The £billions creep up

7th July 2010  Caroline Dinenage (Gosport, Conservative) asks a question re the cost of St Athan PFI.

To ask the Secretary of State for Defence what estimate he has made of the cost of the proposed private finance initiative project for the Engineering Training School at RAF St Athan over the next 30 years.
Photo of Nick Harvey
Nick Harvey (Minister of State (Armed Forces), Defence; North Devon, Liberal Democrat)
holding answer 5 July 2010
The current estimate of the cost of Defence Training Rationalisation Package 1 project is £14 billion. This represents the cost for the provision of the construction of new facilities at St Athan and the whole operating costs for the entire 30 year life of the project. These operating costs include staff, catering and maintenance costs, themajority of which we already carry today.
....When first announced, the FULL training package was announced as £14 billion.Then Package 2 was cut out and it shrunk to £11 billion.
In 2008, the MOD agreed to shrink the trainee contact hours by 25%, but still the cost crept up to £12 billion. 
Late in 2009, the sum of £13 billion was mentioned and used at the January 2010 Public Inquiry. 
Now on their website (www.metrix.uk.com), we see £13.5 billion over 30 years. Now Nick Harvey says £14bn! 

In 2008, there was only a few £100 million between the Metrix deal and the public sector comparator. £2.5 billion later, what is now the difference? 
No surprise that the MOD officials are telling the Minister not to bother with a proper review of alternatives! 

Remember that on 
Friday, October 31, 2008
lib Dem then shadow Defence Secretary Nick Harvey was even more outraged about MoD PFI projects, accusing the MoD of wasting millions of pounds in defence PFI deals. He said "This report shows that the Governments blind faith in PFI projects is leading to millions of pounds being lost in inefficiencies. 
"PFI projects should only be used where they can be clearly proved to provide the best value for money.

1 comment:

Anonymous said...

In his previous life, Nick Harvey complained about the £millions or even £10s of millions lost in PFI contracting, according to the National Audit Office.

With the Metrix PFI £billions (yes BILLIONS) are at stake but Nick Harvey as Minister smiles!

He parrotts his civil servants' excuse that it gave better value (if via rigged accounting) than doing similar at existing MOD training bases 3-4 years ago. Private finance has soared in price since then, so how irresponsible to refuse a genuine value-for-money review!

Max Wallis