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Sir John Bourn, Head of the National Audit Office, told Parliament today that the Ministry of Defence has made considerable progress in developing new approaches to the management of its Research and Technology (R&T) programme to deliver better outcomes for Defence, but the Department could do more to get the full benefit from the money it spends.

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Defence capability is critically dependent on the effective exploitation of advances in technology, as emphasised in the recent Defence White Paper. The Department procures advice on potential new technologies and in some cases funds such technology development directly through its £450 million R&T Programme. Funding has, however, reduced by 30 per cent since the mid 1990’s.

There have been important developments in the Department’s approach to Research and Technology recently. In July 2001 its former in-house supplier, the Defence Evaluation and Research Agency, was split into QinetiQ, with the aim of eventual privatisation, and the Defence Science and Technology Laboratory (Dstl), which will remain as the Department’s in-house supplier. In line with these changes, the Department has re-organised its internal structures and processes to improve the delivery of research programmes. The Department has used this opportunity to introduce an output-management approach.

Sir John’s report identifies that the Department has more to do in deciding funding priorities and planning its research programme. The Department should update its existing strategy to clearly identify its technology priorities, ensure that the levels of strategy are consistent, and communicate its strategy to stakeholders.

Historically, the Department has lacked a coherent way of identifying and measuring the benefits of research programmes. Sir John’s report recognises that measuring research outputs and outcomes is difficult because of the wide variety of outputs and the long-timescales involved. However, the Department should put in place performance measures suggested by the National Audit Office to track whether the aims of its new approach are being achieved and measure longer term outcomes.

The Department is introducing new structures and processes for managing R&T. These should deliver a more focused and responsive research programme. The Department also plans, by 2009/10, to compete over 60 per cent of its R&T programme.

Sir John’s report identifies that progress against targets for introducing competition is good, and there is evidence that competition is improving bid quality. Competition targets will, however, place a further strain on staffing, and the Department should clarify Dstl’s role in supporting the Organisation, and then revisit its recruitment and retention strategy.

“Pull-through” of technology into the Defence Equipment Programme is an important measure of success. Sir John’s report identifies that evidence for pull-through is scarce, though the Department has several actions to improve performance. It is encouraging exploitation by giving Intellectual Property Rights to researchers in industry or academia, and providing incentives to them to incorporate new technology. Exploitation could be improved if the Department rationalised its arrangements for demonstration work, and tackled the funding “valley” between the research and equipment budgets.

"Defence capability is critically dependent on exploiting advances in technology. There have been major changes in the way that the Department procures its £450 million Research and Technology programme. These changes should deliver better outcomes for Defence in the long-term. In the short-term, the Department needs to clearly identify and communicate its funding priorities; ensure that it recruits the expertise needed to deliver its programme; introduce measures to gauge if the aims of its new approach are being achieved; and ensure that the results of its research are put to fullest use."

Sir John Bourn

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