National Audit Office: Clear controls in place to manage UK-Saudi military contracts

• The MoD's current controls for how it manages two major military programmes on behalf of KSA are clear, with no areas of concern identified in how contractors are paid. 
• The MoD has strengthened its processes by applying lessons learned from a court case relating to historic corrupt practices in one of the programmes. 
• The programmes are intended to strengthen and enhance the UK-Saudi defence and security relationship, bringing economic, military and geopolitical benefits to the UK.

The Ministry of Defence (MoD) has in place a clear set of controls to manage military contracts on behalf of the Kingdom of Saudi Arabia (KSA) and has applied lessons learned from a court case to strengthen its processes further, according to a new National Audit Office (NAO) report.¹

For more than four decades, the MoD has run two major programmes for KSA, which it considers as economically, militarily and geopolitically beneficial to the UK.

The Ministry of Defence Saudi Armed Forces Projects (MODSAP) supplies military aircraft, naval vessels, weapons, training and associated support services to the Saudi Armed Forces,² while the Saudi Arabia National Guard Communications Project (SANGCOM) delivers telecommunications capability for the Saudi Arabian National Guard.

A Serious Fraud Office (SFO) investigation into corruption involving the then prime contractor for SANGCOM led to prosecutions in 2021 and 2024. In the first of these, the judge was satisfied that the government was “substantially involved in the historic corrupt arrangements” that led to the prime contractor's conduct.³

Following the conclusion of the court case, the NAO has reviewed the MoD's current arrangements and activities for managing the two programmes.^4,5

It finds that the programmes now have clearly defined and structured governance arrangements, including oversight by senior MoD officials.

The MoD has processes in place to ensure that payments made to contractors working on both programmes are appropriate, with no significant control weaknesses identified.

In recent years, the MoD has also strengthened how it manages the programmes after implementing recommendations from internal audit reviews looking at their respective governance arrangements, and in October 2024 it completed an exercise for MODSAP to learn lessons from the recent court case.

ENDS
Notes to editors

1. The report will be available on the NAO website via the following link from 00:01 Wednesday 10 September: https://www.nao.org.uk/reports/management-of-contracts-by-the-mod-on-behalf-of-saudi-arabia/ 
2. Through its support services, the MODSAP team provides a range of skills relating to commerce, digital, engineering, finance, operational delivery, policy, project management and quality assurance.
3. This court case related to SANGCOM and the SFO made no allegations regarding MODSAP.
4. The investigation does not examine previous arrangements, including those in place during the period covered by the SFO investigation, which have been superseded. It does, however, consider the extent to which the MoD has applied lessons learned from issues raised during the court case. It does not evaluate the value for money of the arrangements, because they are fully funded by the government of KSA.
5. In addition to MODSAP and SANGCOM, the MoD also runs one further, smaller programme on behalf of the KSA – the British Military Mission – through which the UK provides advice and training to the National Guard on infantry and explosive ordnance disposal capabilities. This is not included in the scope of the investigation because it does not involve the MoD managing the supply of equipment to the KSA.