MoD delays next generation prime contract awards

Aaron Morby 12 years ago
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The Ministry of Defence’s estate procurement arm is delaying all new contract awards pending a spending review.

Around six major frameworks and contracts were due to be let this year to help deliver a £5bn planned investment programme in the MoD’s estate.

But the Defence Infrastructure Organisation, which handles the building procurement programme, has delayed any further contract awards.

DIO said it could not yet confirm how long the hiatus would be and would make a further statement when more details were known.

Some contractors bidding for work said they feared the whole programme had slipped by a year. This has raised doubts whether the new contracts will be signed by April 2013.

The move is a serious blow for hordes of of main contractors and their supply chain firms who are bidding or have been shortlisted on the Next Generation Estate Contracts.

Many have been counting on work after building a strong track record with the MoD.

A DIO spokesperson said: “NGEC has been running since December 2008 with a target of replacing the existing contracts from April 2013.

“Since the NGEC timetable was published in August 2010 there have been a number of emerging factors which have subsequently impacted on the procurement schedule.

“These include new Government procurement policies, the creation of the Efficiency & Reform Group Facilities Management Category Board, the Strategic Defence and Security Review.

He added that the weight of interest in working for MoD had also clogged up the system.

“There has been a high degree of industry interest in these contracts, confirmed by market research and consultation. The number of responses to the OJEU notices and subsequent pre-qualification questionnaires was higher than expected.

“This meant the evaluation process took longer than planned.

The spokesman added: “We want to ensure that all NGEC stakeholders – including staff, current contractors, DIO customers and wider industry – have a realistic expectation of the achievable timeframe for these contracts.

“We are therefore reviewing the NGEC programme to ensure that it reflects the evolving and complex circumstances in which these contracts are being procured, and we will confirm the outcome once this is approved.”

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