MoD research agency set for partial privatisation

The Ministry of Defence has unveiled its plans for the semi-privatisation of the Defence Evaluation and Research Agency (Dera). Under its proposals for Public Private Partnership (PPP), the Government will retain a golden share in the agency, in effect creating a half-way house between the agency’s current state-owned status and full privatisation. The plans are […]

The Ministry of Defence has unveiled its plans for the semi-privatisation of the Defence Evaluation and Research Agency (Dera).

Under its proposals for Public Private Partnership (PPP), the Government will retain a golden share in the agency, in effect creating a half-way house between the agency’s current state-owned status and full privatisation.

The plans are now open for consultation and follow a report on the PPP options for Dera submitted by the MoD to ministers in March.

`It is not a privatisation per se, it is identifying the best way forward for Dera,’ the MoD said.

The ministry’s proposed PPP option is for a `special purpose corporate vehicle’ containing most of Dera’s existing staff and facilities.

Some other capability may need to be retained in the MoD, on national and operational security grounds, the MoD said. This means that the Chemical and Biological Warfare Research Establishment at Porton Down will remain state-owned.

The new Dera would operate in the private sector, with mechanisms to preserve its essential character and to protect the ministry’s interests, the MoD said. `It would have significantly more freedoms than now, able to retain and reward high-quality staff, attract private finance and develop successful new business opportunities.’

Defence secretary George Robertson said the MoD would consult on the report’s findings with key `stakeholders’ – including other government departments, UK industry and academia, as well as overseas allies, Dera staff and trade unions. A final recommendation will be put forward in the summer.

The ministry said it preferred the PPP option because `the MoD can no longer afford to fund research covering the whole range of technologies in the way the civil sector can, the obvious example being information technology. We need to use the PPP vehicle to take account of those changes.’