The MoD has been criticised for selecting a new armoured personnel carrier without a competitive tender ©PA images
The MoD has been criticised for selecting a new armoured personnel carrier without a competitive tender ©PA images

MoD increases competitive tenders

6 September 2018

The number of UK defence contracts tendered competitively has risen 7% to nearly half in the last year, according to Ministry of Defence (MoD) figures.

In its annual report the department said it placed 943 new contracts via a competitive tendering process in 2017-18, making up 49% of all new contracts placed. This is up from 865 the previous year.

The number of single-source or non-competitive contracts placed was 639, 33% of the total and a drop of 15% from 977 last year. But the number of cases in which the level of competition was not known rose by 8%, making up 18% of the total. 

In March, MPs said the MoD needed a “clear strategy for increasing competition” in its procurement, and that it needed to reduce the proportion of contracts which did not involve a competitive tender. 

In a report, the Public Accounts Committee (PAC) said there were too many contracts outside the Single Source Contract Regulations (SSCR), which aim to increase transparency and strengthen the hand of commercial staff in negotiations, partly because suppliers are “still failing to cooperate”.

One month later, the PAC again criticised the MoD for announcing a German armoured personnel carrier as its preferred choice to equip strike brigades without holding a competitive tender.

MPs accused the department of “throwing away its bargaining position” by choosing the Boxer eight-wheeled vehicle. It was chosen by the MoD as preferred candidate without a competition, angering the manufacturers of rival vehicles.

According to the annual report, the value of new contracts placed dropped by nearly one third compared to last year to £5.9bn, equating to 122 fewer individual contracts placed. Since 2010, this figure has tumbled from 6,424 contracts worth £7.2bn to 1,928 contracts worth £5.8bn.

The drop was down to the MoD using more Crown Commercial Service contracts and the privatisation of functions such as the military logistics capability and the Defence Support Group, said the MoD.

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