'FEARS GROW UK INDUSTRY WILL BE LEFT OUT OF PLAN TO BUY ARMOURED VEHICLES FOR ARMY'

By Alan Tovey, Industry Editor

Telegraph Online – 25 December 2017

Fears are growing UK companies will be excluded from one of the biggest equipment purchases by the British Army in years – continuing a trend for the Ministry of Defence to award huge contracts to foreign suppliers at the expense of the domestic arms industry. MPs on the Defence and Public Accounts Committees have written to the Ministry of Defence demanding an explanation of how hundreds of eight-wheeled mechanised infantry vehicles (MIVs) will be acquired. 

They are concerned the purchase of the armoured vehicles – which will equip the Army's new strike brigades – will not be put out to competition. Instead they fear the deal will be a “single source” arrangement where it goes to a supplier without a competitive bids, and the likely supplier will be German group Rheinmetall’s “Boxer” design.

Meg Hillier, chair of the Public Accounts spending watchdog committee, has written to Defence Secretary Gavin Williamson highlighting the worries. Saying the committee had been told a decision on how MIVs will be purchased is imminent, Ms Hillier added:

“I am concerned by suggestions you appear to favour a single source approach favouring an overseas provider. Given the level of overspend on many defence programmes, I am not convinced this single source approach can always deliver savings. It also fails to take into account the wider benefits to the UK economy from sourcing within the UK.”

Raising fears about not putting the MIV contract out to competition, Ms Hillier added: 

“UK companies say they do not expect to be gifted contracts but they would hope they could compete on a level playing field.”

The concerns were echoed by the Defence Select Committee. In a letter to Defence Procurement Minister Harriet Baldwin it asked if the MoD's pledges for competition 

“within the supply chain”

for the MIV meant that it had already been decided the contract would not be competed.

Committee chairman Julian Lewis also asked how the MoD would 

“ensure value for money”

is achieved if the MIV contract is single sourced, and 

“whether an assessment has been made of the impact on long-term investment in the UK's armoured fighting vehicle industry in the event the MIv is procured overseas”.

A spokesman for the MoD said: 

“No decision has been taken on the acquisition strategy for MIV and at this stage our approach remains competitive procurement within the supply chain wherever possible.”