HC Deb 04 April 1995 vol 257 cc1093-4W
Sir David Mitchell

To ask the Secretary of State for Defence if he will make a statement about defence agency status for the Directorate of Transport and Movements (Army). [18856]

Mr. Soames

The Directorate of Transport and Movements (Army) will become a Defence Agency of the Ministry of Defence on 4 April 1995 when its name will change to the Defence Transport and Movements Executive. As a fully rationalised tri-service organisation, the main focus of DTMX will continue to be concentrated at its headquarters at Andover, alongside the Quartermaster General's headquarters. It will in due course absorb the surface freight functions carried out by the Navy Department, Air Force Department and the MOD Procurement Executive. The agency has other assets and personnel located at Marchwood military port, Bicester international freight terminal and the Ministry of Defence main building. In all there are some 250 staff comprising 92 military and 158 civilian.

The role of the agency is to provide an agreed transport and movements service for the world-wide support of HM armed forces, the MOD and other Government Departments and sponsored organisations. In so doing, it will meet the appropriate operational logistic support requirements in peacetime, crisis, transition to war and war for all its customers within agreed standards by the most efficient and cost-effective means available.

As the first chief executive, Brigadier M.G.R. Hodson CBE will be afforded greater responsibility and flexibility to build on the current organisation's professional ability and reputation for excellence. This in turn will provide the framework and ethos to give him the essential delegations and autonomy to interface effectively with industry whilst still retaining the military control necessary for policy and planning, which is so essential to mount military operations in any theatre. By adopting a more commercial approach, the chief executive will strive to improve efficiency and value for money and by so doing fulfil the agency's requirement to manage and control an effective operational transport and movements system that supports and sustains the armed forces world wide, while offering best value for money.

The chief executive has been set the following challenging key targets for the first year of operation:

  1. 1. To confirm and satisfy the operational requirement through the achievement of a satisfactory operational evaluation.
  2. 2. To develop with the owner by August 1995 criteria to measure DTMX's fitness for its wide peacetime transport and movements role.
  3. 3. To provide an agreed transport and movements service which meets the standard priority system requirements, as laid down in Department regulations (JSP 336), to time in 95 per cent. of cases.
  4. 4. To implement the agency's competing for quality strategy including specifically:
    1. a. To investigate partnering for Falkland Islands resupply by 1 December 1995.
    2. b. To complete the statement of requirement for the tri-service freight distribution market test by November 1995 and issue invitation for tender by January 1996.
  5. 5. To introduce a system for accruals accounting by:
    1. a. Developing an accounts feeder system and interim accruals accounting system by 1 September 1995 prior to the introduction of the ASCOT accruals accounting system by 31 March 1996.
    2. b. Producing accruals accounts for 1995–96 for a shadow NAO audit in order to produce accruals accounts for 1996–97 for a full NATO audit.
  6. 6. To reduce by 2 per cent. annually the ratio of DTMX management overheads compared to the total value of overall business.
  7. 7. To identify the potential utilisation and throughput at Marchwood military port and 25 Squadron Royal Logistic Corps, Bicester in order to provide a base line against which future targets can be set for the utilisation of owned assets.
  8. 8. To complete the initial development, basic installation and staff training for the DTMX management information system and activity-based costing system as defined in the IS strategy by 31 March 1996.
  9. 9. To introduce by 31 March 1996 service level agreements with the main DTMX customers and suppliers and establish performance standards and annual targets for service delivery and improvement.

I shall arrange for copies of the agency's framework document to be placed in the Library of the House.