Prospect, which represents staff in the MoD fire and defence rescue services, warned that the decision to press ahead with privatisation was wrong whilst lessons were still being learnt from the collapse of Carillion.
Capita was in competition for Defence Fire and Rescue Service (DFRS) against Serco in a contract believed to be worth around £400 million. The service provides fire services on military bases, airfields and munitions sites.
Last month Prospect wrote to MPs to support calls from Julian Lewis the Chair of the Defence Select Committee for the privatisation to be halted whilst the contract was examined. Prospect told MPs that they were concerned the projected savings could not be delivered without increasing the risk to defence.
The union also said that the existing in house provision has been systematically run down with massive cuts and underfunding stifling the ability for the in house service to deliver efficiencies and introduce new technology.
Garry Graham, deputy general secretary of Prospect, said:
“We are deeply disappointed that the Government has pressed ahead with the privatisation of this vital service without providing any reassurance about how it will impact on quality, affect staff or avoid the same troubles as faced by Carillion.
“There is a very real risk that the MoD will end up paying over the odds for a much worse service than they would have had if they had just invested properly in the in house service and the dedicated staff who work there.
“The constant drive the outsource services is not working for the MoD, the taxpayer or the workforce, and it is time for ministers step back and make the right decision to protect this service for the future.
“We will now be working with our members to ensure jobs, quality and services are protected.”
The concerns raised by Prospect with MPs in early June:
They firmly believe the projected savings cannot be delivered without increasing the risk to defence.
That the existing in house provision has been systematically run down with massive
cuts and underfunding stifling the ability for the in house service to deliver efficiencies and introduce new technology.
Although the whole life cost of the project is estimated to be around £400 million they believe that the true cost of the provision of fire risk management to defence is more likely to be in the order of £1.2 billion (when the governance organisation, defence fire safety regulator, Cyprus Locally employed civilians, USVF staff, RAF and Royal Navy firefighters and extant multi activity contracts are included.
They believe that the contract does not include additional work such as the maintenance of fire extinguishers at MOD establishments. This is currently done by the in house service but would need to be done through another contract and borne by local budgets which are already heavily squeezed at a cost of approx. £7,000 per 100 extinguishers per annum. The cost of this additional work has not been considered.
They believe bidders have been offered c£60 million towards the cost of new vehicles with moves to make these purchases VAT exempt.
That any projected savings need to be subject to independent scrutiny. For example, statements have been made about projected savings on pensions costs which may be inaccurate.