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Defence Estates—a part of the Ministry of Defence (MoD)—manages and maintains the defence estate in the UK, including working and living accommodation for Armed Forces personnel and their families and the training estate.
The Committee has undertaken a short inquiry into Defence Estates' responsibilities and performance and highlights a number of concerns in this report.
Defence Estates ceased to be an Agency of the MoD in April 2007. It is important that the loss of Agency status should not result in a loss of transparency and accountability. The MoD should ensure that Key Targets are rigorous and challenging.
Several programmes are in place to upgrade and modernise the Armed Forces' Single Living Accommodation, some of which is in extremely poor condition. Defence Estates has made considerable progress in the past few years, but the scale of the challenge remains enormous. The MoD needs to do more if Servicemen and women are not to be left in sub-standard accommodation for many years to come. There appear to be problems with the operation of the Regional Prime Contracts, which were intended to improve the maintenance of Single Living Accommodation.
The MoD sold the majority of Service Families Accommodation in England and Wales to Annington Homes Ltd in 1996 on a lease-back deal. Views on the merits of the deal differ, but it is deeply disappointing that the incentives in the deal to maintain acceptable standards of repair and fewer empty properties have not operated as intended. There is a case for a review of the whole of the married quarter estate to ensure that property is being retained and disposed of optimally.
The MoD should consider increasing the amount of loan offered to Service personnel to buy their own homes and should explain how it intends to respond to the proposals in the Housing Green Paper for extending home ownership.
Defence Estates has sub-contracted the maintenance of Service Families Accommodation in England and Wales to a private company, under the Housing Prime Contract. The implementation of this contract has faced widespread difficulties and the level of service being delivered is unacceptably poor; the MoD had to invest an extra £20 million to overcome the initial problems. We are not yet satisfied that the MoD has taken on board the extent of the problems and the degree to which Service families now experience sub-standard maintenance. It is vital that Service personnel know whom to turn to when problems occur and where responsibility lies, so that such problems can be resolved swiftly and satisfactorily.
Defence Estates is undertaking a wide-ranging programme of estate rationalisation to concentrate the Armed Forces on fewer, larger sites. The proceeds from the sale of MoD's assets are not as a matter of course returned to the MoD, much less to Defence Estates. This takes away a major incentive for creative thinking with regard to the disposal of property. The MoD should conclude its strategic plan for London as soon as possible in order to ensure that proper investment decisions can be made.
The MoD must also address the issue of how the Defence Training Estate will be affected by the drawdown of forces from Germany and the consequent increased pressure on training areas in the UK.
The MoD has recognised the increasing importance of sustainable development and energy efficiency. We welcome the way in which it has integrated sustainability concerns into its estate management and into its contractual arrangements with private companies. The MoD has also carried out some innovative work into energy conservation, but it has been slow to replicate this work across the estate.
Overall, Defence Estates is doing much good work, and we were impressed by the candid and realistic approach of the new Chief Executive. But there are considerable challenges ahead and Defence Estates must raise its game to meet these challenges. A substantial increase in investment in the defence estate is required and the MoD must resist the temptation to take from the estates budget when the defence budget is stretched.
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