27 May 2005
An estate efficiency drive by the Ministry of Defence is under threat because of funding difficulties, a National Audit Office report has found.
The watchdog said that, despite making 'considerable progress' in estate rationalisation in recent years, the MoD's insufficient funding – 'due to conflicting defence priorities'– might mean it fails to deliver long-term efficiencies.
Regional Prime Contracts, which are used for the bulk of maintenance contracts and minor works on the MoD estate, have suffered from a lack of funding, said the NAO. This means there has been a 'failure to achieve optimum value for money and will lead to a lack of consistency across the estate', according to its report, Managing the defence estate.
The ministry is one of the largest landowners in the UK. Its 240,000-hectare estate is worth about £15bn — including overseas properties and land, such as garrisons in Germany, Cyprus and the Falkland Islands — and costs £1.3bn a year to run. Since 1999, the ministry has received £1.2bn from selling off surplus land. Another £732m could be gained through sales in the next three years.
Sir John Bourn, head of the NAO, said a more efficient estate would benefit service personnel and their families: 'This is why it is important that the MoD does more to strengthen its new arrangements to achieve their full benefits.'
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