The Report of the Iraq Inquiry

• The NAO. The NAO audits the accounts of all government departments and

agencies, and many other public bodies. The NAO also produces around

60 value for money studies each year on the economy, efficiency and

effectiveness of public expenditure.

• Departments’ own internal audit units.425

681.  The estimates cycle is the process by which Parliament approves departments’

resources and cash provision for the year. Departments submit Supply Estimates which

set out how they plan to spend their funding and seek approval from Parliament for the

necessary funds.

682.  Because of the unpredictable nature of military operations, the MOD does not

provide an estimate of NACMO to Parliament at the beginning of each financial year,

as part of its Main Estimates.426 Between 2002/03 and 2005/06, the MOD sought

Parliament’s approval for NACMO expenditure in February (towards the end of the

financial year) as part of the Spring Supplementary Estimates.

683.  The MOD Estimates are reported on by the House of Commons Defence

Committee (HCDC).

684.  In its report on the MOD’s 2005/06 Spring Supplementary Estimates, the HCDC

called for the MOD to provide estimated NACMO for “commenced operations” as part

of its Main Estimates, if necessary with a large element for contingency.427 The HCDC

stated that, for the MOD:

“… Parliamentary approval seems to be regarded as a rubber stamp. For this,

Parliament must take some of the blame: for too long we have allowed

Parliamentary approval of the Estimates to be taken for granted. MOD must

recognise that the agreement of the Treasury is not a substitute for

Parliamentary approval, and that providing information to the Treasury is

not enough.”

685.  From 2006/07, in response to that criticism, the MOD presented initial estimated

NACMO to Parliament in November as part of its Winter Supplementary Estimates,

before seeking formal approval of expenditure as part of the Spring Supplementary

Estimates the following February.428

425 Committee Office Scrutiny Unit, March 2007, Financial Scrutiny Uncovered.

426 Tenth Report from the Defence Committee, Session 2006‑2007, Cost of military operations:

Spring Supplementary Estimate 2006‑07, HC 379.

427 Fourth Report from the Defence Committee, Session 2005‑2006, Cost of peace‑keeping in Iraq and

Afghanistan: Spring Supplementary Estimate 2005‑06, HC 980.

428 Tenth Report from the Defence Committee, Session 2006‑2007, Cost of military operations:

Spring Supplementary Estimate 2006‑07, HC 379.

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