§ Mr. Neil HamiltonTo ask the Chancellor of the Exchequer if he will report the outcome of the price variation negotiations with Racal Data Networks Ltd. for the Government data network.
§ Mr. RyderNegotiations are still in progress and scheduled for completion by 30 June 1990. These negotiations are taking into account marketplace movements since the GDN contract was let and are reviewing general administrative arrangements in the contract associated with the GDN tariff.
Further consideration of the contract has shown that, contrary to earlier interpretations reflected in my right hon. Friend, the then Paymaster-General's answer of 22 June 1988, Official Report, col. 599-600, the contract does not necessarily prevent the cost of the GDN service from exceeding that of comparable public services. The Treasury and Racal Data Networks Ltd. are seeking to negotiate revisions to the contract which would incorporate a satisfactory basis for value-for-money comparison with available public services.
I will announce the outcome of these negotiations when they have been completed.