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By Natasha Lomas, 15 January 2009 15:40

NEWS

Â…the use of legitimate means of reducing payments made to Atlas, where the consortium's performance has not met the terms of the contract," the report notes.

Where the DII system has been rolled out, PAC also noted rates of user dissatisfaction are significant.

The report states: "At least 40 per cent of users declared themselves dissatisfied with DII in the first user satisfaction survey carried out at the beginning of 2008. The DII Programme will only be successful if users are trained and willing to exploit the benefits of the new system."

The PAC report follows a National Audit Office (NAO) report last July which found the DII was running more than a year late.

An EDS spokesman for the Atlas consortium said in a statement: "DII is a major and complex programme that is delivering significant benefits to the Ministry of Defence and our armed forces. The NAO Report in the summer of 2008 into DII and the PAC Report issued today highlighted some early issues that arose on the programme.

"EDS has worked with its Atlas Consortium partners to address these issues and to put the programme back on track, a fact acknowledged in both reports. The NAO estimates that DII has already enabled savings to the Department of £916m."

Another NAO report, published in December, found 20 MoD major projects were £3bn over budget and their schedules had slipped by a total of eight years.