Shine A Light

Is the UK Government fattening up defence logistics for the private sector?

Is the Government neglecting to scrutinise what Ministry of Defence officials are doing? Or is lack of scrutiny a deliberate and necessary part of the privatisation process? 

Clare Sambrook
24 April 2012

Yesterday on BBC Radio 4’s Today Programme, Prime Minister David Cameron made impassioned claims about “fighting” for "hardworking taxpayers": “They want the country changed. I want to change the country for them,” he insisted. But changes afoot at the Ministry of Defence are being made without taxpayers' knowledge and against their interests, according to Plaid Cymru MP Elfyn Llwyd.

Mr Llwyd, who last year revealed that a £44 pair of army boots had been shipped from Bicester in Oxfordshire to Northern Ireland at a cost of more than £700, secured a Parliamentary debate last week about “excessive spending, excessive pricing and excessive commissioning” at Bicester, the MoD logistics base which sends military supplies around Britain and all over the world.

“The scale of management error is so large and so endemic that, to my eyes, it almost looks systematic,” claimed Mr Llwyd. “In a nutshell, we believe that the logistics operation is having its costs inflated in order to hive it off into the private sector. I also believe that MoD logistics is being fattened for that purpose.”

He went further: “I believe that the officials responsible for this are perhaps positioning themselves to make a fortune out of it in due course.”

Back in 2007 the Labour government closed the MoD’s network of regional distribution centres, shrank the truck fleet, cut driver numbers, and outsourced delivery to private hauliers and couriers. Mr Llwyd disputes the Coalition government’s claim that annual net savings of £4m were achieved as a result. (Channel 4’s Cathy Newman subjects the £4m claim to scrutiny here).

Mr Llwyd asked the government: “Did the restructuring work? Have the new arrangements saved money? Were the highly paid consultants who devised the new system worth their fee?" He went on:

“The fact is we do not know whether the business operation has been analysed to show whether it works better or not. The figures have been arranged to show a financial benefit from the new structure. Real-time reports from the computer system, as well as common sense, present a very different picture.”

He said: “I asked the pertinent questions about how many miles were driven, the number of trips that were made, the hours that were taken, the class of vehicle driven and the cost per mile. I was told that the information was not held centrally and was not available, except at disproportionate cost. That is not true. . . All the information is there within half a dozen keystrokes. . .Otherwise how could the Department know what it was actually spending and what it was doing?”

He called for an urgent investigation and a report to the minister.

The government's reply — from procurement minister Peter Luff — was strong in self-assurance and information-lite. Mr Luff accused the member for Dwyfor Meirionnydd of seeing “a conspiracy where there is none”. He said: "The suggestion of fattening up for some kind of killing is just wrong.”

The minister detected in Mr Llwyd “an underlying hostility to the role that the private sector can play in delivering defence outputs more effectively”.

Mistakes happen, said Mr Luff. “Against a background of 8,000 daily deliveries, it is unfair to assert some kind of systematic error, inefficiency or corruption.” There is a fraud hotline and “whistleblowing is entirely encouraged in the Ministry of Defence”.

Indeed, he said:

“I am aware of no such allegation of impropriety in the logistics organisation being made on the hotline.”

Had he asked? one MP inquired.

“I did not ask,” replied the minister. “I am sure that they would have been drawn to my attention had they been made.”

Then the minister’s rhetoric took a Swiftian lurch:

“I am frankly suspicious about whether the allegations have any foundation. However, I will double check. Question after question has been answered, and nothing that it would be improper to conceal will be concealed.” 

He went on:

“Some information sometimes must be kept private for reasons of commercial confidentiality. That is frustrating for politicians and democrats, but sometimes it is important. However, we shall be as open as we possibly can.”

Such answers — circular, uninformative, insincere — are likely to be rolled out with increasing frequency by the government as information about vital public services — defence, health, policing, education — disappears into the vault of commercial confidentiality as a consequence of breakneck privatisation.

Mr Llwyd said the debate asked: “Does Parliament have any power to hold the Government to account? Does the Government have the necessary control over their civil service in this area, or are we all to be treated as nothing more than a nuisance by officials who spend £27 million a year of the public’s money?”

If the quality of the minister's replies to Mr Llwyd is anything to go by, Mr Luff's passion for scrutiny in the public interest is not what marked him out for ministerial office. Indeed, it may be recalled that he is one of those MPs who "flipped" his second home and he spent £17,000 of taxpayers’ money on various household items including, according to the Daily Telegraph, four beds and mattresses, five tables, two ironing boards, two vacuum cleaners, five sets of towels and three kettles.

When Elfyn Llwyd mentioned the £700 delivery charge on a pair of army boots at Prime Minister’s Questions last year, David Cameron replied:

“I recognise the point you make and one of the things we are trying to do in the Ministry of Defence is recognise that there’s a huge amount of cost in terms of back office and logistics and we want to make that more efficient so we can actually spend money on the front line.”

Note the familiar key words: back office costs, efficiencies, spending money on the front line — lifted straight from the Privatisers Cut-n-Paste. While Mr Cameron pursues his mission of “changing the country”, Mr Llwyd is still waiting for information that might reveal whether Bicester’s outsourcing to contractors serves the public interest or betrays it.

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