§ 7. Mr. Kenneth Carlisleasked the Secretary of State for Defence whether he will review the arrangements by which firms tender for contracts with the Ministry of Defence for the first time.
§ The Under-Secretary of State for Defence Procurement (Mr. Ian Stewart)Before a firm is invited to tender for the first time the Ministry normally satisfies itself as to the firm's capabilities.
The documentary arrangements by which firms are invited to tender for the first time are the same as those used with firms that have tendered before.
Aspects of contracts policy are reviewed from Time to time. However, there are no immediate plans for a review of tendering arrangements, which are generally operating satisfactorily.
§ Mr. CarlisleWill my hon. Friend accept that that is a rather disappointing reply? Many firms tendering for the first time for Ministry of Defence work find it difficult to find their way round the labyrinthine complexities of the Ministry of Defence. Will my hon. Friend consider holding a review so that first-time buyers—often small firms — will find it much easier to make the right contacts in the Ministry?
§ Mr. StewartI recognise my hon. Friend's anxiety. We are making arrangements to make firms —particularly small companies—more aware of the points of contact in the Ministry, so that we can get round such problems.
§ Mr. DouglasDoes the Minister accept that there is a close relationship between such tendering policy and keeping technology in this country? Would he care to explain how a company such as Racal can announce that it will obtain a contract for ESM equipment for the type 23 long before the tender document and contract have been concluded by the Ministry of Defence?
§ Mr. StewartIndividual companies must answer for themselves, but I assure the hon. Gentleman that such competitions are conducted with strict impartiality and with full regard to the importance of technology for our national purposes.
§ Mr. HarrisI welcome what my hon. Friend has said about small firms, but will he bear in mind the need to steer some contracts to development areas, and particularly special development areas, where there is high unemployment?
§ Mr. StewartThere are certain provisions for firms in development areas, but I should not like any hon. Member to think that the Ministry of Defence steered contracts in certain directions in the way that my hon. Friend has, perhaps, suggested.
§ Mr. SkinnerWhat about the appalling experience of the contract given to a Swedish firm to build houses for the troops in the Falklands? That firm was run by a group of people in this country who were little more than consultants, and it had a turnover of only £17,000 per annum. Prior to getting the contract, that firm had not filed its accounts for three years. A firm in Britain in the neighbouring constituency of Amber Valley was unable to obtain the contract from the Ministry of Defence. A British firm wanted the job and there were British jobs at stake. but a Swedish firm was able to muscle in. The Minister promised—
§ Mr. SpeakerOrder. It is unfair to ask long supplementary questions, because it prevents other hon. Members from asking questions.
§ Mr. SkinnerIt is a long issue.
§ Mr. StewartThe point made by the hon. Gentleman goes far wider than the original question.