DREW

PAPERS

THE

Gareth Davies

Squadron Leader, Royal Air Force

28

Sovereignty and

Collaboration

Aordable Strategies

in Times of Austerity?
Air University

Steven L. Kwast, Lieutenant General, Commander and President

School of Advanced Air and Space Studies

Thomas D. McCarthy, Colonel, Commandant and Dean
AIR UNIVERSITY

SCHOOL OF ADVANCED AIR AND SPACE STUDIES

Sovereignty and Collaboration

Affordable Strategies in Times of Austerity?

Gareth Davies

Squadron Leader, Royal Air Force

Drew Paper No. 28

Air University Press

Air Force Research Institute

Maxwell Air Force Base, Alabama
Project Editor

Jeanne K. Shamburger

Library of Congress Cataloging-in-Publication Data

Names: Davies, Gareth T. (Gareth Thomas), 1973–author. | Air

 University (U.S.). Press, publisher. | Air University (U.S.). School

 of Advanced Air and Space Studies, issuing body.

Title: Sovereignty and collaboration : affordable strategies in

 times of austerity? / Gareth Davies.

Other titles: Drew paper ; no. 28. 1941-3785

Description: Maxwell Air Force Base, Alabama : Air University

 Press; Air Force Research Institute, 2016. | Series: Drew paper,

 ISSN 1941—3785 ; no. 28 | At head of title: Air University School

 of Advanced Air and Space Studies. | Includes bibliographical

 references.

Identifiers: LCCN 2016029772 | ISBN 9781585662630

Subjects: LCSH: Sovereignty. | International relations—Philosophy.

 | Great Britain—Armed Forces—Procurement. | Armed Forces—

 Procurement—International cooperation. | Balance of power. 

 | World politics—21st century—Forecasting. 

Classification: LCC JZ4034 .D38 2016 | DDC 320.1/5—dc23 

 | SUDOC D 301.26/29:28

LC record available at https://lccn.loc.gov/2016029772

Published by Air University Press in October 2016

Disclaimer

Opinions, conclusions, and recommendations expressed or implied 

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the Air Force Research Institute, Air University, the United States 

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agency. Cleared for public release: distribution unlimited.

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iii

The Drew Papers

The Drew Papers are award-winning master’s theses selected for publication by the School of Advanced Air and Space Studies (SAASS), Maxwell 

AFB, Alabama. This series of papers commemorates the distinguished career 

of Col Dennis “Denny” Drew, USAF, retired. In 30 years at Air University, 

Colonel Drew served on the Air Command and Staff College faculty, directed 

the Airpower Research Institute, and served as dean, associate dean, and professor of military strategy at SAASS. Colonel Drew is one of the Air Force’s 

most extensively published authors and an international speaker in high demand. He has lectured to over 100,000 students at Air University as well as to 

foreign military audiences. In 1985 he received the Muir S. Fairchild Award 

for outstanding contributions to Air University. In 2003 Queen Beatrix of the 

Netherlands made him a Knight in the Order of Orange-Nassau for his contributions to education in the Royal Netherlands Air Forcee.

The Drew Papers are dedicated to promoting the understanding of air- and 

space-power theory and application. These studies are published by the Air 

University Press and broadly distributed throughout the US Air Force, the 

Department of Defense, and other governmental organizations, as well as to 

leading scholars, selected institutions of higher learning, public-policy institutes, and the media.
iv

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v

Contents

List of Illustrations vii

About the Author ix

Acknowledgments xi

Abstract xiii

1 Introduction 1

 2 Sovereignty—Theory 5

The Realist Position 5

The Liberal Position 7

The Academic Position 8

 3 Sovereignty—Policy 13

Ministry of Defence: Collaborative Projects 13

Defence Industrial Strategy White Paper 14

National Security through Technology White Paper 15

 4 Sovereignty—Analysis 19

Categorization 19

Performance 21

Cost 25

Time 27

Causal Factors 29

 5 The Application of Sovereignty 33

Type 45 Case Study: Sovereignty 33

Eurofighter/Typhoon Case Study: Collaborative Development 35

Denmark Case Study: Commerical Off-the-Shelf 36

NATO Alliance Ground Surveillance Case Study:

Pooling and Sharing 38

 6 The Future of Sovereignty 41

Sovereignty or Collaboration? 41

Fears Surrounding Collaboration 43

Policy Implications 45
vi

 7 Conclusion 47

Appendix A Project Data 51

Appendix B Environmental Cost Data 71

Appendix C Causal Factor Data 73

Abbreviations 79

Bibliography 81
vii

Illustrations

Figure

 1 Apportionment of defense expenditure: sovereignty 

 versus collaboration 22

 2 Collaborative projects: distribution of expenditure by

 operating environment, 1999–2013 22

 3 Variation in defense expenditure and sovereign/

 collaborative projects 24

 4 Cost performance: percentage cost change 26

 5 Time performance: variation in ISD by project 28

 6 Causal factors for cost and time performance changes (total) 31

ix

About the Author

Sqn Ldr Gareth Davies joined the Royal Air Force (RAF) in 1996 after 

graduating from Loughborough University with a bachelor’s degree in aeronautical engineering. After completing Initial Officer Training and Basic Flying 

Training, he was posted to RAF Kinloss, Scotland, where he spent six years on 

CXX Squadron as a Nimrod MR2 navigator. During this time he conducted 

operations, in addition to traditional maritime duties, in Afghanistan, the 

Balkans, and Iraq.

In 2005 Squadron Leader Davies was the first non-pilot in the RAF to be 

selected to attend the Empire Test Pilots’ School, where he graduated as a 

flight test engineer. In his next tour at the Air Warfare Centre, he served as a 

trials officer predominantly supporting the purchase of the MQ-9 Reaper and 

the investigation of the use of tactical unmanned aircraft systems in the maritime (Trial Vigilant Viper) and counter-improvised-explosive-device roles.

In 2008 Squadron Leader Davies joined 39 Squadron as a flight commander operating the MQ-9 Reaper in support of operations in Afghanistan. 

Afterward, he completed a tour at the Ministry of Defence as the capability 

desk officer for the Sentinel and RC-135 Rivet Joint. In 2013 he was awarded 

the RAF Spaatz Fellowship and subsequently completed studies at the USAF 

School of Advanced Air and Space Studies at Maxwell AFB, Alabama.

xi

Acknowledgments

The genesis for this project came during my time as a capability desk officer 

in the Ministry of Defence supporting the procurement of the RC-135 Rivet 

Joint for the Royal Air Force. Early on in my tour it became apparent that 

there were many differences between the Rivet Joint and the venerable Nimrod 

R1 that it was replacing. One of the key differences, however, was that the 

Rivet Joint was designed and developed in the United States. Despite the significant operational capability offered by this new platform, detractors and 

opportunists—and there were many—continually pointed to a lack of sovereignty as a key deficiency. But what did this mean? This paper is my humble 

attempt to start to answer that question.

The opportunity to attend the School of Advanced Air and Space Studies 

has been a truly once-in-a-lifetime experience. While this may seem a cliché 

to many, spending a year immersed in texts that I would previously never 

have read and being exposed to the high-quality faculty and students have 

been opportunities that I will be eternally grateful for. In particular, I would 

like to thank Dr. Everett Dolman and Col Richard Bailey, PhD, who have offered 

both guidance and patience during my endeavors. 

Finally, it would be remiss of me not to thank my darling wife. Without her 

enduring humor and support, the experience of the past 12 months would not 

have been possible or as enjoyable. I apologize; all I can offer in return is that 

“I promise it will calm down in October.” 

xiii

Abstract

Sovereignty is the authority of a state to govern itself, the ability to operate 

free from external control. It is a complex and intangible entity that means 

many things to many people. In terms of military procurement, it is the ability 

to develop and operate equipment free from the external constraints of other 

nations. This paper examines sovereignty through the lenses of international 

theory, policy, and practice to determine whether it is an outdated attribute 

during times of austerity and if an alternative—collaboration—delivers on its 

promise of affordability.

The works of realist and liberal economist schools of international relations mark two opposing positions regarding sovereignty and collaboration. 

On the one hand, realists view sovereignty as an integral component of power; 

collaboration, on the other hand, increases dependency and thus dilutes 

power and increases political risk. Liberal economists present the opposite 

view. They believe that combining diverse and specialist national strengths 

raises the collective level of performance. However, defense procurement is 

not a true market economy. Fear of failure necessitates government intervention, and it this involvement that restricts the full benefits of collaboration 

from being realized.

Recent research reveals a rising advocacy for the liberal position, with academics viewing collaboration as a means of addressing funding shortfalls. 

This perspective has been mirrored by the United Kingdom defense policy 

shifting from a protective, mercantile approach to a more liberal exploitation 

of the global defense market. Despite these policy changes, the evidence presented in this study suggests that the retention of sovereignty remains directed 

by more domestic political and commercial considerations. 

Does collaboration improve affordability? From the evidence presented here, 

the answer is a qualified yes. Collaboration certainly offers improved potential 

for short-term affordability but also does not guarantee it. Moreover, evidence 

suggests that in the long term it is a strategy that will only bend, but not break, 

the ever-steepening cost curve of military equipment procurement. For this 

reason, as technological advances continue to diversify national threats and 

opportunities, the question challenging nation-states in the future will not be 

whether to resist collaboration in favor of sovereignty; rather, they must decide 

when to collaborate and what sovereignty to invest in.

1

Chapter 1

Introduction

A horse! A horse! My kingdom for a horse!

—William Shakespeare

Richard III, Act 5, Scene 4

On 22 August 1485 at the Battle of Bosworth Field, King Richard III led the 

last charge of knights in English history. Although their historical validity is 

debatable, Shakespeare’s immortal words capture the essence of the moment: 

a king thrown from his horse and on the verge of defeat. To this day, historians and theater audiences argue whether Richard desired the horse to flee in 

cowardice or to continue to fight to the bitter end; either way he needed a 

horse and, in his desperation, was willing to pay any price to any provider. 

This paper discusses the procurement of military equipment and what price 

nations—particularly the United Kingdom—will pay to retain sovereignty. 

What is sovereignty? The Concise Oxford English Dictionary defines it as 

“supreme power or authority. The authority of a state to govern itself or another state.”1

 From the perspective of procuring military equipment, one can 

interpret this definition in many ways, which can be both ambiguous and 

emotive. As Robert Cox observes, “The changing face of politics means that 

sovereignty is a loose concept. The old legal definitions of ultimate and fully 

autonomous power are no longer meaningful. Sovereignty has gained meaning as an affirmation of cultural identity and lost meaning as power over the 

economy. It means different things to different people.”2

 For example, while 

the Royal Air Force (RAF) declares the collaborative procurement of the RC-135 

Rivet Joint “a vital component of the Nation’s future ISTAR [intelligence, surveillance, target acquisition, and reconnaissance] capabilities,” public opinion 

decries the further jeopardizing of sovereign capability due to its reliance on 

foreign air-refueling tankers.3

 These paradoxical views highlight a developing 

tension for nations between their ability to afford cutting-edge technology 

and their ability to use it at a time and place of national choosing. Central to 

this study are these questions: (1) Has the United Kingdom moved toward 

favoring collaboration over sovereignty? (2) If so, has it improved affordability? 

(3) What, if any, are the nonfinancial costs?

These questions are addressed through a fiscal examination of Britain’s 

purchase of military equipment over the past 15 years. Identifying underlying 

trends and issues for future investments requires particular focus on 
INTRODUCTION

2

sovereign equipment procurement. A review of financial data over the period 

and supporting case studies leads to three interrelated conclusions. First, 

from the perspective of equipment procurement, sovereignty is a complex 

entity. It comes at a price that can be traded in part or in totality through collaborative procurement strategies. In the cycle of design, manufacture, and 

support, reliance on a foreign entity is highly likely. As a result, very few of the 

projects reviewed can claim to be wholly sovereign. Second, from academic 

and policy standpoints, abdication of sovereignty in preference for collaboration has gained increasing prominence as a defensive procurement strategy to 

counter dwindling defense budgets. Finally, collaboration in equipment procurement is only a short-term defensive measure. While financial pressures 

may necessitate its use, the intrinsic self-interest of states demands that sovereignty be a financial burden worth carrying for the long term.

Chapter 2 presents international relations theories highlighting the direct 

link between sovereignty in equipment procurement and national power. In 

practice, sovereignty of equipment is exercised through either operational advantage or freedom of action. Operational advantage is a nation’s ability to 

procure equipment and operate it while freedom of action is its ability to 

choose the time and place for the conduct of combat operations. The chapter 

concludes with a review of recent academic research, which, in summary, 

identifies that increases in the price of military equipment, coupled with decreasing defense budgets, have caused a crisis in the approach toward sovereignty. Many academics conclude that sovereignty is a liberty that nations can 

no longer afford and recommend a shift toward the alternative strategy of 

collaboration. 

Chapter 3 examines key policy documents that have defined the British 

approach toward equipment procurement over the past two decades. Analysis 

of these documents indicates that since 1991 the United Kingdom’s policy has 

shifted markedly away from sovereignty and toward collaboration. Fundamental to this shift in policy are the nation’s attempts to address the increasingly unaffordable nature of complex weapons technology. 

Chapter 4 analyzes data compiled from the National Audit Office (NAO) 

annual major project reports (MPR) from 1999 to 2013 to identify trends in 

cost and time performance for military procurement projects. Specifically 

examined are the cost of sovereignty and whether collaboration delivers on 

its promise of affordability. This analysis shows that, in practice, sovereignty 

in equipment procurement is a complex concept that rarely appears in a pure 

form. In fact, there are shades of sovereignty that may be broadly categorized 

as sovereign, collaborative development, commercial off-the-shelf (COTS), 

and pooling and sharing. Each category yields an element of sovereignty in 
INTRODUCTION

3

favor of collaboration and, importantly, has affordability considerations. Several trends are identified: (1) despite an apparent shift in policy, at the procurement level very little appears to have changed in approaches to sovereignty; (2) collaboration has the potential to improve affordability but does 

not guarantee it; and (3) technological challenges are the key factor for adverse changes in cost and time performance for sovereign and collaborative 

projects alike.

Chapter 5 uses sovereign and collaborative procurement case studies to 

amplify trends identified in chapter 4. Doing so helps explain why sovereignty 

is associated with significant cost increases and why, in some instances, the 

reality of collaboration doesn’t follow the theoretical model detailed in chapter 2. Case studies investigated include the procurement of the Type 45 Destroyer, the development of the Eurofighter/Typhoon, Denmark’s purchase of 

COTS ordnance during the Libyan campaign in 2011, and the effectiveness of 

the North Atlantic Treaty Organization (NATO) Alliance Ground Surveillance (AGS) project.

Chapter 6 considers how the lessons of the past 15 years can be applied to 

future procurement activities. The twin challenges confronting such efforts 

will be the escalation of defense acquisition costs and the erosion of technological advantage due to greater availability of high-end commercial technology. Sovereignty and collaboration will each play central roles in addressing 

both issues. Thus, government policy will need to become increasingly prescriptive regarding collaboration. However, the government must first decide 

what future capabilities are important to its national security. Finally, chapter 7 

offers some final thoughts as well as conclusions based on the study’s analysis of 

NAO data. 

Two key themes run through this paper: the first is that the self-interest of 

states is the driving force in sovereignty. It is this self-interest that undermines 

any attempt to achieve affordability through collaboration. The second is the 

central importance of technology to equipment development. Ultimately, although collaboration may provide an effective means of enhancing a nation’s 

operational advantage, it has significant limitations as a strategic tool for 

managing both short- and long-term affordability challenges. 

As noted, sovereignty in equipment procurement is a complex issue. Modern 

weapon systems employing a “system of systems” approach to engineering 

means that tracing any dependencies on foreign support can be difficult and 

open to interpretation. Using top-level data as presented in the NAO MPRs—

the primary sources for this paper—makes identifying which category of sovereignty an equipment program falls into sometimes problematic. Therefore, 

for the purpose of analysis here, sovereign projects are defined as those that, 
INTRODUCTION

4

in principle, appear to be capable of being developed and operated free from 

the external constraints of other nations. The author fully accepts, and expects, project specialists to draw alternative conclusions for their respective 

projects; such is the complexity of sovereignty. 

Finally, as mentioned previously, financial data from NAO-generated 

MPRs form the backbone of this paper. Although data provided covers a 

period of 15 years and captures the delivery performance of 58 projects totaling 

£90 billion of approved investment, in statistical terms this data pool is still 

relatively limited and specific to the United Kingdom. The projects that the 

NAO selects to feature in the MPRs are those that dominate Ministry of 

Defence (MOD) equipment expenditure. Accordingly, they constitute a 

skewed—but nevertheless important—sample featuring the most complex 

and expensive projects.4

 The conclusions identified in this paper therefore 

cannot be interpreted as statistically significant and should be used only as a 

framework for consideration in future procurement activities. 

Notes

(All notes appear in shortened form. For full details, see the appropriate entry in the bibliography.)

1. Concise Oxford English Dictionary, s.v. “sovereignty.” 

2. Cox with Sinclair, Approaches to World Order, 306.

3. Ministry of Defence, “First Rivet Joint Aircraft Delivered”; and Drury, “Spy Planes Cannot Refuel.” 

4. Kirkpatrick, “MoD Major Project Reports,” 102.
5

Chapter 2

Sovereignty—Theory

Theory then becomes a guide to anyone who wants to learn about 

war from books; it will light his way, ease his progress, train his judgment, and help him to avoid pitfalls.

—Carl von Clausewitz

On War

Sovereignty is the authority of a state to govern itself—the ability to operate 

free from external control. To understand the role of sovereignty in the procurement of military equipment, it is first necessary to understand the portrayal of sovereignty within the context of international relations. The paradigms of international relations are both numerous and varied in their context, 

each likely to provide a different perspective of the problem. The international 

order is typically expressed in two ways: importance of power and importance of institutions.1

 Therefore, for the purpose of this study, the two contrasting theories of neorealism and economic liberalism were selected. Examining sovereignty through the perspective of these two prominent theories 

facilitates understanding not only its relationship to national power but also 

the risks and benefits of the alternative strategy, collaboration.

The Realist Position

Realists assume that anarchy—the absence of a centralized world authority—is 

the overarching constraint of world politics and that power is essential to the 

creation and sustainment of order. Order can take the form of a balance of 

power, where the counterbalance of opposing state powers serves as a restraint and equilibrium of power is a source of stability, or of hegemony, where 

unrestrained preponderance of power provides stability.2

In War and Change in World Politics, Robert Gilpin defines power as the 

economic, military, and technological capability of a state.3

 He argues that 

while “economic growth and demographic change are the most important 

forces underlying international political change,” frequently “the triggering 

mechanism for change may be the major technological, military or economic 

changes that promise significant gains to a particular state or major losses to 

other states in the international system.”4

 Technological and military changes 
SOVEREIGNTY—THEORY

6

manifest themselves in the ability of a nation to deliver operational advantage 

and superior military technology.

John Mearsheimer also highlights the relevance of technology to the power 

of the state. He observes that “great powers not only seek to imitate successful 

practices, they also prize innovation. States look for new ways to gain advantage over opponents, by developing new weapons, innovative doctrine, or 

clever strategy.” However, as Mearsheimer observes, any advantage through 

technology will be temporal in nature because “states do not acquire new 

technologies simultaneously, which means that the innovator often gains significant, albeit temporary, advantages over the laggard.”5

Realists view international politics as a zero-sum game; one nation’s gain is 

another nation’s loss. With this in mind, a realist considers collaboration in 

the procurement of equipment as a compromise in power. According to Kenneth 

Waltz, “States do not willingly place themselves in situations of increased dependence. In a self-help system, considerations of security subordinate 

economic gain to political interest.”6

 In practice, interdependence in equipment procurement manifests itself in heightened risks in both the short and 

long term. In the short term, realist concerns include the following questions: 

(1) In a world of joint supply chains, is a state’s ability to operate the equipment independently of other nations reduced? (2) Do increases in the number of procuring nations correspond to reduced agility in development of 

equipment? (3) How are variations in nations’ requirements resolved? 

Furthermore, the loss of both technical and industrial support bases—one of 

the short-term cost benefits of collaboration—means that reverting to a sovereign option in the longer term is made increasingly unaffordable. The validity 

of these concerns is addressed in the next chapter.

Despite these risks, a realist does not think that collaboration should be 

avoided at all costs. For example, Waltz argues that a sovereign state “decide[s] 

for itself how it will cope with its internal and external problems, including 

whether or not to seek assistance from others, and in doing so limits its freedom by making commitments to them.”7

 Even Machiavelli, who believed that 

“no reliance can be had on arms other than [one’s] own,” found room for collaboration. He advocated collaboration if it were in the self-interest of the 

state and maintained that any agreement would have no moral binding force.8

Overall, realists perceive collaboration as both a necessary evil and a means of 

achieving an end.
SOVEREIGNTY—THEORY

7

The Liberal Position

If realists view collaboration with trepidation, for liberalists, such as Adam 

Smith, it serves as a guiding principle. His seminal work, The Wealth of 

Nations, codified Smith’s ideas and served as a challenge to existing feudal 

and mercantile controls of the late eighteenth century. Mercantilists considered trading with other countries as a zero-sum game whereas Smith believed 

that wealth could be increased through specialization and trading. Smith’s 

argument rested on three principles: (1) the prime psychological drive of man 

as an economic being is self-interest, (2) a natural order exists in the universe 

that makes all individual strivings for self-interest add up to a social good, 

and (3) the best program is to leave the economic process alone—what later 

became known as laissez-faire, economic liberalism, or noninterventionism.9

For Smith, the key to success in the industrial era was through the division 

of labor. Using the manufacture of steel pins as an example, he observed that, 

through division of labor, 10 men produced 48,000 pins in a day. In contrast, 

he noted that the same 10 men, individually, would not have produced 20 

pins—perhaps not even 1 pin—in a day.10 Smith attributed this quantitative 

improvement to increasing dexterity, saving time passing from one task to 

another, and inventing machinery to complete the simplified tasks.11 However, the underlying theme to this growth in production was cooperation. 

Division of labor enabled each manufacturing unit to specialize but introduced dependency on other units to complete the process.

In Smith’s mind, restricting cooperation to the domestic market served as 

restraint on the free market, something he vehemently opposed.12 As he states 

in The Wealth of Nations, “The general industry of a country . . . is certainly 

not employed to the greatest advantage, when it is thus directed towards an 

object that it can buy cheaper than it can make.” However, although Smith 

advocated for an international free market, he did concede that defense was 

an area where protection of domestic industry was acceptable.13 Smith’s latitude for defense was based on his view that “the first duty of the sovereign, 

that of protecting the society from the violence and invasion of other independent societies, can be performed only by means of a military force.”14

Smith also acknowledged that the sovereign’s principal duty is a costly 

business, both in times of war and peace, with technology being one of the 

major cost drivers.15 In the late eighteenth century, Smith regarded the introduction of gunpowder as a technology capable of delivering operational advantage between nations. The advantage came at a financial cost, but he believed that it was a cost worth paying: “In modern war the great expence of 

fire-arms gives an evident advantage which can best afford that expence.”16
SOVEREIGNTY—THEORY

8

David Ricardo identified further benefits of cooperation in the early nineteenth century in his opposition to the Corn Laws, tariffs designed to protect 

the United Kingdom’s corn manufacturing. In his argument, he formulated 

the idea that there can be mutual benefit from international trade. He argued 

that a nation should concentrate on sectors where it had a comparative advantage: the ability to produce one thing at a lower cost than that of producing 

another. By specializing in their comparative strengths, trading nations are 

better able to improve on their collective benefit than if they were to operate 

individually.17 Nations would be at liberty to release limited resources, thereby 

allowing for the collective production of more profitable goods. This argument holds even if one party has an absolute advantage over all of its trading 

counterparts.

The potential benefits offered by a liberal market are, however, somewhat 

restricted by the potentially unique characteristics of the defense market. A 

monopoly exists when a single seller attains “exclusive possession or control 

of the supply or trade in a commodity or service.”18 Monopolies tend to lead 

to markets typified by a lack of economic competition to produce goods or 

services and a lack of viable alternatives. The polar opposite of a monopoly is 

a monopsony—a “market situation in which there is only one buyer” who can 

interface with numerous providers and thereby dictate the market conditions.19 Individually, both monopolies and monopsonies are rare. However, in 

the UK defense industry they exist in tandem, thereby further skewing the 

market away from the theoretical model (see chap. 4). While liberalists espouse the benefits of collaboration, they also recognize that the uniqueness of 

defense procurement may act to limit them. 

The Academic Position

The concept of equipment collaboration has been subject to limited academic research catalyzed on an intermittent basis by NATO conferences. In 

his review of the development of the international system, Aaron Cowley suggests that diminishing sovereignty was part of the natural evolution of the 

international order.20 Cowley reasons that the ability to recognize the value of 

cooperation and employ it robustly ranked among the most valuable traits of 

the human species. Further, human social structures evolved over time to 

help ensure survival and meet other needs. Nevertheless, he also notes that 

the benefits motivating long-term cooperation are often undermined by the 

temptation of defection for short-term gains: “Nations often select the bird in 

hand over two in the bush.”21 As Cowley indicates, the European Union (EU) 
SOVEREIGNTY—THEORY

9

may have been conceived at the Treaty of Westphalia, but it took the painful 

experiences of the Thirty Years’ War and the two world wars to mature to its 

present, still incomplete form. The message is simple: nation-states are driven 

by self-interest, and any compromise in sovereignty is likely to be a product of 

a significant strategic shock as opposed to any voluntary concession. Many 

academics believe that resource pressures imposed on defense spending may 

provide such a shock for the provision of military equipment. The impact of 

the reduction in defense spending from the perspective of procurers and 

manufacturers is discussed next.

In his appraisal of the EU approach to military collaboration, Tomáš 

Valášek states that—barring a few minor military expeditions—no EU government has gone into a “shooting war alone” since the United Kingdom 

fought Argentina in 1982.22 As the tonic to offset decades of inadequate European defense budgets, he identifies pooling and sharing; cooperating more 

closely across borders in the form of common maintenance, training, and 

education; sharing infrastructure; and creating joint units. He also stresses 

that European advances in collaboration have been episodic: “For each partnership many more countries have opted to go it alone, because they fear that 

they may not be able to deploy their shared units, or because they worry about 

the costs.”23 Furthermore, savings through specialization, such as the Estonian effort to coordinate NATO’s studying of cyber threats, is largely negated 

by the desire of many governments to retain or develop a national capacity.24

The struggle to retain national capacity also resonates in Thomas Overhage’s analysis of European military capabilities. In the wake of the 2010 

banking crisis and the Libyan campaign in 2011, Overhage describes nations 

being caught by a “defense interest trilemma” in which security, sovereignty, 

and resource efficiency each receive differing emphasis as a result of overriding national, political, and strategic culture. He argues that domestic pressures, such as the media, lead to a “short term, emotional, reactive definition 

of national interest.” As a result, nations like France and the United Kingdom 

seek to “to preserve the full range of military capabilities” while retaining the 

ability to “conduct combat operations at a time and place of national choosing.”25 Additionally, as each nation struggled to restructure its military following the 2010 banking crisis, it was evident that cost savings were very much 

sought at a national level and did not reflect wider European coordination or 

cooperation.26

Giovanni Faleg and Alessandro Giovannini observe that a lack of coordination had extended to the European defense market, which they viewed as 

being characterized by the presence of a multitude of national industries, each 

with its own forms of protection and related national interests.27 They point 
SOVEREIGNTY—THEORY

10

out that “member states usually design procurement specifications with the 

implicit purpose to contract national defence manufacturing industries, and 

maintain in this way the complete sovereign control of the national knowledge 

in defence production.”28 Faleg and Giovannini conclude that as emerging nations seek to turn their economic strengths into a force-projection capacity, collaboration might be essential if defense industries are to remain competitive. 

Their recommendations take three forms: first, expanding the collaboration 

shown in the air and space sector to the land and maritime domains; second, 

agreeing on long-term strategic priorities for collaborative groups to focus research and development (R&D); and finally, following Ricardo’s theory of mutual gains through specialization leading to more efficient, cost-effective, and 

better integrated militaries. In reality, as Cowley suggests and as chapter 4 indicates, the temptation of nations to exploit short-term gains and their reticence 

to concede sovereignty often undermine such mitigations. 

International relations theorists agree that sovereignty in defense procurement is a necessary component of national power and something that should 

be retained—but not at any cost. Recent academic research on the procurement of military equipment generally supports collaboration—perceived as a 

potential remedy to the paradoxical stranglehold of spiraling equipment costs 

and dwindling defense budgets. The cost of such a strategy, however, is the 

sacrifice of sovereignty. By promoting greater interdependence, nations attempt to address short-term affordability issues at the expense of long-term 

independence. 

Chapter 3 reviews the United Kingdom’s procurement policy for major 

military equipment over the past 15 years. Analysis addresses whether the 

United Kingdom is following the evolutionary cycle described by Cowley and 

whether recent financial constraints have created sufficient shock to trigger 

increased collaboration, as other academics suggest. 

Notes

1. Ikenberry, After Victory, 10.

2. Ibid., 24.

3. Gilpin, War and Change, 13.

4. Ibid., 55.

5. Mearsheimer, Great Power Politics, 163, 231.

6. Waltz, Theory of International Politics, 107.

7. Ibid., 96.

8. Machiavelli, Art of War; and Nardin and Mapel, Traditions of International Ethics, 68.

9. Smith, Wealth of Nations, viii.

10. Ibid., 5.

11. Ibid., 7.
SOVEREIGNTY—THEORY

11

12. Henderson, Concise Encyclopedia of Economics, s.v. “Adam Smith,” 591. 

13. Smith, Wealth of Nations, 424, 429.

14. Ibid., 653.

15. Ibid., 668.

16. Ibid., 669.

17. Henderson, Concise Encyclopedia of Economics, s.v. “David Ricardo.”

18. Concise Oxford English Dictionary Online, s.v. “monopoly,” accessed 24 February 2016, 

http://www.oxforddictionaries.com/us/definition/american_english/monopoly.

19. Ibid. 

20. Cowley, “Evolution of the International System,” 3.

21. Ibid., 117.

22. Valášek, Surviving Austerity, 1.

23. Ibid., 8.

24. Ibid., 40.

25. Overhage, Less Is More, 19, 58, 63.

26. Ibid., 62. 

27. Faleg and Giovannini, Pooling and Sharing, 11.

28. Ibid., 13.

13

Chapter 3

Sovereignty—Policy 

Over the past two decades, the key policy directives regarding UK equipment sovereignty and collaboration were the 1991 NAO-sponsored report 

Ministry of Defence: Collaborative Projects; the 2005 Defence Industrial Strategy

(DIS) white paper; and the 2012 National Security through Technology white 

paper. The MOD’s performance in executing these policies can be measured 

through the MPRs presented to Parliament annually. The reports detail cost 

and time performance of the largest defense projects that the department has 

chosen to invest in. The United Kingdom’s approach to sovereignty over past 

decades in terms of policy and practice is described next. 

Ministry of Defence: Collaborative Projects

Published in February 1991, the NAO-sponsored report on the MOD’s collaborative projects examined the approach toward equipment collaboration 

based on the leading 10 collaborative projects.1

 Regarding collaboration and 

the widening opportunities for purchasing from overseas, the report detailed 

three key findings that were to feature prominently in equipment procurement over the coming decades. 

First, subject to an overall policy of obtaining maximum value for money 

spent, the report expected “most significant new equipment developments to 

be collaborative.” The NAO identified the following potential advantages offered by collaborative projects: cost savings compared to national alternatives, 

interoperability with allies, and in-service support savings through centralized spares holdings.2

 Disadvantages identified included the effect of collaborative factors manifesting in the delay of project timescales, issues with the reconciliation of cost/work share with national objectives, constraints placed on 

the nation’s freedom to withdraw, and the impact of withdrawal by other nations.3

 Simply put, the report forecast increasing tension in the role of sovereignty: operational advantage—access to cutting-edge equipment and 

technology—would necessitate increased interdependence with other nations.

Second, after reviewing project performance from 1984 to 1988, the NAO 

concluded that a lack of common equipment requirements and timescales 

created difficulties for collaboration.4

 Furthermore, the report highlighted 

considerable differences in the collaborative expenditure of each operating 

environment. Whereas the air environment appeared to embrace partnership 
SOVEREIGNTY—PARTY

14

with other nations by apportioning approximately one-third of its budget to 

collaborative projects, both land and maritime environments were more 

reticent—each apportioning less than 5 percent of its expenditure to cooperative projects. The prime reason cited for the difference in approach to collaboration was air’s propensity for having “more expensive and technologically 

complex equipment where development costs account for a relatively high 

proportion of total procurement costs.”5

 Thus, this 1991 report portrayed collaboration as an unfavorable strategy that both maritime and land components could afford to avoid due to their relatively low project costs.

Finally, and perhaps most importantly, NAO analysis suggested that collaboration yielded higher production costs than those of sovereign projects.6

The NAO acknowledged that this conclusion was somewhat unexpected as 

one of the key assumptions of collaboration is its reduction of costs through 

shared nonrecurring costs and economies of increased scale in production. It 

pinpointed numerous projects where the benefits of increased scale were undermined by disparate national strategies, such as standardization of equipment 

and in-service support.7

 Despite this observation, the NAO generally supported collaborative projects because it expected increases in production 

costs to be offset by savings generated by collaborative R&D.8

 Giovannini and 

Faleg echo this view in their report on the future of the European defense 

market.9

 The NAO noted some significant limitations that national policies 

placed on collaboration and indicated the difficulties that would need to be 

addressed if it were to achieve its full potential. In essence, the NAO had observed that sovereignty was stopping the full benefits of collaboration from 

being realized.

Defence Industrial Strategy White Paper

In 2005 the United Kingdom issued the DIS white paper identifying future 

defense requirements and, for the first time, detailing the industrial capabilities needed to ensure that equipment could be operated in a manner consistent with national choosing.10 Sovereignty represented one of three strategic 

themes in the DIS, which identified a direct link between the through-life 

sovereignty of military equipment and national security. The DIS prescribed 

measures to protect all phases of development—from R&D, through manufacture, to the retention of test and evaluation capability—for every sovereign 

industrial sector. The strategy aimed for the UK government to work with its 

onshore industry to develop an affordable, competitive, and sustainable industrial base.11
SOVEREIGNTY—PARTY

15

The DIS was not, however, simply a protectionist measure to support all 

UK industry. Instead, it introduced the term appropriate sovereignty, defined 

as “the appropriate degree of sovereignty over industrial skills, capacities, capabilities and technology to ensure operational independence against the 

range of operations that [the United Kingdom] wish[es] to be able to conduct.” For example, the DIS rejected previous directives that the United Kingdom retain an absolute sovereign capability to build warship hulls onshore, 

but it recognized the need to retain some capability to maintain competence 

in warship design, integration, and development.12 In essence, the DIS acknowledged the increased benefits of global competition but also directed governmental intervention to prevent the disappearance of indigenous capabilities 

required to maintain national security. It represented the government’s clear 

statement regarding its limits for conceding national sovereignty.

National Security through Technology White Paper

In February 2012, the MOD released its National Security through Technology 

white paper establishing the procurement policy for defense and security 

needs to meet the vision of Future Force 2020.

13 In replacing the DIS as a policy 

document, the white paper represented a significant shift in government policy 

for equipment sovereignty. If sovereignty were a focal feature of DIS, it was 

conspicuous by its relative absence. The white paper in effect signaled a move 

away from prescriptive measures to protect sovereignty. One possible cause 

for this policy shift was the emphasis placed on the newly elected coalition 

government that debt reduction was the national security priority. The coalition government implemented a reduction in defense spending of 12.24 percent in real terms from 2008 to 2015.14

The government acknowledged concerns about the policy change but argued that “at a time of constrained budgets and unpredictability of threat,” it 

was appropriate to clarify the “understanding of what operational advantages 

and freedom of action [the government] need[s] to protect.”15 Whereas the 

DIS directed detailed activities for each industrial sector to protect sovereignty, the white paper simply presented a broader list of concepts that could 

be traded upon at risk. The United Kingdom’s position on the sovereignty of 

military equipment was now open to interpretation.

The white paper introduced two means of defining sovereignty: freedom of 

action and operational advantage. Freedom of action was defined as “the ability to 

determine internal and external affairs and act in the country’s interests free 

from intervention by other states or entities, in accordance with [its] legal 
SOVEREIGNTY—PARTY

16

obligations.” While this definition may not have differed greatly from the 

views offered by theorists such as Machiavelli or Adam Smith, the white paper 

did introduce a key caveat. Despite freedom of action being essential to 

national sovereignty, it would not be bought “at any cost.” Operational advantage was defined as “the ability to find and maintain an edge over potential 

adversaries.”16 The white paper identified long-term investment as key to obtaining, and maintaining, operational advantage involving military equipment and technology. In a world of finite resources and rapidly evolving 

threats, the need for long-term investment presented the United Kingdom 

with a particularly challenging strategic choice: in which capability area 

should it invest?

The white paper listed four broad capability areas where sovereignty would 

be protected. The first situation involves any capability considered fundamental 

to the freedom of action of the nation—for example, cryptography. A second 

case occurs when a supplier might need access to classified material—for instance, a provider of support to the propulsion and weapon system of the 

United Kingdom’s national deterrent. The third circumstance takes place if 

the capability were considered essential to deliver an assured capability to 

respond—for example, the ability to maintain and update defensive aid suites 

at a sufficiently responsive tempo to support military operations. Finally, sovereignty would be protected for a capability considered key to delivering operational advantage, therefore requiring a high confidence in performance. 

The need to protect sovereignty in critical situations ultimately meant investing in personnel to maintain subject-matter expertise to retain the United 

Kingdom’s position as an intelligent customer.

The white paper’s reduced prominence of sovereignty contrasted with a 

corresponding heightened stress on collaboration. The document advocated 

bilateral collaboration for offering “the best balance of advantages and disadvantages.” The United Kingdom also committed to wider European and 

NATO collaborative efforts, in particular NATO’s Smart Defence initiative 

emphasizing pooling and sharing to fill key capability gaps.17 This dramatic 

shift in emphasis can be traced to perhaps the key theme in the white paper: 

affordability.

At the time of issuing the white paper, the UK government was confronted 

with the major challenge of delivering an affordable strategy for national 

security. Despite having, at the time, the fourth largest defense budget in the 

world, the UK government still considered it insufficient means to face an 

increasingly capable and diverse range of threats.18 In response, the United 

Kingdom promoted a more liberal approach to defense procurement: using 
SOVEREIGNTY—PARTY

17

the open competition of the global defense market to obtain “products that 

are proven, that are reliable, and that meet our current needs” (emphasis added).19

 The “new approach” to procurement directed by the white paper placed 

primacy on COTS products while protection of sovereignty was relegated to 

the final consideration. From a policy standpoint, the United Kingdom adopted an increasingly liberal position and, in line with the academic analysis, 

sought to balance the “potential benefits of taking a particular acquisition 

approach for a specific defence or security capability against the possible risks 

to [its] freedom of action.”20 The question remains, however, whether collaboration is the proverbial “maiden’s prayer” or is more a case of achieving shortterm savings at the expense of long-term security. Chapter 4 compares the 

recent UK experience with collaborative versus sovereign projects in an effort 

to identify if collaboration is really an affordable alternative to sovereignty. 

Notes

1. Great Britain National Audit Office, Collaborative Projects. 

2. Ibid., 1, 13.

3. Ibid., 13.

4. Ibid., 9.

5. Ibid., 8.

6. Ibid., 13.

7. Ibid., 15.

8. Ibid., 1–13.

9. Faleg and Giovannini, Pooling and Sharing. 

10. Great Britain Ministry of Defence, Defence Industrial Strategy, 2. 

11. Ibid.

12. Ibid., 17, 70.

13. Ibid., 5.

14. Great Britain Ministry of Defence, Joint Concept Note 3/12, Air Space Operating Concept, 1–8.

15. Great Britain Ministry of Defence, National Security through Technology, 6.

16. Ibid., 26.

17. Ibid., 8, 32.

18. Ibid., 8.

19. Ibid., 6.

20. Ibid., 27.

19

Chapter 4

Sovereignty—Analysis

The primary source of evidence used in this paper to determine the performance of equipment projects is the National Audit Office’s annual major projects 

reports. The NAO is independent of the British government and is responsible to Parliament, under the direction of the comptroller and auditor general, for the scrutiny of public spending. The comptroller and auditor general 

have statutory authority to report to Parliament on whether departments 

have used their resources effectively, efficiently, and with economy. Each year 

they present to Parliament data on the cost, time frame, and performance of 

the 16 largest (by cost) defense projects in which the MOD has chosen to invest. They are known as post-main-gate projects, and the data is presented in 

the form of an MPR.1

Although the MPR is only a snapshot of the major projects, Parliament 

considers the volume of expenditure sufficient to serve as a reliable indicator 

of wider performance of MOD procurement. For example, the MPR 2012 accounted for £19.5 billion of equipment procurement and served as a foundational document for assuring Parliament of the MOD’s ability to “balance 

prudent financial management with meeting the capability needs of the 

armed forces.”2

In compiling the MPR, project managers submit a project summary sheet 

(PSS) detailing the performance of the project during the previous reporting 

period. Data included in the PSS includes the original approval for the project 

in terms of both cost and time and the forecast for the project entering into 

service as defined by the in-service date (ISD). The ISD is normally a point at 

which the Front Line Command accepts that the equipment is capable of 

meeting the majority of key user requirements. Comparing these values 

makes it possible to determine changes to both the cost and time performance 

for each project.

Categorization

The PSS also has a summary of the project procurement route. For the 

purpose of this paper, these summaries are used to categorize the level of sovereignty attributed to the project. Analysis of the PSSs shows that equipment 

procurement may be categorized in four ways, which in decreasing levels of 
SOVEREIGNTY—ANALYSIS

20

sovereignty are sovereign procurement, collaborative development, COTS, 

and pooling and sharing.

Sovereign procurement enables the United Kingdom to exploit its own 

technology and resources to design, manufacture, and maintain equipment. 

In theory, these conditions allow it to both operate autonomously of other 

nations’ approvals and have the technological and industrial infrastructure to 

develop any follow-on program. In practice, where a system-of-systems approach is used to deliver highly complex military weapon capability, it is very 

difficult to determine whether a system has some reliance on a foreign entity 

at a subcomponent level. For example, consider the procurement of six Type 

45 destroyers. The Type 45 was designed, manufactured, and operated as a 

sovereign asset, but its Principal Anti-Air Missile System (PAAMS) is a collaborative project with France and Italy. For the purpose of this analysis, sovereign projects are judged as those intended to be developed and operated free 

from the external constraints of other nations. In the instance of the Type 45, 

according to this definition, it is judged to be a sovereign platform despite the 

presence of the PAAMS.

Under collaborative development, the United Kingdom acts in partnership 

with other nations to design and manufacture equipment while each procuring nation continues to meet maintenance costs. As reflected in the 1991 

NAO review on collaboration, sharing of the design and development processes 

necessitates an alignment of capability requirements among the procuring 

nations.3

 Any compromise in capability requirements needed to produce a consensus can be construed as a reduction in operational advantage and therefore 

a reduction in sovereignty. UK involvement in the Eurofighter/Typhoon program is an example of collaborative development.

COTS acquisition sees the procuring nation divorce itself from the design 

and development phase of the project to decrease delivery times and increase 

cost efficiency. COTS procurement has been used increasingly over recent 

years, particularly in meeting deliveries against urgent operational requirements for Iraq and Afghanistan. The United Kingdom’s procurement of C-17 

transport aircraft from the United States is an example of COTS procurement. 

The categorization of COTS includes the procurement of existing equipment 

that is modified, prior to entering service, to meet specific capability requirements. For example, the Panther command and liaison vehicle is based on an 

Italian Iveco-designed vehicle and was subsequently upgraded to UK specifications by BAE Land Systems.4
SOVEREIGNTY—ANALYSIS

21

Pooling and sharing occurs when the dependency for the delivery of the 

capability is transferred completely to another country or organization in return for either funds or alternative capability. Elements of pooling and sharing 

are present in collaborative development as well as in COTS procurement—

the resources of other nations may be used in both the design and development phases of manufacture. For the purpose of this paper, pooling and sharing is defined as the provision of full military capability in lieu of financial 

contributions. Although no projects were listed as pooling and sharing in the 

MPR 2012, in chapter 5 the NATO collaborative procurement of Global Hawk 

is used as a mechanism to identify some of the benefits and issues surrounding this type of procurement. A full list of the categorizations applied to each 

project is detailed in appendix A.

Performance

Next, we consider whether the United Kingdom’s defense procurement has 

followed, in practice, the policy changes described in the last chapter. To make 

this determination, we initially examine the differences between sovereign 

and collaborative projects in two ways. First, the variation between forecast 

and actual expenditure is compared with corresponding observations made 

in a 1991 NAO audit on collaborative projects. Thereafter, the variation in the 

total number of sovereign and collaborative projects detailed in MPRs from 

1999 to 2013 is analyzed. Comparing these sets of data enables identifying a 

potential disconnect between the United Kingdom’s policy and the procurement practice surrounding sovereignty. 

Using the categorization described previously, it is possible to determine 

the variation in approved expenditure between sovereign and collaborative 

projects. Data detailing the variation in expenditure is detailed in appendix A 

and summarized in figure 1.5

 During the period 1999–2013, collaborative expenditure outweighed its sovereign counterpart by a ratio of two to one. A 

similar comparison, conducted by the NAO in 1991, determined that this 

ratio was previously three to one in favor of sovereign expenditure, suggesting 

a marked shift toward collaborative procurement over the past 15 years. Such 

a conclusion, particularly when placed in the context of increasing fiscal pressure on defense expenditure, appears supportive of academic theories that 

collaboration is a safe port in times of fiscal austerity. However, increasing the 

granularity of analysis to consider defense procurement at the environmental 

levels of air, land, and maritime reveals other factors at work. 
SOVEREIGNTY—ANALYSIS

22

Collaborative

(Development and COTS)

Sovereign

1984—1990 1999—2012

Figure 1. Apportionment of defense expenditure: sovereignty versus collaboration

Data detailing the distribution of expenditure by operating environment for the 

period 1999–2013 is detailed in appendix B. As summarized in figure 2, procurements in the air domain accounted for 94 percent of all approved collaborative expenditure. In contrast, only one maritime collaborative investment—the procurement of extremely high frequency / superhigh frequency satellite communication 

terminals for selected submarines at an approved cost of £290 million—featured in 

the MPRs during the period. Similarly, in 1991 the NAO highlighted disparities in 

the approach each operating environment took toward collaboration: in 1987 air 

systems accounted for 95 percent of all collaborative expenditure while collaborative investment in sea systems was reported to be “very low.”6

Air

Land

Maritime

Figure 2. Collaborative projects: distribution of expenditure by operating environment, 1999–2013
SOVEREIGNTY—ANALYSIS

23

Analysis by operating environment expenditure appears to counter the 

conclusion that a shift toward collaboration has occurred and suggests that in 

over two decades very little has changed for the United Kingdom in terms of 

the application of collaborative strategies. That is, the air domain remains 

positive in its approach to collaboration while land and maritime domains 

remain reticent. Resolving this apparent conflict in conclusions requires introduction of a third comparison: the variation in total numbers of sovereign 

and collaborative projects.

Analyzing approaches to procurement through apportionment of expenditure alone may introduce a form of selection bias. Military procurement, in 

particular for the air environment, is dominated by high-unit-value specialist 

projects. Inclusion of a few relatively high-cost projects in the data, such as the 

Typhoon and Joint Strike Fighter—both of which occur during the period—

may obscure any trends offered by more numerous, yet relatively cheaper, 

projects. The variation in numbers of collaborative and sovereign projects is 

considered to address this potential bias. Although such data was not available 

for the period from 1984 to 1990, it is possible to trace fluctuations in procurement practices from 1999 to 2013. While such analysis is not supported 

by sufficient data to be statistically significant—the number of projects represented in each MPR is limited to approximately 16—it does offer an alternative 

insight into trends during the period. 

Figure 3 illustrates the variation in the numbers of sovereign and collaborative projects featured in MPRs from 1999 to 2013. It also depicts the variation in defense expenditure over the same period. A steady increase in expenditure, attributed to commitment to campaigns in Afghanistan and Iraq, 

is marked by a significant decline following the release of the House of 

Commons Defence Committee’s Strategic Defence and Security Review

(SDSR) in 2010.7

Figure 3 also shows that the number of sovereign projects featured in the 

MPR each year varied between 7 and 13 during the period, reaching its apogee 

in 2007. By contrast, the number of collaborative projects varied between 5 

and 9 and never exceeded that of their sovereign counterparts. Interpreting 

the data across the period makes it possible to conclude that the average number 

of sovereign and collaborative projects remained steady at 10 and 7, respectively. These trends further support the assertion that little has changed in the 

United Kingdom’s approach to sovereignty when investing in military equipment. If true, this assertion raises two further questions: (1) Why has the 

promise of increased collaboration not been realized? (2) Why does the apportionment of military expenditure suggest otherwise (see fig. 1)? Three 

possible factors can be used to explain these apparent anomalies.
SOVEREIGNTY—ANALYSIS

24

50

45

40

35

30

25

20

15

10

5

0 0

2

4

6

8

10

12

14

16

18

20

UK Defence Expenditure £(Bn)

Number of Projects

Year

Sovereign

Collaborative

Defence Spending

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Figure 3. Variation in defense expenditure and sovereign/collaborative projects

First, collaboration opportunities may simply not have arisen. As the NAO 

noted in 1991, sovereign equipment requirements need to align with those of 

other nations for collaboration to occur. Further, as the Type 45 case study 

(chap. 5) highlights, opportunities that do arise are usually undercut by misaligned national capability requirements, spending limitations, and workshare agreements. Second, the effect of reduced defense spending may not yet 

have been manifested in procurement trends. The average procurement 

period for the MPR 2012 projects was 10 years.8

 Therefore, current reporting 

may partially reflect a legacy approach toward sovereignty. In this instance, 

the relative shift toward collaboration shown from 2009 could be interpreted 

as the beginning of a long-term trend. This explanation is, however, undermined by the fact that a similar pattern of change also occurred between 2003 

and 2006; furthermore, this shift predates both the cost cuts of the 2010 SDSR

and the 2011 National Security through Technology white paper. Finally, a high 

level of investment in air platforms—such as Typhoon, Rivet Joint, A-400M, 

and the Future Strategic Tanker—occurs during the period of analysis.

Considering all these factors, this paper maintains that the shifting expenditure merely reflects a relatively high investment in air platforms during the 
SOVEREIGNTY—ANALYSIS

25

period (fig. 1). By extension, it concludes that, despite marked changes in policy 

in 2005 and 2013, the United Kingdom’s approach to collaboration has not 

changed accordingly. 

Why has there been such resistance to exploiting the perceived benefits of 

collaboration? One answer could be legacy institutional bias against the compromise of state sovereignty at the project level. For example, realizing the full 

cost benefits of collaboration would require closing state infrastructure, such 

as shipyards. In terms of sovereignty, such drastic measures would take generations to redress. Of note, nowhere in the data analyzed was a sovereign 

project initiated to replace a capability previously provided by collaboration. 

An alternative motive could be that the perceived cost benefits attributed to 

collaborative projects have simply not materialized. In 1991 the NAO hinted 

that the cost benefits of collaboration might not be as clear-cut as intuition 

would suggest.9

 These theories are examined next through comparing the 

cost and time performance of collaborative and sovereign projects.

Cost

The through-life variation of project costs was compared by using PSS data. 

A detailed breakdown of project costs is presented in appendix A. Figure 4 

shows the variation of percentage project costs according to class of sovereignty 

as defined earlier in this chapter. The cost approvals featured in the PSSs range 

from £17 billion (Eurofighter/Typhoon) to £200 million (Soothsayer). Therefore, percentage costs, in terms of initial approval versus final delivery cost, have 

been used in an attempt to normalize the total cost variations. Analysis of the 

data in figure 4 provides two differing conclusions regarding the influence that 

sovereignty and collaboration have on project costs. 

First, 15 of the 31 sovereign projects analyzed experienced some form of 

cost growth during their manufacture. On average, this cost growth translated into an increase in sovereign project costs of 5 percent over their initial 

approvals. Furthermore, sovereign projects exhibited a trend of year-on-year 

cost growth, particularly in the lead-up to a capability entering service. In 

some cases—particularly for larger sovereign projects—these incremental increases manifested into significant, almost unbounded cumulative cost 

growth. Procurement of the Astute-class nuclear submarines and Queen Elizabeth–

class aircraft carriers provides such an example: project costs exceeded 50 

percent of their original funding approval. Conversely, of the 16 sovereign 

projects delivered under budget, the majority produced savings of less than 5 

percent. Only the contracts to provide precision-guided bombs and a land-support 
SOVEREIGNTY—ANALYSIS

26

vehicle were delivered for more than 20 percent below the expenditure initially approved. In both instances, the savings were a result of MOD departmental program management as opposed to efficiencies of the projects.

Naval high-frequency (HF) comm Guided multiple-launch rocket system (GLMRS) Multi-role armoured vehicle (MRAV) Next-generation light anti-armoured weapon Precision-guided bomb Support vehicle Panther command & control vehicle Successor Identification Friend or Foe (IFF) Joint combat aircraft (JCA) Tactical Recon Armoured Combat Equip. Requirement (TRACER) Trojan & Titan Falcon comm system Combat infrastructure platform (CIP) Light forces anti-tank weapon AH-64 sensor Advanced jet trainer Skynet 5 Merlin HM Mk3 CASTOR (Storm Shadow) Landing platform dock (LPD) replacement Puma Life Extension Landing ship dock (auxiliary) (LSD[A]) Watchkeeper Future strategic tanker aircraft (FSTA) Bowman comm systemC-17 Merlin HM Mk1 Sustainment C-130J C Vehicle capability Beyond-visual-range air-to-air missile (BVRAAM)

Advanced short-range air-to-air missile (ASRAAM) Seawolf mid-life upgrade (MLU) AH-64 Chinook Airseeker

Tornado GR4 MLU High-velocity missile system

TRIGAT medium-range anti-tank weapon

Challenger II tanks

Warrior capability sustainment program (CSP)

Airborne stand-off radar (ASTOR)

Terrier armoured digger

Typhoon future capability package (FCP)

Trafalgar-class & Swiftsure-class submarine update Eurofighter (Typhoon) Advanced air-launched anti-armour weapon (AAAW) (Brimstone)

Astute class (4) Type 45 destroyer A400M

Nimrod MRA4 Merlin HM Mk 1 maritime helicopter Extended-range ordnance

Soothsayer electronic warfare program Astute class (1-3) Queen Elizabeth class

Percentage Cost Change 

Sovereign 

Collaborative Development

COTS

-40.0 -20.0 0.0 20.0 40.0 60.0 80.0

Figure 4. Cost performance: percentage cost change

Second, compared to the cost performance of their sovereign counterparts, 

that of collaborative projects was more stable in terms of both net performance and profile. Of the 22 collaborative projects observed, only 5 were 

delivered for a cost greater than their initial approval—all of which were 

collaborative development. Collaborative projects, on average, completed 

delivery of their equipment into service at a cost of 5 percent less than their 

initial approval; COTS projects in particular showed a propensity for delivering on budget (fig. 4). Furthermore, in general, collaborative projects did not 
SOVEREIGNTY—ANALYSIS

27

exhibit the gradual, and in some cases unbounded, increase in costs that 

featured significantly in the sovereign projects. 

There are, however, some exceptions to the observation that collaborative 

projects helped bound cost growth. Indeed, in some instances, the cost performance of collaborative development projects bore remarkable similarities 

to their sovereign counterparts. Of the five projects that experienced cost 

growth, two of them (Airbus A400M Atlas transport aircraft and Merlin HM 

Mk1 maritime helicopter) grew in excess of 30 percent. While data availability 

precludes analysis of Merlin HM Mk1 project profiles, the A400M experienced 

a 34 percent increase in cost over a four-year period—an experience mirroring 

the sovereign submarine and aircraft carrier projects. 

Analysis of cost performance suggests two key benefits for collaborative 

projects. First, collaboration appears to bound total costs. Over the period, a 

10 percent net difference occurred in the cost performance of collaborative 

projects over that of their sovereign counterparts. Second, in general, collaborative projects exhibited a fairly steady cost profile throughout the manufacturing 

period. The MPR 2012 noted that changing cost profiles created “turbulence 

and uncertainty for the Equipment Plan, reducing the [MOD’s] ability to plan 

and manage the defence budget effectively.”10 Therefore, the stable cost profiles shown by collaborative projects should support capability planning. Although these findings appear to support the academic premise that collaboration is an effective cost-saving measure, the evidence presented shows that 

this rule is not absolute. The performance of the A400M demonstrated that 

collaboration does not guarantee a project’s protection from the spiraling cost 

increases observed in some sovereign projects. Furthermore, comparing projects 

against their ISDs reveals a less favorable record of collaborative projects.

Time

For the purpose of this paper, ISD is the parameter used for measuring 

the time performance of equipment programs. A summary of the variation 

between the ISD initially forecast and that actually achieved is presented in 

figure 5. The overriding impression of that figure is similarity in the timeliness 

of sovereign and collaborative projects. Both experienced significant delays in 

delivering equipment, with sovereign and collaborative projects suffering 

average delays of 22 and 17 months, respectively. 
SOVEREIGNTY—ANALYSIS

28

Percentage Cost Change 

n 

-40.0 -20.0 0.0 20.0 40.0 60.0 80.0

Naval high-frequency (HF) comm Guided multiple-launch rocket system (GLMRS) Multi-role armoured vehicle (MRAV) Next-generation light anti-armoured weapon Precision-guided bomb Support vehicle Panther command & control vehicle Successor Identification Friend or Foe (IFF) Joint combat aircraft (JCA) Tactical Recon Armoured Combat Equip. Requirement (TRACER) Trojan & Titan Falcon comm system Combat infrastructure platform (CIP)

Light forces anti-tank weapon

Advanced jet trainer

Skynet 5 Merlin HM Mk3 CASTOR (Storm Shadow)

Puma Life Extension

Watchkeeper Future strategic tanker aircraft (FSTA)

Bowman comm system C-17 Merlin HM Mk1 Sustainment C-130J C Vehicle capability Beyond-visual-range air-to-air missile (BVRAAM)

Advanced short-range air-to-air missile (ASRAAM) Seawolf mid-life upgrade (MLU) AH

AH-64 sensor

-64 Chinook Airseeker

Tornado GR4 MLU High-velocity missile system

TRIGAT medium-range anti-tank weapon

Challenger II tanks

Warrior capability sustainment program (CSP)

Airborne stand-off radar (ASTOR)

Terrier armoured digger

Typhoon future capability package (FCP)

Trafalgar-class & Swiftsure-class submarine update Eurofighter (Typhoon) Advanced air-launched anti-armour weapon (AAAW) (Brimstone)

Astute class (4) Type 45 destroyer A400M

Nimrod MRA4

Merlin HM Mk 1 maritime helicopter

Extended-range ordnance

Soothsayer electronic warfare program Astute class (1-3)

Queen Elizabeth class

Sovereign

Collaborative Development

COTS

Landing platform dock (LPD) replacement

Landing ship dock (auxiliary) (LSD[A])

Figure 5. Time performance: variation in ISD by project

Sovereign projects delivered early were outnumbered by a ratio of two to one 

against those delivered late. Furthermore, at least five projects—including the 

later-cancelled Nimrod MRA4 Maritime patrol and attack aircraft—experienced 

delays in excess of three years. In a similar comparison, collaborative projects 

fared little better; again, there were more late than early deliveries—12 to 5, respectively. Four projects—including the subsequently cancelled TRIGAT 

medium-range anti-tank weapon—incurred delays in excess of three years. 

As with cost performance, COTS procurements tended to be delivered according 

to schedule. Chapter 5 provides some balance to the generally favorable 

view of COTS presented so far by highlighting the political limitations of such 

an approach. 
SOVEREIGNTY—ANALYSIS

29

One discrepancy in the perceived similarities in time performance between 

sovereign and collaborative projects lies in the associated costs and management of any delays. When equipment is delivered late, the MOD is generally 

forced to accept a capability risk associated with retaining older equipment in 

service to cover for the delay to new equipment. In some instances, additional 

costs are incurred for updating existing equipment to extend its service life. A 

2009 Royal United Services Institute (RUSI) report highlights MOD inconsistencies in reporting secondary costs such as erosion of operational benefit, 

added costs of continuing to operate predecessor equipment, and disrupted 

manpower and training. The report went so far as to state that “some MOD 

project offices virtually ignore the financial and operational penalties of delay.”11 As a specific example, the RUSI speculates that because Typhoon’s outof-service date was dictated by its predicted obsolescence against hostile air 

defense systems, its loss in operational benefit due to a four-and-a-half-year 

delay could be as much as £4.5 billion.12

Fully quantifying the operational costs of delayed projects would be difficult 

and arguably unreasonable. However, it is important to recognize that the 

sovereign state must meet the cost of any delays. Although such costs apply 

equally to sovereign and collaborative projects, the effects of delays are more acute 

for collaborative ventures: the nature of collaboration means that the needs of the 

group predominate. Any attempt to mitigate secondary costs through normal 

project management techniques, such as reducing the delay by trading capability, 

is dependent on an alignment of the collaborative partner’s interests. 

The increased delays of collaborative projects are likely to manifest in associated costs that will be met by each sovereign partner. To understand the 

rationale for these delays and identify whether they serve as a delineating factor 

between sovereign and collaborative projects, one finds it instructive to investigate the causal factors listed in the PSSs. 

Causal Factors

The PSSs categorize the key casual factors for changes in cost and time performance in terms of corporate and project changes. Corporate changes can be 

either new capability requirements due to revised MOD needs flowing from 

operational assessment or new budgetary guidelines based on updated departmental budgetary priorities. Project changes are categorized into (1) technical 

factors, which affect the technical ability to deliver the project; (2) procure-
SOVEREIGNTY—ANALYSIS

30

ment processes, which affect contractual procedures, including those for collaborative projects; and (3) contracting processes (introduced in 2009), which 

affect contract negotiations.13

Details of the causal factors affecting all MPR projects for the period 1999–2013 

are provided in appendix C. Figure 6 summarizes the total number of such 

factors for changes in project cost and time performance. Discussed next is 

the influence of these causal factors on these projects from corporate and 

project perspectives. 

From the corporate viewpoint, projects can be managed externally by 

manipulating capability requirements or budgetary inputs. Inspection of figure 6 

reveals that corporate changes were directed more toward implementing cost 

changes than schedule changes. During the period 1999–2013, 121 corporate changes were implemented to manage cost versus only 23 to manage 

time. Averaging changes against the number of projects indicates that approximately 60 percent of the changes were made in collaborative projects. This 

finding addresses two myths surrounding collaboration. First, industry favors 

collaboration because the difficulties of aligning group interests effectively 

lock in governments to defined requirements and avoid capability creep. Second, 

and in some ways related, collaboration restricts the role of the sovereign 

nation in the management of projects. Figure 6 refutes both of these charges 

and, if anything, indicates that governments may be expected to exercise 

more corporate control over collaborative projects than do their sovereign 

counterparts.

Project-driven causal factors that influence changes in cost and time performance include technical factors, procurement processes, and contract processes. Of these factors, as well as those for corporate-driven change, the technical 

aspect predominates (fig. 6). Unlike corporate changes, technical factors influenced both cost and time performance, with 128 and 55 changes, respectively. Both from a cost and time perspective, technical factors adversely 

affected sovereign projects about twice as much as their collaborative counterparts. A secondary factor affecting project changes is procedural. Perhaps 

counterintuitively, figure 6 indicates that little differentiates the programmatic 

changes attributed to the procedural processes of either sovereign or collaborative projects.

Examining the project performance of recent major MOD military procurements has identified several conceptual themes. First, the issue of sovereignty and collaboration is more complex than may appear at first glance. In 

the paradigm of military equipment procurement, shades of sovereignty exist 

whereby gradual increases in collaboration are paid for by a reduction in
SOVEREIGNTY—ANALYSIS

31

sovereignty. In decreasing levels of sovereignty, the procurement processes 

identified are sovereign procurement, collaborative development, COTS, and 

pooling and sharing. 

0

10

20

30

40

50

60

70

80

90

100

Number of Project Changes

Time

0

20

40

60

80

100

120

140

Number of Project Changes

Cost

Sovereign

COTS

Collaborative

Development

Sovereign

COTS

Collaborative

Development

Figure 6. Causal factors for cost and time performance changes (total)
SOVEREIGNTY—ANALYSIS

32

Second, tracing key policy documents makes it possible to discern a distinct shift in the United Kingdom’s approach toward sovereignty and collaboration. In the early 1990s, at the birth of the European Union, the United 

Kingdom appeared hesitant, almost cautious, about the opportunities offered 

by collaboration. By 2013 a far more liberal approach had been adopted, and 

collaboration was seen almost as a cornerstone of policy. The reason for the 

change was the increasingly technologically complex nature of defense 

projects, making them increasingly unaffordable within a sovereign capacity. 

Overall, technical factors appear to be the main impediment, regardless of 

sovereignty status, in delivering projects within time and cost constraints.

Third, it appears that very little has changed regarding each operational 

environment’s approach to sovereignty, with air being pro-collaboration and 

land and maritime remaining bastions of sovereignty. 

Finally, supporting the theoretical and political promise of increased 

affordability, economies of scale leveraged by collaboration generally provide 

savings. However, there is no guarantee. Evidence shows that collaborative 

projects are equally susceptible to the almost unbounded cost growth, as are 

their sovereign counterparts. In practice, from the perspective of cost and 

time performance, little differentiates sovereign and collaborative projects. 

Equally, fears that increased collaboration may reduce a country’s sovereign 

input into the management of projects appear unfounded. These themes are 

developed next through the use of case studies. 

Notes

1. Great Britain National Audit Office, Major Projects Report 2012, 1.

2. Ibid., 5.

3. Great Britain National Audit Office, Collaborative Projects, 15.

4. Great Britain National Audit Office, Major Projects Report 2006, 93.

5. Great Britain National Audit Office, Collaborative Projects, 7.

6. Ibid., 8. 

7. Chantrill, “Time Series Chart.”

8. Great Britain National Audit Office, Major Projects Report 2012, 4.

9. Great Britain National Audit Office, Collaborative Projects, 19.

10. Great Britain National Audit Office, Major Projects Report 2012, 7.

11. Kirkpatrick, “MoD Major Project Reports,” 105.

12. Ibid.

13. Great Britain National Audit Office, Major Projects Report 2012, 12.
33

Chapter 5

The Application of Sovereignty

In this chapter, four case studies highlight and develop some of the issues 

realized in recent sovereign and collaborative projects. The first case is the 

United Kingdom’s sovereign procurement of the Type 45 destroyer. It illustrates the conflict between a nation’s need to deliver operational advantage 

through state-of-the-art military equipment and the practical demand to 

spread the associated high development costs across collaborative partnerships. The second is the European collaborative development of the Eurofighter/Typhoon fourth-generation fighter. Again, the project suffered major 

issues with aligning interests, resulting in numerous cost increases and time 

delays. However, when one considers the fighter project in the long term, the 

United Kingdom gained a high-end technological capability beyond the national means to deliver. 

The third case study concerns the Danish COTS procurement of precision 

munitions. While the United Kingdom’s experience of COTS procurement 

has been generally favorable, this example highlights the potential implications of total dependency on another state for a capability. The final case study 

presents the NATO procurement of Global Hawk unmanned aerial vehicles 

to bolster its intelligence, surveillance, and reconnaissance (ISR) capabilities—a 

program that the United Kingdom has opted to contribute to via its sovereign 

Sentinel wide-area surveillance program rather than financial investment. 

The study emphasizes the susceptibility of a collaborative project to the external 

influences of states pursuing national self-interest.

Type 45 Case Study: Sovereignty

In July 2000, UK defense ministers approved the £5 billion procurement of 

6, out of a planned class of 12, Type 45 destroyers as a replacement for the aging Type 42 destroyers.1 Although at the time of approval it was estimated that 

the first ship would enter service in November 2007, the in-service date was 

not until July 2010.

Since the 1980s, the United Kingdom had been involved in three separate 

projects to replace its Type 42 destroyers. The first attempt, a collaborative 

project called NATO Frigate Replacement for the 1990s, involved the United 

Kingdom, the United States, Canada, France, Germany, Italy, Spain, and the 

Netherlands. Differing national requirements, spending limitations, and timescales 
THE APPLICATION OF SOVEREIGNTY

34

made consensus impossible, and the project was cancelled in 1989.2 In 1992 

another collaborative project, known as Horizon, was initiated among the 

United Kingdom, France, and Italy to produce a ship and its weapon system, 

the PAAMS. Again, national requirements plagued the collaboration, and in 

1999 the United Kingdom withdrew from Horizon because “costs were 

unacceptable . . . and industry could not agree [on] a Prime Contractor 

Framework.”3

 Although the United Kingdom withdrew from Horizon, it continued to collaborate with the French and Italians in developing the PAAMS 

that would be later integrated onto the Type 45. Rather than buying a modified variant of America’s multirole DDG-51 Arleigh Burke–class destroyer, 

whose costs and performance were stable, the United Kingdom had opted to 

develop its own anti-air-warfare destroyer in an attempt to improve on its 

high-end sovereign capabilities.4

Withdrawal from Horizon meant an extension to the increasingly obsolescent Type 42 destroyers. The MOD estimated the cost of extending the Type 

42s to be £195 million, the bulk of which was associated with manpower, 

spares, and equipment.5

 The cost of extending the Type 42s would have exceeded £400 million if the Royal Navy had not accepted a reduction in availability and readiness levels by retiring ships early. By mid-2007 Type 42 availability had fallen below 50 percent.6

 The repeated failure of collaborative efforts 

to deliver operational advantage resulted in fewer ships at sea, equating in 

turn to a reduction in sovereign freedom of maneuver.

In 2004 the Type 45 project was experiencing substantial time and cost 

delays. To manage costs, the government decided to reduce the fleet size from 

12 ships to 6. It also declined an option in 2008 to procure 2 more ships. Although exercising this style of aggressive project management may not have 

been feasible in a collaborative program, it still failed to deliver the savings 

envisioned. NAO analysis concluded that the sovereign construction of a 

Type 45, excluding development costs, was broadly in line with other types of 

destroyers of a similar class.7

 However, if development costs were included, 

the cost of the Type 45 was over £100 million more per ship than its class 

counterparts.8

 Because the MOD had reduced the number of ships ordered to 

half that originally envisioned, extensive development costs, such as the integration of PAAMS, were not spread as widely as expected.

In 2009 the House of Commons Public Accounts Committee was highly 

critical of the Type 45 project taking over 20 years to deliver a replacement for 

the Type 42. Furthermore, it summarized the strategy for mitigating the ensuing capability shortfalls as one of “juggle and hope.”9

 While the situation may 

have been born from the failings of collaboration, the Type 45 case study illustrates a key theme of this paper: the constant friction between a nation’s 
THE APPLICATION OF SOVEREIGNTY

35

need to deliver state-of-the-art military equipment and the institutional reticence to spread the associated high development costs across collaborative 

partnerships.

Eurofighter/Typhoon Case Study: Collaborative Development 

When the Eurofighter entered service with the RAF, it was given the name 

Typhoon. This decision in itself raised objections with its German collaborators 

due to connotations of the successes of a similarly named aircraft interdicting 

German forces in World War II. Both the Eurofighter and Typhoon titles are 

used interchangeably throughout this paper, depending on the context.

When conceived in the late 1980s, the Eurofighter project was the poster 

child of European interdependence. Collaboration among the United Kingdom, Germany, Italy, and Spain meant that the Eurofighter could draw upon 

the specialization of each nation’s air and space and defense industries. According to the 2011 NAO report Management of the Typhoon Project, “The 

main aim of collaboration was to reduce the cost to each partner nation in 

designing, producing, and supporting a highly complex and technologically 

advanced new aircraft.”10 Certainly, the United Kingdom’s perspective was 

that the capability could not be delivered in an efficient and affordable manner without collaboration, which offered a means of increasing the operational advantage of all partner nations.

While Adam Smith advocated for the invisible hand of market forces to 

guide the shape of such collaboration, work-share arrangements for the Eurofighter project were driven more by political considerations than commercial 

or military imperatives. The result of this compromise was to affect national 

sovereignty in two major ways. First, the operational advantage of the project 

was diminished as partner nations failed to agree on long-term capability requirements. As a 2011 report from the House of Commons Committee of 

Public Accounts observed, “The collaborative arrangements have proved 

problematic. The spread of design, manufacturing and support expertise 

across a number of suppliers throughout Europe has increased the cost of the 

aircraft overall and poses risks to the timeliness and affordability of support 

and upgrade activities.”11 Second, on occasion, the collaborative equipment 

support contract limited the freedom of maneuver of the Typhoon capability. 

For example, in 2008 only 70 percent of requested equipment spares had been 

delivered by the required deadline to support an operational deployment. The 

net result was that the remaining aircraft in the fleet were scavenged for parts. 
THE APPLICATION OF SOVEREIGNTY

36

Overall, the NAO estimated that shortfalls in the collaborative process used to 

deliver the Typhoon resulted in a cost increase of approximately £2.2 billion.12

With these difficulties in mind, it would be easy to dismiss collaboration as 

failing to deliver on its promise of affordability. However, a political desire to 

retain a sovereign industrial base drove inefficiencies into the collaboration. 

The 2011 NAO report also pointed out that “Typhoon contracts [were] negotiated with United Kingdom industry on a non-competitive basis under longstanding agreements which enable industry to recover agreed overhead 

costs.”13 Following the 2010 Strategic Defense and Security Review, the accelerated retirement and drawdown of the Harrier and Tornado fleets, respectively, 

resulted in a forecast reduction in industrial demand. Due to the long-standing 

arrangements, a risk existed that unless industry restructured, “the costs of 

under-utilised industry assets [would] be re-charged to the [MOD] on its remaining contracts—notably Typhoon.”14 This linkage of the Typhoon project 

to the long-term sustainability of the UK military aircraft industry exemplifies 

the distorting effect that the nexus of monopoly and monopsony can generate.

One of the key concerns of entering into collaborative projects is that interdependence with other nations will impose a rigidity on the management of 

capabilities incompatible with the demands of operations. This fear was rebutted in chapter 4, as it is here, in light of Typhoon’s deployment to support 

coalition operations in Libya in 2011. Software for the Typhoon aircraft radar 

and defensive aid systems was quickly updated to ensure the protection of 

aircraft and aircrew.15 Furthermore, within a matter of days, the United Kingdom, on its first operational deployment of Typhoon beyond its defensive 

counterair role at home and in the Falklands, was able to accelerate delivery 

of the aircraft’s nascent air-to-ground capability.

16

Although the Typhoon case study illustrates some of the pitfalls of collaborative development, it can also be interpreted as an exemplar of how collaboration can work. The Eurofighter project delivered a technologically advanced 

capability that was both beyond the means of national resources and responsive to the needs of the nation—qualities to which any sovereign capability 

would aspire. 

Denmark Case Study: Commercial Off-the-Shelf 

As described in chapter 4, the United Kingdom’s experience of procuring 

COTS military equipment has been relatively successful during the period of 

analysis. In response to urgent operational requirements for Iraq and Afghanistan, COTS is a proven procurement route that is both agile to a nation’s 
THE APPLICATION OF SOVEREIGNTY

37

requirements—assuming that the desired capability exists and is available—

and predictable in terms of cost and time performance. However, as argued 

previously, COTS is a short-term intervention; any savings in R&D and manufacture will ultimately undermine the domestic industrial base and thereby 

erode any ability to deliver operational advantage in the long term. Furthermore, as this case study shows, dependency directly correlates with increased 

political risk. Denmark’s shortage of COTS munitions during the NATO 

campaign in Libya highlights another shortfall of COTS procurement: the 

dangers of dependency when sovereign demand exceeds the capacity of foreign supply. 

In a display of overwhelming national support, Denmark deployed six F-16s 

in March 2011 to support NATO operations in Libya. In their description of 

Denmark’s involvement in the campaign, Peter Jakobsen and Karsten Møller 

describe the “Danish Way of War” as founded on the premise of collaboration 

and a “willingness to let its principal allies decide where, when and how force 

will be used.” From a strategic perspective, Jakobsen argues, Denmark’s aim 

“is not to win wars or even battles but to support the right cause and the right 

allies in order to gain goodwill, prestige, security and influence.”17 It is a policy 

that has a certain resonance with the National Security through Technology 

white paper. Over the last 15 years, Jakobsen asserts, the pedigree of Denmark 

has risen to compete with that of the United Kingdom as the United States’ 

staunchest ally. From the equipment perspective, Denmark has effectively offset the components of sovereignty, prioritizing operational advantage at the 

expense of freedom of maneuver.

 In Libya—as in other recent conflicts in Bosnia, Kosovo, Afghanistan, and 

Iraq—Denmark executed its strategic role to perfection. Such was the impact 

of the Danish F-16s that the joint force air component commander of Operation Odyssey Dawn, Maj Gen Margaret H. Woodward, USAF, dubbed them 

the “rock stars of the campaign.”18 Denmark’s strategy, however, had a flaw; its 

aircraft depended on laser-guided munitions procured via a COTS process 

struggling to maintain tempo with the pace of operations. By June the shortfall had become so acute that Denmark approached the Netherlands for aid.19

However, the intensity of the air campaign, coupled with the political emphasis for no collateral damage, led to an alliance-wide accelerated depletion of 

precision munitions.20 Such was the severity of the supply shortfall that Denmark was forced to look outside its normal supplier base—a move that nearly 

had significant political consequences.

On 10 October 2012, the Danish Defense Force accidentally released a 

classified post-Libya mission report to the Danish media. Included in the report were details of how the Danish Air Force had procured munitions from 
THE APPLICATION OF SOVEREIGNTY

38

Israel. The fact that the revelations were made a year after the campaign likely 

helped to diffuse the situation; however, they can hardly have helped ArabDanish relations already tarnished by the publishing of cartoons of the 

prophet Muhammad in a Danish newspaper in 2005. Nevertheless, the revelations were a source of embarrassment for the Danish government. Given 

the importance of the Arab League to the campaign, similar revelations during the conflict may not have been so limited in impact. Denmark’s shortfall 

of laser-guided bombs in Libya provides due warning that in an environment 

of self-interest, interdependence can be both a source of great political 

strength and weakness.

NATO Alliance Ground Surveillance Case Study:

 Pooling and Sharing

During the Chicago Summit in May 2012, NATO members agreed to the 

acquisition of five Global Hawks and associated ground systems under the 

banner of the NATO Alliance Ground Surveillance program. The aim of 

NATO AGS is to provide ground commanders with a persistent wide-area 

surveillance capability, a noted deficiency of the alliance in the Libyan campaign.21 Valued at $1.7 billion, NATO AGS is billed as “an affordable solution 

during tough economic times.”22 Unable to afford this capability individually, 

14 NATO nations agreed to pool resources and share what is considered an 

essential capability. At face value, NATO AGS appears to be an example of the 

pooling and sharing opportunities offered by NATO’s Smart Defence concept. 

However, the road to NATO AGS has been far from smooth and has yet to be 

fully realized.

NATO AGS originated during the 1992 Defense Planning Committee; 

however, it was not until 2007 that the alliance achieved consensus for COTS 

procurement of the system, including eight air platforms. Not long after it 

reached this agreement, however, the defense budgets of member states came 

under increasing financial pressure. Citing financial reasons, Poland was the 

first country to withdraw from the project. Denmark and Canada soon followed Poland’s lead by withdrawing in 2010 and 2011, respectively. Throughout this period, the project was confronted by a dilemma of whether to increase the costs for remaining members or to reduce capability. When 

Northrop Grumman submitted revised costs in 2010, NATO had downsized 

the number of Global Hawks it was procuring to six and later reduced the 

number to five.
THE APPLICATION OF SOVEREIGNTY

39

One of the key attributes of NATO AGS is its improved affordability by accessing the wider Global Hawk market. A second concern for the project, 

outside the withdrawal of partner nations, has been the impact of the financial drawdown on wider Global Hawk sales. In May 2014, citing concerns 

over national certification, Germany cancelled its $1.3 billion acquisition of 

Euro Hawk, a Global Hawk variant.23 In January 2012, the USAF declared its 

intent to terminate the Global Hawk program entirely.24 Any decrease in the 

size of the Global Hawk market would likely be met by corresponding increases in AGS support costs. In essence, the principle of economies of scale 

would be working in reverse, and AGS members would be faced with footing 

the bill. 

Both Denmark and Poland have since rejoined the project after witnessing, 

in Denmark’s case firsthand, NATO’s ISR shortcomings in Libya and reprioritizing national interests. In 2013 the US National Defense Authorization 

Act stipulated that the USAF “shall maintain the operational capability of 

each RQ-4 Global Hawk unmanned aircraft system belonging to the Air Force 

or delivered to the Air Force.”25 While the battle between the USAF and Congress continues, its implications, in particular regarding cost, are sure to reverberate across AGS collaborations.

Although data was unavailable for any pooling and sharing projects, analysis of NATO AGS illustrates both the strengths and weaknesses of this most 

extreme form of collaboration. It demonstrates that by combining their interests, 14 nations were able to procure a share in technological capabilities well 

beyond those expected through sovereign means. 

A final issue that the AGS project raises is what happens when a member 

nation exercises its sovereign veto. NATO’s need to gain political consensus 

before committing forces may dilute capabilities that are best employed, if 

possible, before conflicts flare up. The uncertainty engendered by this requirement may have factored in the decisions of France, the United Kingdom, and, 

recently, Germany to offer sovereign capabilities as “contributions in kind” 

versus financial contributions.26 The presence of so-called contributions in 

kind may present a form of moral dilemma for the alliance; states may be 

more inclined to invoke their veto because there is a sovereign alternative to 

deploying NATO Global Hawks. 

In the instance of NATO AGS, collaboration provided an opportunity for 

several nations to gain access to capabilities beyond their national resources. 

However, the cost of such an advantage is the susceptibility of a collaborative 

project to the external influences of states pursuing national self-interest.

A review of the preceding case studies allowed development of the three 

themes identified in chapter 4. First, technological complexity is making it 
THE APPLICATION OF SOVEREIGNTY

40

almost prohibitively expensive for most states to develop an operational advantage by sovereign means alone. Second, while collaborative projects may 

offer a viable means of sharing the burden of development, they do not guarantee against cost and time overruns. Finally, national interests such as workshare agreements and capability requirements limit realization of the full benefits 

of collaboration. Chapter 6 considers the implications of these themes for 

future procurement activities.

Notes

1. Great Britain National Audit Office, Type 45 Destroyer, 4.

2. Ibid., 9.

3. Ibid.

4. “DDG Type 45.” 

5. Great Britain National Audit Office, Type 45 Destroyer, 10.

6. Ibid., 11.

7. Ibid., 19.

8. Ibid.

9. Great Britain House of Commons, Type 45 Destroyer, Ev 12. 

10. Great Britain National Audit Office, Typhoon Project, 8. 

11. Great Britain House of Commons, Management of the Typhoon Project, 10.

12. Great Britain National Audit Office, Management of the Typhoon Project, 24.

13. Ibid., 25.

14. Ibid.

15. Great Britain Ministry of Defence, National Security through Technology, 24.

16. House of Commons Defence Committee, Operations in Libya, Ev 47.

17. Jakobsen and Møller, “Danish Way of War,” 108.

18. Ibid., 114.

19. Agence France-Presse, “Danish Planes in Libya.”

20. DeYoung and Jaffe, “NATO Runs Short.” 

21. NATO, “Alliance Ground Surveillance.” 

22. Michell, “NATO Alliance Ground Surveillance,” 56.

23. Agence France-Presse, “Germany Axes Euro Hawk.” 

24. Roston, “Battle over Global Hawk.” 

25. Ibid.

26. Pocock, “Alternatives to Global Hawk.” 
41

Chapter 6

The Future of Sovereignty

This chapter considers the level of importance that the United Kingdom 

should place on sovereignty in future procurement activities. In particular, it 

assesses the merit of collaboration as a strategic alternative to manage affordability. First, it provides the context in which these procurement strategies will 

likely be employed. The focus is on two contradictory strategic drivers: 

economic resource and technology. Second, it recommends ways to modify 

current policy to maximize the benefits of both sovereignty and collaboration. 

Sovereignty or Collaboration?

In late 2013, many analysts believed that the United Kingdom had weathered 

the worst of the financial storm and questioned what role the nation would 

play in the postcrash era. The Economist posited two scenarios: a fractured 

sovereign state or an enthusiastic global player.1

 In some ways, the same scenarios apply to the United Kingdom’s approach to defense procurement: retention of sovereignty or a continued drift toward collaboration. One thing is 

certain: as “the nation [learns] to live within its means,” a dramatic reversal is 

unlikely in the painful cost-cutting measures experienced since 2010.2

 In his 

analysis of the 2013 budget, the RUSI’s director of UK Defence Policy Studies, 

Prof. Mark Chalmers, argues that “if this Government is re-elected and sticks 

to its commitment to continue reductions in departmental spending in 

2016/17 and 2017/18, further defence cuts seem inevitable.”3

 The financial 

squeeze, coupled with a continued flow of yet-to-be-funded major equipment 

programs such as the replacement for the Vanguard-class nuclear-powered 

ballistic-missile submarine and introduction of the Joint Strike Fighter, means 

that something will have to give. 

Operational advantage through technological superiority has long been 

considered a foundational aspect of UK defense policy. However, as shown in 

chapter 4, delivering what is often highly sophisticated defense equipment 

within agreed costs and timescales is becoming an increasingly complex challenge. In their positioning paper 20YY: Preparing for War in the Robotic Age, 

Robert Work and Shawn Brimley agree that the future battlespace will be 

dominated by technologies including “directed energy, electromagnetic rail 

guns, and high-powered microwave weapons; additive manufacturing and 

3-D printing; synthetic biology; and even technologies to enhance human 
THE FUTURE OF SOVEREIGNTY

42

performance on the battlefield.”4 The driver for these innovations is not the 

military sector but demands and advances in the commercial sector. Rather 

than dictating the pace of change, the military is increasingly a passenger riding the wave of change dictated by consumer demand. As Robert Cox observes, “In the relationship between productive and military capabilities, 

military demand was for a long time the stimulant of new ways of organizing 

production. . . . In more recent years, however, the direction of technological 

flow has become more ambiguous. Military innovations have become more 

and more dependent upon the progress of civilian technologies.”5

The operational impact of this change in balance of investment is that civilian 

technology is now having a growing influence on the battlefield. As evidence, 

consider John Mackinlay’s appraisal of the effect of the commercial communications revolution on insurgencies: “The surge of mass communications 

had for the first time given the insurgent the opportunity to mobilize an international array of migrant minorities and nations; there was no longer one or 

two populations involved but many and they were spread across the face of 

the globe.”6

 The question remains, What role does sovereignty play in such a 

challenging and uncertain security environment? To answer this question, we 

examine the strengths and weaknesses of sovereignty and collaboration as 

strategic tools. 

In theory, sovereignty offers a nation ultimate security, both in terms of 

autonomous development and employment of a capability. In practice, absolute sovereignty is a rare commodity in an environment dominated by systemof-systems architecture. In the past, the United Kingdom’s sovereign efforts 

for capital projects have been largely directed toward the maritime environment—

the production of warships, nuclear submarines, and aircraft carriers. The 

evidence presented in chapter 4 indicates that whatever the operating environment, sovereign investment has come at a cost. On average, sovereign 

projects delivered 5 percent over budget and 22 months late. Indeed, some 

projects, like the Astute-class nuclear submarines and Queen Elizabeth–class 

aircraft carriers, have experienced cost growth in excess of 50 percent and 

incurred delays of over three years. If these overruns resulted in enhanced 

national security, then one would be right to argue that it was a wise investment. However, one need only look at the important role that Scottish shipyards are playing in the Scottish devolution debate to understand that retention of a sound military industrial base is as much about domestic politics as 

about provision of long-term military capability. After the announcement to 

cease shipbuilding in Portsmouth in 2014, a well-placed source was reported 

as saying to the BBC that the government was “acutely conscious of the politics of the Clyde” ahead of the 2014 Scottish independence referendum.7

 The 
THE FUTURE OF SOVEREIGNTY

43

implication was that the continued employment of the Clyde’s voting shipbuilders trumped any capability considerations. Thus, politicians were concerned less with the capability provided than with where it came from and 

what it meant to their domestic constituents in terms of jobs.

As summarized in chapter 2, many academics see collaborative development as an antidote to the financial and technological pressures being confronted by sovereign projects. Project data supports these assumptions with, 

on average, collaborative projects outperforming their sovereign counterparts 

in terms of both cost and time performance. The evidence reviewed reveals 

that COTS projects in particular are able to deliver within time and cost 

parameters. One factor that emerged from the case studies detailed in chapter 5—

but undersold by academics—is that collaboration could enhance a nation’s 

technological advantage. In each case study—including, arguably, the sovereign project—foreign collaboration gave the United Kingdom access to technology beyond its national means. 

Fears Surrounding Collaboration

Some people fear that collaboration adversely affects sovereignty by reducing 

a nation-state’s freedom of action both politically and operationally. The evidence for such fears draws mixed conclusions. Chapter 4 rebutted the equation of collaboration with a limitation on corporate intervention. Investigation of the causal factors affecting project changes showed that a government’s 

ability to intervene in the management of collaborative projects is no less inhibited than for sovereign projects. Evidence did, however, support the fear 

that collaboration impinges on a government’s calculus of how and where to 

employ its forces in that its decisions become increasingly linked with the 

self-interests of other nations. In the instance of NATO’s AGS system, such 

self-interests extend as far as determining the force strength of the capabilities 

being procured. Furthermore, analysis suggests that, in addition to the listed 

benefits, three further corrosive factors affect collaboration in defense procurement: (1) the detrimental effect of the misalignment of national interests, 

(2) the lag between policy and implementation, and (3) the apparent permanency of any transition from a sovereign to a collaborative approach. 

First, any collaborative effort depends on the enduring alignment of national 

interests and long-term political investment. As each of the case studies demonstrates, alignment of requirements is inherently difficult to achieve and is continually undermined by the self-interests of states. In every case, a lack of a 

common equipment requirement and an agreed timescale amounted, in 
THE FUTURE OF SOVEREIGNTY

44

effect, to the absence of a harmonized operational requirement. Although an 

increase in contributing nations may reduce the costs of projects, it conversely 

heightens the political risk. Additionally, collaboration does not always guarantee affordability. Several collaborative projects experienced the same, almost unbounded cost growth that plagued some sovereign projects. Moreover, as the Typhoon case study illustrated, the role of domestic politics and 

commercial factors will undoubtedly taint any national priorities.

Second, without prescriptive measures, collaboration does not appear to be 

a responsive mechanism for addressing funding shortfalls. Since the formation of the European Union, the United Kingdom’s approach to sovereignty 

has ranged from the protective prescriptive measures of the 2005 Defence Industrial Strategy white paper to the more open laissez-faire approach of the 

2012 National Security through Technology white paper. Yet throughout these 

political transitions, practical implementation has changed very little; projects 

continue to be assessed on a case-by-case basis. 

Finally, transition from a sovereign to collaborative effort appears to be an 

irreversible strategy—of the 58 projects reported in MPRs from 1999 to 2013, 

none were a sovereign project initiated to replace a collaborative effort. The 

reason for this trend is that to realize the maximum financial benefits of collaboration, one must shed domestic capabilities such as industrial base and 

R&D expertise. This reduced industrial and R&D support makes any subsequent sovereign effort harder to justify because of the regeneration costs. 

The performance of COTS illustrates the paradox facing governments 

when they are assessing whether to transition to a collaborative procurement 

approach. Chapter 4 showed that COTS by far surpassed other modes of procurement in terms of cost and time performance. This factor raises the question of whether nations should adopt a COTS-only approach to equipment 

procurement. The first issue is that the required equipment may not be on the 

shelf, resulting in a compromise of desired capability. Second, although COTS 

projects offer short-term benefits by exploiting economies of scale to increase 

cost-effectiveness, such benefits are likely made at the expense of longer-term 

sovereign capability. When investment is directed to foreign COTS projects, 

the life-sustaining long-term investment for sovereign assets is reduced. The 

net result is a withering of domestic capabilities such as design and manufacture, infrastructure, and specialist personnel—resources that will be prohibitively expensive, in terms of both time and finance, to regenerate. 

With these factors in mind, sovereignty should not be conceded lightly, 

and collaboration remains a risky strategy—nations must continually consider what happens when, not if, our friends fail us.
THE FUTURE OF SOVEREIGNTY

45

Policy Implications

The policy implications of these observations are best understood in the 

context of the United Kingdom’s current policy regarding sovereignty, laid 

out in the 2012 National Security through Technology white paper. That paper 

is built on two principles: sound R&D and a commitment to delivering operational advantage through long-term investment and access to open competition.8

 Considering these principles in light of the observations from this 

study makes it possible to develop recommendations for the future management of sovereign capabilities. 

The white paper identifies that “technology underpins most equipment 

and support arrangements” and highlights long-term R&D funding as a 

means of meeting “an increasingly capable and diverse range of threats.”9

 Despite this commitment, commercial R&D is rapidly surpassing its military 

counterpart. We live in exponential times when technology dictates the pace 

of evolution and R&D fuels the engine of change. According to investigations 

by Scientists for Global Responsibility, the MOD’s average yearly R&D expenditure was £1.8 billion in the period 2008–11.10 Although a significant sum, it 

is only half that spent by Apple and pales in comparison to Samsung’s $11.2 

billion and Microsoft’s $10.6 billion in R&D expenditures for 2012.11 The only 

way to address this yawning research gap is through effective collaboration 

with partner nations. Adopting the Ricardian principles of diversification and 

specialization will make it possible to raise the collective benefit of military 

R&D to meet the demands of commercial investment.

Current policy presents sovereignty as an important quality but not one to 

be retained at any cost. In essence, the policy seeks to adopt a principle of 

cost-effectiveness exercised by exposure to the free market. In some ways this 

policy is correct. To retain equipment sovereignty at great expense because a 

nation has always had such a capability would be folly. Furthermore, the 

nexus of spiraling defense costs and technological diversification necessitates 

a reevaluation of the capability areas in which a nation wishes to remain sovereign. Future policy regarding sovereignty needs to consider the shifting 

technological landscape and adjust accordingly. However, to make these adjustments, policy should revert to prescriptive measures that dictate areas 

where collaboration should occur. Collaboration in defense procurement is as 

much about investment of political capital to develop trust and underwrite 

partnerships that in all likelihood will last decades. Evidence presented in this 

paper suggests that without such prescriptive guidance, norms and behaviors 

toward sovereignty are unlikely to change rapidly. Therefore, if collaboration 
THE FUTURE OF SOVEREIGNTY

46

is to work, the government must provide some guidance to the invisible hand 

of the free market. 

Both of these measures seek to promote the use of collaboration to mitigate 

resource shortfalls and to help provide a level of capability beyond the 

national means. Thus, collaboration should no longer be viewed as a defensive measure—a necessary product of dwindling defense budgets—but as a 

potential source of strength. This strength, however, comes at a cost of increased dependence on other nations and as such carries the risk that someday another nation’s self-interest may not align fully with your own. 

Notes

1. “Little England or Great Britain?”

2. Ibid.

3. Chalmers, “Squeeze Continues.”

4. Work and Brimley, 20YY, 7. 

5. Cox, Approaches to World Order, 282.

6. Mackinlay, Insurgent Archipelago, 79.

7. Robinson, “UK Shipyards.” 

8. Great Britain Ministry of Defence, National Security through Technology, 8.

9. Ibid.

10. Parkinson, Pace, and Webber, Offensive Insecurity, 6.

11. Pepitone, “Apple Spends Way Less.” 
47

Chapter 7

Conclusion

King Richard III:

What says Lord Stanley? Will he bring his power?

Messenger:

My lord, he doth deny to come.

—William Shakespeare

Richard III, Act 5, Scene 3

With these words, the balance of power at Bosworth Field shifted decisively. Lord Thomas Stanley committed his forces to the service of the House 

of Lancaster and Henry, Earl of Richmond. This betrayal sealed the fate of 

“the third sun of York.” One can only imagine Richard’s emotions: anger, dismay, apprehension? Whatever the emotion, it should not have been disbelief; 

throughout his turbulent history, Richard III had participated in a murderous 

game of power politics. He had witnessed his brother’s rise to—and temporary 

removal from—the throne due to subtle shifts in the balance of power orchestrated by the scheming Earl of Warwick. Lord Thomas Stanley, a man whose 

family motto was sans changer (without changing), had achieved high office 

by continually ensuring that his family favored both sides during any battle. 

Richard’s world was one of self-interest, where alliances were a source of both 

strength and weakness. 

After his defeat, Richard was buried in a pauper’s grave. The renegade Lord 

Thomas Stanley was appointed Earl of Derby on 27 October 1485, and the 

following year he was confirmed as High Constable of England and High 

Steward of the Duchy of Lancaster. Richard’s victor, Henry, Earl of Richmond—

subsequently crowned King Henry VII—would contrive his own alliances 

and, by uniting the houses of Lancaster and York through marriage, write a 

new chapter in English history. 

The issues of sovereignty and collaboration remain as pertinent today as on 

that fateful day in 1485. This paper addressed them from the perspective of 

the United Kingdom’s approach to procuring military equipment. Analyzing 

these issues through the concepts of theory, policy, and performance enabled 

the development of a broad understanding of the paradoxical challenges that 

modern governments face in the realm of equipment procurement.

Examining the issues from both the realist and liberal economist schools of 

thought offers a balanced view on the benefits of sovereignty and its counterpoint, 
CONCLUSION

48

collaboration. Realists view sovereignty as an integral part of power. This view 

is refined by the caveat that sovereignty should not be bought at any price and 

that, in some instances, collaboration enhances power. The price associated 

with such collaboration is increased political dependency. For projects with 

life spans on the order of half a century, such commitment represents a significant investment of political capital. 

Liberal economists present the opposite view. They believe that combining 

various nations’ diverse and specialized strengths raises the collective level of 

performance. Shaping this position is the recognition that because defense is 

critical to a nation-state, it does not translate into a true market economy. 

Thus, governments are often unwilling to allow the time to let market forces 

do their work as doing so may court the possibility of failure. A nation-state’s 

intervention in the collaborative process undermines the realization of its potential benefits. In essence, both realist and liberal schools of thought appear 

to converge on one central theme: balance is required for any approach. 

In recent times, academics have tended to advocate collaboration as a 

means of addressing funding shortfalls. They also note that issues such as 

national self-interest, domestic pressures, and isolated industrial bases have, 

in the past, prevented nations from fully exploiting the benefits of collaboration. Such restraints were evident throughout the fiscal review and supporting 

case studies that this paper presented. While the academics were correct in 

focusing on the underexploited fiscal benefits of collaboration and the temptation of delivering capabilities beyond national resources, they perhaps underemphasized the chief drawback: risk and exposure to other nations’ interests 

driven by increased interdependence.

From a policy perspective, the United Kingdom’s approach to collaboration over the last 20 years has shifted from a means of opportunity to one of 

necessity. The new approach detailed in the 2012 National Security through 

Technology white paper emphasizes collaboration through bilateral arrangements and the procurement of COTS products. However, the evidence presented by this study suggests that this strategy may be a sound one in the 

short term but questions whether it may, in effect, be mortgaging the nation’s 

long-term security. In essence, COTS offers short-term bridges for capability 

shortfalls rather than sound long-term policy. This study’s analysis of NAO 

data from 1999 to 2013 led to three conclusions regarding cost and time performance of sovereign projects as compared to that of their collaborative 

counterparts.

First, despite the simplistic view portrayed by internal national groups and 

some newspapers, sovereignty is a complex issue. The likelihood of collaboration 

becomes greater, and perhaps necessary, at some level within military systems as 
CONCLUSION

49

they continue to advance technologically. Further, operational issues such as basing rights and overflight factor into decisions leading toward collaboration versus 

sovereignty. Thus, absolute sovereignty is a rare commodity.

Second, collaborative—particularly COTS—projects generally outperform 

sovereign projects in headline costs and, to a lesser extent, time; however, this 

data does not present the whole picture. Limitations in reporting procedures 

mean that the financial costs associated with delays, which are, arguably, more 

acute for collaborative projects, are not normally considered at the departmental level. Thus, the financial benefit of collaboration may not be as high as 

the average 10 percent cost swing reported in this paper. Indeed, COTS aside, 

little differentiates sovereign from collaborative projects; both are equally susceptible to significant delays and almost unbounded cost growth. Use of case 

studies served to capture the nonfinancial costs of collaboration, especially 

the increased political risk and exposure to the repercussions of other nations 

operating in their own self-interests. 

Finally, during this time frame, the air environment appeared to be much 

more conducive to collaboration than did the maritime environment, and, to 

an even greater extent, land environments, which have been far more reticent. 

Factors that may have influenced such approaches include the extended design and manufacture periods for the projects and the associated sovereign 

industrial base. Such domestic factors undermine the efficacy of collaboration as a means to combat insufficient financial resources. 

Continued increases in the costs of military procurement, coupled with 

diversification of technologies, mean that nations face a strategic problem of 

the ends exceeding the means. As Ken Waltz observes, “To buy military 

equipment in the quantity and variety sufficient for military effectiveness exceeds the economic capability of most states.”1

 If collaboration is to prove an 

effective tool in combating these trends, then leadership must consider two 

modifications to existing policy. First, to overcome the environmental reticence of both the maritime and land domains to change procurement methods, one must shift from the current laissez faire economic approach to a 

more prescriptive policy that details areas for collaboration. Second, a truly 

free-market environment, based on trust among close allies, must be established in the R&D domain. Only by accepting that the risk of sovereign failure can 

be mitigated by the collective benefit of collaboration can nations hope to redress 

the ever-increasing gap between commercial and military R&D activities. 

Is collaboration an affordable strategy in times of austerity? The evidence 

in this paper points to a qualified yes. However, as a strategy it merely bends, 

but does not break, the ever-steepening equipment cost curve. For the short-term 

gains offered by collaboration, one must consider not only the political costs but 
CONCLUSION

50

also what happens when opportunities for collaboration do not arise. Because of 

the short-term gains offered, collaboration is likely to increasingly feature the 

strategic landscape. The question that challenges nations in the future will not be 

whether to resist collaboration in favor of sovereignty but to determine when to 

collaborate and what sovereignty to invest in. In a world driven by self-interest, 

collaboration can be both a source of great strength and great weakness. Despite 

the rhetoric associated with increased military collaboration, and in spite of the 

economic pressures of the early twenty-first century, self-interest is still the prime 

motive of nation-states. Ultimately, these countries must be honest (if only to 

themselves) about where they wish their self-interests to take them—and then act 

accordingly.

Note

1. Waltz, Theory of International Politics, 183.
51

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Advanced airlaunched antiarmour weapon 

(AAAW) 

(Brimstone)

2005

Estimate £M 815 885 849 822 988 941 900 899

Approval 799 899 809 849 849 814 814 814

Difference 16 -14 -40 -27 139 127 86 85

ISD approval Dec-91 Sep-01 Sep-01 Sep-01 Sep-01 Sep-01 Sep-01 Sep-01

Forecast ISD Oct-01 Oct-02 Oct-02 Oct-02 Apr-04 Mar-05 Mar-05 Mar-05

Variation (months) 118 13 13 13 31 42 42 42

Type of procurement S S S S S S S S S

% cost increase 2 -1.56 -4.94 -3.18 16.4 15.6 10.6 10.4

Advanced jet 

trainer 2009

Estimate £M 467

Approval 497

Difference -30

ISD approval Feb-10

Forecast ISD Nov-09

Variation (months) -3

Type of procurement S

% cost increase -6

Advanced

 short-range 

air-to-air 

missile 

(ASRAAM)

2001

Estimate £M 823 857

Approval 828 866

Difference -5 -9

ISD approval Dec-98 Dec-98

Forecast ISD Dec-00 Jun-01

Variation (months) 24 30

Type of procurement CD CD

% cost increase -0.6 -1

Appendix A—Project Data

CD—collaborative development; COTS—commercial off-the-shelf; ISD—in-service date; S—sovereign
APPENDIX A

52

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

AH-64

Apache attack 

helicopter

2001

Estimate £M 2,704 2,858 2,997 3,068 3,168

Approval 2,835 3,015 2,997 2,997 2,997

Difference -131 -157 0 71 171

ISD approval Dec-97 Dec-99 Dec-99 Dec-99 Dec-99

Forecast ISD Dec-00 Dec-00 Jan-01 Jan-01 Jan-01

Variation (months) 36 12 13 13 13

Type of procurement COTS COTS COTS COTS COTS

% cost increase -4.6 -5.2 0 2.4 5.7

AH-64 

Apache attack

helicopter

2009

Estimate £M 228

Approval 245

Difference -17

ISD approval Dec-09

Forecast ISD Apr-09

Variation (months) -8

Type of procurement CD

% cost increase -6.9

Airborne 

stand-off radar

 (ASTOR)

2006

Estimate £M 14 926 930 1,013 1,002 968 954

Approval 13 938 938 938 938 914 914

Difference 1 -12 -8 75 64 54 40

ISD approval Apr-03 Sep-05 Sep-05 Sep-05 Sep-05 Sep-05 Sep-05

Forecast ISD Sep-05 Sep-05 Sep-05 Sep-05 Sep-05 Nov-05 Nov-06

Variation (months) 29 0 0 0 0 2 14

Type of procurement S S S S S S S

% cost increase 7.7 -1.3 -0.9 8 6.8 5.9 4.4
53

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Airbus A400M 

Atlas 2015

Estimate £M 2,356 2,484 2,619 2,644 2,616 2,629 2,632 3,285 3,231 3,105 3,268 2,809

Approval 2,823 2,828 2,744 2,744 2,744 2,744 2,744 2,744 2,744 2,498 2,498 2,238

Difference -242 -344 -125 -100 -128 -115 -112 541 487 607 770 571

ISD approval Dec-09 Dec-09 Dec-09 Dec-09 Dec-09 Dec-09 Dec-09 Dec-09 Dec-09 Feb-09 Feb-09 Feb-09

Forecast ISD Jun-10 Mar-11 Mar-11 Mar-11 Mar-11 Mar-11 Dec-11 Dec-15 Mar-15 Mar-15 Mar-15 Mar-15

Variation (months) 6 15 15 15 15 15 24 72 63 73 73 73

Type of procurement CD CD CD CD CD CD CD CD CD CD CD CD

% cost increase -8.6 -12.2 -4.56 -3.64 -4.66 -4.19 -4.08 19.7 17.7 24.3 30.8 25.5

Airseeker 

intelligence 

aircraft

2014

Estimate £M 659 637

Approval 681 633

Difference 22 1

ISD approval Oct-14 Oct-14

Forecast ISD Oct-14 Oct-14

Variation (months) 0 0

Type of procurement COTS COTS

% cost increase 3.2 0.2

Astute-class 

nuclearpowered

 attack

 submarine (1–3)

2010

Estimate £M 2,012 2,768 2,698 2,707 3,710 3,484 3,492 3,656 3,798 3,806 3,933 4,041 3,480 3,386 3,414

Approval 2,084 2,726 2,726 2,726 2,726 2,578 2,578 2,578 2,578 2,578 2,578 2,578 2,233 2,233 2,233

Difference -71 42 -28 -19 984 906 914 1,078 1,220 1,228 1,355 1,463 1,247 1,153 1,181

ISD approval Dec-01 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05 Jun-05

Forecast ISD Jun-05 Jun-05 Jun-05 Jun-05 Jan-09 Jan-09 Dec-08 Nov-08 May-09 Mar-10 Jul-10 Apr-10 Apr-10

Variation (months) 42 0 0 0 43 43 42 41 47 57 61 58 58

Type of procurement S S S S S S S S S S S S S S S

% cost increase -3.4 1.5 -1 -0.7 36.1 35.1 35.5 41.8 47.3 47.6 52.6 56.7 55.8 51.6 52.9

APPENDIX A
APPENDIX A

54

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Astute-class 

nuclear-powered 

attack

 submarine (4)

2018

Estimate £M 1,589 1,567 1,404 1,448 1,504

Approval 1,610 1,610 1,279 1,279 1,279

Difference -21 -43 125 169 225

ISD approval Aug-15 Aug-15

Forecast ISD Dec-16 Dec-16 Jan-18 Jan-18

Variation (months) 29 29

Type of procurement S S S S S

% cost increase -1.3 -2.7 9.8 13.2 17.6

Beyond-visualrange air-to-air 

missile

(BVRAAM)

2012

Estimate £M 1,397 1,417 1,355 1,204 1,204 1,168 1,279 1,282 1,305 1,115 1,122

Approval 1,437 1,437 1,362 1,362 1,362 1,362 1,362 1,362 1,362 1,136 1,136

Difference -40 -40 -7 -158 -158 -194 -83 -80 -57 -21 -14

ISD approval Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12 Aug-12

Forecast ISD Jun-12 Aug-12 Aug-12 Aug-12 Aug-13 Aug-13 Aug-12 Aug-12 Aug-12 Nov-12 Nov-12

Variation (months) -2 0 0 0 12 12 0 0 0 3 3

Type of procurement CD CD CD CD CD CD CD CD CD CD CD

% cost increase -2.8 -2.8 -0.5 -11.6 -11.6 -14.2 -6.1 -5.9 -4.2 -1.8 -1.2

Bowman comm 

systems 2004

Estimate £M 2,023 1,991 2,007 2,017 2,009

Approval 2,073 2,041 2,041 2,014 2,041

Difference -50 -50 -34 -24 -32

ISD approval Dec-04 Dec-04 Dec-04 Dec-04 Dec-04

Forecast ISD Mar-04 Mar-04 Mar-04 Mar-04 Mar-04

Variation (months) -9 -9 -9 -9 -9

Type of procurement S S S S S

% cost increase -2.4 -2.4 -1.7 -1.2 -1.6
55

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Challenger II 

tanks 1998

Estimate £M 2,378 2,325

Approval 2,312 2,203

Difference 65 122

ISD approval Dec-95 Dec-95

Forecast ISD Jun-98 Jun-98

Variation (months) 30 30

Type of procurement S S

% cost increase 2.8 5.5

CH-47

Chinook

heavy-lift 

helicopter

2014

Estimate £M 841

Approval 841

Difference 0

ISD approval May-14

Forecast ISD Nov-14

Variation (months) 6

Type of procurement COTS

% cost increase 0

Combat

 infrastructure 

platform (CIP)

2005

Estimate £M 340 338 338

Approval 379 379 379

Difference -39 -41 -41

ISD approval Dec-04 Dec-04 Dec-04

Forecast ISD Jul-04 Dec-05 Dec-05

Variation (months) -5 12 12

Type of procurement S S S

% cost increase -10.3 -10.8 -10.8

APPENDIX A
APPENDIX A

56

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

C-130J 

Super Hercules

transport

aircraft

2000

Estimate £M 1,042 1,049

Approval 1,060 1,045

Difference -14 -18 4

ISD approval Jul-98 Jul-98 Jul-98

Forecast ISD May-00 Jun-00 Jun-00

Variation (months) 22 23 23

Type of procurement CD CD CD

% cost increase -1.7 0.4

Conventionally armed stand-off missile (CASOM) (Storm Shadow)

2002

Estimate £M 859 987 981 980

Approval 875 1,027 1,027 1,027

Difference -16 -40 -46 -47

ISD approval Dec-94 Aug-02 Aug-02 Dec-01

Forecast ISD Dec-01 Dec-01 Dec-01 Nov-02

Variation (months) 84 8 8 11

Type of procurement CD CD CD CD

% cost increase -1.8 -3.9 -4.5 -4.6

C-17

Globemaster III

transport

aircraft

2001

Estimate £M 771 775 769

Approval 785 785 785

Difference -14 -10 -16

ISD approval Dec-01 Dec-01 Dec-01

Forecast ISD Sep-01 Sep-01 Sep-01

Variation (months) -3 -3 -3

Type of procurement COTS COTS COTS

% cost increase -1.8 -1.3 -2
57

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

C Vehicle

 capability 2006

Estimate £M 710 703 703

Approval 714 714 714

Difference -4 -11 -11

ISD approval Apr-06 Apr-06 Apr-06

Forecast ISD Mar-06 Mar-06 Mar-06

Variation (months) -1 -1 -1

Type of procurement S S S

% cost increase -0.6 -1.5 -1.5

Eurofighter 

(Typhoon) 2003

Estimate £M 14,727 18,832 18,869 18,633 19,670 19,014 17,526 20,182 17,740

Approval 13,356 17,364 17,364 17,364 17,364 16,671 16,671 16,671 16,671 16,671 16,671 16,671 15,173

Difference 1,371 1,468 1,505 1,269 2,306 2,343 855 3,511 2,567

ISD approval Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98 Dec-98

Forecast ISD Jun-02 Jun-02 Jun-02 Jun-02 Jun-03 Jun-03 Jun-03 Jun-03 Jun-03 Jun-03 Jun-03 Jun-03 Jun-03

Variation (months) 42 42 42 42 54 54 54 54 54 54 54 54 54

Type of procurement CD CD CD CD CD CD CD CD CD CD CD CD CD

% cost increase 10.3 8.5 8.7 7.3 13.3 14.1 5.1 21.1 16.9

Extended-range 

ordnance 2003

Estimate £M 188

Approval 140

Difference 48

ISD approval May-98

Forecast ISD Jul-03

Variation (months) 62

Type of procurement S

% cost increase 34.3

APPENDIX A
APPENDIX A

58

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Falcon

comm system 2012

Estimate £M 292 291 285 270 349

Approval 324 324 324 324 395

Difference -32 -33 -39 -54 -46

ISD approval Feb-11 Feb-11 Feb-11 Feb-11 Jun-10

Forecast ISD Jun-10 Jun-10 Nov-10 Dec-10 Dec-12

Variation (months) -8 -8 -3 -2 30

Type of procurement S S S S S

% cost increase -9.9 -10.2 -12 -16.7 -11.6

Future strategic 

tanker aircraft 

(FSTA)

2014

Estimate £M 11,917 12,009 12,226 11,393

Approval 12,536 12,307 12,307 11,779

Difference -619 -298 -41 -386

ISD approval Nov-14 May-14 May-14 May-14

Forecast ISD May-14 May-14 May-14 May-14

Variation (months) -6 0 0 0

Type of procurement CD CD CD CD

% cost increase -4.9 -2.4 -0.3 -3.3

Guided

 multiple-launch 

rocket system 

(GMLRS)

2007

Estimate £M 263 263 91

Approval 360 360 360

Difference -97 -97 -269

ISD approval Jan-08 Jan-08 Jan-08

Forecast ISD Apr-07 Apr-07 Mar-07

Variation (months) -9 -9 -10

Type of procurement COTS COTS COTS

% cost increase -26.9 -26.9 -74.7
59

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

High-velocity 

missile system 2000

Estimate £M 898 933 904 904

Approval 882 927 901 901

Difference 16 6 3 3

ISD approval Sep-97 Sep-97 Sep-97 Sep-97

Forecast ISD Dec-90 Dec-90 Dec-90 Dec-90

Variation (months) 81 81 81 81

Type of procurement S S S S

% cost increase 1.8 0.6 0.3 0.3

Joint combat 

aircraft (JCA) N/A

Estimate £M 2,332 2,327 2,573 1,914 1,916 1,858 1,834 1,813 2,448 2,112 2,200 2,488

Approval 2,358 2,358 2,236 2,236 2,236 2,236 2,236 2,236 2,874 2,482 2,566 2,873

Difference -26 -31 337 -322 -320 -378 -402 -423 -426 -370 -366 -385

ISD approval n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Forecast ISD n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Variation (months) n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Type of procurement CD CD CD CD CD CD CD CD CD CD CD CD

% cost increase -1.1 -1.3 15.1 -14.4 -14.3 -16.9 -18 -18.9 -14.8 -14.9 -14.3 -13.4

Landing platform 

dock (LPD)

replacement 2003

Estimate £M 635 810 786

Approval 619 819 819

Difference 16 -9 -33

ISD approval Dec-00 Aug-00 Aug-00

Forecast ISD Mar-03 Mar-03 Mar-03

Variation (months) 27 31 31

Type of procurement S S S

% cost increase 2.6 -1.1 -4

APPENDIX A
APPENDIX A

60

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Landing ship 

dock (auxiliary)

LSD(A)

2004

Estimate £M 381

Approval 395

Difference -14

ISD approval Oct-04 Oct-04

Forecast ISD Jul-04 Jul-04

Variation (months) -3 -3

Type of procurement S S

% cost increase -3.5

Light forces antitank weapon 2005

Estimate £M 318 310 305

Approval 345 345 345

Difference -27 -35 -40

ISD approval Aug-06 Aug-06 Aug-06

Forecast ISD Nov-05 Nov-05 Jul-05

Variation (months) -9 -9 -13

Type of procurement CD CD CD

% cost increase -7.8 -10.1 -11.6

Medium-range 

TRIGAT

anti-tank

weapon

2005

Estimate £M 122 941

Cancelled

31 Mar 01

Approval 127 920

Difference -5 21

ISD approval Dec-95 Dec-95

Forecast ISD Jun-05 Jun-05

Variation (months) 114 114

Type of procurement CD CD

% cost increase -3.9 2.3
61

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Merlin HM 

Mk1

maritime

helicopter

1999

Estimate £M 5,028 4,081 4,183

Approval 3,867 3,121 3,213

Difference 1,161 960 970

ISD approval Dec-93 Dec-93

Forecast ISD Mar-99 Mar-99

Variation (months) 63 63

Type of procurement CD CD

% cost increase 30 30.8

Merlin HM

 Mk1 sustainment 2014

Estimate £M 832 832 830 829 768 791

Approval 840 840 840 840 805 805

Difference -8 -8 -10 -11 -37 -14

ISD approval Sep-14 Sep-14 Sep-14 Sep-14 Feb-14 Feb-14

Forecast ISD Feb-14 Feb-14 Feb-14 Feb-14 Feb-14 Jun-14

Variation (months) -7 -7 -7 -7 0 4

Type of procurement S S S S S S

% cost increase -1 -1 -1.2 -1.3 -4.6 -1.7

Merlin HM

 Mk3

maritime

helicopter

2000

Estimate £M 758 752 755

Approval 773 789 794

Difference -15 -37 -39

ISD approval Dec-99 Dec-99 Dec-99

Forecast ISD Jun-00 Jun-00 Jun-00

Variation (months) 6 6 6

Type of procurement CD CD CD

% cost increase -1.9 -4.7 -4.9

APPENDIX A
APPENDIX A

62

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Multi-role 

armoured vehicle 

(MRAV)

2008

Estimate £M 451 335 318

Withdrew 

17 Jul 

2003

Approval 428 428 428

Difference 23 -93 -110

ISD approval Mar-11 Mar-11 Mar-11

Forecast ISD Aug-08 Aug-08 Aug-08

Variation (months) -31 -31 -31

Type of procurement CD CD CD

% cost increase 5.4 -21.7 -25.7

Naval highfrequency (HF) 

comm

2012

Estimate £M 200

Approval 290

Difference -90

ISD approval Nov-09

Forecast ISD May-12

Variation (months) 30

Type of procurement COTS

% cost increase -31

Next-generation 

light anti- armour 

weapon

2009

Estimate £M 355 356 314 318 310

Approval 415 415 415 415 415

Difference -60 -59 -101 -97 -105

ISD approval Jul-07 Jul-07 Jul-07 Jul-07 Jul-07

Forecast ISD Nov-06 Nov-06 Jul-07 Jul-08 Apr-09

Variation (months) -8 -8 0 12 21

Type of procurement CD CD CD CD CD

% cost increase -14.5 -14.2 -24.3 -23.4 -25.3
63

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Nimrod MRA4

maritime patrol 

and 

attack aircraft

2012

Estimate £M 2,317 2,817 2,835 2,838 3,376 3,593 3,808 3,516 3,500 3,602 3,602

Approval 2,409 2,959 2,982 2,982 2,982 2,813 2,813 2,813 2,813 2,813 2,813

Difference -92 -142 -147 -144 394 780 995 703 687 789 789

ISD approval Dec-00 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03 Apr-03

Forecast ISD Mar-05 Dec-04 Dec-04 Nov-05 Mar-09 Sep-09 Sep-10 Sep-10 Sep-10 Dec-10 Oct-12

Variation (months) 51 20 20 31 71 77 89 89 89 92 114

Type of procurement S S S S S S S S S S S

% cost increase -3.8 -4.8 -4.9 -4.8 13.2 27.7 35.4 25 24.4 28 28

Panther 

command and 

control vehicle

2007

Estimate £M 201

Approval 238

Difference -37

ISD approval Nov-07

Forecast ISD Sep-07

Variation (months) -2

Type of procurement COTS

% cost increase -15.5

Precision-guided 

bomb 2007

Estimate £M 352 341 277

Approval 363 363 363

Difference -11 -22 -86

ISD approval Dec-07 Dec-07 Dec-07

Forecast ISD Sep-07 Sep-07 Sep-07

Variation (months) -3 -3 -3

Type of procurement S S S

% cost increase -3.0 -6.1 -23.7

APPENDIX A
APPENDIX A

64

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Puma life 

extension 2013

Estimate £M 326

Approval 339

Difference -13

ISD approval Nov-13

Forecast ISD Nov-13

Variation (months) 0

Type of procurement S

% cost increase -3.8

Queen Elizabeth–

class

aircraft carrier

2017

Estimate £M 5,133 5,900 5,131 5,348 6,102

Approval 4,359 4,359 3,541 3,541 3,541

Difference 744 1541 1590 1807 2561

ISD approval Oct-15 Oct-15 Jul-15 Jul-15 Jul-15

Forecast ISD May-16 May-16 Oct-16 Jul-17 Dec-17

Variation (months) 7 7 15 24 29

Type of procurement S S S S S

% cost increase 17.1 35.4 44.9 51.0 72.3

Seawolf missile 

system 

mid-life update

2006

Estimate £M 286 284

Approval 288 288

Difference -2 -2

ISD approval Dec-04 Dec-04

Forecast ISD Mar-05 Jan-06

Variation (months) 3 12

Type of procurement S S

% cost increase -0.7 -0.7
65

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Skynet 5

military 

communications

satellite

2005

Estimate £M 2,679 2,775 2,775

Approval 2,920 2,920 2,920

Difference -241 -145 -145

ISD approval Mar-05 Mar-05 Mar-05

Forecast ISD Feb-05 Feb-05 Feb-05

Variation (months) -1 -1 -1

Type of procurement S S S

% cost increase -8.3 -5 -5

Soothsayer 

electronic

warfare program

2009

Estimate £M 195 202

Approval 150 150

Difference 45 52

ISD approval Jun-07 Jun-07

Forecast ISD Feb-08 Jun-09

Variation (months) 8 24

Type of procurement S S

% cost increase 30 34.7

Spearfish

torpedo 1994

Estimate £M 1,810 1,348 1,347

Approval 1,628 1,246 1,246

Difference 182 102 101

ISD approval Dec-87 Dec-87 Dec-87

Forecast ISD Mar-94 Mar-94 Mar-94

Variation (months) 75 75 75

Type of procurement S S S

% cost increase 11.2 8.2 8.1

APPENDIX A
APPENDIX A

66

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Successor 

Identification 

Friend or Foe 

(IFF)

2004

Estimate £M 458 471 464

Approval 558 558 548

Difference -100 -87 -84

ISD approval Apr-04 Apr-04 Apr-04

Forecast ISD Feb-04 Mar-04 Mar-04

Variation (months) -2 -1 -1

Type of procurement S S S

% cost increase -17.9 -15.6 -15.3

Support vehicle 2008

Estimate £M 1,362 1,338 1,263 1,272 1,272

Approval 1,641 1,641 1,641 1,641 1,641 1,641

Difference -279 -303 -378 -369 -369

ISD approval Apr-06 Apr-06 Apr-06 Apr-06 Apr-06 Apr-06 Apr-06

Forecast ISD Apr-07 Feb-08 Feb-08 Feb-08 Feb-08 Feb-08 Jan-08

Variation (months) 12 22 22 22 22 22 22

Type of procurement S S S S S S S

% cost increase 0 -17 -18.5 -23 -22.5 -22.5

Terrier

armoured

digger

2013

Estimate £M 299 296 299 313 322

Approval 304 304 304 304 304

Difference -5 -8 -5 9 18

ISD approval Dec-08 Dec-08 Dec-08 Dec-08

Forecast ISD Sep-08 Sep-09 Dec-11 Apr-13

Variation (months) -3 9 36 52

Type of procurement S S S S S

% cost increase -1.6 -2.6 -1.6 3 5.9
67

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Tornado GR4 

mid-life upgrade 

(MLU)

2012

Estimate £M 303

Approval 301

Difference 2

ISD approval Mar-13

Forecast ISD Nov-12

Variation (months) -4

Type of procurement S

% cost increase 0.7

Tactical

Reconnaissance 

Armoured 

Combat

 Equipment 

Requirement 

(TRACER)

2013

Estimate £M 130 Can- celled

Approval 124

Difference 6

ISD approval Dec-04

Forecast ISD Oct-13

Variation (months)

Type of procurement CD

% cost increase 4.8

Trafalgar-class 

and 

Swiftsure-class 

submarine 

update

2004

Estimate £M 705 669 687

Approval 673 619 619

Difference 32 50 68

ISD approval Dec-98 May-02 May-02

Forecast ISD May-03 May-03 May-04

Variation (months) 53 12 24

Type of procurement S S S

% cost increase 4.8 8.1 11 APPENDIX A
APPENDIX A

68

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Trojan and Titan

combat

engineering 

vehicles

2006

Estimate £M 357 336

Approval 407 398

Difference -50 -62

ISD approval Dec-06 Dec-06

Forecast ISD Oct-05 Oct-06

Variation (months) -14 -2

Type of procurement S S

% cost increase -12.3 -15.6

Type 45 destroyer 2010

Estimate £M 5,279 5,546 5,896 6,110 6,464 6,464 6,464 6,464 5,664 5,556

Approval 5,837 5,837 5474 5,474 5,475 5,475 5,475 5,475 5,475 4,757 4,757

Difference -558 -291 421 635 989 989 989 989 907 799

ISD approval Nov-07 Nov-07 Nov-07 Nov-07 Nov-07 Nov-07 Nov-07 Nov-07 Nov-07 May-07 May-07

Forecast ISD Nov-07 Nov-07 May-09 May-09 Dec-09 Nov-10 Nov-10 Jul-10 Jul-10 Jul-10 Jul-10

Variation (months) 0 0 18 18 25 36 36 32 32 38 39

Type of procurement S S S S S S S S S S S

% cost increase -9.6 -5 0 7.7 11.6 18.1 18.1 18.1 18.1 19.1 16.8

Typhoon future 

capability 

package 

(FCP)

2013

Estimate £M 436 436 445 419 441 430

Approval 458 458 458 410 402 402

Difference -22 -22 -13 9 39 28

ISD approval Jun-12 Jun-12 Jun-12 Jun-12 Jun-12 Jun-12

Forecast ISD Jun-12 Jun-12 Jun-12 Jun-12 Dec-13 Dec-13

Variation (months) 0 0 0 0 18 18

Type of procurement CD CD CD CD CD CD

% cost increase -4.8 -4.8 -2.8 2.2 9.7 7.0
69

Project ISD Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Warrior

 capability

 sustainment 

program (CSP)

2018

Estimate £M 1,319 1,371

Approval 1,319 1,319

Difference 0 52

ISD approval Nov-18 Nov-18

Forecast ISD Nov-18 Nov-18

Variation (months) 0 0

Type of procurement S S

% cost increase 0 3.9

Watchkeeper 

unmanned 

aerial vehicle

2010

Estimate £M 901 898 895 889 839

Approval 920 920 920 920 847

Difference -19 -22 -25 -31 -8

ISD approval Feb-11 Feb-11 Feb-11 Feb-11 Jan-10

Forecast ISD Jun-10 Dec-10 Dec-10 Feb-11 Jan-10

Variation (months) -8 -2 -2 0 0

Type of procurement S S S S S

% cost increase -2.1 -2.4 -2.7 -3.4 -0.9

Wildcat

 helicopter 2014

Estimate £M 1,911 1,669 1,689 1,644 1,663

Approval 1,966 1,966 1,966 1,803 1,803

Difference -55 -297 -277 -159 -140

ISD approval Aug-14 Aug-14 Aug-14 Jan-14 Jan-14

Forecast ISD Jan-14 Jan-14 Jan-14 Jan-14 Aug-14

Variation (months) -7 -7 -7 0 7

Type of procurement S S S S S

% cost increase -2.8 -15.1 -14.1 -8.8 -7.8

Source: Compiled by the author from the Great Britain National Audit Office, Ministry of Defence major projects reports, 1999–2013. See bibliography for itemization of reports.

APPENDIX A

71

Appendix B—Environmental Cost Data

Collaborative development and commercial off-the-shelf (COTS) Environment Approval (£M)

Advanced short-range air-to-air missile (ASRAAM) Air 866

AH-64 Apache attack helicopter Air 2,997

AH-64 sensor Air 245

Airbus A400M Atlas Air 2,498

Airseeker intelligence aircraft Air 633

Beyond-visual-range air-to-air missile (BVRAAM) Air 1,136

CH-47 Chinook heavy-lift helicopter Air 841

C-130J Super Hercules transport aircraft Air 1,045

Conventionally armed stand-off missile (CASOM) (Storm Shadow) Air 1,027

C-17 Globemaster III transport aircraft Air 785

Eurofighter (Typhoon) Air 15,173

Future strategic tanker aircraft (FSTA) Air 12,307

Joint combat aircraft (JCA) Air 2,566

Merlin HM Mk1 maritime helicopter Air 3,213

Merlin HM Mk3 maritime helicopter Air 794

Typhoon future capability package (FCP) Air 402

Guided multiple-launch rocket system (GMLRS) Land 360

Light forces anti-tank weapon Land 345

Medium-range TRIGAT anti-tank weapon Land 920

Multi-role armoured vehicle (MRAV) Land 428

Next-generation light anti-armour weapon Land 415

Panther command and control vehicle Land 238

Tactical Reconnaissance Armoured Combat Equipment Requirement 

(TRACER) Land 124

Naval high-frequency (HF) communications Maritime 290
APPENDIX B

72

Sovereign Environment Approval (£M)

Advanced air-launched anti-armour weapon (AAAW) (Brimstone) Air 814

Advanced jet trainer Air 497

Airborne stand-off radar (ASTOR) Air 914

High-velocity missile system Air 901

Merlin HM Mk1 sustainment Air 805

Nimrod MRA4 maritime patrol and attack aircraft Air 2,813

Precision-guided bomb Air 363

Puma life extension Air 339

Successor Identification Friend or Foe (IFF) Air 548

Tornado GR4 mid-life upgrade (MLU) Air 301

Watchkeeper unmanned aerial vehicle Air 847

Wildcat helicopter Air 1,803

Bowman communications system Land 2,041

C Vehicle capability Land 714

Challenger II tanks Land 2,203

Combat infrastructure platform (CIP) Land 379

Extended-range ordnance Land 140

Falcon communications system Land 395

Soothsayer electronic warfare program Land 150

Support vehicle Land 1,641

Terrier armoured digger Land 304

Trojan and Titan combat engineering vehicles Land 398

Warrior capability sustainment program (CSP) Land 1,319

Astute-class nuclear-powered attack submarine (1–3) Maritime 2,233

Astute-class nuclear-powered attack submarine (4) Maritime 1,279

Landing platform dock (LPD) replacement Maritime 819

Landing ship dock (auxiliary) (LSD[A]) Maritime 395

Queen Elizabeth–class aircraft carrier Maritime 3,541

Seawolf missile system mid-life update Maritime 288

Spearfish torpedo Maritime 1,246

Trafalgar-class and Swiftsure-class submarine update Maritime 619

Type 45 destroyer Maritime 4,757

Skynet 5 military communications satellite Space 2,920

Source: Compiled by the author from the Great Britain National Audit Office, Ministry of Defence major projects reports, 1999–2013. See 

bibliography for itemization of reports.
73

 Appendix C—Causal Factor Data

Sovereign

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Advanced 

air-launched 

anti-armour 

weapon (AAAW)

(Brimstone)

1 1 2 0 0 0 1 0 1 0 0 1

Advanced jet 

trainer 0 0 2 0 0 1 0 0 1 0 0 0

Airborne 

standoff radar 

(ASTOR)

1 0 2 0 0 1 0 0 3 0 0 0

Astute-class 

nuclear-powered 

attack submarine 

(1–3)

1 3 10 1 0 0 0 0 4 0 0 0

Astute-class 

nuclear-powered 

attack

 submarine (4)

0 3 8 0 0 0 0 2 0 0 0 0

Bowman 

communications 

system

2 1 1 1 0 2 0 0 0 0 0 0

Challenger II 

tanks 1 1 0 0 0 1 0 0 1 0 0 0

Combat

 infrastructure 

platform

 (CIP)

0 1 4 0 0 0 0 0 3 0 0 0

C Vehicle 

capability 0 0 0 0 0 1 1 0 1 0 0 1
APPENDIX C

74

Sovereign

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Extended-range 

ordnance 0 1 1 0 0 1 0 1 1 0 0 1

Falcon

communications

system

2 2 2 1 0 0 1 0 5 0 0 0

High-velocity 

missile system 1 1 1 0 0 1 0 1 1 0 0 1

Landing platform dock (LPD) 

replacement

1 1 1 1 0 0 0 0 1 1 0 1

Landing ship 

dock (auxiliary)

(LSD[A])

0 0 0 0 0 0 0 0 0 0 0 0

Merlin HM Mk1 

maritime

 helicopter

 sustainment

0 0 3 1 0 0 0 0 0 0 0 0

Nimrod MRA4

maritime patrol 

and attack 

aircraft

1 1 3 0 0 1 0 1 1 0 0 0

Precision-guided 

bomb 1 1 1 3 0 0 0 0 0 0 0 1

Puma life 

extension 1 0 0 0 0 0 0 0 0 0 0 0

Queen

Elizabeth–class 

aircraft carrier

0 7 19 2 0 0 0 3 2 0 0 0
75

APPENDIX C

Sovereign

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed 

capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Skynet 5

military 

communications 

satellite

0 0 0 0 0 1 0 0 0 0 0 0

Soothsayer

electronic 

warfare program

0 1 1 0 0 0 0 0 3 0 0 0

Successor Identification Friend 

or Foe (IFF)

1 0 1 1 0 1 0 0 1 0 0 1

Support vehicle 1 1 1 0 0 0 0 1 1 0 0 1

Terrier 

armoured digger 2 0 1 2 0 0 2 0 1 0 0 0

Trafalgar-class 

and

Swiftsure-class

 submarine 

update

1 0 1 0 0 0 0 0 0 0 0 1

Trojan & Titan

combat 

engineering 

vehicles

2 0 1 0 0 2 1 0 0 0 0 2

Type 45

 destroyer 0 7 5 2 0 1 0 0 2 1 0 0

Warrior 

capability

sustainment 

program 

(CSP)

2 0 1 0 0 0 0 0 0 0 0 0

Wildcat

 helicopter 2 12 0 0 0 0 0 0 1 2 0 0
APPENDIX C

76

Commercial 

off-the-shelf 

(COTS)

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed

 capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed

 capability 

requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International 

procurement

Contract 

process

AH-64 Apache

attack

helicopter

1 1 0 1 0 1 1 1 1 0 0 0

Airseeker 

intelligence 

aircraft

0 0 0 0 0 0 0 0 0 0 0 0

CH-47 Chinook 

heavy-lift 

helicopter

0 0 5 0 0 0 0 0 0 0 0 0

C-17

Globemaster III

transport 

aircraft

1 0 0 1 0 1 0 0 0 0 0 0

Guided

 multiplelaunch 

rocket system 

(GMLRS)

2 3 0 0 0 1 0 0 0 0 0 0

Naval highfrequency 

(HF) comm

1 0 1 0 0 1 0 0 2 0 0 0

Panther 

command and 

control vehicle

0 1 0 0 0 0 1 0 0 0 0 0
77

APPENDIX C

Collaborative 

development

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed 

capability

 requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed

capability 

requirements

Budgetary 

factors

Technical 

Factors

Procurement 

processes

International

procurement

Contract 

process

Advanced 

short-range 

air-to-air missile 

(ASRAAM)

1 0 1 0 0 1 1 0 1 0 0 0

AH-64 sensor 0 0 1 0 0 1 0 0 1 0

Airbus A400M 5 1 15 6 4 0 0 0 5 1 1 0

Beyond-visualrange air-to-air 

missile 

(BVRAAM)

2 2 3 3 5 0 0 0 0 1 0 0

C-130J Super 

Hercules transport aircraft 1 0 1 0 0 1 0 0 1 0 0 0

Conventionally 

armed stand-off 

missile

 (CASOM) 

(Storm Shadow)

1 1 1 0 0 0 1 0 1 0 0 1

Eurofighter 

(Typhoon) 2 5 9 4 0 0 0 0 1 0 1 0

Future strategic 

tanker aircraft 

(FSTA)

3 5 7 1 0 0 0 0 0 0 0 0

Light 

forces anti-tank 

weapon

0 1 2 0 0 0 0 0 0 1 0 0

Medium-range 

TRIGAT

 anti-tank 

weapon

1 1 0 1 0 0 0 1 1 1 0 0
APPENDIX C

78

Collaborative 

development

Cost Time

Corporate changes Project changes Corporate changes Project changes

Changed 

capability

 requirements

Budgetary 

factors

Technical 

factors

Procurement 

processes

International

procurement

Contract 

process

Changed

capability 

requirements

Budgetary 

factors

Technical 

Factors

Procurement 

processes

International

procurement

Contract 

process

Merlin HM 

Mk1 1 1 1 0 0 1 0 1 1 0 0 1

Merlin HM Mk3 1 1 1 0 0 1 0 0 1 0 0 0

Multi-role 

armoured

 vehicle (MRAV)

1 1 1 1 0 1 0 0 0 0 0 0

Next-generation 

light antiarmour weapon 0 3 1 2 0 1 1 0 3 0 0 0

Typhoon future 

capability 

package (FCP)

0 1 6 0 0 0 0 0 2 0 0 0

Source: Compiled by the author from the Great Britain National Audit Office, Ministry of Defence major projects reports, 1999–2013. See bibliography for itemization of reports.
79

Abbreviations

AGS Alliance Ground Surveillance

COTS commercial off-the-shelf

DIS Defence Industrial Strategy

EU European Union

ISD in-service date

ISR intelligence, surveillance, and reconnaissance

ISTAR intelligence, surveillance, target acquisition, and reconnaissance

MOD Ministry of Defence

MPR major projects report

NAO National Audit Office

NATO North Atlantic Treaty Organization

PAAMS Principal Anti-Air Missile System

PSS project summary sheet

RAF Royal Air Force

R&D research and development

RUSI Royal United Services Institute

SDSR Strategic Defence and Security Review

81

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ISBN: 978-1-58566-263-0

ISSN: 1941-3785

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