UK MoD Sees Savings In New Contract Rules

A review of single-source military equipment contracts has found that the Government could potentially save hundreds of millions of pounds by introducing new rules for industry, the MOD announced today. Lord (David) Currie of Marylebone chaired the review of single-source procurement, which is currently subject to 'Yellow Book' rules - where only one defence supplier is invited to tender. Single-source contracts currently account for 40 per cent of all MOD procurement and in-service support of equipment. The Department is today launching a public consultation on how to take forward the findings of the review, which examines the UK's existing framework for pricing single-source contracts and considers whether, in future, costs can be cut and efficiency increased while making UK industry more competitive on the world market. The Minister for Defence Equipment, Support and Technology, Peter Luff, said: "Current arrangements for single-source procurement have been in place for over 40 years and it is clear that they are no longer fit for purpose. That is why I asked Lord Currie to review them. "I welcome his report and its recommendations to deliver better value for money to both our Armed Forces and the UK taxpayer. Through careful implementation, I would be disappointed if we couldn't deliver savings rising to £200m per year - although I expect this will take a number of years to reach its full value.