§ Mr. JenkinTo ask the Secretary of State for Defence what savings have accrued from the replacement of five 205W contracts supporting a guided missile system with a single incentivised contract streamlined stockholdings and overheads, as noted in his Department's performance report 2000–01. [44219]
§ Dr. Moonie[holding answer 18 March 2002]: The reference in the report relates to a support contract for the Rapier FSB2 guided weapon system. This contract has been in place since April 2000. Savings of approximately £134,000 were achieved in the first year and similar levels of savings are expected throughout the remainder of the contract. Of equal importance is the increase in availability of the equipment system as a result of this contract.
§ Mr. JenkinTo ask the Secretary of State for Defence what savings have accrued to his Department from the use of incentives in the MOD's food supply contract that require the contractor to seek improved value for money on behalf of the Department. [44217]
§ Dr. Moonie[holding answer 18 March 2002]: The decision to contractorise Ministry of Defence food supply is estimated to be saving £13 million per year compared to previous arrangements. This is as a direct result of employing the contractor's commercial buying power to secure best value for money in the marketplace. The contractor does not profit from the cost of food supplied to the MOD and prices are subject to regular, independent, benchmarking. In addition to these savings the contractor's operating costs, on which the contractor does earn profit, are constrained through the use of a contracted Target Cost Incentive arrangement, under which annualised cost under-runs are shared. We are currently in negotiation over the precise amount accrued.
§ Mr. JenkinTo ask the Secretary of State for Defence which sections of his budget received extra resources as a result of money gained from efficiency savings in each of the last three years; and how much was given to each. [43217]
§ Mr. IngramThe allocation of resources within the Ministry of Defence is carried out in accordance with agreed priorities and objectives. We take into account many issues, including predicted efficiency savings. These are not managed separately and we therefore do not track how they are reinvested.
§ Mr. JenkinTo ask the Secretary of State for Defence (1) how the efficiency savings in each of the last three years were achieved; [43218]
(2) which single efficiency measures have resulted in annual savings of over (a) £500,000, (b) £1 million and (c) £5 million. [44223]
§ Mr. Ingram[holding answer 18 March 2002]: Efficiency savings are achieved by each area of the Ministry of Defence and of the services reviewing its business and identifying ways in which it might operate more efficiently and effectively. This can involve, for example, internal restructuring, use of public private partnerships and wider markets and increased use of IT.
The MOD does not maintain a central list of efficiency measures and the information requested on individual measures could be provided only at disproportionate cost. Information on financially significant efficiency measures for 1998–99 and 1999–2000 was, however, provided to the House of Commons Defence Committee, and was 206W published on 9 May 2001 as part of the Committee's 8th Report, copies of which are available in the Library of the House.
Examples of efficiency measures taken in 2000–01 are set out in the Departmental Performance Report 2000–01 (Cm 5290), copies of which are also available in the Library of the House.
§ Mr. JenkinTo ask the Secretary of State for Defence what the annual target is for efficiency savings to be made in his Department's spending; and how much was saved in each of the past five years. [44216]
§ Mr. Ingram[holding answer 18 March 2002]: The Ministry of Defence's achievement against the efficiency target agreed in the 1998 Comprehensive Spending Review is set out in the Departmental Performance Report 2000–01 (Cm 5290), copies of which are available in the Library of the House. The cumulative achievement is:
£ million Target Achievement 1998–99 505 594 1999–2000 998 1,126 2000–01 1,499 1,462 Information on efficiency achievement in 1996–97 and 1997–98 has been archived. I will write to the hon. Member when the information is available.