{"id":40189,"date":"2018-06-27T06:00:05","date_gmt":"2018-06-26T20:00:05","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=40189"},"modified":"2018-06-27T09:46:47","modified_gmt":"2018-06-26T23:46:47","slug":"if-not-now-when-the-anaos-reporting-on-defence-megaprojects","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/if-not-now-when-the-anaos-reporting-on-defence-megaprojects\/","title":{"rendered":"If not now, when? The ANAO\u2019s reporting on defence megaprojects"},"content":{"rendered":"
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The Australian National Audit Office\u2019s public assessments of the health of major Department of Defence projects are invaluable\u2014but the fact that the ANAO isn\u2019t yet reporting on the $80-billion future submarine program or the $35-billion future frigate program means that it\u2019s missing the boat.<\/p>\n

ASPI has noted<\/a> on numerous occasions in recent years the decline in transparency regarding Defence\u2019s investment program. This has reached the point where it\u2019s impossible to even know<\/a> which projects the government has approved, let alone their budgets, schedules or risks.<\/p>\n

The one shining exception to this has been the ANAO\u2019s major projects report<\/a>, published annually since 2008\u201309, which is based on Defence\u2019s own project reporting. As ASPI has previously noted<\/a>, the MPR is about the only place the public can get information directly from the coalface of Defence. It includes not just reporting on budgets and expenditure and progress against schedules, but frank assessments of risks and the measures adopted to address them.<\/p>\n

However, the MPR has limitations. It includes only 25 or 30 of the hundreds of projects conducted by Defence\u2019s Capability Acquisition and Sustainment Group (so it has no ICT or facilities projects, which spend billions of dollars of public money). Moreover, the guidelines<\/a> for MPRs (endorsed by parliament\u2019s Joint Committee of Public Accounts and Audit) state that a project can only be included a year after it receives second-pass approval.<\/p>\n

This latter point is fundamentally problematic. Over the next few years, it will make the MPR miss the largest programs in Australia\u2019s history.<\/p>\n

One of the key judgements of the First Principles Review<\/a> of Defence was that the department was too focused on process at the expense of outcomes. To address this, Defence has developed a new capability life cycle that\u2019s risk-driven instead of process-driven. The approach, agreed by the Prime Minister\u2019s Department and the Department of Finance, is now in place.<\/p>\n

While milestones such as second pass (or Gate 2, as it is termed in the capability life cycle) still matter, the focus throughout is on identifying risks and managing projects in a way that\u2019s commensurate with those risks. And as Defence moves from lots of individual projects to fewer, larger programs, what \u2018second pass\u2019 might mean becomes unclear.<\/p>\n

Despite this, the ANAO seems to be stuck in the previous process-driven model where milestones matter more than risks.<\/p>\n

The ANAO\u2019s reporting criteria mean that the two biggest projects in Defence\u2019s history\u2014SEA 1000 (future submarines) and SEA 5000 (future frigates)\u2014are not included in the MPR. This is not an oversight. According to advice from the ANAO, there are no plans to include them in the 2017\u201318 edition to be published later this year. But the scrutiny provided by the MPR is warranted for those projects right now because:<\/p>\n