Training review heads for delays, job cuts

Training review heads for delays, job cuts
Tuesday, December 09, 2008
The Defence Training Review (DTR) could be delivered up to three years late, cause thousands of layoffs and create trouble for the existing pensions of defence training staff according to an MoD newsletter revealed to Defence Management.

Already £1bn over budget, the £12bn project has recently seen its consortium led by Metrix resubmit their financial proposal in order to adapt to the declining economy and to find alternative methods of funding. The Final Clarification and Confirm process is now underway according to the MoD. Integrated project team leaders in the MoD will review Metrix's new proposal to insure that the project remains affordable and delivers value for money.

When Metrix was awarded preferred bidder status for the project in early 2007, its business plan included the sale of vacant MoD land to raise revenue for the deal. Since then the property market has crashed, thus negating the value of the estimated revenue Metrix hoped to raise and leaving a massive funding shortfall.

It is not yet known how Metrix plans to raise additional capital for the project. MoD officials have promised to ensure that the commercial core remains intact in the new business proposal. The MoD newsletter admitted that the new proposal has the potential to impact=2 0the "performance, cost and time," of the project.

There is the possibility therefore that the project will be slightly scaled back or delayed in order to allow Metrix to operate within its new financial means.

MoD officials now expect that the project could be delivered as late as 2015, three years later than first expected.

The DTR has been considered controversial by many people in part because it involves the privatisation of defence training. As a result, many MoD staff will either come under the control of the Metrix consortium or they will lose their jobs. Several thousand MoD civilian staff are set to be affected by the move.

According to the MoD newsletter 1,076 posts will be transferred to Metrix while another 1,000 staff will be kept "within the project". For the first time the MoD admitted that there will be a number of job losses as part of "an element of rationalisation" by Metrix.

Metrix officials had previously declined to confirm that the DTR would create job losses in some places while creating new jobs at St Athan in south Wales.

It was also revealed in the MoD newsletter that MoD staff who are lucky enough to keep their jobs via transfer to the Metrix consortium will not be keeping their government pensions.

The MoD's pension scheme will not transfer to Metrix, although the consortium promises to offer a "broadly comparable" scheme. For a pension to be "broadly comparable" the provisions do not have to be the same as the previous pension, but the overall value needs to be similar to the old pension.

Staff who have worked at the MoD for a few years will be able to transfer their pensions to Metrix's new scheme. However staff members who are close to retirement will be forced to draw on their pensions earlier than expected

No comments: