A senior engineer from Qinetiq arrived at the offices of BAE Systems in Chadderton, Lancashire, in August 2004 for a meeting he would never forget.

The two-day gathering had been organised to sign off work on a safety case for the Royal Air Force’s ageing Nimrod aircraft. BAE, Europe’s biggest defence contractor, had been given the job of identifying and assessing all the risks on the fleet and telling the RAF what it needed to do to make sure the big surveillance plane was safe to fly. Qinetiq, a defence and science firm spun out of the Ministry of Defence, was to provide independent oversight and advice to the RAF.

The Qinetiq representative was ill at ease. He was standing in at short notice for a colleague, and felt “like a fish out of water”. He was not prepared for the hostility he would face.

When he told the meeting that he couldn’t in conscience accept BAE continuing with one phase of the work, he was booed. “I can remember this clearly because I have never been booed in a meeting before and have not been at any time since,” he later recalled.

Two years and one day after the meeting, on September 2, 2006, Nimrod XV230 was flying a routine mission over Afghanistan when it exploded, killing all 14 on board. A board of inquiry found that fuel had leaked from the plane’s air-to-air refuelling equipment and found its way onto hot pipes. The government commissioned an independent review by Charles Haddon-Cave QC into the wider causes of the disaster, which was published last week.

As expected, it criticised the Ministry of Defence and RAF. It also fired a broadside at BAE and Qinetiq for failures in safety work that contributed to the deaths of the servicemen. “If the Nimrod safety case had been drawn up with proper skill, care and attention, the catastrophic fire risks ... would have been identified and dealt with, and the loss of XV230 would have been avoided,” the report concluded.

It related the companies failings’ in excruciating detail, drawing on documents and the evidence of those involved in key meetings, such as the Qinetiq engineer who was booed by BAE engineers. The report named three BAE employees, and two from Qinetiq whom Haddon-Cave said “bear a share of responsibility” for the tragedy.

He described BAE as a “company in denial” that had failed to live up to its ethical policy, and accused it of having tried to obstruct the inquiry.

The criticisms are particularly damaging for BAE, which has set great store by its improved ethics after long- standing allegations of bribery in connection with arms sales. The Serious Fraud Office has dropped its investigation into weapons deals in Saudi Arabia, but it is still looking into BAE contracts in the Czech Republic, Austria, Romania, Tanzania and South Africa.

In response, Dick Olver, BAE’s chairman, appointed Lord Woolf, former lord chief justice, to overhaul the company’s ethical standards and processes. His report was adopted by the board in 2008. Haddon-Cave said the firm’s obstruction of his inquiry came after the Woolf report. “In my view, the above gives rise to a concern that BAE Systems has failed to implement its expressed ethical business culture company-wide. The responsibility for this must lie with the leadership,” said Haddon-Cave.

A large chunk of his report was given over to BAE and Qinetiq’s work in drawing up the safety case for Nimrod, an aircraft that can trace its roots back to the Comet, the first jet airliner. It accused BAE of not having done the work properly, and Qinetiq of having acted as “little more than a cipher” rather than giving a genuine independent assessment.

There were some bizarre revelations. An internal BAE e-mail revealed one member of staff talking about payment for the safety case as a “pools win”. She later tried to explain away the reference by saying that Pools Win was a place in the UK where the handover of the work was to take place. Haddon-Cave said this was “frankly, unedifying”.

The three BAE staff named in the report are Chris Lowe, chief airworthiness engineer, Richard Oldfield, task leader, and Eric Prince, flight systems and avionics manager. The pair from Qinetiq are Martyn Mahy, task manager, and Colin Blagrove, technical assurance manager. All are still employed by their respective companies.

BAE said yesterday that it had acknowledged failings in its systems, and apologised for them. It did not consider there had been any misconduct by its employees, adding: “We absolutely disagree with any suggestion that there is no safety culture within the company or that there is a lack of senior leadership commitment to a strong ethical and safety culture.”

Qinetiq, whose chief executive, Graham Love, announced last week that he would stand down, said it would “seek to learn from all that the report says”.

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