The delivery of a fleet of armoured vehicles will be a significant challenge for the Ministry of Defence (MoD) because of failures that have led to delays and unresolved safety problems, according to the public spending watchdog. The MoD has a £5.5bn contract with General Dynamics Land Systems UK (GDLS-UK) for the design, manufacture and initial in-service support of 589 Ajax armoured vehicles. As of December 2021, the department had paid GDLS-UK £3.2bn, but has so far only received 26 vehicles, the National Audit Office (NAO) said. The late delivery left the army with ageing armoured vehicles that were expensive to maintain, it added. At the end of last year, GDLS-UK had designed the vehicles, built 324 hulls, and assembled and completed factory acceptance testing of just 143 vehicles, the NAO said. Meg Hillier MP, chair of the public accounts committee, said: “The NAO report reads like a checklist for major project failure where almost everything that can go wrong, did go wrong. It means Ajax has now joined the sorry pantheon of government projects which have gone off the tracks. “Despite more than £3bn having been spent so far, the in-service date is more than four years late and there is still no end in sight. The army is forced to continue using increasingly old and obsolete equipment which, aside from adding cost, reduces our capability at a time when dangers are only increasing. “The MoD has not paid the contractor for over a year and with both sides at loggerheads, there is real pressure building in the programme. Both parties must find a way out of the deadlock, work together to rescue the programme, and ensure the army gets the equipment it needs.” The department had assumed the vehicles would be in service in 2017 and subsequently set an “initial operating capability” date of July 2020, which it then pushed back to June 2021, but missed. Concerns about excessive noise and vibration levels remain unresolved, and the MoD has not yet set a new initial operating capability target date. It also has no confidence that the April 2025 goal for full operating capability is achievable, according to the NAO report. The delays will have important operational impacts on the army, the watchdog warned. The MoD transferred financial risks to GDLS-UK by agreeing a firm-priced contract to deliver the Ajax vehicles, but this may not protect it from further expenditure, the NAO added. It is not yet clear whether the programme’s problems are resolvable, the watchdog said in its report. Gareth Davies, the head of the NAO, said: “The MoD and GDLS-UK’s approach was flawed from the start. They did not fully understand the scale or complexity of the Ajax programme and a series of failures have led to delays and unresolved safety issues that will have a significant impact on the army’s ability to use the vehicles. “We have seen similar problems on other defence programmes, and the department must demonstrate that it understands the fundamental improvement required in its management of major programmes.” An MoD spokesperson said: “As we have made clear, Ajax is a troubled programme, and we will not accept a vehicle that is not fit for purpose. As the NAO recognises, we are working with General Dynamics to resolve the noise and vibration issues with a view to Ajax being successfully delivered to the army. “We continue to meet our obligations to Nato and will mitigate any capability gap through a range of alternative reconnaissance capabilities.”