MoD warned on spending

Existing guidance at the MoD was found to be too widely dispersed and out-of-date, according to the report released today by the National Audit Office.

Over the last five years one quarter of the annual £9bn defence equipment and services budget had been spent without a competitive tender, the NAO said.

But the NAO was not satisfied that all guidance on how such procurement should be negotiated was either accessible or up-to-date.

The MoD uses a government profit formula agreed with the CBI in 1968 and the concept of ‘no acceptable price, no contract’ introduced in 1992 to ensure value for money.

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