Capita working with engineer URS and PA Consulting  has been named preferred bidder for the role of Strategic Business Partner.

The firms are in line for a 10-year contract, worth around £400m, to transform the procurement and management of facilities and services for our Armed Forces.

Their first task is to deliver an 18-month transformation project to act as the blueprint for the future strategic asset management of the estate.

URS will support the operational management of the estate and management of capital projects.

PA Consulting will provide expertise in managing complex change programmes for MoD.

The Government claimed the role had the potential to deliver substantial savings for the taxpayer, which could reach over £300m a year over the period.

DIO will now consult further with trades unions and it is expected the contract will be awarded later in the spring.

Defence Secretary Philip Hammond said: “Working with a Strategic Business Partner will bring in private sector expertise to enhance the Defence Infrastructure Organisation and deliver value-for-money and potentially hundreds of millions of pounds of savings for the taxpayer.

“This is another step along the way in implementing Lord Levene’s reforms and will allow us to tap into the innovation and expertise of the private sector so that we can deliver the best possible infrastructure and services for our Armed Forces.”

Andy Parker, Capita chief executive, said: “The partnership will help to unlock the knowledge, skills and resources that already exist within the DIO, while adding capability to tackle the significant cost-saving targets currently facing the MOD.”