Lithuania’s arms and military equipment procurement system is failing to meet the needs of its armed forces despite rapidly rising defence spending, the National Audit Office reports.
The findings prompted the defence minister to announce that legislative proposals to overhaul the system will be submitted to parliament this autumn.
The audit found that the proportion of failed weapons procurements jumped from 24% in 2023 to 59% in 2025. As a result, some military requirements are being met later than planned.
Both internal and external factors are hindering the system’s ability to meet military needs on time.
Internal causes include funding constraints, shifting procurement priorities, outdated capability development plans, lengthy decision-making processes, a shortage of qualified specialists, insufficient monitoring of procurement efficiency, and fragmented management of key armament projects.
The external environment, meanwhile, is shaped by rising international demand for weaponry, limited manufacturing capacity, and long production and delivery lead times – all of which have delayed the fulfilment of various military requirements.
“Today, time is as critical a resource in the defence sector as funding. The doubling in the number of failed procurements and months-long coordination of decisions are directly stalling the necessary expansion of the armed forces. We must therefore not only review the legal environment, but also eliminate the other internal causes behind procurement bottlenecks and delayed decisions,” said Auditor General Irena Segaloviciene.
The procurement process is significantly slowed by coordination: in 42% of cases analysed, internal coordination with ministry departments and advisory groups took between 30 and 374 days, despite recommendations that the maximum duration for an entire international procurement should not exceed 180 to 240 calendar days.
Between 2023 and 2025, the Defence Materiel Agency, using exceptions under the Law on Public Procurement in the Fields of Defence and Security, signed 62 contracts for weaponry and military equipment worth nearly EUR 3.4 billion. This accounted for 48% of all such contracts and 40% of their total value. The exceptions were applied lawfully.
While no fundamental legal violations affecting the outcome of regular public procurements were found, the audit identified serious control deficiencies in 38% of cases, with eight of 21 procurements showing high- or medium-level discrepancies.
The report noted that while military capabilities are being strengthened to develop a division, 13 of 16 capability areas related to weapons procurement are still being developed according to outdated plans.
The audit found a lack of performance indicators, along with failures to record current capability levels or the timeframes required to reach targets.
The National Audit Office stressed the need to strengthen monitoring and project management in arms procurement. Due to fragmented management, some projects lacked implementation plans, while decisions were taken without assessing total project value, including ammunition, infrastructure and lifecycle maintenance costs.
The value of the Leopard 2 A8 tank project, for example, increased by 33% once all signed and planned contracts were taken into account – illustrating how a failure to evaluate all project-related expenses makes it difficult to plan funding accurately, manage risk and ensure smooth implementation.
The auditor has issued recommendations to the Defence Ministry, the Defence Materiel Agency and the Lithuanian Armed Forces. A key target is to ensure that no more than 730 calendar days pass between the approval of a military requirement and its fulfilment.
Further efforts aim to shorten decision coordination to no more than 35 working days and to reduce the share of failed procurements to 20%.
The Defence Ministry has pledged to strengthen the management of high-priority procurement projects, while the Lithuanian Armed Forces will update capability development plans and set clear progress indicators.
The goal is for 80% of capabilities to have defined target levels, and for 95% to have reached their planned progress until 2030.
Defence Minister Robertas Kaunas acknowledged the findings, saying the audit “confirmed what had been discussed for years: the procurement system operated without clear deadlines, without separated responsibilities, and without effective monitoring.”
He said procurement issues had been ignored between 2021 and 2025, but that current reforms were moving in the right direction.
Legislative proposals are due in parliament this autumn. A review of public procurement regulations is already under way to accelerate acquisitions.
The ministry is also developing a faster procurement mechanism for use in the event of mobilisation or war, improving project management and risk controls, and consolidating procurement data across the national defence system into a single information system. (LRT)