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MoD presses ahead with billion pound rental plan

8th December 1994
Page 8
Page 8, 8th December 1994 — MoD presses ahead with billion pound rental plan
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Which of the following most accurately describes the problem?

• The Ministry of Defence is talking to at least nine firms about contracting out the management of its 100,000-strong back-up fleet.

The MoD expects to decide by next spring who is to pilot its proposal to contract out its fleet of non-combat trucks, vans, Land Rovers, minibuses and cars.

The pilot is due to start from October 1995, but the MoD is not saying how long U expects it to take. And it says it still has to decide how to contract out the work. The MoD is thought to be favouring the idea of selling its non-combat vehicles to a private company and then leasing them back. This company would be responsible for fleet maintenance and replacement.

If the MoD goes ahead with its plans to use a third-party after the pilot, the

work is expected to generate £1bn a year revenue for the rental sector (CM 24-30 March).

Contracting out was recommended in a defence cost study in July. The MoD estimates that it could save it from purchasing £450m worth of vehicles in the next 10 years.

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Organisations: Ministry of Defence

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