HC Deb 16 March 1998 vol 308 cc448-9W
Ms Roseanna Cunningham

To ask the Secretary of State for Defence (1) what was the original projected cost of the implementation of the MRPII Scheduling System at(a) NARO Almondbank and (b) NARO Fleetlands; and what has been the actual cost of implementation; [34592]

(2) what was the original projected timescale for the implementation of the MRPII Scheduling System in (i) NARO Almondbank and (ii) NARO Fleetlands; and what has been the actual timescale for implementation; [34594]

(3) what were the original projected cost savings to be gained from the implementation of the MRP II Scheduling System at (a) NARO Almondbank and (b) NARO Fleetlands; and what have been the actual cost savings of its implementation. [34591]

Dr. Reid

This is a matter for the Chief Executive of the Naval Aircraft Repair Organisation (NARO). I have asked the Chief Executive to write to the hon. Member.

Letter from S. R. Hill to Ms Roseanna Cunningham, dated 16 March 1998:

  1. 1. I am replying to your 3 Questions to the Secretary of State for Defence that sought timescales, cost savings and implementation costs in connection with the MRPII scheduling system in NARO Almondbank and NARO Fleetlands as this falls within my area of responsibility as Chief Executive.
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  2. 2. Timescales. The case approved in January 1992 projected implementation of the MRPII system in NARO Almondbank in July 1993 and in NARO Fleetlands in December 1993 but with the caveat that expenditure could not be committed until an ongoing Efficiency Study of the NARO had been completed. As a direct result of this delay the contract was not let until May 93. Taking this into account MRPII completion would not have been achieved to plan until May 96. At this time the project suffered delays due to data take on (the time for which had been under estimated) and performance and technical shortfalls identified during user pilots. These problems were rectified in time for the system to go live in NARO Almondbank in May 1997 and in NARO Fleetlands in July 1997.
  3. 3. Cost Savings. The case approved in January 1992 projected cost savings to be gained from the MRPII system of £53.6 million in NARO Almondbank and £35.4 million in NARO Fleetlands. The bulk of the perceived savings to the Ministry of Defence were attributable to reduced repair times, improved asset (spares etc.) visibility, and a consequent reduction in the number of assets procured. These savings fall very largely outside the NARO budget. Cost savings were forecast to be realised progressively over a period of 7 years following implementation. The actual savings to date within the NARO are estimated at £37K in NARO Almondbank and £1.0 million in NARO Fleetlands, these savings are deemed from the MRPII system subsuming pre-existing system functions and the decommissioning of the older legacy systems. It is too early yet for us to be able to carry out a post project evaluation of the overall effectiveness of the MRPII system in generating savings for the MoD.
  4. 4. Implementation Costs. The case approved in January 1992 projected a 10 year cost of implementation of the MRPII system in the NARO of £16.2 million (ex VAT at financial year 91/92 prices). The project costs were for the complete MRPII system and were not broken down between the NARO Divisions. The actual cost of implementation on the same price base has been £14.13 million and the current projected 10 year costs include some further costs associated with additional NARO Finance, Personnel, Training and Publications systems.
  5. 5. It should be noted that the MRPII Scheduling System forms part of an integrated business solution, the NARO Business System, which embraces commercial accounting, personnel, attendance and payroll.