The state spends billions on purchasing and maintaining armoured equipment for the Army. However, most of the equipment is not operable.

Press release on audit No 19/13 – 25 May 2020

The Supreme Audit Office (SAO) verified purchases, modernisation, repairs, and maintenance of armoured equipment of the Army of the Czech Republic conducted between 2016 and 2018. During this period, the Ministry of Defence (MoD) invested CZK 2.8 billion in new equipment, and it spent a further CZK 1.3 billion on repairs, maintenance, and spare parts. Despite these expenses, most of the armoured equipment was not operable. This may pose a threat to the operational readiness of the Army. All the audited purchases and service support were commissioned by the MoD on the basis of an exception to the law or in a negotiated procedure without prior publication. Dependence on suppliers or expensive repairs and maintenance of armoured equipment is also a problem.

The MoD did not consider the costs of the entire lifecycle of armoured equipment before making its purchase, although it was bound to do so on the basis of a Government Resolution dating back to 2011. Not considering maintenance and repair costs before making a purchase leads to a situation when the MoD is dependent on the supplier of servicing support and spare parts, which makes the operation of armoured equipment more expensive. The expenditure on servicing support and on the purchase of spare parts increased from CZK 194 million in 2016 to almost CZK 780 million in 2018.

Problems with the delivery of spare parts and servicing occurred, for example, in the case of infantry fighting vehicles, armoured personnel carriers, or modernised tanks. This equipment was not operable, to a large extent. Less than 43% of tanks were operable in the audited period. One of the rescue tanks was not operable for as long as 3.5 years, which represents almost a fifth of its lifespan.

If the army itself was more involved in repairs and maintenance of armoured equipment, this would bring about savings. However, the army does not have enough capacities for this. A majority of the servicing support is provided by external suppliers. The trend in other countries is quite the opposite. External services are used mainly for specialised devices.

In the case of all the audited purchases of armoured equipment and servicing, the MoD used the exception to the Public Procurement Act, or negotiated procedures without prior publication. It used expert opinions to document that the contractual prices are meeting requirements.

For example, the expert opinions justified an increase in the price of armoured command and signalling vehicles by 60% compared to previous estimates, which represents an increase from CZK 1.3 billion to CZK 2 billion. In the case of a framework agreement for three years of servicing support for infantry fighting vehicles and armoured personnel carriers, the MoD increased the price by CZK 795 million which is a 270% increase compared to the previous framework agreement.

The auditors also found shortcomings in the planning of investments. The MoD did not have clearly defined needs of the army, which it could take into account when planning expenditures. Various documents differed in terms of the number of equipment, the amount of funds, and timeframes. Moreover, there were delays in the process of completing investments.

The auditors also found that the MoD inefficiently spent almost CZK 86 million on technical modifications of an armoured vehicle. This vehicle was to be used for reconnaissance in international missions. However, the technical modifications overloaded the vehicle. Therefore, the weapons system had to be changed and the number of soldiers operating the weapon and performing reconnaissance at the same time had to be reduced. The army also made further modifications to reduce the weight of the vehicle. In the end, it was not in operation for a total of 6.5 months and the army did not use it for international missions.

print the page