The Ministry of Defence is to try to save millions by re-negotiating the 40-year-old rules on defence contracts.

Procurement Minister Peter Luff told the BBC the current rules were heavily weighted towards the private sector and overdue for reform.

This could lead to the MoD reducing the cost of new military equipment.

At present the rules, dating back to 1968, mean the MoD contributes towards contractors' office running costs, pensions and redundancy payments.

Defence companies will contribute towards a review of the rules, which is likely to take 18 months.
Far advanced

New rules could also enable the MoD to renegotiate some existing long-term contracts, said Mr Luff.

According to the BBC's Carole Walker, it is thought unlikely this will apply to the contracts to build two new aircraft carriers, because the projects are so far advanced.

Former Prime Minister Gordon Brown has said cancelling either of the carriers would be a betrayal of the shipyards which are building them.

The news emerged as Defence Secretary Liam Fox warned that the MoD would not be able to do all it would like to.

This, he said, was because of the deficit and the "shambolic" mess left by the previous government. Some big decisions are due to be made this week, he said.

http://www.bbc.co.uk/news/uk-11481182

The PFI scum will just want something in return, surely? And how much will the legal fees be?

Even if the MOD so succeed the cost of equipment will just be increased to compensate.

Yes but Labour are not responsible for the mess in Ireland. Even the German have had a increase in their deficit.

PFI's will all be brought on to the governments books soon enough.

but they are responsible for the massive increase in PFI liability and the mess all of the government contracts are in. 13 years was enough time to get that in order but nope far too "difficult".
Not that I have much hope the current lot will do any better.

I agree that the whole treatment of them will be fudged. Once we get back to sensible investment funded solely by selling government bonds, that these con games will end. Though since some were started by the tories they might hide the evidence instead.

MOD purchasing is crazy.

To give you an example. The MOD are currently in the middle of procuring 20 or so new chinook helicopters.

Chinooks are built by boeing to a pretty standard spec and the end user then specs their requirements.

The final 'specing' costs about 20% of the final price (or more if more kit is required).

We could just buy them to the same spec as the standard - which is american standard military spec but the MOD insists that US spec is not good enough and can not give flying clearance and we don't know that they are safe - ie not to OUR spec.

However, our troops fly in american chinooks every day - no one questions their safety a jot when it comes to operational matters. It is all due to red tape.

So these things cost us 20-30% more than they cost the US forces.

Crazy.

Didge

Don't forget the problems with the software licenses which meant we still could not fly them.

they are finally flying but were mothballed for years.
What they haven't announced is that they are due to be refitted again in 2 years with the new cockpit!

Didge