MoD set to overhaul plans to privatise procurement unit

Suzie Neuwirth
THE MINISTRY of Defence is close to making an announcement on the future of its procurement arm, after a privatisation scheme failed to attract enough interest.

The MoD was considering replacing its inefficient procurement process with a so-called GoCo scheme, creating a government-owned, contractor-operated body. But the plan is expected to be shelved after private contractors withdrew from the bidding process, aside from one Bechtel-led consortium. “No decisions have been made but the secretary of state will be updating the house in due course,” a Ministry of Defence spokesperson told City A.M.

Defence secretary Philip Hammond told John Pienaar on BBC Radio 5 Live yesterday: “This is an organisation which is doing some incredibly complex projects but is constrained by civil service pay structures. We will announce very shortly how we are going to go forward on this, but whatever the outcome, we will not turn our backs on the idea of bringing more private sector expertise into defence procurement.”