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Container Ships

Mr. Davidson: To ask the Secretary of State for Defence if he will make a statement on his Department's plans to procure four new roll-on roll-off container ships. [110652]

Dr. Moonie: I refer my hon. Friend to the answer I gave on 29 February 2000, Official Report, columns 207-08W, to my hon. Friend the Member for Dunfermline, West, (Ms Squire).

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Atomic Weapons Establishment

Mr. Chaytor: To ask the Secretary of State for Defence if he will reassess the decision to award the management contract for the Atomic Weapons Establishment to the British Nuclear Fuels-led consortium from 1 April. [112356]

Mr. Spellar: I refer my hon. Friend to the answers given by the Secretary of State for Defence on 21 February 2000, Official Report, columns 1223-24, to my hon. Friend the Member for Reading, West (Mr. Salter) and the hon. Member for Newbury (Mr. Rendle).

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Military Establishments

Mr. Ashdown: To ask the Secretary of State for Defence if he will list the military establishments within (a) Somerset and (b) Yeovil constituency, showing in each case the personnel complement; if he will set out the plans to change the (i) number and (ii) manning of such establishments; and if he will make a statement. [110793]

Mr. Spellar: The Ministry of Defence (MOD) establishments within (a) the county of Somerset and (b) Yeovil constituency are as listed. The personnel complement at each establishment is also given.

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Establishment	Town	Personnel complement
	(a) County of Somerset
Army Careers Information Office	Taunton	4
Defence Evaluation and Research Agency, Royal Ordnance Factory	Bridgwater	42
Royal Naval Air Station, Yeovilton	Yeovil	3,829
Hydrographic Department	Taunton	855
Somerset South Avon Wing Air Training Corps	Taunton	3
Light Infantry Office (Somerset)	Taunton	3
40 Royal Marine Commando and Norton Manor Camp	Taunton	610
Territorial Army Centre	Taunton	9
Territorial Army Centre	Bridgwater	8
Territorial Army Centre	Yeovil	1
Defence Procurement Agency, Westland Helicoptor Ltd. Team	Yeovil	8
Defence Procurement Agency, Special Procurement Services Office	Yeovil	23
Civilian Personnel Management	Taunton	10
	(b) Yeovil constituency:
Defence Procurement Agency, Westland Helicoptor Ltd. Team	Yeovil	8
Defence Procurement Agency, Special Procurement Services Office	Yeovil	23
Territorial Army	Yeovil	1

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(i) The Civilian Personnel Management Taunton is due to close on 31 March 2000 and the Territorial Army centre Bridgwater is due to close on 30 June 2000.
(ii) Current plans to change the manning of establishments in Yeovil constituency and the County of Somerset are set out as follows:
With effect from 2003, 513 military posts, 16 civilian posts and 60 contractors will transfer from RNAS Yeovilton to RAF Wittering and Cottesmore, as a result of the creation of Joint Force 2000;
With effect from 30 June 2000, 30 civilian staff will transfer from DERA Bridgwater to DERA Porton Down as part of DERA's programme to integrate capabilities.
With effect from April 2000 there will be a requirement for 16 military personnel at RNAS Yeovilton, due to a switch from Army to Navy maintenance regulations.

RMPA Programme

Mr. Keetch: To ask the Secretary of State for Defence (1) if he will make a statement on the recovery of liquidated damages for late delivery in the renegotiation of replacement maritime patrol aircraft contracts; [112472]

(2) what penalty clauses were included in contracts placed as part of the Replacement Maritime Patrol Aircraft programme since 1995; and if he will make a statement; [112471]

(3) what were the conclusions of the Critical Design Review of the Replacement Maritime Patrol Aircraft programme; what action has been taken as a result of each recommendation; and if he will make a statement; [112470]

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(4) if he will list the terms and conditions of the renegotiated contract with British Aerospace for the RMPA programme, indicating which ones, and for what reason, differ from those in the 1996 contract; and if he will make a statement; [112469]

(5) what technical and programme factors led to the in-service date slippage of the RMPA project to 2005; and if he will make a statement; [112468]

(6) if he will provide a summary of the costs of the Replacement Maritime Patrol Aircraft Programme including development and production costs, in particular (a) costs arising as a result of delays to the planned in-service date of the RMPA and (b) the reasons for cost variation since the original RMPA contract was placed; and if he will make a statement. [112467]

Dr. Moonie [holding answer 2 March 2000]: This is a matter for the Chief Executive of the Defence Procurement Agency. I have asked the Chief Executive to write to the hon. Member.

Letter from J. W. Howe to Mr. Paul Keetch, dated 7 March 2000:

I am replying to your six questions to the Secretary of State for Defence about the Nimrod MRA4 programme (previously known as the Replacement Maritime Patrol Aircraft). This matter falls within my area of responsibility as Chief of Defence Procurement and Chief Executive of the Defence Procurement Agency.

You asked about the cost of the Nimrod MRA4 programme. Overall project costs are estimated at £2317M (at 1999/00 prices), a reduction of £92M (on the same price base) on the estimated costs at MoD Approval in August 1996, prior to contract placement in December that year. The reduction is due primarily to the renegotiation of the contract in early 1999, which included changes

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in risk assessment and recovery of Liquidated Damages (LD). The additional run-on costs on the existing Nimrod MR2 (up to its currently planned out of service date) consequent on the slippage in delivery of Nimrod MRA4 are offset by the reduction in the cost of operating Nimrod MRA4 over the same period.

You asked also about the nature of technical and programme factors which led to the slippage of the ISD to 2005. As the Minister made clear when he announced the slippage BAe Operations Ltd. (now known as BAE SYSTEMS) experienced technical difficulties with the development of new information technology toolsets, particularly in the area of design and concurrent engineering, and difficulty in resourcing this complex aircraft project. Additionally, the acquisition of the necessary software tools took longer than anticipated and the company faced particular difficulties in applying new information to the design of the aircraft.

In three of your questions you asked about contract terms and conditions and the differences in the renegotiated contract, in particular penalty clauses and the recovery of Liquidated Damages. It is not practical or meaningful to list all the terms and conditions of the renegotiated contract here. But the main features related to programme timescales which resulted in the slippage of the in-service date (ISD) from April 2003 to March 2005, changes to the contract specification to clear up ambiguities, operationally acceptable reductions in specification and benefits in through life support. The MoD also secured a revised Variation of Price (VOP) formula whereby our commitment to pay inflation over nine years of the contract period is greatly reduced. In addition, we secured BAE SYSTEMS' commitment to integrate the Active Search Sonobuoy System during the main aircraft programme and so deliver an active search capability at ISD. Liquidated Damages will also be recovered from BAE SYSTEMS for delayed contract deliverables and a new Liquidated Damages provision was negotiated to protect against further delays.

Your final question related to the recent Critical Design Review (CDR). The Air Vehicle Critical Design Review for the Nimrod MRA4 was held at the end of September 1999. There were 34 time-bound actions placed at the review which have all now been completed, signifying that a major engineering design milestone for the Nimrod MRA4 Air Vehicle is complete: thus far the aircraft has met the revised programme milestones.

Defence Exports Services Organisation

Mr. Key: To ask the Secretary of State for Defence if he will list the budget of the Defence Exports Services Organisation for (a) the past two years, (b) the current year and (c) the next two years. [112548]

Dr. Moonie [holding answer 2 March 2000]: Actual cash expenditure on the DESO budget for the last two years has been:

£ million

	Expenditure	Receipts	Net operating costs
1997-98	55.810	41.430	14.380
1998-99	45.290	29.280	16.010

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Forecast cash expenditure on the DESO budget this year is:

£ million

	Expenditure	Receipts	Net operating costs
1999-2000	45.225	32.807	12.418

The DESO budget has not yet been set for later years.

These net operating costs are more than offset by benefits to the Defence budget, estimated at over £400 million a year, arising from DESO's activities. These benefits include an overall reduction in overhead costs for UK Procurement as a result of export orders, and receipts from Commercial Exploitation Levy and disposal of surplus MOD equipment.

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