection system, not yet, but the £1.4 billion is funded. In respect of the arrival date, the first 18 are scheduled to arrive in March 2027 with the IOC in November 2027. IOC is defined as one squadron at readiness.

Chair

Sorry—18?

Alex Chalk

IOC—November 2027. Yes.

Chair

So 18 vehicles will arrive.

Alex Chalk

Yes, that’s right.

Chair

We can’t go to war with 18.

Alex Chalk

No, of course, but it is not just Challenger 3, because at that time, you still have Challenger 2s as well, so it becomes a blended fleet.

Chair

That is an obsolete tank. My question was very clear cut: when will the British Army have its full complement of Challenger 3s?

Alex Chalk

I thought you asked about IOCs; I gave you that date.

Chair

The in-service date—yes, that’s correct, but I wasn’t expecting the answer to be just 18. If that was our requirement, we could celebrate, but I hope that we are seeking to build more than 18 of them.

Alex Chalk

The FOC is 2030. The IOC is 2027, as I have indicated.

Chair

What are the total numbers?

Alex Chalk

The total number is as per the letter that we wrote to you—it is 148. We have 227 Challenger 2s at the moment and 148 Challenger 3s.

Chair

And do you expect these to be in service by 2030? Is that your target date?

Alex Chalk

That is right—specifically, December 2030.

Chair

Can we do the same arithmetic for Boxer?

Alex Chalk

Certainly, one moment please.

Mr Francois

It is 2025.

Alex Chalk

I think what I heard sotto voce from Mr Francois is right. The IOC remains on schedule for 2025. That is defined as a company group of vehicles equipped with trained crews. The FOC is 2032.

Chair

And the numbers again.

Alex Chalk

In 2025—27 vehicles. The FOC in 2032—I think 523 were originally ordered, with a further 100 being confirmed and contracted for earlier this year.

Chair

So 2032 is when we will have the full complement of Boxers.

Alex Chalk

The total order is for 623—Mr Williams?

David Williams

Yes.

Chair

So you are expecting the Warrior to continue until Boxer is brought in.

Alex Chalk

Absolutely, so there will be a blended fleet of Boxer, Warrior, Ajax, Challenger, Apache—

Chair

And you think the Warriors, which are, again, a couple of decades old, will last that long and that we will be able to keep them going. Bear in mind that we spent £140 million on looking at upgrades but did not do the upgrade.

Alex Chalk

That is specifically something that I have asked about and that we have looked into. I am very happy to answer, but would you prefer to, General Sharon?

Lt. General Nesmith

If you are comfortable—

Chair

Please.

Lt. General Nesmith

At the last Integrated Review, as the Committee will remember, we took a decision to delete the Warrior CSP—the sustainment programme. We then extended our Warrior fleet to see us through the period until we delivered our Ajax. Of course, we have not yet concluded when the IOC of Ajax will be, but at the moment the Warrior is extended to from 2025.

Chair

We have the little nugget of Ajax to come on to later, so we will leave that for the moment. It is important to recognise the Committee’s concern about the huge delays that there will be in our land force capabilities—the dates are coming into the 2030s—before this equipment, which has been around for a couple of decades, comes into service. It should not take that long to procure.

Mr Jones

Challenger 3 is ambitious. I say to the new Minister that he needs to look at this and can it, frankly, because this has all the hallmarks of every equipment programme that we have done where we have tried to retrofit things. It is like trying to turn a 1989 Ford Escort into a modern electric vehicle with everything on it. On interoperability, it is difficult in terms of NATO. If we are going to spend £1.4 billion, those dates will not be met because you will find problems in trying to retrofit these things. We should be going through them and scrapping them—deciding we don’t need them, which I don’t agree with—or going down the route of looking at the new Leopard or Panther, because otherwise this is going to be another example of “jam tomorrow”, which will keep moving on and on and on. I say that now; I hope I’m wrong, but if we are here in five or six years’ time, I’m sure I’m not wrong.

Chair

Okay.

Alex Chalk

Can I respond on that briefly?

Chair

Very quickly.

Alex Chalk

I think I take it from that question that you think we should have tanks, you’re just saying not this one. The only thing I would gently say is that one of the most valuable things that I read in order to prepare for this is your own report, “Obsolescent and outgunned”, which, if I may respectfully say so, was an excellent document.

Mrs Lewell-Buck

We agree.

Alex Chalk

Fancy that! Just to that point, if I may, this Committee did not recommend one way or the other, but said in paragraph 38: “We do not propose to recommend which course the Ministry of Defence should take”—that is to say, whether we should go for Leopard or Challenger 2—because these are balanced judgments. But the advice I have received is that Challenger 3 would be a considerably more capable—

Mr Jones

Can I just say, Minister: it’s wrong.

Alex Chalk

The report is wrong?

Mr Jones

No, the advice you are getting is wrong. This will lead one way, and you can see it happening. In every programme where we try to retrofit things into old kit, however well intentioned—I am not making any suggestions about the advice you have been given by individuals for alternatives—there has been optimism bias to a degree that never works, and my fear is that that is where we are going on this programme. You will get there, you will throw money at it, but the important thing is capability, and that will not be there for the Army.

Chair

Okay, we will come back to this in the meat of our discussions. Sarah, do you want to take us on to the more topical issues of Challengers today?

Sarah Atherton

We read that we are going to provide Ukraine with between 10 or 12 Challenger 2s. You obviously project that we can spare those, so what is the reasoning and purpose behind that donation?

Alex Chalk

I have to be clear: no decision has been made about that. That, I know, is something that will be being considered, but I do not want to lose this point, which is that, of course, we have already provided a number of vehicles—200 or so—which I think is a point that has almost been lost—not by this Committee, but certainly beyond that. Whether we provide 10 or 12, or indeed any, that is a decision that has not yet been made. I just need to be moderately clear about that. But certainly, were they to be provided, notwithstanding the points that have been made, I think a lot of people would recognise that actually committing a main battle tank would not just have a symbolic value but would also give an additional capability. I do not know whether any colleagues want to follow up on that.

Lt. General Nesmith

From our perspective, we are very clear: the granting of a western tank, Challenger 2, is demonstrable in itself. Of course, our highest priority is that we support Ukraine in the defeat of Russia, for the obvious reason of helping Ukraine to restore its sovereign borders, but also to make us safer at home today. As part of any of that decision making, we will be really clear about the impact on our readiness and how we sustain our readiness, and also the feeding in to the Challenger 3 upgrade programme.

Chair

Sarah.

Sarah Atherton

Can I just ask, then—

Mr Francois

If we can’t spare 12 tanks, we may as well go home.

Chair

Let Sarah complete her question.

Sarah Atherton

What consideration has been given then, in the equipment that is donated, to the secret or sensitive information on it? If you look at the Challenger 2, what about the armour? I think it has Dorchester, or Chobham, armour. That is very secret.

Chair

I suspect that, because you say this is all speculation and you are waiting for the Ramstein meeting, I think, of Defence Ministers, to make these big announcements, it will be politically charged: there will be bigger consequences, touching on the supply chain, support and so forth—the whole effort to keep just 12 tanks working. Can I invite you, Minister, or the Defence Secretary to make an oral statement to the House if this decision is made, so that we can probe further the wider consequences?

David Williams

If I could just provide some reassurance, every category or piece of equipment capability that we have given to the Ukrainians since February last year has been accompanied by an assessment of the risk of diversion, the risk of exploitation by potential adversaries in the future. That assessment forms part of the advice that goes to Ministers before the gifting of lethal aid is agreed, so it is very much part of the decision-making process.

Chair

That is very helpful. Is that okay, Sarah?

Sarah Atherton

Yes, thanks.

Chair

I think Kevan wants to come in.

Mr Jones

Yes. You wanted rid of the equipment you have given so far anyway. You were getting rid of things like Mastiff anyway. I am not suggesting that that is not being added to the capability in Ukraine, but it was not key stuff. In terms of Challenger, let us be honest: this is for the birds. It is just a PR story. On the idea of delivering 12 Challenger tanks to Ukraine, how on earth are you going to do the training? What about the spare parts and the ammunition, which will be different from what the Ukrainians are using? Given the rate at which they are getting through ammunition, have we got enough ammunition to supply 12 tanks, even if these survive? Honestly, Minister, it is a great PR thing. It gets you a headline, but it is going nowhere, isn’t it?

Chair

Right. I am sure you can take all those questions away with you. We look forward to the oral statement.

Alex Chalk

Thank you.

Chair

The final point that we want to touch on, which I mentioned to you outside, is to do with Protector and Reaper.

Robert Courts

Protector has been reported as slipping both in financial terms and in delivery date, such that we now expect it—if the Telegraph is to be believed—to be five years late cumulatively and half a billion pounds over budget. Why is that, and can we confirm what we are now hearing?

Alex Chalk

I will make three initial points and then maybe others will want to come in. First, the idea of its coming into effect in 2018 is not a date we recognise. It was always the case that the in-service date was going to be 2021, never 2018. That’s point one. Point two: it is correct that it was pushed back from 2021 to 2023 and that a cost came with that, which I am happy to explore. A deliberate decision was made so that that budget could be focused on the immediate pressing priorities in that year. I pause to note—the Chair mentioned it sotto voce—that this works together with Reaper; it is a replacement for Reaper. So the decision was made: we have Reaper and, actually, it is better to push this back to 2023.

Robert Courts

Can I pause you there to explore the reasons why that decision was taken?

Alex Chalk

Yes, of course. At that time—others in the Department then will be able to speak to this in greater depth—there were specific priorities, whether that was P-8 or anti-submarine warfare, or whatever was the particular priority at that stage. The third point I wanted to make is this: the figure of half a billion that you have indicated is not one that is recognised. There was a cost—that is perfectly true—but it is important to also recognise that a significant element of that cost was because the delay meant that there was an upgrade to the very thing that we are getting, which would have avoided the in-service upgrade. In other words—this was to do with a main visual sensor—by doing it and paying for it then, we would not have had to pay for it later and, indeed, take it off the line later.

Chair

But you are upgrading something that they are already designing. You are also upgrading the Reaper because that needed to have its life extended. Is that not correct?

Alex Chalk

Yes, there is an extension to Reaper; that is absolutely right. But, for the avoidance of doubt, that extension comes at no additional cost, because that comes from the overall Protector budget, as I understand it. Perhaps David Williams can come in on that specific point. On the issue of the upgrade—

Chair

Sorry, but your Protector budget has just gone up by about half a billion. What is the increase in budget? Sorry, Robert, I will hand back to you.

Robert Courts

I was going to ask that. What is the specific increase in the budget?

David Williams

It is not the £500 million figure; it is around £300 million.[2] I can let you have a precise number after the hearing.

Chair

That is still significant.

David Williams

It is still significant, but the decision was taken in light of the Integrated Review, as part of the spending review 2020 settlement, that in order to create the headroom for investment in capabilities that we wanted to prioritise—

Chair

P-8s.

David Williams

It was not just P-8s, but the full range of capability that we have in our equipment plan. Some decisions were taken to retire capabilities. In other areas, a decision was taken to defer future programmes. In this particular case, given that we have Reaper and a capability that is working for us at the moment, the decision was taken, but the financial headroom in the early years created by a deliberate decision to push this back was a price worth paying.

Chair

It is a familiar story: there is not enough money and, therefore, in order to keep the P-8 programme going, you have then had to rob another programme.

David Williams

We would say it is a balance of investment decision to defer the portfolio.

Chair

Thank you for being candid about that.

Robert Courts

Given that that is a familiar story, can we count on this in-service date, or is it going to slip further?

David Williams

I am not expecting, through deliberate programme action, that we will look to change the dates. The programme and the budget are now baked in.

Robert Courts

I have one more point on this. These are systems that are going to have greater endurance, greater sensors and greater weapons, but we are only getting 16. When we look at the immediate preliminary lessons of Ukraine—at least according to RUSI—we see a massive amount of attrition from these systems that are being used there. The initial conclusion, at least as far as RUSI is concerned, is that they need to be cheap and attritable; this is neither. Are these going to be able to defend themselves in a contested airspace?

David Williams

I think there is a conflation of—

Robert Courts

Different systems, I accept that.

David Williams

The principal lesson for us from Ukraine—I think we will be coming on to these later in terms of UAVs—is really on the cheap mass tactical drone. These are high-end strategic systems, so the way in which they would be operating would be—

Robert Courts

Sorry to interrupt, but you have two choices, don’t you? I accept that there are two different types of systems: you either have cheap, attritable, essentially throwaway ones, which are the little things that we are talking about, or this, which is much bigger. But the essence of my question still stands: are these going to be able to defend themselves in contested airspace?

David Williams

I think where we will end up is that, actually, we want both, and then we will operate these in a way that means we are preserving them for future missions.

Robert Courts

So out of contested airspace.

David Williams

Not necessarily. How they are used is—what you are seeing in Ukraine today is not equivalent.

Robert Courts

It is not so much how they are used; it is where they are used that I am interested in.

David Williams

Okay. Well, perhaps we can come back to that.

Chair

You are, I think, teasing us to suggest that we have further questions to ask, which we are not going to be able to do justice to here— Robert, I hope you are happy with that. You can see where we are going with this: it needs to be expedited as quickly as possible. If nothing else, Predator is allowed to operate in civilian airspace, which I think is the crucial part, whereas Reaper cannot. Therefore, even in looking after our own domestic interest—top cover here in the UK—that is why we need to get this sorted. We will move on to our main substantive. Colleagues, we have a vote imminent, but we also have about an hour and a half left. That is about 30 minutes for each section. Kevan, start us off and see how we get on before the vote.

Mr Jones

Can I ask what the Army’s ambition is? Does it remain what was in the Command Paper in 2021, which was a warfighting division optimised to fight a peer adversary within a NATO context?

Alex Chalk

Yes, is the answer.

Lt. General Nesmith

What we laid out in the last Integrated Review under Future Soldier, as you will recognise, is the most significant transformation programme that we have embarked upon to deliver a core warfighting capability to enable us to fight and win wars on land. Everything we see from war in Europe amplifies our core purpose, so that remains the case.

Mr Jones

On what date will you actually be able to deliver that capability?

Lt. General Nesmith

We deliver against all that is asked of us today, in terms of our NATO commitments.

Mr Jones

That is not the question.

Lt. General Nesmith

We recognise that there are shortfalls against some of the broader NDPP targets. I think that has been a well-documented shortfall—indeed, internally to our own Department, this has been recognised in our capability assessments. That is why we have an investment plan of £34 billion in the Integrated Review, to address some of that.

Mr Francois

When?

Lt. General Nesmith

I think we laid out in Future Soldier that it was a decade of delivery.

Mr Jones

Wait a minute, though. Since 2010, the Army has burned through something like £12 billion of public money. Twenty per cent. of that was obviously on Ajax and Warrior, and you have delivered no new capability in those 10 years. How much faith have we got in the fact that you will deliver these ambitious programmes in the next 10 years, or are you just going to keep burning through money?

Lt. General Nesmith

I recognise that we have not delivered some of the programmes in the way that we would have wished to. We have learned a lot of lessons from those programmes.

Mr Jones

But they are very expensive lessons, General. It is £12 billion of public money. There are those of us who are arguing that defence budgets should increase—having been a Minister at the Ministry of Defence, I know that the Treasury sit on your shoulder—but, frankly, if I was in the Treasury and you came to ask for more money, I would say no. The Treasury would be quite right to do that. You cannot really give us a date when the capabilities are going to be achieved. Is there not a serious issue for the Army—it has an issue about its relevance—in terms of not being able to deliver this? I accept that some of these are political decisions, but a lot of them are decisions that have been taken in the Army itself. My task when I retire is to write a book on FRES, because that would be a fascinating subject, given the amount of money it wasted. They are Army decisions on these things, not ministerial ones. Can you understand why politicians and the public—and perhaps the Treasury—are pretty sceptical about your capability in the Army to deliver anything?

Lt. General Nesmith

There are a number of things there. The first thing I would say is that the Integrated Review was a decade of delivery. We were very clear about that at the time. We took some capability risks at that point, and we knew that it would be a decade before we modernised the Army in the way we wished. Of course, some of that now feels very uncomfortable. I also recognise that we needed to up our game on how we would deliver some of those programmes. I had been out of the Army headquarters for a couple of years. I have come back to Army headquarters, and we have done a lot to address some of the specific lessons that have come out of those equipment programmes. I see values as an example of where we have been perhaps found wanting in some of our programme delivery, and how we have professionalised—with a small p. We now have dedicated SROs against all of our GMPP programmes so that the requisite amount of time is dedicated to the programmes. We have identified the suitably qualified and experienced personnel that we need to resource the SROs with so that they are professionalised programme deliverers. As recommended by the IPA, we educate and train them. We are building a network inside the headquarters—a community.

Mr Jones

General, I have been hearing this for 20 years. Some of this is about delivery. Let’s look at what we are trying to achieve. We have to deliver Ajax—we will come back to that. Warrior has written off £400 million of public money, and the Boxer dates that the Minister gave us earlier mean it is going to have to be extended even further. You know my views on Challenger; that is another one waiting to happen, frankly. Is it not time for the Army to do some serious thinking? If it is going to deliver that—that is the ambition—it has to start either cutting programmes or making some realistic assessments. Otherwise, this Government and any future Government are going to ask the question, “What is the relevance of the Army?” You have a difficult problem now, because there is a CDS from the Navy. You had good years during Afghanistan and Iraq because money was flowing in, and you got loads of things. Since 2010, things have changed. You now have a CDS from the Navy and that puts the focus on other things. You have a serious relevance problem as an Army, haven’t you?

Lt. General Nesmith

The third thing I was going to say was that we are starting to deliver the programme now. We have some success stories that we can already point to, in terms of the AH-64 Echo. I accept that we have not delivered in the way we might have wished to in the past.

Mr Jones

But £12 billion of public money is a lot of money to be wasted, isn’t it?

David Williams

Can I come in on that? First, I am always loth to speak for the Chief of the Defence Staff, but I think if he had been here, he would be emphasising the centrality of NATO to our security. There is a real importance to the land component of that. We are engaging with NATO colleagues on the new force model. We are engaging with SACEUR on the regional plans and his strategy for the run-up to the Vilnius conference. I do not think that saying there is a naval CDS is a fair attack. On our future equipment programme, we have £41 billion allocated over the next 10 years to the modernisation of the Army. My main point is that the implication of your question is that there is a binary state, in which we do not have a division now, but will get a warfighting division at some point in the future; whereas in practice our warfighting capability today is based on Challenger 2, Warrior, AS90 and AH. We have a programme in which, over the next decade, a range of those major platforms will be upgraded or replaced, but it is a decade’s driving journey; it is not a binary position in which first there is nothing, and then this comes.

Mr Jones

No, but you have some huge capability gaps in that period, which means that you cannot deliver this. We will come back to Ukraine in a minute. I understand why the Army wants to deliver a divisional capability—because it is tanks, and what the Army has traditionally done—but it begs the question: should there be a rethink, especially when talking about NATO? Are we looking for tomorrow’s contribution to the more agile forces that are needed in Europe? I accept that this has been fixed, and this is where we are at, but there will be a huge capability gap throughout the period. With some programmes, we are looking to find out when they will come in. We will come back to Ajax—Mark’s favourite subject—in a minute, but you cannot deliver effect if you do not have the capability.

Lt. General Nesmith

We have credible capability today. Everything that we have seen play out in Ukraine exemplifies that if you have capability that you adapt and exploit, the adversary that adapts the quickest prevails. The fact that Challenger 2 is one of those armoured fighting vehicles that is sought after indicates that it is credible capability.

Mr Jones

It is not sought after at all. Talk to our NATO colleagues. You know that is not true. A tank is sought after, but not Challenger 2.

Lt. General Nesmith

A western tank is sought after, but we have credible capability today. What Ukraine also indicates, of course, is that there remains a very hard edge to warfighting capability in the land domain, and that is still centred around the combined arms manoeuvre of an armoured fighting vehicle fleet, but it is not the combined arms manoeuvre of yesteryear.

Chair

We need to make progress, and we are also cutting into John’s sandwich time, but Mark, quickly.

Mr Francois

Very quickly, General, I am not about to say anything that the Russians do not know. We have a fighting division, 3 Div. If we crash that division out of barracks at 5.30 tomorrow morning, half of it would not get out of the tank park, because so many of the vehicles are obsolescent. Many of them are 25, 30, 40 or even 50 years old. We would be lucky to get a brigade to Estonia in 60 days. How can you possibly say that we have a credible deterrent effect when our warfighting division is so old, and so full of obsolete vehicles that you have had 20 years to replace? You have replaced none of it. How can you say that we can credibly contribute to deterrence with an Army that is clapped out? That is the truth. What is your answer?

Lt. General Nesmith

We credibly contribute to deterrence today. Our USP as the British Army is very much about highly qualified and competent combat arms, some very professional skilled trade personnel and enablers, and conceptual leadership. We contribute all that today, as we work, train and educate alongside our friends.

Mr Francois

With respect, although our soldiers are arguably—man for man, woman for woman—as good as those of any other Army on Earth, if their vehicles do not work, and do not even start, they cannot fight, can they?

Chair

Mark, you’ve made your point. You are coming back after John. You talked about contribution. Jens Stoltenberg said at the Madrid NATO summit that NATO’s new strategic concept moved the size of the rapid response corps from 40,000 to 300,000. What is our contribution to that now?

Lt. General Nesmith

We are working in support of Defence, looking at the options for our proposition for the new NATO force model.

Chair

Okay, but we have no numbers. For 40,000, it is easy to say: 16 Air Assault Brigade, 3 Commando Brigade and as Mark suggested, perhaps as many tanks as we can muster, but 300,000? If that is what the NATO Secretary-General says is now required because of the heightened threat level, we need to confirm what we are able to get out of the park.

David Williams

It is a live debate with SACEUR as part of the NATO planning process; it is live right now. That will lead to consideration and presentation of various plans and agreements at the NATO summit in Vilnius in the summer. It is a substantial increase. It also needs to be seen in the context of a substantial increase in NATO membership itself, given the accession—

Chair

Okay. You have the Integrated Review coming in before Vilnius. I presume that there will be an answer as to what our contribution will be to this 300,000 force, given that people will be looking to us, as a senior member of NATO, to be a significant contributor to that force. Maybe you could write to the Committee with more details.

David Williams

We would expect to be a significant contributor to that force.

Chair

Thank you, Mr Williams.

John Spellar

If we have this heavy armour available, why are we pulling back from Estonia?

Chair

Two battalions down to one—or battlegroups, sorry.

Lt. General Nesmith

What we have committed to is support to our forward presence in Estonia and we have committed to having an armoured brigade combat team doing that. That remains the case. The fact that they are not forward is correct, but, over time, we will pulse capabilities as appropriate.

John Spellar

Given the international tension at the moment, particularly the tension on those countries that border on to Russia, why are we pulling back?

Lt. General Nesmith

I don’t think we are pulling back—we remain committed.

John Spellar

Well, we are reducing our commitment.

Chair

By half.

Lt. General Nesmith

The commitment is the same; it is just not forward present, but we are at readiness in support of the battlegroup.

John Spellar

But why are we doing that?

David Williams

Our presence and activity both in land and air and other domains on NATO’s eastern flank is substantially higher today than it was in February. We took the opportunity of the planned roulement of Army units into Estonia to double up on our commitment on the ground. We have forward deployed a range of enablers and other equipment. We had Challenger 2 out for a while; it spent a bit of time in Poland and a bit of time in Finland, and it is now back in the UK. We are being quite dynamic and flexible in the way in which we are providing visible presence as well as active engagement in NATO tasking, day in, day out.

John Spellar

Let’s move on to Warrior. Does the cancellation of the upgrade programme create a capability gap?

Lt. General Nesmith

You are right that in the Integrated Review we made a decision to delete the CSP. What we have in our Future Soldier transformation programme is delivering a core warfighting capability based on three AFVs: Challenger 3, Ajax and Boxer. What we see as the future of our new combined arms manoeuvre is how we exploit the different levels of mobility protection and lethality of those three platforms.

John Spellar

Let’s go back to the basic question. Does that create a capability gap? We know Boxer is several years late, and Ajax, after all the money we have spent, we have not yet got one of them, so we have a real shortfall. We have now cancelled the upgrade of Warrior. Surely, by definition, that creates a gap in the capability.

Lt. General Nesmith

We have extended Warrior for a period of time until Ajax is coming into service. If you like, that is the surrogate platform for the Ajax capability. At the point at which Ajax is in, Warrior will go out.

John Spellar

How long will that extension last for?

Lt. General Nesmith

It is from 2025.

John Spellar

How many of Ajax do we anticipate coming in to fill that gap? In other words, we are projecting a sizeable gap in this capacity.

Lt. General Nesmith

As we understand how Ajax will be delivered, we will absolutely be able to mitigate any gap.

John Spellar

How will we mitigate the gap? It cannot be Boxer, because that is well delayed as well, and Ajax will be coming in late, if ever. What will actually cover this gap in an intensified international situation?

Lt. General Nesmith

I think that would remain to be decided, but one of the options—

John Spellar

You mean you haven’t planned for that?

Lt. General Nesmith

One of the options could be that we therefore continue to use Warrior as our surrogate platform. But, of course, it is very much a live issue about when we anticipate Ajax coming into service.

David Williams

Yes, we need to keep under review our plans for how we blend the withdrawal from service of Warrior with the entry into service of Ajax and Boxer, although I do not recognise the characterisation of Boxer being massively delayed—

Chair

Sorry, what?

David Williams

I don’t think that Boxer is massively late.

Alex Chalk

It is still in the original IOC. That—

Mr Francois

It is not. The original IOC was ’24; it is now ’25. I am sorry, but you are wrong.

Chair

Either way, it was a programme we were financially involved with back in 2005, I think, and that is a little while back.

Alex Chalk

In 2003. The central point is that there will be a blend—that is right. We have 700 or so Warrior armoured fighting vehicles—

John Spellar

It’s more like a single malt than a blend.

Alex Chalk

But Ajax will come on stream—we anticipate that happening, and no doubt we will talk more about that in due course—and Boxer will be rolled out as well. The Apaches will be upgraded as well, so then we can talk about Deep Fires and all those sorts of things. They come together to form at any particular time a lethal fighting force—

Chair

Minister, slow down, because you are now merging things and blurring the battle picture. Going back, if I may, General, you said that Ajax is replacing Warrior. Please correct me if that is not what you said.

Lt. General Nesmith

We took the decision to extend Warrior as a surrogate platform for Ajax.

Chair

Ajax is a recce vehicle replacing Scimitar—that is what I thought was happening.

Lt. General Nesmith

Correct, so—

Chair

And it is Boxer that is replacing Warrior. You talk about capability gaps. Ajax has not come about yet, so Scimitar, which is 1971, is still kicking about, as far as I understand, and Boxer is a track vehicle without a turret replacing an armoured fighting vehicle with tracks and a 30 mm RARDEN cannon on the top. So there is a capability gap if you replace Warrior with Boxer. Is that not correct?

Lt. General Nesmith

How we see ourselves operating over time, as we transform to Future Soldier, is around a core capability of armoured fighting vehicles, which is the mix of Challenger 3, Ajax and Boxer. It is how they work together that provides the capability—

Chair

This is a decade away though.

Lt. General Nesmith

—over the next decade of transformation or modernisation.

Chair

As you said at the beginning, 2032 is when all these things come in, when you have the full complement. Anyway, I think we should make progress. We get the message: everything coming over the horizon is very slow, and the world will look very different in 2030 or 2032. Mark?

Mr Francois

Minister, you kindly said that you had done some homework and have looked at our report about the British Army’s armoured vehicle capability, “Obsolescent and outgunned”, which we published in March 2021. You will recognise this statement from the executive summary: “This report reveals a woeful story of bureaucratic procrastination, military indecision, financial mismanagement and general ineptitude, which have continually bedevilled attempts to properly re-equip the British Army over the last two decades.” When we published the report, the Army had not brought a major AFV into service for over 20 years. Two years, or very nearly, have passed since that report was published. In that time, which new major AFVs have you brought into service?

Alex Chalk

I have read the report, for which many thanks, and I have looked at precisely those points. My analysis of this—it might be helpful for me to say how I view it coming in—is that it is true, there has not been an armoured fighting vehicle in that time. However, by way of context, it is important to note that in the period when we were fighting in Iraq and Afghanistan, a lot of vehicles were procured rapidly for the British Army—in fact, more than 2,500. I accept that not all of them were heavy armoured fighting vehicles, but whether it was the Ridgeback, the Foxhound, the Mastiff or the Wolfhound, there were hundreds and hundreds of them—over 2,500 vehicles. I pause to note, because one could be forgiven for missing this point, that more than 2,000 of those are still in action. Indeed, some of what we have been able to deploy to Ukraine, those 200 fighting vehicles, are, indeed, pretty heavily—I certainly wouldn’t—you know what those vehicles are, but not everyone does.

Mr Francois

I understand—

Alex Chalk

So, that is important context. The reason—can I just—

Mr Francois

The bells are about to ring.

Alex Chalk

I know, I will absolutely get to this point, but, specifically to your point—someone mentioned FRES—the context of those 20 years is that, up to about 2010, there were three failures. There was TRACER, which didn’t work. There was MRAV, which is what Boxer used to be called, where the decision was made not to go with it in 2003. Then, there was FRES, which was going to be 3,000 vehicles and did not happen. The reason why I mention that is that, if you go back to the NAO report of 2011, which I did read, it said that that would create a tail of gaps in the heavy armoured military thing going up to 2025. In other words, those three decisions had a problem. Then, as indeed, “Obsolescent and Outgunned” said, we pivoted into the fact that we were fighting in Afghanistan and procured 2,500 vehicles for that particular conflict. That is the context.

Mr Francois

Minister, I take your point that this is, in one way, on the nub of it.

Alex Chalk

Yes.

Mr Francois

Part of the problem is, while we can blame the contractors—we will get on to Ajax in a minute—a fundamental problem has been that the executive committee of the Army Board could not make its mind up on what it wanted. Twenty years ago, it wanted heavy armour to fight in an eastern European scenario. Then, because of Iraq and Afghanistan, it switched its focus to fighting in the sand, with lighter, more mobile vehicles. Meanwhile, I think it would be generous to say that it took its eye off the ball at the kind of heavier end of capability. Now, it is desperately trying to play catch-up, because of what has happened in Ukraine, and there was a 20-year missing period, which is why so many of those programmes have been cancelled, have gone wrong, or are horribly delayed. The Defence Command Paper, General, said that we will have, in effect, a fully-fledged fighting division by the end of the decade. That is still seven years away, and I think the Committee will be very concerned by the fact that, today, you did not even reconfirm that as a date; you wouldn’t give us a date by when we will have a full-up warfighting division. Can you tell us that that happen by 2030, General?

Lt. General Nesmith

I would absolutely confirm what was set out in that Defence Command Paper. Future Soldier delivers over a 10-year—

Mr Francois

We are, for the record, still fighting for a fully-fledged war-fighting division seven years from now?

Lt. General Nesmith

In the Future Soldier plan, it was absolutely about a decade of delivery, and there were known capability risks that we took as we formulated that plan. I think that, through today’s lens of war in Ukraine, on land, some of those decisions feel very uncomfortable. Perhaps when we get on to the “What we have learned from Ukraine” piece, the question will be, “What does that mean that we need to do?”

Mr Francois

This is kind of at the nub of it. This is part of the problem, which is that the Army kept changing its mind about what it wanted. That then wagged the procurement tail, as it were, and that is partly why we are in the horrible mess that we are in. Boxer is delayed, its IOC slipped by a year, Minister—look behind you; they will nod, right? With Ajax, we do not even have an IOC; Challenger’s is 2027 for one squadron; and for the replacement for AS-90, we are talking around the end of the decade—and there is a war going on in Ukraine right now. The cumulative effect of all of those decisions that that, if we had to crash out of barracks and fight today, we would be woefully unprepared. Let’s be honest: part of that is the Army’s fault, isn’t it, General?

Lt. General Nesmith

I think, as I said, we have most definitely learned lessons from the equipment programme over the past decade.

Mr Francois

In which case, if that is true—forgive us for a little bit of cynicism, but we will take you at your word—what are we doing to materially accelerate those programmes? Why are they continuing to slip to the right, rather than being brought forward to the left as urgent operational requirements? Why do we still need to wait until the end of 2027 for a world-class battle tank, to take just one example? If you admit—to be fair, you have admitted—that a lot of it was the Army’s fault, but shouldn’t the Army then say, “All right, we’ve made a horrible mistake. Let’s now speed everything up to compensate for it”? Surely that is what you should do.

Lt. General Nesmith

First, Defence made some of the decisions around the equipment for the Department, of which, clearly the Army is a part. I would also say a number of things. First of all, we need certainty of our funding, so that we can get on and deliver the programme. I absolutely recognise that we laid out a decade of delivery—

Mr Francois

You have £31 billion—the PUS just said it. How much more do you want?

Lt. General Nesmith

But there is a profile to it. Secondly, we recognise that there are capability gaps in that, capability risks in there that we no longer feel comfortable about—the 4+1, which I am sure we will talk about later—and we are doing something to address that now. We have rebalanced across our own programme to be able to deliver some of that. Thirdly, we are absolutely looking at what we can accelerate. There are a number of challenges around that; the funding profile is but one of them.

Mr Francois

Just quickly, on Mr Spellar’s point, you were mixing apples and pears earlier, and you know you were, about different capabilities. The difference between Boxer and Warrior is that Boxer is wheeled and Warrior is tracked. So if you have to accompany tanks cross-country, you cannot do it as easily in Boxer as you can in Warrior, yes? [Interruption.]

Chair

Hold that thought. We will suspend this sitting for about 10 minutes as we vote. We will reconvene shortly. Sitting suspended for a Division in the House. On resuming—

Chair

Welcome back to this Defence Select Committee hearing, which was briefly interrupted by a vote. Mark Francois, would you like to wrap up your question?

Mr Francois

Thank you, Chair. General—not quite saved by the bell—the Army has £31 billion allocated to it in the Equipment Plan. Given that you have candidly admitted that it was largely the Army’s fault that you went round in circles for 20 years, what concrete steps are you taking as a service to accelerate some of these armoured fighting vehicle procurement programmes to plug the gaps in our inventory in case we have to fight? Ultimately, that is what all this is about. What are you doing to speed these programmes up so that the vehicles do not take years and years to come into service?

Lt. General Nesmith

I will touch on two different aspects of what we are doing as a consequence of war in Ukraine. The first is to recognise that in our Future Soldier plan there are a number of capability areas where we now feel uncomfortable about the level of risk. That is the 4+1 capabilities that we may come on to talk about later. In the first instance, it is about how we address some of those capability gaps around our air defence, our uncrewed air system, our deep fires, our ISTAR and our logistics and stockpiles. That is what we are looking to address in the first instance in terms of rebalancing some of the capability risks. We have already done an internal balance of investment for that purpose. Secondly, against our programme, we of course are looking at opportunities to accelerate. Two very realistic constraints may play out in our ability to do that. One is some of the supply chain constraints that we see as a consequence of war in Ukraine and the second is the capacity of industry. That is not to say that it is not our want to accelerate programmes—we do, and we will be looking to do what we can.

Mr Francois

So you are trying to speed things up.

Lt. General Nesmith

We are looking at what we can do to fill our gaps, or the capability risks that we no longer feel comfortable with, and to do things quicker within our modernisation plan.

Mr Francois

Thank you, General.

Chair

In this final section on the Army’s requirements, we will quickly turn to the Joint Expeditionary Force. This is a welcome story that is perhaps less publicised—a British initiative bringing together like-minded nations. It is a sub-unit, if you like, of NATO, but it is separate to NATO. We know that Ukraine will not be joining NATO any time soon, much as it would like to and we would like it to. As you look towards the integrated review, do you think that we should lean on the JEF’s common commitment to democracy and utilise that, rather than leaning on NATO? If you are inside the club, NATO works extremely well—absolutely right—to secure and strengthen countries’ capabilities and defence; if you are not in the club, you are left exposed. I am simply asking you to take away my question. Can we lead—because this is a British initiative—on advancing this pool of high readiness and ability to stand up to threats, using the JEF, with a view to inviting Ukraine? Ukraine will need an umbrella of security, whatever happens this year, in the next few years until it is able to join NATO proper.

Alex Chalk

I am certainly happy to take that away as one of the many lessons that we are going to be learning from this conflict.

Chair

If all answers were as simple as that, we would get through everything.

Alex Chalk

May I say one thing? When we were talking about the armoured fighting vehicles and the protective ability that had been procured in the 2010s, I said it was about 2,500 vehicles. In fact, that figure was 2,313, of which more than 2,000 are still being used by the British Army.

Chair

The Committee was aware of that, but we were being polite.

Mr Jones

Well, that is not true. They are not being used, most of them, because a lot are parked up and we are selling them off.

Alex Chalk

I am just saying that those are in the in-service fleet.

Mr Jones

Come on. We are giving them to Ukraine because we weren’t using them. We are starting to sell them off, and a lot of them are not operational.

Chair

The record has been corrected. Emma, I turn to you as we look at more general Army acquisition, not least Ajax itself.

Mrs Lewell-Buck

Thanks, Chair. Moving back to the discussion that my colleagues had about Ajax, as you know, the UK selected an off-the-shelf design for Ajax, but last year the director general said that, apart from the chassis, we have in effect developed it from scratch. What went wrong? Why is that?

Lt. General Nesmith

One of the identified recommendations from the Ajax reviews is that we overcomplicated our requirement. Several hundred requirements were laid out for the programme, and that was way too complicated. One of the lessons we have taken into how we professionalise our programme delivery is about the simplification of laying out requirements so that there are far fewer, the programme is simpler to deliver against and it has broader utility.

Mrs Lewell-Buck

I am a little confused. You are saying that you overcomplicated the requirement, but the decision was made to have an off-the-shelf design. Did you not already know what the requirement would be when you selected the off-the-shelf design? How come it ended up going full circle, if that makes sense?

Lt. General Nesmith

Apologies if I misunderstood the question. I will ask Darren to talk to the detail, but there was an off-the-shelf chassis, against which we have then adapted.

Major General Crook

Absolutely. It is a modified off-the-shelf solution. It is a base vehicle known as ASCOD 2, which had been developed by the Austrians and Spanish, so it was a modification of that, enhancing it up to include the capability that we were seeking to gain advantage from, including the sensor suite and the 40 mm cannon.

Lt. General Nesmith

What we have learned from some of that is, first, about the simplification of our requirements and, secondly, absolutely, one of the principles in our land industrial strategy about the use of proven capabilities, modularity and commonality.

David Williams

The lesson for me is not falling into a trap. There are perfectly reasonable circumstances in which we might take an off-the-shelf product or vehicle and choose to modify it. The important thing in those circumstances, going into that, is that it is not necessarily much less complicated or complex than a pure development programme. If you really want to go off the shelf for the simplicity that that brings, you need to go off the shelf, buy something, get it into service and then think about how you might develop it in a spiral way through life. The degree of complexity in the requirements for Ajax involved well over 1,000 key user requirements, and a number of those requirements changed during the life of the project, as opposed to Boxer, for example, which had about 100 KURs.[3] We are learning from that experience.

Alex Chalk

When I came into this role, as a complete civilian, I was absolutely clear that, as a matter of common sense, it is much better to get 80% capability today, rather than 100% capability tomorrow, because tomorrow never comes, or can never come. Imagine how pleased I was to see that, in your own report “Obsolescent and outgunned”, you make exactly that point at paragraph 23. The thing that is encouraging to me is that in Boxer we are going for something that is that much simpler. The sophistication comes from the command module that goes on the back, which we can swap out, but the essential structure itself is much more straightforward. We see that in the Type 31 as well.

Mr Jones

It is, but it goes back to an earlier point. I do not disagree, General, about what you are trying to do for the future, but I have been in this field for quite a while now—I was at the famous “trials of truth”, part of FRES, where Boxer was tested way back in 2006, I think. My problem is with how you get the culture in the Army to sit up and listen. If you look at the reason why we have a lot of these delays, it is down to the Army, with changes to specifications and overcomplicating things. How do you embed that, so that even at a senior level you can say to people, as the Minister said, “Yes, it’s nice to have, but actually we will get 80% of it, rather than what you want.” Let us be honest, FRES was just a category of that, how it developed over time—it was just optimism. It has been the same with all these programmes. That is an Army problem and not a political problem.

Lt. General Nesmith

Sorry, I am in danger of repeating what I was saying about professionalising the programme delivery, but a lot of thought—

Mr Jones

Sorry, General, I think you are missing the point. The emphasis on over-procurement is not with the people delivering the programme, but with the higher-ups, including the Army Board, who have asked for things to be changed over a period of time. How do you get the rigour into delivering what the Minister wants to deliver—which I certainly think is better—which is trying to get 80% of what you want, rather than “tomorrow never comes” and the approach of the past 20 years on this programme? How do you get that vigour into senior thinking?

Lt. General Nesmith

Absolutely, the programme delivery teams need to be capable, competent and linked.

Mr Jones

That would be a start, yes.

Lt. General Nesmith

Linked to that is creating an environment in which people are able to challenge. While we have a lot about upskilling our programme delivery, which gives people the toolset to be less optimistic or to have less optimism bias—that is absolutely about the programme teams and is an important upping of our game in that respect—linked to that is how we shift our Army culture. You know that we are working hard on a lot around Army culture—

Mr Jones

Have the generals been on that course as well?

Lt. General Nesmith

It starts at the top. It is absolutely about creating an environment that is open to challenge. That is the other aspect of changing how we work together.

Major General Crook

There is also an element to do with the cost of change. We now have examples, which we can show, where there is that cost of change in financial terms and in schedule. We have to take those opportunities, crystallise them and present them to people.

Mr Francois

General Crook, let us take a parallel example, with Warrior, before we come to Ajax. For the capability sustainment programme, you decided to give Warrior a new turret and an upgraded weapon. You spent 10 years trying to do that, and £400 million of British taxpayers’ money, and then you cancelled it. With Challenger 3, you are trying to put a new turret on with an upgraded gun, and you think that will take you at least another four or nearly five years before you can bring 18 of them into service. Based on your track record of doing that with armoured vehicles, do you understand why the Committee is so sceptical?

Major General Crook

Mr Francois, yes, I do. I absolutely recognise that caution and the shadow of those former programmes, but I would point out that we have been working really closely with RBSL since they had the contract award. In fact, the Minister and I visited RBSL in December, where we were able not just to meet the apprentices, but to see some of the system integration labs, the dynamic test rigs and the turret test rigs, which are there to de-risk the programme. There is absolutely a challenge—of course there is—and there are risks in the programme, but we have that ability, by working with industry and good professional people, to de-risk the programme. We are also bringing in a known weapon system: the 120 mm smoothbore is proven, and we understand it. RBSL have the skills from that ground base and, as I go back to that apprenticeship piece, they are looking to build that through-life to get that turret in. We are absolutely committed to that.

Mr Francois

But RBSL, along with Krauss-Maffei Wegmann, built Puma for the German army. This is a new AIFV. They brought it in. They did a trial. There were 18 of them. Every single one of them broke down during the trial. In Germany, Puma is a laughing-stock programme. It’s their Ajax, if you like. So how can you have confidence in a company that does that?

Major General Crook

We continue to work closely with the heritage that these companies have; you touched on KMW there. There is a heritage in this, a design organisation in this. We are understanding the lessons through that trials process. The trials process allows us to learn and embed new ideas into things. Of course, with the Puma IFV, some of the challenges they are facing are in the public domain. So we are learning from that as well. That is enabling us to build our test systems, understand the criteria that we’re getting at and then design trials, with industry, that get at these things early.

Mr Francois

Let’s come to Ajax directly. You have mentioned trials. Here’s where we are today, right? According to the Public Accounts Committee, who were very disobliging about Ajax—The Telegraph at the weekend called it a farce—you have now spent about £4 billion of taxpayers’ money, at a time when we are having arguments about how we use taxpayers’ money to get people out of hospital, and all the rest of it. You’ve spent 4 billion quid over 10 years. You still don’t have a single Ajax vehicle in frontline service. And you still can’t give us an IOC date—after 10 years. So perhaps you could update this Committee. What is now the initial operating capability date for Ajax?

Major General Crook

Well, let me just go through a couple of other points and—

Mr Francois

No, just answer that one first and then make your other points.

Major General Crook

We have been working very, very closely with General Dynamics, as you would expect, to draw together a schedule that we understand, in terms of the retrofit of the capability. We have presented that as a plan to the investment appraisal committee.[4] I think that was articulated to you in December. That is now being considered, with advice to go back to Ministers. So we need to wait until we have had that ministerial advice given and approved before we go forward.

Mr Francois

Sorry, but 10 years and £4 billion on, you still can’t tell us when it’s going to enter service?

Major General Crook

I don’t think that I am in a position to say that.

Mr Francois

Well, can anyone tell us? Just give us a date. Can any of you give us a date? It’s a very simple question.

Lt. General Nesmith

From the work that Darren has just described, we have an assumed IOC and FOC—

Mr Francois

Which are what?

Lt. General Nesmith

Which we are unable to give publicly because it hasn’t been through the due process. But we have an IOC and we—

Mr Francois

With respect, General, you have had 10 years. How much more due process do you need? You’ve had a decade!

Lt. General Nesmith

It’s departmental process from the point at which it goes from an IAC, through Ministers—

John Spellar

Maybe the perm sec can assist us, then.

David Williams

The decade for the programme is not a fair challenge in terms of where we are on setting the IOC and FOC, going forward, because clearly we have had to revisit those in the light of the problems that the project has had around noise and vibration and the work that we have been doing—

Mr Francois

No, sorry, it is, because we started off with development and production at the same time, which was very unusual, and that began in 2010, so actually we could have said 12 years.

David Williams

Yes, but my point is that whatever we may have thought in 2009, 2014 or 2018 has had to be adjusted in the light of the noise and vibration problem that the vehicle has experienced, on which we now have a workable solution. The vehicle has successfully been through the user validation trials, and we are refining and finalising what we think that means for IOC and FOC, but that will be advice to Ministers, and it will be for Ministers to decide whether they agree with that.

Mr Francois

So you can’t give us a date, either. Look, some of the people who were involved in the trials were subsequently medically discharged from the Army with very serious hearing problems. Some of the people who served during the trials had to have steroid injections. A lot of the people who were involved in the trials had to have very detailed hearing tests to determine whether their hearing had been adversely affected. This is a really serious matter. Some people lost their jobs; they lost their military careers. You say that the vehicle has been through a set of safety trials. They were conducted by the MoD. You could, if you were a cynic, point out that there are a hell of a lot of careers hanging on this programme, so why weren’t these trials completed independently? A cynic would say that this was the MoD marking its own homework, wouldn’t they?

Major General Crook

We are marking General Dynamics’ homework. We are using the armoured trials and development unit to do that, which is independent of Defence Equipment & Support. We have people who have been working tirelessly to push this trials process through, to build the data to support a safe system of work. That is what we have been generating. Yesterday, I had a conversation with one of the senior NCOs from the armoured trials and development unit. He described the capability as a game changer, and he completed the UVT battlefield missions with complete confidence, so we have built a safe system of work, and we have worked that safe system on an incremental basis to build a body of evidence to support this. We are not marking our own homework; in fact, I am one of those who has had the hearing tests. We’ve got safety at the absolute forefront of our mind, and we are building that body of evidence to make sure that we’ve got the battle-winning equipment that our troops deserve.

Mr Francois

All right. Because of the problems around this programme, the Secretary of State—by the way, thank you for describing this report as excellent; that is not what the Secretary of State said when it came out but, then, I think he was misadvised—brought in a QC, now a KC, Clive Sheldon, to conduct a review into the management information surrounding the Ajax programme. So, it was not about whether or not you could solve all the problems but, basically, about who knew what when about what was going wrong. Permanent Secretary, you told the Public Accounts Committee just prior to Christmas that we were very close to that report being published, and that it would be published—that it wasn’t going through a Maxwellisation process. Can you or the Minister give us a date today for when the Sheldon review into Ajax will be published?

David Williams

I can update you to the extent of saying that Mr Sheldon has indicated that he will provide, essentially, a final draft to Ministers around the end of January, so it is a few weeks away. There will then be a process of ministerial consideration, and there may need to be some fact-checking. I do not know whether there will be a process of Maxwellisation; it depends on the level of personal observation, as opposed to systemic.

Mr Francois

You told the PAC that there wouldn’t be.

David Williams

Well, I am not aware that there will be, but I have not seen the report.

Mr Francois

Okay. When Sue Gray published her famous report, she was in control of the timings for that, so obviously Mr Sheldon will be in control of the timings for this. I suspect that, when this report comes out, there are going to be some people who were involved in this programme who are going to be deeply embarrassed, but let’s wait and see. Assuming it gets to Ministers by the end of January, when will it then be published so that we can read it and this Committee can take evidence on it?

David Williams

I am afraid that I cannot give you a feel for that. I am happy to get the sponsors of the review to provide a response to the Committee in writing, but given some of my previous engagement with the project, I am not sponsoring the work itself.

Mr Francois

We understand that. My last question is for the Minister, and then I will hand back to the Chair. It is probably fair to say, Minister, that the MoD has not covered itself in glory in this, and neither—it has to be said—has General Dynamics. If you cannot tell us what the IOC is for the vehicle, which is very disappointing, can you at least give us a likely date for when the Sheldon review into what went wrong information-wise will be published? You are the Minister; when do you want to publish it?

Alex Chalk

As soon after the end of January as possible. To try to be of as much assistance to you as possible, if we get it by the end of January, I would expect that the process of doing whatever needs to take place—maybe Maxwellisation, maybe not—should happen within the subsequent four weeks, maybe six weeks maximum. I would expect it to be shortly after that point.

Mr Francois

Four to six weeks.

Alex Chalk

Well, four to six weeks for that process to conclude. If there is anything further that needs to happen beyond that, you are talking about weeks, not months. I think that is as far as I can usefully go.

Mr Francois

Lastly, can you give us an assurance that, rather like Sue Gray, the report will be published completely unredacted?

Alex Chalk

I have to see what it says first—I really do. That is important—[Interruption.] No, it is important, actually; it’s not something to scoff at. That’s because if there are things in that which are operationally sensitive, bearing in mind that—I have spoken to my predecessor—it was absolutely essential that this silk was able to go wherever he needed to go and to follow the evidence. By the way, I think that’s absolutely the right approach. It follows—[Interruption.] Hang on, let me finish the point. It follows, therefore, that if, in the course of those inquiries, he discovers things that have an impact on national security, then of course I’d have to look at them. I think that’s unlikely. That’s all.

Chair

Thank you. Perhaps you could share a copy with the Committee, under the usual terms, so we can then see the full unredacted report. That would be very helpful.

Alex Chalk

Yes; that is overwhelmingly likely, yes.

Chair

We will come back to Mark in a second, but over to Dave now.

Dave Doogan

Minister, we hear a lot about the global reputation of the British Army. By any measure, it is an advanced, established and quality operation. Likewise, General Dynamics is a world-leading engineering company. How can these two organisations have come together and produced something as troubled as Ajax?

Alex Chalk

That is precisely why there needed to be a review of it. I think that’s right—this has been an unhappy episode. I want to make one thing clear, only because when I came into this Department it wasn’t initially clear to me but it has provided me with a measure of reassurance. You could be forgiven for thinking that throughout all this—there had been all these user validation trials, all this stuff going on—that nothing has been going on in the background while waiting for this to conclude. In fact, already we have 143 that have been completed in the six variants. By completed, I mean about 80% ready to go. Yes, you need to do some software upgrades and you need to have replaced some of the armour, but you have got those 143. There are over 400 hulls that are ready. If you go down to Merthyr Tydfil—

Dave Doogan

Thanks to Spain.

Alex Chalk

That’s true. Not uncommonly, these are combined and collaborative efforts, but the overwhelming majority of the work, by the way, is taking place in the United Kingdom. Those production lines are running hot; it’s all going ahead. I think it’s reasonable to say that we have turned something of a corner, notwithstanding the points that you properly make. The user validation trials—it is just worth reflecting—completed over 1,500 km. They have done blast protection; they have fired rounds on the move. You have had a letter, haven’t you, from General Dynamics suggesting that 98,000 km have been completed? We recognise 1,500 km, but on any view it is a lot. A great deal has taken place and you have heard what General Crook said about the view from those who are driving it. All I was going to say is that yes, of course we need to learn the lessons and we need to be transparent about that, but the idea that nothing has been produced, this is all sunk and it’s no good would be—

Dave Doogan

I accept that things have happened, but billions of pounds have also been spent and we’ve still not got IOC levels.

Alex Chalk

That is true. The only thing I would say is that when you’re procuring equipment of this nature, you do have to do quite a lot of the money up front, so that you can build these hulls and do a certain amount of that work. It’s not just the case that you pay nothing, they produce it and then you get a bill at the end.

Dave Doogan

It’s a bad contract, Minister—it’s a bad contract. Anyway, I don’t want to over-rehearse Ajax over and above the work that other colleagues have done. Boxer, on the other hand, is a much more straightforward project and it’s still troubled. What’s the common denominator?

Alex Chalk

As you say, Boxer is a totally different kettle of fish and I will just state at the outset that it is worth reflecting that the lessons have been learned, in the sense that it is a much more straightforward machine. As you say, the Germans have been using it: they have used it in Afghanistan. The Australians use it, and so on and so forth. You have the drive module, which is quite a straightforward bit of equipment and then you put the command module on top and you can swap them out. Actually, I have been to RBSL; I have seen the production lines there. We will produce them this year; they will be produced throughout next year and the year after, and so on. Of course, if you look hard enough, you can find problems in any of these projects, but overall—

Dave Doogan

You don’t have to look hard, though, Minister.

Alex Chalk

But Boxer specifically is proceeding reasonably well. I think it’s reasonable to say that. I know that Mr Francois says it has slipped a year. I don’t want to get into all the detail and argument about that.

Dave Doogan

Well, you say it’s slipped a year, but we say it’s slipped five years.

Alex Chalk

No, I don’t think that’s right—I really don’t think that’s right. I don’t know whether others who have been here for longer want to comment on that.

David Williams

Boxer, against its approved IOC date, is still on track, but what we had—

Dave Doogan

If you keep moving the date, it’ll keep getting on track.

David Williams

We have contracted through OCCAR for an earlier delivery date in ’24, which the project is now slipping against, but it is still within the approval that we have set for the programme, and that’s largely down to supply chain pinch points and availability of material.

Dave Doogan

General, you said in response to Mr Jones earlier that Ajax and Boxer procurement had not gone as you would have hoped, or words to that effect—I hope I am not putting words in your mouth. You said there were lessons to be learned—something of that nature. Many of us on the Committee are really concerned that exactly the same mistakes are now getting made with Challenger 3, in terms of British military procurement exceptionalism. It is as if all the business over there—namely, Leopard 2—is good for other countries but not us; we need a different set of bells and whistles that will cost a different amount of money. When it comes to upgrading, we will have to pay for it ourselves, as opposed to sharing and disaggregating those upgrade costs with all the NATO allies in Europe that operate Leopard 2. Why are we ploughing this lone furrow with an out-of-date platform?

Lt. General Nesmith

I think I recognised that we had learned lessons from the equipment programme, rather than particular elements within it standfast, with Ajax. You make a comparison with Challenger 3. There is a real integration challenge around the programme—that is true. In terms of the simplicity of setting the requirement from Ajax to Challenger 3, we have also lived in the spirit of a significantly more straightforward and shorter list of requirements against our Challenger 3 programme.

Dave Doogan

Nevertheless, we are going to create in Challenger 3 a one-off and unique British product, which, like all Challengers, only the UK will operate, in terms of a peer nation—I realise they are in Kuwait and Oman. In the long run, this will be much more expensive with, I would argue, significant operational drawbacks. Why are we not operating on the same platform? It would have been built in the UK if we had ordered more than 130—that was the threshold. So, it is not about the industrial strategy. I do not understand. I would like you to give a compelling reason why the answer to the problem of the future main battle tank for the UK is Challenger 3 and not Leopard 2.

Lt. General Nesmith

At the time the investment decision was taken, based on the analysis, it delivered a more capable platform and through-life costs were lower. At the time that the decision was made, that was the compelling case for why we chose Challenger 3.

Dave Doogan

I think time will demonstrate that that appraisal is fundamentally wrong.

Alex Chalk

Can I come in on that? I do not think it is as clear as that. In your own report, “Obsolescent and outgunned”, you did not say that we should definitely go for Leopard and not Challenger. I do not think it is as cut and dry as that.

Chair

We do not write policy. All we do is expose. I want to draw this to a close because I want to move on to something else. Just on Boxer, the bottom line is it should not take eight years to procure an off-the-shelf vehicle. We are not designing this; we jumped out of the design package in the early 2000s. Eight years to procure something that you can already buy off the shelf now shows that something is going wrong. That is the message we need to get across. We need to make progress and I do want to get on to Ukraine. Over to Mark on Morpheus.

Mr Francois

Ajax was billed as a highly advanced digitised system. In layman’s terms, in the integrated review the argument was that you could have a smaller army with fewer units—and in some cases less kit—if everything was brilliantly joined up, highly digitalised and could speak to each other. That would give a force multiplier effect, and at the end of the day you get more bang for your buck. I am using layman’s English, but that was the gist of it. I can see witnesses are nodding. The brain of Ajax, the bit of kit that is meant to do all of this digitised communication and the thing that is meant to go into most of the Army’s other fighting vehicles, is a system called Morpheus. Morpheus is an even bigger basket case than Ajax. It is late, you have spent a vast amount of money on it and there is very little to show for it. Without the brain, a lot of the rest of the concept does not work, not just for Ajax but across the whole of the British Army. General Crook, what is the IOC for Morpheus?

Major General Crook

It will perhaps come as a surprise, Mr Francois, that Morpheus is outside of my—

Mr Francois

I know that it is Defence Digital, but you are the nearest we have got today, so what is the IOC for Morpheus?

Lt. General Nesmith

Perhaps I can take the question. Right at this point in time, we are in dialogue with General Dynamics.

Mr Francois

Ah, General Dynamics; they seem to crop up a lot. Go on.

Lt. General Nesmith

We are working with General Dynamics to work out how we progress through the Morpheus programme—in particular the EvO transition partnership element within that. You are right to say that our Future Soldier proposition was absolutely around the centrality of data and the network, and of course the real game changing part of Ajax is the sensor sweep that is provided on it and the internal open architecture that futureproofs it. Today, we have a capability that allows us to digitally connect our platforms. Sticking with Ajax as an example, the plan was always to put Bowman—our BCIP capability—into our Ajax platform. At a point in time in the future, exploiting the open architecture, we will be able to migrate to whatever the future system is.