Assessing the Affordability of Force Structures

28 Pages·2013·0.6 MB·English

Assessing the Affordability of
Force Structures
Dr Stuart Taylor

19 September 2013
© Crown copyright 2013. Published
with the permission of Dstl on behalf
of the controller HMSO
Overview
• Context
• Current force structure costing capability
– Strengths
– Limitations
• Proposed future costing capability
– MoD research project
– Emerging ideas
19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Context
• Extant capability used to support previous Defence
Review (Force Structure Cost Model)
• Requirement to develop tools and techniques to
support SDSR 15
• Defence policy and capability choices will drive the
future force structure requirement
• Need to be able to determine the affordability of the
various options

19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Force Structure Cost Model (FSCM)
• Requirement to support High Level Operational
Analysis (HLOA) studies
– Force Elements could not be costed using MOD’s
systems
• Designed in 1999. Fully functional 2002.
• It is a high level tool designed to:
– Map Pan-DLoD costs to Force Elements
– Support force structures analysis
– Represent peace time costs
• It is not:
– A budgeting tool
– A tool which identifies and costs specific details of alternative
force structures

19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Major FSCM Inputs
Cost Data Force Structure Data
Equipment Procurement
Asset registers
Programme (EPP)
Equipment Support Service Management plans
Programme (ESP)
UINs
Defence Infrastructure
Organisation (DIO)
Personnel numbers
Personnel costs
Ammunition costs Defence ammo reports
FSCM
19 September 2013
© Crown copyright 2013. Published
with the permission of Dstl on behalf
of the controller HMSO
Illustrative Cost Profiles
Manpower
In-service
Production
Development
Manpower
In-service
Production
Development
Manpower
In-service
Production
Development
19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
FSCM: Highest level
EOD Regiment Astute Class
Type 23 General
Light Infantry
Purpose
DE&S The Red Arrows
DIO Typhoon
19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Uses of the FSCM
• Provide Pan-DLoD cost profiles for capabilities
• Provide EACs for Balance of Investment studies
• Show interdependencies between P9 lines and Force
Elements
• Estimate in-year costs for alternative force structures
• Supported...
– SDSR 10
– 3 Month Exercise
– Other models
– Numerous studies
• Key model within MoD Cost Management Strategy

19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Affordability – Current Capability
• Alternative force structures treated as an input
• In-year force levels adjusted accordingly
• In-year costs estimated through simple extrapolation
• Comparison with different budget scenarios
• Single in-year cost is insufficient for affordability
analysis

19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO
Affordability - Requirements
• A fuller understanding of affordability requires cost
profiles over time

19 September 2013
©© CCrroowwnn ccooppyyrriigghhtt 22001133 . DPsutbl lished
with the permission of Dstl on behalf
of the controller HMSO