New Contracts and Urgent Development Efforts. General Kuptel: Armament Agency Getting Ready to Face the Modernization Challenges on Unprecedented Scale [Interview]

- Brig. General Artur Kuptel emphasizes the fact that the Act on Homeland Defence, and Reinforcement Package for the Armed Forces for 2023-2035, along with the Armed Forces Support Fund, and a reform of the Polish military procurement system were all implemented to accelerate the procurement processes. - The Head of the Armament Agency presents the priorities of work undertaken by the Polish industry when it comes to the unmanned systems in the naval, land, and air domain, and the systems used to counter the unmanned assets used by the adversary. - Kuptel adds that making the R&D processes far more dynamic has been one of the assumptions behind the reform of the procurement system. He stresses the fact that the current geopolitical context, including the war in Ukraine, forces the Agency to make decisions on the urgent launch of new development efforts that would be based on the experiences gathered through the conflict in Ukraine. - Kuptel also explains how the transfer of technologies would be arranged in the programs pursued with the Korean partners. - The Head of the Armament Agency justifies the necessity to amend the requirements for some programmes, based on lessons learned from Ukraine. - General Kuptel admits that maintaining the current HR and recruiting new specialists is a major challenge for the Armament Agency. - The US government provided us with LOA on 23rd August this year, including, apart from 96 AH-64E Apache helicopters, a maximum possible weapons and equipment package. Currently, we are engaged in talks with the US, aimed at determining the shape of the final subject of the order, Kuptel stressed.

Jędrzej Graf: General, the new military equipment and armament procurement system has been in operation for several months now. The Technical Modernization Council is almost two years old. It can be seen clearly that modernization and procurement contracting progress at a faster tempo. What elements played a key role here, apart from more funds available to the Polish Ministry of Defence? Earlier on, many procurement processes, those less spectacular, or less costly ones, but still relevant, were being delayed by the ongoing procedures.

The adoption of the Act on Homeland Defence, on 11th March 2022, played a key role here, including the establishment of the Armed Forces Reinforcement Package for 2023-2025, and of the Armed Forces Support Fund, but also the implementation of a new military equipment procurement system, which resulted in a far more efficient issuance of the orders.

The Technical Modernization Council was brought to life in 2021, and the Armament Agency, born on 1st January 2022, was responsible for procuring modern military equipment meeting the requirements of modern and future battlespace, altogether facilitating effective contracting with regards to military equipment orders, especially in the case of priority and complex modernization programmes. The Armament Agency, which I’d like to stress, is completing its tasks based on Central Material Plans (including the Technical Modernization Plan, and the Plan on Procurement of Material Means), covering the planning timeline until 2035. All of the above propels the technical modernization of the Polish Armed Forces to an unprecedented scale.

As I said already, the tempo has been unprecedented. Is it possible, at such a rapid pace, to negotiate favourable agreements for the Polish Armed Forces, and the industry, also financially?

A well-prepared team of experts with major experience, know-how, and expertise in the field of defence procurement can accomplish tasks to the best possible degree, and with the best final results. We are also taking the Polish defence industry into account, applying all available mechanisms, compliant with the law.

Each organization evolves and requires adjustments or amendments to be made. What is the biggest challenge ahead, for the Armament Agency?

The dynamics of changes determining the actions taken by the Armament Agency, fluidly and continuously call for structural and operational optimization of this organ. Maintaining the current, and recruiting new personnel responsible for the whole area of military procurement is the biggest challenge now, taking into account the subordinated units as well.

We are making major procurements, but some worries emerge regarding the possibility of maintaining the equipment throughout its lifecycle. For modern equipment, such as Abrams MBT, Patriot air defence system, or the F-35, the LCC would be much higher than for the legacy generation systems, while logistics support packages procured alongside the equipment usually remain valid just for a few years, immediately after the procurement. To what extent does the Armament Agency take into account the long-term support for the equipment, throughout the lifecycle, when preparing the orders? And how can we face this challenge, working closely with the Support Inspectorate?

One of the elements of implementing and expanding the technical capacity, new technologies, is seen in the application of mechanisms I mentioned when answering the question on Polish industrial participation. One of them (but not the only one) comes in the form of concluding and implementing offset agreements.

One needs to note that both the Polish Ministry of Defence, as well as the Armament Agency, considering the role the Polish defence sector entities play in meeting the national defence needs, are driven to maintain and establish new capacity in the national industrial potential, especially in priority domains, including munitions manufacturing, or securing the lifecycles for new equipment types throughout the whole lifecycle, starting from the broadest possible manufacturing know-how, through maintenance capacity, and modernization capacity to finish with.

A large portion of procurement pursued by the Armament Agency pertains to foreign-made equipment, and the reason for that stems from the lack of sufficient manufacturing capacity. To what extent the Armament Agency, when planning long-term contracts, can get involved, to increase the Polish industry's manufacturing capacity? So that most of the equipment procurement funds stay in Poland, in the long run.

The Armament Agency, ever since it has been founded, concluded several dozens major long-term contracts involving the Polish defence industry companies, valued at several dozens billion zlotys. I always stress the fact that the Polish defence industry is always the first choice variant for the Armament Agency, and we always direct orders there, if the industry offers readymade, or possible-to-implement solutions that can be efficiently acquired and delivered across a timeline required by the Armed Forces. We are expecting the Polish defence industry to boost its potential and manufacturing and maintenance capacity. We shall remember that pursuing the Technical Modernization Plan for the Polish Armed Forces involves facing challenges ahead of the Polish MoD, and the Polish defence industry as well.

The order portfolio for the PGZ Group is full to a major extent for the upcoming years, while finalizing the contracts already concluded would require a major organizational, and manufacturing effort. One cannot forget about the offset agreements I have mentioned already, thanks to which the Polish defence industry is broadening its capabilities and manufacturing capacity, and acquires expertise and knowledge, or about the basic national security interest mechanism that is used by the Polish defence industry. The aforesaid mechanism applies both to keeping the existing capabilities in good shape, in the selected domains, such as munitions, but also to the establishment of new ones, or expansion of the existing ones.

Currently, numerous R&D projects have reached the final stages, such as the Borsuk IFV, or Wisła and Narew radars. Decisions on the launch of those projects were often being made a decade ago. What are the key directions for development efforts that the Armament Agency intends to launch so that new equipment is commissioned after 2030?

The key directions for development efforts correspond with the prospective operational requirements expressed by the Polish Armed Forces, defined within the scope of the review of operational capability requirements conducted by the General Staff of the Polish Armed Forces, in a four-year cycle. Regardless of the above, the current geopolitical context, shaped mainly by the war in Ukraine, forces the Agency to make decisions on the urgent launch of new development works that would be based on the experiences gathered through the conflict in Ukraine. It is not a secret that conclusions drawn from the operations conducted in Ukraine unanimously point to a necessity to amend numerous tactical and technical requirements defined for military equipment to ensure its lethality on the future battlefield. As a result, this implies an initiation of the procurement process for new equipment, also through pursuing development, or even research studies.

The development studies conducted under the supervision of the Ministry of Defence are aimed at developing a prototype of a specific military equipment piece, the use of which would make it possible to meet the operational requirements expressed by the Polish Armed Forces in the future. NKTO New Wheeled APC framework agreement signed last month is one of the recent examples coming from that domain. The first performance contract for this programme would cover a development study aimed at developing the NKTO platform from scratch by the Polish defence industry, over the upcoming years. We are focusing, currently, on developing and acquiring new unmanned systems, that would conduct operations in naval, land, and air domains, and systems that would be used to counter enemy drones. One shall also remember the APCs meeting the requirements of the engineering units, broadband communications, satellite reconnaissance, anti-tank systems and new munitions.

Numerous development projects in the past had suffered from delays and really small budgets. What has been done to change that?

Indeed, it seems to be an accurate conclusion, regarding the conditions of implementation of development works during the last decade. I cannot hide the fact that similar conclusions had an impact on decisions pertaining to the organizational structure of the Armament Agency. Stimulation of R&D in the Polish defence industry has been a part of the planning ideation since the very start of the effort tied to the establishment of a new executory organization for the military procurement process. Specifically, we have undertaken actions as follows: we have established the R&D Directorate; we have shifted the centre of gravity from the area of research to the area of development, indicating the methodological profile for the baseline foundation of the research projects, within the context of their potential application in development projects, tightly tied to the well-defined operational requirements; and finally, we have considered the human factor to play a key role in the process of implementing project undertakings as such.

Not only am I referring here to the recruitment of highly qualified personnel, substantially competent in the area of military technologies, but I am also pointing out the necessity for a mental and cultural shift to happen, when engaging in innovative projects where both the contractor and the ordering party (namely The Armament Agency) are working based on a partner-like relations, with mutual support in achieving the overarching objective: completing the given project, based on rules previously set out, adjusted as per common sense, in circumstances in which this would be required.

When it comes to the limited financing, within which some of the recent projects were completed, I am wondering whether this should be viewed as a deficiency or a flaw. In essence, most of the development works, that went through a successful verification, result in the procurement of military equipment, where the contractors, within the framework of successively concluded agreements, recover the aforesaid "low investments". As time goes by, I am inclined to engage in considerations that lead to a conclusion in which our "deficiency", namely the successful projects, despite the low, relative to the global indications, financial outlays, shall be turned into the strength of ours, at least in the allied NATO arena. R&D as a service, at an attractive price, is more and more visibly distinguishing the Polish research and industrial complex in the international arena.

To what extent does the transfer of a major portion of equipment to Ukraine resisting the Russian full-scale aggression, and the necessity to introduce replacements, have an impact on accelerated procurement of new equipment?

Not only does the accelerated contracting regarding the military equipment stem from donations for Ukraine, but primarily from the geopolitical situation, and the adopted 2023-2035 Armed Forces Reinforcement Package.

Now, onto the key programmes. We have already obtained Congress authorization regarding the acquisition of launchers and missiles for the second phase of the Wisła program. How the contracting of the second phase of Wisła, including the elements of command and support, would differ from the stage one procurement, apart from the number of missiles or launchers, or the radar type?

Contracting in the second phase of the Wisła programme would be aligned with the first phase. The experience and skills acquired throughout Phase I would have a direct impact on the quality and timely execution of the acquisition of the Phase II elements.

Narew programme and the SONA army mobile protection system are tied to the Wisła system. The relevance of such systems within IADS has been highlighted by the war in Ukraine. What are the next steps in those areas?

Indeed, the Narew Programme is one of the most expansive and complex modernization programmes undertaken by the Polish Armed Forces in history, with an estimated value reaching several billion zlotys. When it comes to the SONA programme, the Armament Agency carried out market research and also prepared the key results documentation for mobile air defence assets offering a capability to counter a broad spectrum of threats, such as unmanned aerial vehicles, RAM targets (Rocket, Artillery, and Mortar), and classic ABT threats (Air Breathing Target).

Given the Ukrainian experience, the requirements defined by the Armed Forces so far, including ones stemming from the SONA operational requirement, are verified within the IAMD system within the framework of the ongoing operational capability requirements review. The results of that review should become known to the Armament Agency in a few weeks. That would constitute a foundation for further steps. It would probably not be a surprise that further air defence contracts are to be signed during the MSPO exhibition in Kielce.

And what about counter-UAS? In modern warfare, we can see that not only do the large unmanned platforms pose a threat, but also the mass-employed civil systems - defence against them needs to be common, also in the lower-tier elements.

As I pointed out, responding to the previous question, the area tied to the IAMD domain is broad, and it includes procurement of military equipment addressing the counter-UAS capabilities, within the scope of neutralizing different classes of UAVs. These capabilities are being acquired through the delivery of new military equipment, such as the SKYctrl systems, counter-UAS systems of the Pilica+ system, and also within the framework of implementing the newly identified or verified requirements that the Polish Armed Forces have, such as SONA, NIDA, DRACENA, and a couple of other requirements. Here I can say that the resources that remain at the disposal of the Polish Armed Forces, within the scope of systems designed for detecting and countering UAS, have been continuously growing since last year, and that process is going to continue.

Procurement in South Korea is yet another key direction. K2/K2PL main battle tanks, K9/K9PL howitzers, and Chunmoo launchers for the Army, and manufacturing of the assets and the guided Chunmoo rockets domestically are to be implemented at the second stage. How do the preparations progress, before the implementation of stage two, and before the conclusion of performance contracts?

Currently, talks are underway, between the Armament Agency, and the Contractors, on the final configuration of the polonized, acquired main battle tanks, self-propelled howitzers, and MLRS systems - all coming from South Korea. In the case of the K2PL main battle tanks, we are planning to acquire 820 examples in total, 500 of which are planned to be manufactured at the WZM S.A. facility that would, over a few years, gradually take over the work on this order from the Koreans, by establishing a domestic manufacturing and maintenance-servicing centre.

This programme would result in an efficient, generational replacement of main battle tanks in the Polish Armed Forces. In the case of HSW, apart from the Krab manufacturing underway now, assembly, and then manufacturing and maintenance of the K9PL system would be implemented, as per arrangements made with the Koreans, within the framework of the existing consortium. When it comes to the Homar-K MLRS (the polonized K239 Chunmoo variant), a transfer of technology for the Polish defence industry businesses is planned, in connection with the manufacturing of the launcher module, and rockets. It shall also be stressed that the implementation of all of those programmes would be accompanied by the acquisition of many vehicles and specialist equipment pieces being supplied by the Polish defence industry to the elements operating the aforesaid equipment.

The Armed Forces Support Fund - What role does it play in the procurement made in Korea? Is financing ensured already, for the second phase of the performance agreements mentioned above?

The Armed Forces Support Fund is a very important financing tool, emerging on the grounds of the Act on Homeland Defence. The acquisition of military equipment stems from the Central Material Plans, and it is financed from a variety of sources, including, above all, the budget, and the Support Fund. So far, the Support Fund financing experience has been positive. Several contracts were concluded, and currently, no major threats emerge, tied to the conclusion of further contracts.

The Navy is currently working on several warship programmes, such as Delfin or Kormoran. Miecznik, however, and Orka launched recently, attract most of the public attention - frigates and submarines. I would like to ask - are you not worried about delays stemming from the possible differences in the configuration of three vessels - the first, prototype one, and two series-manufactured ones?

The agreements management system implemented at the Armament Agency, and the contractual and risk management on the Contractor side, make it possible to optimistically look towards the future. Noteworthy, the "cascade" vessel platform building variant employed for the sake of this agreement, involving the acquisition of readymade elements that would not undergo any modifications throughout the project, is aimed at further diminishing such a risk. Considering the war in Ukraine breaking out, it is difficult to foresee the ultimate set of factors determining the time of delivery.

What is the direction in which the Orka programme consultation is going?

Currently, the Hardware Requirements Definition phase is underway, and Preliminary Market Consultation is a relevant element of that. As announced already, the PMC phase sees 11 entities involved, 7 of which offer readymade solutions in the form of a specific submarine. Currently, the entities submitted are analyzed. Then RFIs would be sent out, aimed at initially determining whether vessel designs proposed by the individual bidders meet the requirements. As a result of that, realistic Equipment Requirements would be determined, along with a feasibility study taking the procurement formula into account, along with the timeline, necessity and scope of offset arrangements, or a transfer of technologies, risks, costs, and so on.

And how does the Kruk attack helicopters procurement progress? Can you confirm the off-the-record rumours that a plan was devised, to divide this procurement?

The US government provided us with LOA on 23rd August this year, including, apart from 96 AH-64E Apache helicopters, a maximum possible weapons and equipment package. Currently, we are engaged in talks with the US, aimed at determining the shape of the final subject of the order. In parallel, talks are underway involving the industry, regarding the offset, and also dialogue is happening between the MoD representatives, and the US Army, regarding a gap-filler solution - the transfer of 8 AH-64D helicopters coming from the US Army stockpile, needed to train the pilots, and the ground crews, before the actual delivery of the AH-64E helicopters. Currently, we are not planning to divide the Apache procurement into parts.

What is the relationship between the Kruk procurement, and the newly prepared Black Hawk acquisition? In what way both helicopters would be readied to be interoperable?

One should note that the Armament Agency ensures the procurement of military equipment with technical and functional specifications defined by the user - operational forces, and the SOF component. Nevertheless, given the need to efficiently and rationally use the procured helicopters, we need to approach them as a complete combat system, complementing the other elements during operations, and being interdependent. Solutions tested by the US Army in combat show that the sole preparation of a proper Apache-Black Hawk combat tandem would create a synergy and proper impact. Thus, when procuring the Black Hawk helicopters, we would take into account the requirements related to ensuring interoperability for this duo. Considering the fact that the negotiation with the US is underway, we still need to wait for further details.

Finally, I would like to ask you about one more matter. As the full-scale war in Ukraine lasts, we see that many pieces of equipment are rapidly developed, sometimes with the use of civilian technologies such as UAVs, sometimes with the integration of systems that are far more convoluted, such as guided missiles, with new carrier platforms. To what extent approach as such would be rational, at least in some cases, in Poland, when it comes to the use of available civil technologies?

Life verifies the capabilities, and war paves new paths for the use, or functionality of civilian equipment that may be used in the Armed Forces. One should point out that analytical bodies function, within the Polish Armed Forces, with relevant capabilities and know-how in acquiring experience in using military-grade, or civilian equipment adopted for military applications. The Economy Mobilization Programme is a good example here, where civilian vehicles are procured for the military, and they are tailored within the scope of formal and technical requirements. One should stress that the Polish Armed Forces shall not transplant the Ukrainian conflict experience in an unchanged form. They need to be used creatively, and tailored to our domestic conditions, so that the defence potential of the Polish Armed Forces is boosted to the maximum, in the context of new threats. We are following closely the particular matters associated with the use and neutralization of UAVs - and we will soon, I hope, see the tangible, practical results of that.

Thank you for this conversation.