Labour demands parliamentary review into defence outsourcing

Suzie Neuwirth
THE DEBATE over the Ministry of Defence’s (MoD) outsourcing initiatives raged on yesterday, after Labour called for full parliamentary scrutiny of the department’s plans to hire a private company to support the management of its military estate.

The MoD has denied that it is privatising or outsourcing the way it runs its military estate, but said it is “considering appointing a strategic business partner from the private sector to provide infrastructure support”.

The move follows a high-profile gaffe over the MoD’s outsourcing of an IT contract, which wasted £15.5m on a failed system.

“The government doesn’t seem to have learned any lessons from its botched attempt to privatise defence procurement or the IT fiasco after it outsourced recruitment to the Armed Forces,” said Labour’s shadow defence secretary Vernon Coaker. “Labour is calling for full parliamentary scrutiny of these proposals before the government can proceed.”

Three consortiums have bid for the £400m defence infrastructure organisation contract. One is led by beleaguered outsourcing firm Serco, which is still awaiting a decision by the Cabinet Office on whether it can be awarded new government work, after allegations of fraud. The two other consortiums are being led by Capita and Telereal Trillium.

“A number of bidders are currently being considered but no final decision has been taken,” said an MoD spokesperson.

An approval process to assess the terms of the contract will begin shortly and once the contract has been approved, the MoD will appoint a preferred bidder. It is understood that a final decision on the winner of the contract is expected next month.

Capita, Serco and Telereal Trillium declined to comment.