Select Committee on Defence Fifteenth Report

4  Single Living Accommodation

27. The poor quality of some of the accommodation provided for our Service personnel has been the subject of media attention in recent months. The MoD acknowledged that:

More needs to be done to bring all accommodation up to the highest appropriate standard. The problems relate to a housing stock dating in large part from the 1950s and 1960s and to a legacy of under-investment, because the occupiers of the estate often used cuts in maintenance funding as a balancer or regulator of their budgets.[23]

28. When we asked Vice Admiral Laurence what were his priorities as the new Chief Executive of Defence Estates, he told us that:

You could say that the top four priorities are: accommodation; accommodation; accommodation; and accommodation. Certainly the first I would put is accommodation; both improving the standard of the accommodation that we have, upgrading it, bringing it up to the top condition; and also improving the standard of routine maintenance that we provide through various contractors. That is my top priority.[24]

Building improvements

29. There are a number of projects currently being undertaken to upgrade and improve the condition of Single Living Accommodation—the accommodation provided for Armed Forces personnel who are single or who have elected not to be accompanied by their families.

30. Perhaps the most significant is Project SLAM, the Single Living Accommodation Modernisation programme. This is being carried out for the MoD by Debut Services Limited, a joint venture between Bovis Lend Lease Limited and Babcock Infrastructure Services. Project SLAM has so far created more than 6,000 new bed spaces, with another 3,000 to follow. On 11 January 2007, it was announced that the second phase of Project SLAM would deliver a minimum of 3,800 upgraded bed spaces.[25] According to Defence Estates' Annual Report for 2005-06, SLAM had substantially exceeded its in-year target of delivering 2,500 bed spaces, with 3,750 being created.[26]

31. In parallel to SLAM, Project CHALLENGER is underway in Northern Ireland; the Project to Upgrade and Modernise Accommodation (PUMA) in Germany; and separate projects in Gibraltar and Cyprus.[27]

32. Private Finance Initiative (PFI) projects are also contributing to improving Single Living Accommodation. The largest such project is Allenby/Connaught, a 35-year contract worth £8 billion, to deliver modern living and working accommodation to Aldershot Garrison and the garrisons around Salisbury Plain. The contract was let to Aspire Defence Limited, a consortium consisting of Carillion Holdings Limited, Kellogg Brown and Root, and HSBC. The intention is that Allenby/Connaught will house 18,000 personnel (nearly 20% of the British Army). The first major challenge will be the return from Germany in July 2007 of 2nd Royal Tank Regiment.[28]

33. The redevelopment of Colchester Garrison, which we visited in 2006, is also being undertaken as a PFI project—by RMPA Services plc, a consortium consisting of Atkins Limited, Sir Robert McAlpine, Sodexho and HSBC. The 35-year contract, worth £2 billion, is intended to provide accommodation for 3,500 Service personnel and 700 civilian workers. Construction began in May 2004, and the first units moved into the new Merville Barracks in September 2006. These were 7 Parachute Regiment Royal Horse Artillery, 16 Close Support Medical Regiment and 216 Signal Squadron.[29]

34. The redevelopment of Catterick Garrison is taking place under a different relationship with the private sector. In order to expand the garrison to accommodate a further five major units—Catterick is already home to 18,500 people, housing ten major units and numerous minor formations—the MoD, in cooperation with Richmond District Council, has begun to sell land in Catterick to developers who undertake, as part of their contractual obligations, to provide amenities for the military and civilian population, such as retail and leisure facilities.[30]

35. PFI projects have brought substantial levels of investment in new, high-quality living and working accommodation for the Armed Forces, and allow access to private-sector expertise across a range of disciplines. However, they also commit the MoD to very long-term deals and limit its flexibility. Vice Admiral Laurence told us:

My own view is that it is a balance we must keep under very close review. The proportion of accommodation which is within the PFIs is increasing. There needs to be a mix, and we need to make sure we are not transferring too many of our accommodation into private ownership.[31]

36. It goes beyond the scope of this inquiry to offer an evaluation of the merits and risks of Private Finance Initiative and Public Private Partnership projects. We note that the NAO has begun a study into the management of MoD PFI projects, focusing on eight projects to examine the allocation of risks and how the risks have been managed to date.[32] We shall be noting its conclusions with great interest. These are matters which we shall continue to monitor closely.

37. While these projects are delivering substantial improvements in Single Living Accommodation, the scale of the challenge remains enormous. The NAO found that:

At current planned funding levels, the Department will increase the number of single bed spaces at the requisite standard from some 25,000 (22% of the requirement) at the beginning of 2003-04 to around 50,000 (45%) by the end of 2007-08. This would rise to nearly 75,000 (68%) by the end of 2012-13. Given the predicted fall in requirement, this leaves a shortfall of around 35,000 bed spaces below the required standard.[33]

38. The shortfall will be even worse if—as in the past—programmed improvements are delayed. The NAO's report identifies significant deferrals in 2006-07:

  • In Scotland, £1.3 million of planned work deferred;
  • In the South West, 231 projects delayed to meet budget cuts, and 83 upgrades and 75 redecoration projects deferred.[34]

These deferrals may not have related to living accommodation, but they demonstrate the risk that the programmed improvements to Single Living Accommodation are not achieved.

39. We asked Vice Admiral Laurence whether some Service personnel could be living in sub-standard accommodation for many years to come. He considered that the MoD had set its standards for accommodation "extremely high", aiming for every member of the Armed Forces to have a single room with en-suite facilities. He acknowledged that there was a "huge backlog" and told us:

We are doing what we can. We will not reach our very highest standards for perhaps ten or 20 years; but I do not think it is true to say that those people not living in those very highest standards are living in substandard accommodation.[35]

40. While much progress has been made, the condition of some SLA remains appalling. We visited Cavalry Barracks, Hounslow, currently home to the 1st Battalion, Worcestershire and Sherwood Foresters Regiment (1 WFR), and several 'guest' units; and Elizabeth Barracks, Pirbright, home to the 1st Battalion, the Royal Anglian Regiment (1 R ANGLIAN). Both 1 WFR and 1 R ANGLIAN are currently on operational deployment. The accommodation provided was disgraceful. At Hounslow, we found barrack blocks with overflowing drains and repairs which had been left unattended; at Elizabeth Barracks, we saw where NCOs slept eight to a room, with minimal privacy and negligible storage. We were told that soldiers from 1 R ANGLIAN on deployment in Afghanistan had more comfortable accommodation than their comrades left behind in Pirbright. In contrast, we saw magnificent new accommodation for Army recruits at Alexandra Barracks, home of the Army Training Regiment (Pirbright).

41. The concern was expressed to us that poor accommodation was having a serious effect on morale and retention, especially among NCOs. Vice Admiral Laurence argued that accommodation issues were not reflected as a significant reason for leaving the Armed Forces in the Continuous Attitude Surveys, but nonetheless conceded, "I am absolutely convinced that it is a factor in there somewhere. I am convinced that for personnel and, in particular, their families accommodation is a factor".[36]

42. We welcome the steps which are being taken to improve and modernise Single Living Accommodation, and have seen some new accommodation which is first-rate. However, it is not clear what the strategy is and some accommodation remains appalling. This is unacceptable. Quite apart from this being poor management of property, accommodation is an important factor in retention, and the MoD must do more to address the condition of accommodation if it is not to lose experienced personnel who are very difficult to replace. The MoD must, as a priority, put right the worst accommodation as well as that which can most easily be improved.

Regional Prime Contracts

43. Improvements to existing Single Living Accommodation come under the new Regional Prime Contracts (South West, South East, Central, East and Scotland). The five contracts provide primarily estate services, for example, grounds and building maintenance and decoration, and some new building work.[37] The NAO report says that estate procurement was previously undertaken by many parts of the MoD and was hampered by many client-customer interfaces, imprecise allocation of risk and vulnerability to fraud and malpractice. Problems including poorly directed funding, inconsistencies in approach and varying standards led to a poor quality estate.[38]

44. The implementation of the RPCs is intended to deliver through-life value-for-money improvements in estate management of the order of 30% by 2013. According to the MoD, this will be achieved through "improved planning, supply chain management, incentivisation, continuous improvement, economies of scale and partnering".[39] The improvements which the RPCs are intended to bring about are measured using an Estate Performance Measurement System (EPMS), which was piloted in early 2005 and then rolled out more widely. However, the MoD cautioned that the poor availability of historical data has "hamper[ed] assessments", though it was confident that the RPC system would deliver substantial savings.[40]

45. The NAO report concluded that, while the RPCs were improving the way the estate was managed, it was too early for this to have had an impact on the overall quality of the estate. It noted that the MoD had faced affordability constraints across the defence budget in 2006-07 and Defence Estates had to find savings of £13.5 million (4.5%) in the funding of Regional Prime Contracts largely through deferrals in planned maintenance repair.[41]

46. During our visit to Cavalry Barracks, Hounslow, we heard dissatisfaction with the complexity of the new contractual arrangements. We were told that, prior to the introduction of the Regional Prime Contracts, each district had received an allocation of money for maintenance, and the General Officer Commanding had had the ability to inject additional resources from elsewhere. There was now an arrangement whereby Defence Estates represented the customer, while the Army Infrastructure Organisation at Wilton controlled a budget from which it released funds to Defence Estates for maintenance as required; Defence Estates then approached the contractor to carry out the repairs. This was seen as excessively cumbersome.

47. We were also told that there were frequent disputes with the contractors on the distinction between routine maintenance and improvements to the fabric of buildings; a broken sash window, for example, might lie unrepaired while Defence Estates and the contractor argued whether the broken window constituted maintenance or was the result of the poor fabric of the building.

48. The Regional Prime Contracts are intended to improve the maintenance of Single Living Accommodation, but it is clear that there are significant problems in the way the they are operating in practice. We recommend that the MoD provide us, in the response to this report, with a progress report showing how these contracts are performing against the expected improvements.

23   Ev 20, para 20 Back

24   Q 6 Back

25   Ev 21, para 26 Back

26   Defence Estates, Agency Annual Report and Accounts 2005/06, HC (2005-06) 1273, para 1.5 Back

27   Ev 21, para 22 Back

28   HC (2006-07) 154, p 19, Box 2 Back

29   "Colchester gets keys to 'new' Garrison", Defence News: Estates and Environment, 26 September 2006, Back

30   See Qq 73-76 and footnote to Q 74 Back

31   Q 78  Back

32 Back

33   HC (2006-07) 154, p 15 Back

34   HC (2006-07) 154, Appendix 5. See also Q 10 Back

35   Q 11 Back

36   Q 68 Back

37   HC (2006-07) 154, p 51 Back

38   ibid., para 1.4 Back

39   HC (2005-06) 1394, p 151 Back

40   ibid., p 152 Back

41   HC (2006-07) 154, paras 8-9 Back

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Prepared 14 September 2007