MOD’s Jim Carter: Modernising the defence supply chain

The MOD is the largest procurement organisation in central government, managing some of the most complex and technologically advanced requirements in the world, with an annual procurement spend of more than £20 billion per year.  

But there are strategic challenges to be addressed if we are to sustain delivery of effective military capability in a challenging financial climate, and maintain our contribution to national security and prosperity over the long term. This is why we have embarked upon an ambitious programme of change and improvement, which will help us to deliver our vision of a vibrant, sustainable and competitive UK industrial base. I am proud to be leading a number of initiatives under our Modernising Defence Programme (MDP), as we seek to adopt a more collaborative and demanding approach to our relationship with industry.  

As part of this, we have reviewed our Strategic Supplier Management approach, to deliver improved performance with our most strategic suppliers; delivering better value for money and key prosperity objectives, and mitigating supply chain risk. In addition, Small and Medium Enterprise (SME) Champions have been appointed within our strategic suppliers, and their role is to help shape our strategy for engagement with SMEs. 

MOD's Jim Carter on modernising the defence supply chain

Simultaneously we’re seeking to reframe our collective engagement with industry. We’ve jointly developed a 2025 Defence Industry Vision, and are re-designing our Defence Suppliers Forum structure with Ministerial leadership to realise a step change in cooperative delivery. I’ve been personally delighted with the engagement in these initiatives, including working closely with industry via round table events to explore the challenges and opportunities of working within the defence sector. Across MOD and industry there is universal support for improving both performance and engagement, and a real appetite to see these important changes implemented – and succeed. 

But that’s not all. We also want to encourage innovation and will continue to pursue policies and practices that make it easier for new and smaller businesses to do business with defence. For example, we have recently introduced new functionality to our Defence Contracts Online portal www.contracts.mod.uk to enable sub-contracts to be advertised, and we are encouraging our major suppliers to make use of this facility to improve visibility of opportunities. We have also engaged with our major suppliers and asked them to report SME spend through their supply chain, and we will continue this on an annual basis. We have also refreshed our SME Action Plan and intend publishing this early in the New Year; this will include pathfinder projects which will demonstrate effective strategies to encourage wider SME participation throughout our supply chain. 

For information about doing business with defence, visit www.contracts.mod.uk and follow us on Twitter @defenceproc. 

Jim Carter, Commercial Director Supply Chain, Ministry of Defence

Hammond reconfirms commitment to defence privatisation

Secretary of State for Defence The Rt Hon Philip Hammond MPSummary: Defence Secretary Philip Hammond has renewed his plans to part-privatise the way the Government procures food and weaponry for the MOD just weeks after the bidding process for the contract was abandoned.

Last month, Mr Hammond announced that the contract to transform Defence Equipment and Support (DE&S) into a Government-owned, contractor-operated enterprise had to be called off due to a lack of competition after one of only two bidders pulled out.

Failed tendering procedure

The failed tendering procedure is rumoured to have cost the Government £17.8m. Despite criticisms that the plan wasted money and would have caused serious privacy concerns regarding the passing of sensitive military information into private ownership, Mr Hammond has now announced new measures to partly renew the privatisation process.

DE&S is now set to receive greater operational freedom and less red tape, including the ability to increase salaries in order to attract highly skilled senior staff.

Procurement of defence equipment

Private contractors will only oversee certain aspects of DE&S instead of the previous plans to have the successful bidder operate all aspects of the procurement of defence equipment, weapons and food.

A spokeswoman for the MOD said: “The new DE&S is an arm’s-length body working within specially agreed freedoms that will allow DE&S to operate differently to the rest of the Civil Service. It is an innovative structure that will bring the change needed to make sure every pound spent on defence provides value for money.”

Mr Hammond has appointed Bernard Gray as the first Chief Executive of DE&S-Plus, the newly revamped agency. DE&S-Plus will have an annual spend budget of £15bn from April.

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DPRTE 2013: it’s a buyer’s market

Crowd | Defence Contracts InternationalDefence Procurement Research, Technology & Exportability (DPRTE) 2013 is fast approaching and is set to be even bigger and better than last year’s highly successful launch event.

The one-day event, to be held at the UWE Bristol Exhibition and Conference Centre on 20 November, will showcase innovative defence procurement for both buyers and suppliers.

Transparency is one of the core principles running through public procurement, and from the procurer’s point of view is one of the most effective defences against legal challenge.

DPRTE 2013 will be host to a new information hub outlining best practice in transparency – the Buyer Procurement Excellence Knowledge Transfer Zone. Here, buyers can gain expert guidance from PASS (Procurement Advice and Support Service) consultants on how to tender more effectively, enhancing practitioners’ overall knowledge and procurement capabilities.

With increasing pressure on the defence budget and public spending, the PASS consultants can assist buyers in developing more effective processes for public sector contracting, resulting in streamlined resources and delivering significant results.

From the initial contact with the marketplace via prior information notice (PIN) or contract notice, and from selection stage to award stage documentation, the information available at the Buyer Procurement Excellence Knowledge Sessions will make the procurement process more transparent, while outlining best practice.

The Knowledge Sessions will discuss the forthcoming new EU Procurement Directive, to be published later in 2013. This will include vital information on major changes to the current procurement regime, including new procedures and amendments to framework agreements and electronic catalogues, as well as timescale and threshold reforms.

Over the course of the day the latest legal intelligence will also be discussed, as will how to best adopt the ‘Toolbox Approach’ to help you make the right judgements.

Each PASS consultant has a strong background in the public sector and has extensive knowledge of procurement policies, processes, legislation and best practice.

For further information and to register, visit: www.dprte.co.uk