Ministry of Defence wasting billions on unneeded equipment, MPs say
The Ministry of Defence has bought billions of pounds worth of equipment that it does not need, MPs have said.
Between 2009 and 2011, it bought £1.5bn worth of raw materials and consumable supplies - like uniforms and ammunition - more than it used, a report from the Public Accounts Committee found.
But the committee said it was "cautiously encouraged" that the MoD was "now starting to get a grip".
The government has pledged "to reverse decades of lax inventory management".
The committee said the MoD did not always dispose of items it no longer needed. More than £4.2bn worth of non-explosive supplies had not moved for at least two years, it said.
The MPs also said they were "disappointed" that the MoD had failed to improve its management of supplies, despite criticism from the National Audit Office dating as far back as 1991.
Committee member Richard Bacon said: "It is unacceptable that the Ministry of Defence is wasting significant amounts of public money buying equipment and supplies that it doesn't need.
"It is particularly galling at a time when funding is tight and when one considers that the National Audit Office has been warning about these issues for over 20 years."
The report said: "The MoD purchases, holds and uses more than 710 million items of 900,000 different types, from bullets and missiles to medical supplies, clothing and spare parts for vehicles, ships and aircraft.
"Project teams within the department can order as much consumable stock as they think they might ever need because they are only billed for it when they use it."
There were therefore "no incentives in place to prevent over-ordering", it concluded.
The MoD plans to introduce controls to reduce spending on inventory by £300m in 2012-13 and £500m each year by 2015.
It also intends to reduce the volume of stock held by 35% in order to make room for equipment returning from Afghanistan and Germany in central depots, some of which are already at 90% capacity.
Defence Equipment Minister Philip Dunne said: "Support for military operations is, and must continue to be, our first priority.
"Appropriate reserves of equipment are essential to be able to deploy our armed forces at short notice and sustain them on operations around the world."
He added: "I am determined to reverse decades of lax inventory management to ensure that MoD assets are managed much more efficiently in the future.
"Considerable progress has been made since 2010; the size and value of our holdings are now heading in the right direction and we plan to spend almost £2bn less on inventory over the next four years."
But shadow defence secretary Jim Murphy said: "Ministers seem to be cutting kit we need while ordering equipment we'll never use. Ministers should be cutting from the backroom not the frontline.
"Continued waste is unacceptable at a time of deep defence cuts and government failure to balance the books.
"There must be persistent prudence to ensure every penny piece is spent wisely.
"We need real reform to MoD budgeting. The government must respond by getting a grip of the inventory management system."