2017 Report details for project: Logistics Commodities Services Transformation

Project name: Logistics Commodities Services Transformation - there are 6 reports for this project: 2013, 2014, 2015, 2016, 2017, 2018
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Organisation: MOD (D17) - see all reports for this organisation
Report year: 2017 (data is from Sept 2016)
Category: Military - see all reports for this category
Description: The Logistics, Commodities and Services (LCS) Operating Centre in MOD provides commodity procurement, storage and distribution services for the Armed Forces. The LCS(T) programme is designed to undertake a major reform of the LCS, developing a service of the right size for current military requirements and reducing cost through upgrades to both the inadequate current facilities, and the modernisation of the processes in operation.
DCA (RAG): Amber
DCA text: Notable successes include high Delivery Partner (DP) performance, improved commodity provision, increased operational outload capacity and a successful build of the new Defence Fulfilment Centre. The DP and MOD agreed the Forecast of Expenditure (FE) by the start of Contract Year (CY) 3 on 01 April 2017 Benefits against the MGBC have been eroded through: Firstly reduced demand against the Global Removal & Movement Service (GRMS) contract. Secondly, a slippage in the integration of information systems due to technical challenges. This is under negotiation and DP and will be concluded as part of the FE process. Work continues to develop the strategy to exploit the considerable potential for LCST to deliver further benefit. This is focused on widening the scope of commodity acquisition and inventory management that sits within the LCS(T) contract.
Start date: 2011-08-01
End date: 2018-02-01
Schedule text: As a result of the IS delay, the DP will now reach Full Operating Capability on 31 Mar 19 which is in line with the MGBC 90% confidence date of 5 Apr 19, instead of the 50% confidence date of 01 Jul 18.
Baseline: £92.62m
Forecast: £115.27m
Variance: 24.00%
Variance text: As at 30/09/16 the FY 16/17 forecast included £27m expenditure on the Defence Fulfilment Centre (DFC) that moved from FY 15/16 to FY 16/17. The DFC cost was firm priced so re-profiling from FY 15/16 to FY 16/17 does not impact the overall cost of the project.
Whole Life Cost: £652.44m
WLCost text: As at 30/09/16 the total whole life implementation costs are forecast to be £647m, reflecting a small reduction from the Allocated Budget of £652m. Forecast net benefits over the 13 Year appraisal period of £402m reflect an improvement on the Target net benefits of £336m. However this will be impacted by the IS slippage explained above
Sourcefile: IPA_2017.csv

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