§ Mr. Matthew Banks
To ask the President of the Board of Trade what progress he has made towards introducing private sector management into the National Physical Laboratory. 
§ Mr. Lang
The intention to introduce private sector management to the National Physical Laboratory was announced by my right hon. Friend the Member for Henley (Mr. Heseltine) on 14 April 1994. A detailed investigation to tender was made available in December to five bidding consortia selected from among those expressing interest. In May, the Department selected two744W consortia as shortlisted bidders and in late June, Serco became the preferred bidder for final negotiations. These are now complete and Serco, in collaboration with AEA Technology and Loughborough university as subcontractors for particular tasks, has been selected to become the contractor to manage the laboratory and deliver the Department's measurement programmes for the next five years. Serco, which will take over on 1 October, offered better value for money than either its nearest competitor or the benchmark of NPL continuing as an agency. All but a few of the laboratory's staff will transfer to Serco, which will purchase some of the assets of the laboratory. The DTI will lease other assets together with the buildings to Serco for the duration of the contract.
The contract includes incentives on the contractor to develop the business of the laboratory and to improve efficiency. The existing management have made substantial progress in these areas during NPL's period as an agency of the Department, but I am sure that private sector management will bring additional commercial freedoms and skills to NPL's work. The contract also requires NPL to maintain its status as one of the world's greatest metrology laboratories and as a centre of excellence for all aspects of measurement. I am confident that under commercial management the laboratory will be even better able to fulfil this vital role. As part of the arrangements to ensure this, the Royal Society and the Royal Academy of Engineering have agreed to advise me on the maintenance of the long-term capability and standing of the laboratory.