The deal is expected to deliver “significant savings”. © Crown Copyright
The deal is expected to deliver “significant savings”. © Crown Copyright

MoD signs £525m contract to boost fire and rescue services

22 July 2019

The Ministry of Defence (MoD) has signed a £525m deal with outsourcing company Capita to upgrade fire and rescue services provided to the MoD. 

The 12-year contract includes management of 53 fire stations in the UK and MoD sites in Cyprus and the Falklands, and procurement of new fire engines and fire-fighting equipment.

A new training facility for MoD firefighters will also be constructed and managed by Capita at the Fire Service College in Gloucestershire. As part of the contract, The Defence Fire Training and Development Centre at Manston, Kent, will be closed and training will be transferred to Capita’s existing fire training facility in Moreton-in-Marsh, Gloucestershire.

The contract is part of the Defense Fire and Rescue Project and will enable fast investments in equipment, technology, and training to improve firefighter safety and fire risk management. 

Earl Howe, defense minister and deputy leader of the House of Commons, said in a written parliamentary statement: “Following a competitive bidding process Capita’s bid was deemed to deliver the best technical solution and the best value for money for defence. The 12-year contract is worth £525 million and will mark a step change in capability for defence’s fire and rescue capability.

The deal is expected to deliver “significant savings”, said the statement, and will be implemented over the next few years. 

A legal challenge of the tender from public service provider Serco caused a delay in the award of the contract, which was initially announced in June 2018. The MoD has agreed an out-of-court settlement of £10m with the firm, according to Howe.

The “proposed contractual arrangements with Capita have been subject to thorough scrutiny and due diligence processes conducted across government,” said the MoD.

Jon Lewis, CEO at Capita, commented: “Capita is a longstanding partner and strategic supplier to the Ministry of Defence and has a record of delivering technology-enabled transformation of complex services, while at the same time providing value for money.”

Separately, G4S’s gross profits on a contract to run the Brook House immigration removal centre at Gatwick were £14.3m between 2012 and 2018, according to the National Audit Office (NAO).

In a report the NAO said in the period to 2016 gross annual profits ranged between £2.1m and £2.4m, representing 18-20% gross profit. Following a BBC Panorama programme in 2017 that found instances of verbal and physical abuse of detainees by staff, gross profit fell to 10-14% because G4S spent more on the contract.

“It is difficult to say exactly what an appropriate profit would be,” said the NAO.

The Home Office (HO) concluded behaviour in the programme was not a material breach of contract and “inappropriate use of force and the use of inappropriate language are not themselves contractual performance measures”, said the NAO.

Under the contract G4S is paid a monthly fee, from which deductions are made for failures against 30 measures including cleaning, staffing and maintenance.

The report said the biggest deductions included £30,000 for a prisoner escape in March 2016 and £21,000 in January 2019 for a failure to distribute post to detainees.

As a result of the Panorama programme the HO charged G4S £2,768 in service credits for eight incidents out of 84 identified in the programme.

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