Labyrinthine IT systems lose MoD almost £300m

Failings in computer systems used by the Ministry of Defence led to the loss of almost £300m in payments and equipment, the National Audit Office (NAO) has found.

The MoD's problems are the latest blot on Whitehall's troubled track record when it comes to managing computer systems, ranging from the Department of Health's flawed £12.7bn National Programme for IT to the Cabinet Office's £24.4m writeoff on the Scope project.

According to an NAO report into the MoD's 2008-09 accounts, published today, errors in data held on the Ministry of Defence's Joint Personnel Administration (JPA) software system has led to the MoD overpaying staff by an estimated £140m.

The JPA system is "extremely complex and subject to continuous change", the report said, with some 400 "extensions" having been made to the original software.

The convoluted system is prone to mistakes being made during data entry, the report found, with almost 15 per cent of the JPA transactions examined by the NAO containing an error.

"The department has a range of detective controls in place but these will not prevent error occurring or detect all errors that have been made," the report said.

The NAO said that more checks need to be built into the system to reduce the number of errors and said that plans to introduce a new enhanced information management tool, Oracle OBIEE+, could help.

The NAO report also found the MoD unable to account for £155m-worth of Bowman secure radio systems being used by Army personnel in Iraq and Afghanistan.

The NAO report criticised weaknesses in the MoD's stock management computer systems, which it said were made up of a mix of "new and legacy" kit.

"The department's stock systems are highly complex, because of the number of different lines of stock and locations at which they are held," it said.

"The complexities within the stock systems create a significant risk of error, and unintended consequences can occur as a result of minor changes or actions in one system."

The report said the MoD needs a good quality inventory management system to ensure appropriate logistical support for operations and to prevent theft and fraud.

The NAO report isn't the first instance of problems with IT at the Ministry of Defence: the £7.1bn Defence Information Infrastructure programme to provide a single information infrastructure was recently found to be 18 months late and at least £182m over budget.