MoD suspends helicopter rescue contract

18 December 2010
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18 December 2010 | Lindsay Clark

The UK government has delayed the procurement process for a private finance initiative (PFI) contract to provide a new search and rescue helicopter service.

Transport secretary Philip Hammond said this week he had planned to announce progress on negotiations with the preferred bidder for a deal to provide helicopters, training for aircrew and a coastal rescue service.

“However, the preferred bidder has informed the Ministry of Defence (MoD) it has become aware of a possible issue in connection with its bid to provide the UK search and rescue capability, which was the basis of its selection as the preferred bidder as announced in February 2010,” Hammond said in a statement. “In the circumstances it is not appropriate for us to proceed with the programme.”

No further explanation for the delay was provided by the government or preferred supplier Soteria. The Department for Transport will make a further announcement on the process, but would not confirm when.

Soteria had been named preferred bidder for the search and rescue PFI contract, valued at around £6 billion. The consortium comprises helicopter service supplier CHC, manufacturer Sikorsky, training provider ThalesUK and RBS, a PFI equity investor.

The PFI deal will replace Sea King helicopters being used by the RAF and the Fleet Air Arm to perform search and rescue off the British coast.

The procurement programme was halted before in June as the new coalition government reconsidered decisions made by the previous Labour administration. A source close to Soteria said the firm was frustrated with the number of delays to the programme.

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