HL Deb 28 June 2001 vol 626 cc19-20WA
Lord Faulkner of Worcester

asked Her Majesty's Government:

What progress has been made on the private-public partnership for the Defence Evaluation and Research Agency. [HL99]

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach)

I refer my noble friend to the announcement made by the Secretary of State for Defence in another place on 24 July 2000 (Official Report, columns 778–779), about our decision to implement the Core Competence model for the Defence Evaluation and Research Agency (DERA) public-private partnership. Under Core Competence, around three-quarters of the current DERA organisation will be turned into a company with the registered name of QinetiQ plc. For strategic reasons, the remainder, known as the Defence Science and Technology Laboratory (Dst1), will be retained within Ministry of Defence to carry out functions that could not appropriately be transferred to the private sector.

Since the announcement in July work has focused on achieving the legal separation of DERA into the two entities: QinetiQ and Dst1. This work has included the enactment of secondary legislation as outlined in Statutory Instrument 1246/2001 (made on 28 March 2001). This instrument will result in DERA being renamed Dst1 and net assets attributable to QinetiQ being removed from the Trading Fund and transferred to the new company.

Subject to final legal drafting and contractual negotiations, we intend to vest QinetiQ plc with its assets and liabilities with effect from 1 July 2001. At that point, QinetiQ will remain a wholly government-owned plc. Thereafter, work will continue on preparation for its eventual sale.