Select Committee on Defence Written Evidence


Memorandum from the Ministry of Defence

INTRODUCTION

  1.  The Ministry of Defence (MOD) is one of the largest landowners in the UK with a diverse estate measuring some 240,000 hectares (1% of the UK mainland). The built estate measures approximately 80,000 hectares comprising naval bases, barracks and camps, airfields, research and development installations, storage and distribution centres, communications facilities, family quarters and town centre careers offices. The rural estate measures some 160,000 hectares of training areas, small arms, test and evaluation and aerial bombing ranges. This includes 175 Sites of Special Scientific Interest for which MOD has direct management responsibility, the largest number in Government Ownership. The department also owns 772 listed buildings and 1,057 scheduled monuments. [1]The overseas estate consists largely of garrisons in Germany, Cyprus, the Falkland Islands and Gibraltar. There are also major training facilities in Canada, Cyprus, Germany, Norway, Poland and Kenya, with other facilities in Ascension Island, Belize, Brunei, Nepal, Singapore and the United States. The total defence estate is valued at around £18 billion.

  2.  The defence estate must support the military task set out in the Defence Strategic Guidance and adapt to meet evolving needs. It is consequently kept under review in order to ensure that it is the right size and quality to support the effective and efficient delivery of defence capability in line with acknowledged best practice. The Secretary of State launched the refreshed Estate Strategy[2] in 2006 which sets out the principles by which the defence estate will be managed and developed in order to support operational training and to create a place were people want to live and work.

  3.  In 2003, a new organisational structure was created to manage the vast majority of the defence estate. The structure essentially separated the supply and demand functions. It is thus for the Service and other Top Level Budgets (TLBs) to set and fund their future estate requirements in output terms (demand), and for Defence Estates (DE) to meet these in the optimum and most cost-effective way (supply) with funds for the maintenance and delivery of projects transferring to DE. DE merged with the former Defence Housing Executive in 2004 to take responsibility for the management of Service Families Accommodation in UK. It also became a TLB in its own right in April 2005. The former Army Training Estate and other single-Service training estate organisations were incorporated within DE from April 2006 to form the Defence Training Estate. At the same time, DE became the single balance sheet owner for land and buildings and this is reflected in their accounts. In light of these changes, DE ceased to be an Agency in April 2007.

  4.  In parallel, contractual arrangements have been revolutionised including the Prime Contracting Initiative, examples of which are set out below. Prime Contracting is the application of the principles of Smart Acquisition to estate procurement. Implementation of Prime Contracting is at the core of the MOD's drive to improve the value for money it obtains from expenditure on both the construction and maintenance of the estate. This is achieved through improved management and efficiencies in planning, supply chain management, incentivisation, continuous improvement, economies of scale and partnering. Contractual arrangements for the Overseas and Volunteer estate are also being transformed along similar lines with a strong emphasis on partnering.

  5.   These initiatives have meant that for the MOD as a whole, the last 6 years has been one of huge change for the estate both in the structure and responsibilities of DE and other TLBs, and the way land and property owned by the MOD are managed.

DE—ROLE AND GOVERNANCE

  6.  The Defence Management Board (DMB) chaired by the Permanent Under Secretary (PUS), is the Department's executive management board and provides senior level leadership and top-level management of MOD. The Defence Estates Committee (DEC), chaired by the 2nd PUS acts on behalf of the DMB to oversee development of policy for the estate, the implementation of estate strategy and policy, DE's performance, and the relationship between DE and estate users (Customer Estate Organisations through Customer Supplier Agreements). The DEC considers each year the totality of estate programmes and investment across the MOD to inform the annual planning round. The Minister (Armed Forces) has the opportunity to chair the DEC if matters of policy are being discussed, with the Under Secretary of State and Minister for the Veterans being responsible for day-to-day estate issues

  7.  DE derives its objectives from the MOD Departmental Plan ("owned" by the DMB) which reflects the Public Service Agreement between MOD and the Treasury. The Service Delivery Agreement agreed between MOD Centre and individual TLBs informs the DE Corporate Plan for the management of the estate. Attached at Annex A is a report on the performance of DE against the Key Targets for 2005-06, taken from its Annual Report and Accounts for that year (the latest audited accounts). In addition, at Annex B, is an analysis of additions for 2005-06 covering assets under construction/land and buildings. Copies of the DE Corporate Plan for 2007-2012 which set out the Key Targets DE is required to deliver, are also attached.

  8.  Parts of the estate management remain outside DE's responsibility. These include works undertaken by other TLBs, for instance certain PFIs such as Allenby/Connaught, the Defence Training Review and the three Naval Dockyards. These "legacy" projects have been managed from inception by the relevant TLBs and their transfer to DE at this stage would not add value. It is stressed, however, that DE is fully integrated with the relevant project teams to ensure that all the inter-dependencies are properly managed.

FINANCIAL PERFORMANCE

  9.  DE, in line with all other parts of the MOD, agrees annual budgets with the Department in line with HM Treasury's control framework. These are in respect of Direct Resource, Indirect Resource and Capital expenditure net of the market value of land and buildings to be sold during the year. Resource consumption is based on accrued expenditure and not on the amount of cash spent during the year.

  10.  During 2005-06 Defence Estates had combined Direct Resource and Capital budgets of £1.15 billion. Actual outturn exceeded the agreed budgets by £38million. Of this £26 million arose due to the inability to complete on the disposal of a site by the year end due to contractual issues. The sale was completed in 2006-07. The further £12 million overspend, which resulted from incomplete in-year transfers from other MOD budget holders, was forecast and did not result in the department overspending against either its Treasury or Parliamentary Controls. The Indirect Resource outturn was within the budget agreed with the department.

ESTATE RATIONALISATION

  11.  A key part of the Estate Strategy is to have an estate consisting of fewer larger sites appropriately located and making the best use of resources whilst remaining fully capable of meeting the military need. For some years, the MOD has been disposing of land and buildings reflecting changes to military needs. For example, a number of high value sites and buildings (including Duke of Yorks Headquarters and Chelsea Barracks) have been or are being disposed of in accordance with Treasury policy. Since 1999, the Department has disposed of land and buildings with a value of £1.69 billion pounds. This included reducing the MOD estate in London from 7 to 3 office buildings in the last 4 years. Future investment will be focused on those sites identified as anchor locations[3] (eg High Wycombe, Catterick).

  12.  In 2005, the Department identified and funded a further series of rationalisation measures which would result in streamlined organisational structures and the release of parts of the estate for re-use or disposal. Those completed are:

    —  Merger of FLEET and 2nd Sea Lord HQs at Portsmouth (achieved April 06)

    —  The creation of Air Command through the collocation of Strike Command and Personnel & Training Command HQs at High Wycombe

  Those still in planning are:

    —  The collocation of the former Defence Logistics Organisation (now part of Defence Equipment and Supply) at Abbey Wood, Bristol and Bath

    —  The planned collocation of HQ LAND and Adjutant General HQs at Andover (Project HYPERION) in 2009

    —  The rationalisation of the Chief of Defence Intelligence's estate

  13.  Other potential but yet to be approved rationalisations include the Midlands Medical Accommodation project which includes the relocation of HQ Defence Medical Education and Training Agency from Gosport and Keogh Barracks (Aldershot) to Lichfield, and the provision of SLA, SFA, messing and other facilities.

  14.  Other rationalisation projects include: Colchester PFI; Project Allenby/Connaught PFI (both transforming their respective Garrisons) and the MOD Estate London (MODEL)

  15.  PROJECT MODEL represents a significant rationalisation of the MOD's estate in Greater London, consolidating the facilities occupied by UK forces onto modern, integrated, fit-for-purpose facilities at Northolt. The Project is funded through disposal receipts from the sale of sites rendered surplus to requirements, and involves an innovative procurement strategy: "Prime Plus Contracting", which seeks the involvement of industry as an integrator of the four key project outputs: construction works, disposal of sites, finance and re-location of personnel. It releases 100 hectares of brownfield land for redevelopment.

LONG TERM ESTATE DEVELOPMENT PLAN

  16.  The Defence Estate Strategy 2006 outlined a commitment to produce a long-term (20 year) strategic plan for the development of the estate by the end of 2007. This plan, known as the Defence Estate Development Plan, is currently being drafted with customer engagement from the individual TLBs and is scheduled to be completed by December 2007. The intention is to review the Plan biannually to ensure that it continues to meet evolving requirements.

  17.  There is an aspiration to develop Defence Communities in environments where civilian and military personnel and their families want to live and work both now and in the future, whilst recognising the sustainable development needs of others. In this context, the Army is considering "Super Garrisons"—distributed geographic entities that seek to concentrate formations and units in a coherent, efficient and effective manner thus improving military output. The model has already been developed in Aldershot, Catterick, Colchester and around Salisbury Plain but there is also an aspiration to develop a West Midlands Super Garrison based upon the RAF Stafford site and potentially RAF Cosford.

  18.  The Royal Navy already effectively has Super Garrisons centred around the three naval bases at Portsmouth, Plymouth and Faslane. The Royal Marines are progressively consolidating units in the Southwest of England. The equivalent for the RAF is a long term rationalization onto fewer, larger "hub" airfields. The most advanced of these is the development of RAF Brize Norton as the prime Defence Air Port of Departure (and it will become the Air Transport and Air to Air refuelling hub). Meanwhile the Joint Helicopter command is examining the benefit of a Support Helicopter Main Operating Base (Project Belvedere) with potential implications for airfields at Lyneham, Dishforth, Wattisham, Gutersloh, Benson and Odiham.

MAINTENANCE OF THE ESTATE

Prime Contracting

  19.  The Department let five Regional Prime Contracts between 2003 and 2005, covering the five geographical areas of Scotland, South West, South East, Central and East for the delivery of maintenance and construction of the built estate in Great Britain. Following the transfer of housing to DE in 2004, DE took on the responsibility for placing a national Housing Prime Contract to replace regional contractual arrangements. These Prime Contracts provide single points of responsibility for the management and delivery of projects and integrated estate services on most MOD establishments, and in total replaced over 600 individual contracts. In addition the LANDmarc contract covering the maintenance of the Army training estate is now managed by DE.

Service Accommodation

  20.  There has recently been a greater focus of Parliamentary and media attention on standards of Service Accommodation (both Families and Single Living). The position is that much is already at a high standard but 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. Programmes to improve the standards of both kinds of accommodation are in place and are outlined below.

Service Family Accommodation (SFA)

  21.  The provision of housing for personnel and families is determined by the Defence Living Accommodation Strategy (DLAS). This aims to meet changing needs and aspirations through a `mixed economy' comprising quality public funded SFA in the right locations to support mobility and choice for those individuals who choose greater stability. Initiatives to assist choice include: the long service advance of pay scheme, under which eligible individuals can apply for up to £8500 as a loan to assist with house purchase; and the joint Housing Advisory Office, the role of which is to brief and educate personnel about future housing opportunities.

  22.  DE is currently responsible for some 49,000 Service family homes in mainland Great Britain. Most of those in England and Wales were sold to Annington Homes Ltd in 1996 and leased back by MOD. MOD retained the responsibility for maintenance and upgrade. Annual rent to Anningtons is around £140 million per year.

  23.  DE manages SFA in mainland UK (overseas SFA is managed by the appropriate Top Level Budget holder). There are around 20,000 moves in and moves out of SFA each year. Accommodation charges, recommended by the Armed Forces Pay Review Body, are deducted from the pay of Service personnel, and DE receives these sums.

  24.  We accept that the initial service offered by the Housing Prime Contract was not up to the standards anticipated or required. This was caused by a large number of outstanding cases inherited from the old system, and by other causes which have now been rectified. 97% of emergency calls are currently being responded to within 3 hours of being notified where there is an immediate health and safety risk. In every case any make-safe process will be completed within 24 hours. This compares very well with the old system. Moreover, 82% of urgent calls are currently being responded to within 5 working days, and within 20 working days for routine repairs. The helpdesk is now operating very well, with all calls being answered in less than 2 minutes, and reported missed appointments are now down to around 1%. We are working hard to improve the performance in this critical area of service delivery. The average repair time taken to fix boilers/heating systems has also reduced since April 2006, despite the fact that more calls were received and no occupant is left without alternative heating while the problem is fixed. Finally, customer satisfaction levels have also improved with the latest statistics showing a 94% level of satisfaction (29% excellent, 49% good and 16% satisfactory).

  25.  Housing stock condition is categorised from Standard 1 for Condition (the best) to Standard 4 (the worst). Definitions of each category are at Annex C. Over the last 6 years, the percentage of housing stock at Standard 1 has risen from 41% to 59%. It is worth noting that Standard 1 for Condition is higher than the Decent Homes Standard set by the Department for Communities and Local Government. In addition, a further 36% is at Standard 2 with the rest at Standards 3 and 4. There is an ongoing programme of upgrades agreed with customers, with a minimum of 600 planned for this financial year. A refreshed longer term SFA upgrade programme will be submitted for Ministerial approval later this year. A total of £35 million is also planned to be spent on life-cycle replacements, for example boiler replacements and internal and external decoration.

Single Living Accommodation (SLA)

  26.  SLA is being progressively upgraded through a number of contracts. The Single Living Accommodation Modernisation (SLAM) Project has so far delivered over 6,000 new bedspaces with a further 3,000 to be delivered by the end of this financial year. The second phase of this Project was announced by the Prime Minister on 11 January. This will provide a minimum of 3,800 upgraded bedspaces.

  27.  Running in parallel with Project SLAM and working to comparable timescales, are a number of separate and existing projects to modernise SLA: in Scotland partially through the Regional Prime Contract, Project CHALLENGER in Northern Ireland, the Programme to Upgrade and Modernise Accomodation (PUMA) in Germany and separate projects for Gibraltar and Cyprus, as well as projects such as Allenby/Connaught and Colchester PFIs.

  28.  Upgraded SLA usually provides single en-suite rooms for trained personnel of all ranks. These greatly improved living conditions are expected to have a beneficial impact on recruitment and retention of servicemen and women with a consequent enhancement in their operational effectiveness. The new accommodation has received widespread approval from Service personnel who occupy it; 37% of those in the new accommodation say it will influence their decision to remain in the Services.

  29.  In total, across MOD just over 20,000 new or upgraded single living bed spaces have been delivered between 2001-02 and the end of the present financial year. And a further 20,000 will be delivered over the next three years.

PROJECT AQUATRINE

  30.  Project Aquatrine is one of the Government's most significant Public Private Partnership projects that has transferred the responsibility for the operation and maintenance of MOD's water and wastewater assets and infrastructure throughout Great Britain to three private sector providers.

  31.  The project comprises three 25-year Private Finance Initiative arrangements, known as Packages, worth £2.3Bn in total covering Great Britain. The Project has enabled the transfer of environmental risk to those in the private sector who are best placed to manage it and enabled the MOD to focus more on its core activities.

THE VOLUNTEER ESTATE

  32.  The UK Volunteer Estate (VE) comprises facilities in which the Territorial Army, Royal Naval Reserve and Royal Marines Reserve and the Royal Auxiliary Air Force (RAuxAF) can be trained. It also encompasses facilities used by the MOD sponsored youth organisations, Army Cadet Force, the Air Training Corps and the Combined Cadet Force. The VE is spread throughout the UK, its concentration matching population density and is maintained by 13 Reserve Forces' and Cadets' Associations (RFCAs) who receive funding for estate work through customer budgetary structures.

  33.  From 1 April 2007, DE has become responsible for maintaining the VE to meet the operational requirements of customers, but will continue to use the RFCAs to deliver estate services to the VE. This does not apply to the RAuxAF who are predominately based on RAF stations maintained by RPCs. DE is working with the new `Director Volunteer Estate' within the Council of RFCAs to bring about the necessary changes to the RFCA `supply chain' which will give them flexibility and empowerment whilst establishing an appropriate level of assurance for DE. The benefits of the changes are: to achieve stable funding for the VE; allow for a greater degree of planning by the RFCAs; a greater consistency in the service customers receive; and enable the VE to be managed on a national basis so that resources go to areas of greatest need.

MEASURING ESTATE CONDITION

  34.  Due to the wide variety and nature of the numerous contractual arrangements previously in place to maintain the MOD estate no single measure of estate condition was previously available. With the introduction of Prime Contracting and the creation of DE this has facilitated in the development of the Estate Performance Measurement System (EPMS) and the Estate Planning Tool (EPT).

  35.  The EPMS is being been developed to provide a central performance management system, which allows performance data to be shared across both DE and the customer community. EPMS measures performance across six key, customer identified, areas; Estate Condition, Programme Effectiveness, Efficiency, Customer Satisfaction, Safety and Sustainability.

  36.  The web-enabled EPT provides a central database to store and analyse data on estate condition. EPT captures condition data using a single physical condition grading methodology and allows this information to be analysed to inform improvement and future investment. A cornerstone of EPT and EPMS is `Target Condition'. This is the required condition for an asset, as agreed by the customers, and is captured and held in the establishments' Integrated Estate Management Plans (IEMPs). The Target Condition for an asset takes into account the assets importance in supporting military capability, safety, sustainability and any future plans for the use of the asset. At present the single physical condition grading methodology and EPT are only in use for DE maintained estate (excluding family accommodation) although we are looking to broaden the scope into accommodation and non-DE maintained areas

  37.  An additional Accommodation Module is being developed for EPT to allow condition data to be readily accessible for both Service Family Accommodation (SFA) and Single Living Accommodation (SLA). The EPT will also capture factors for the Scaling and location of accommodation.

SUSTAINABLE DEVELOPMENT

  38.  The development, occupation and use of the defence estate can have a significant impact on the environment. However, MOD has continued to build on its reputation as a good steward by developing strategies, procedures and processes to identify and manage environmental and sustainability impacts in support of Government policies and targets. These management approaches are being integrated into the contractual arrangements of private partners by DE working with the suppliers individually and through Supplier Associations, to ensure that the Department's best practice requirements are supported through its procurement activities (at Woodbridge Airfield, for example, 98% of all waste material was recycled during an £80M rebuild). As a major landowner, MOD has considerable environmental responsibilities and challenges to face.

  39.  The Government's approach to Sustainable Development is set out in its new strategy `Securing the Future', launched 7 March 2005. It is committed to ensuring that sustainable development is at the heart of policy making and estate management of all its central departments and executive agencies. MOD achieved the target placed on all departments to produce a focused, sustainable development action plan by December 2005.

  40.  The MOD fully supports the development and implementation of "Sustainable Operations on the Government Estate', launched in 2006, the main vehicle for improving, assessing and managing the performance of the Government estate covering all the key environmental and social impacts and setting challenging targets.

  41.  DE supports 2nd PUS as the Department's Sustainable Development Champion and as chair of the new cross-Government Sustainable Development Operations Board which is supported by a cross-Government Sustainable Operations Working Group chaired by a DE Director at official level. Since 2000 a sustainability appraisal has to be completed for every policy, programme or project. DE has developed a suite of tool-sets and strategies to help to deliver this commitment. The Environmental and Sustainability Appraisal Tool Handbook and the Defence Related Environmental Assessment Methodology provide Project Managers with a series of checklists for identifying significant environmental impacts of future developments. These are widely perceived as setting standards of best practice in Government.

  42.  Environmental Management Systems that comply with International Organisation for Standardisation (known worldwide as ISO) 14001 are being introduced at all major MOD sites. These require site managers to identify impacts of site occupation, to set targets to reduce significant impacts and to monitor and report progress through an Annual Management Review and a periodic MOD Audit process.

  43.  Integrated Land Management Plans are used to assess and manage impacts at all principal training areas. These 5-year rolling plans ensure that defence-related activities at the site take account of the requirement for nature conservation, woodland protection, heritage management and public access. Smaller sites are adopting less detailed plans known as Integrated Rural Management Plans.

  44.  External Stakeholder Liaison on environmental issues is carried out through a series of consultation committees. An annual Statutory Bodies and non-Governmental Organisation Conference is supported by a Liaison Committee for the Environment which in turn has Advisory Sub-Groups in England, Scotland and Wales.

  45.  A network of some 180 voluntary Conservation Groups support the Department by monitoring habitats and species, providing input to management plans and even practical work in support of nature conservation and archaeology on the rural estate. Sanctuary Magazine and associated Sanctuary Award records and recognises their efforts as well as promoting MOD's environmental and heritage policies.

ENERGY MANAGEMENT

  46.  Energy supply is essential to support MOD operations but it is recognised that increasing energy consumption and costs and climate change will have significant impacts for the Department. The MOD consumes two thirds of the energy used by Government and spends around £28M a year on non-operational energy. It has some 4,000 sites of which 220 account for 76% of all energy consumed by MOD. These sites are now being targeted to identify opportunities to improve energy efficiency and reduce consumption.

  47.  In April 2006, the Estate Utilities Board (EUB) was formed at the direction of the DEC, to deliver a comprehensive programme of work to drive down energy and water consumption across the whole estate and to explore different avenues and opportunities with site-based teams and industry partners. The EUB has developed a non-operational energy management strategy out of which will fall site-specific energy action plans. A programme plan has been established and works streams developed, to identify savings and drive through efficiency.

  48.  In moving towards a carbon neutral office estate by 2012, the MOD is using the agreed Office of Government Commerce (OGC) definition of the MOD civil estate and work continues to agree the exact list (building by building) with OGC. Plans to deliver carbon neutrality for the office estate have yet to be fully developed, but will probably be achieved through a combination of energy efficient measures, increased use of renewable technologies and offsetting. While more work is required, it is expected that carbon reduction projects currently being undertaken on the estate could offset emissions that cannot be eliminated. By 2005-06, the department had achieved around 6% reduction in carbon emissions based on 1999-2000 levels.

HERITAGE

  49.  The MOD owns many older buildings and fully recognises the importance of heritage for the nation and how the historic environment can enhance the working environment. This cultural resource supports the ethos and heritage of MOD.

  50.  The Department's heritage portfolio represents over half the Government's histotic environment assets, and in the UK includes over 800 historic buildings, in excess of 9,000 archaeological monuments (of which more than 900 are scheduled) and nine Registered Parks and Gardens. Areas of the estate also fall within 6 World Heritage Sites and a number of defence sites have been designated as or are located within Conservation Areas. The Overseas estate also contains important historic features, such as classical remains in Cyprus and historic buildings in Gibraltar (a candidate World Heritage Site).

  51.  The Department endeavours to be imaginative in examining the options for the re-use of historic buildings when set against operational priorities and other alternatives.

Annex A

DEFENCE ESTATES—KEY TARGETS—2005-06

  2.14  The performance targets laid out in the table below are consistent with the targets set out in the Defence Estates Corporate Plan 2005-2010.
KT1—To improve the defence estate in a sustainable manner to improve its fitness for purpose and condition.
1a. Improve Single Living Accommodation (SLA) to Grade 1 (Project SLAM and SLA Parallel Projects (PP), including overseas). Project SLAM—3,570 SLAM bedspaces were delivered in year against a target of 2,500.

SLA Parallel Projects—3,055 bed spaces were delivered against a target 5,300.

Target exceeded—The Defence Estates SLAM Programme delivered an additional 1,070 bedspaces, exceeding the target by over 40%.

Target not achieved—The number of bedspaces delivered by the TLBs has failed to meet the target[4].

1b. Improve Service Families Accommodation (SFA) by completing the upgrade of properties to Standard1 for Condition (S1FC) as part of the programme to upgrade all core stock required for the longer term. Delivery of minimum number of upgraded properties (600). Target exceeded—1,705 upgraded properties complete at end of Qtr 4. (Exceeding target by 184%).

1c. To improve and maintain the defence estate.
The target condition for the built estate has been established with customers. This now forms a baseline against which the performance of Regional Prime Contracting (RPC) will be measured in future. Target achieved—in line with prime contracting roll out programme.

1d. Sites of Special Scientific Interest (SSSI) in Satisfactory Condition (95% by 2010).
79% of SSSIs have met the criteria for satisfactory condition. Target exceeded—Target of 75% of MOD sites in England.
KT 2—To provide an estate of the right size through the consolidation of assets.
2a. Provide an estate of the right size through implementing agreed Estate Rationalisation (ER) milestones. Evidence of performance is reflected in the contribution to the achievement of a number of estate related projects, for example the progress of TLB Co-locations. Target achieved—Progress towards estate of the right size resulting in a rationalised estate with financial receipts obtained through site disposal.
2b. Achieve Accrued Estates Disposal Receipts (Gross) Achieve accrued Estates Disposal Receipts (gross) of £250m. Target exceeded—Receipts of £257.5m (excluding assets transferred to the Private Sector).
KT 3—To improve customer satisfaction and service delivery.
3a. Decrease customer dissatisfaction with the quality of property provided as SFA. Housing Directorate has now completed the development of the new survey which will be rolled out in 2006-07. Target achieved.
3b. Decrease customer dissatisfaction with service delivery to SFA occupants Housing Directorate has now completed the development of the new survey which will be rolled out in 2006-07. Target achieved.
3c. Increase customer satisfaction with Defence Estates service delivery to Customer Estate Organisations (CEstOs) The measure for 2005-06 was overall achievement of Customer Service Agreement (CSAs) to be ? 90%. The CSAs measure delivery against performance targets but contain an element of customer satisfaction. For 2006-07 a separate measure of customer satisfaction will be developed. Target achieved

KT 4—Achieve key milestones for implementation of key MOD Estates Change Initiatives.

4a. Regional Prime Contracts
RPC (Central) Contract Awarded November 2005 against a target of September 2005.

RPC (East) Contract Award November 2005 against a target of October 2005.

Target not achieved—Due to protracted contract negotiations, but in Service Date of April 2006 achieved with Contract Award within Project tolerance of August to December 2005

Target not achieved—Date of Contract award not met but no impact on planned go live date of June 2006.


4b. Defence Housing
Housing Prime Contract (HPC) awarded 14 November 2005. Progress made against streamlined Housing Directorate structure. Target not achieved—Due to extended contractual negotiations target was August 2005.

4c. Project Alexander
Deferred Scope Implementation introduced across Northern Ireland (NI), Germany and UK training estate. Target achieved—Implementation achieved by April 2006.

4d. Defence Training Estate Rationalisation Study (DTERS).
Completion of Phase 1 has been achieved. Target achieved—All assets now transferred with 2 new organisations up and running, Customer and Supplier Organisations with Commercial and associated finance to manage the assets in place accordingly.
KT 5—Deliver value for money efficiencies.
5a. Deliver 30% through-life value for money output efficiencies through the introduction of Prime Contracting. Following the successful conclusion of pilots for the Estate Performance Measurement System (EPMS) at 9 MOD locations, it was agreed to roll-out a single asset grading methodology, introduce Integrated Estate Management Plans (IEMPs), and demonstrate Value for Money using the developed model and associated performance indicators, across the defence estate. Target achieved—Demonstrated 3% through-life Value For Money (VFM) efficiency target for 2005-06 in Prime Contracts against baseline.

5b. To deliver output efficiencies from Project SLAM.
£5.04m. This figure is taken directly from the Departmental Efficiency Programme. Target achieved—Delivered profiled efficiency.

5c. To deliver output efficiencies from Project Aquatrine.
£11.04m. This figure is taken directly from the Departmental Efficiency Programme. Target achieved—There is already improvement with significant investment in infrastructure taking place.

5d. To deliver the savings from the introduction of the Housing Prime Contract (HPC).
Initial restructuring of "soft" housing service is underway but further economies are being examined. Restructuring will be complete by April 2007. Target not achieved—Due to delay in awarding HPC. The transfer of responsibility for all repairs and maintenance to Services Family Accommodation (SFA) to Housing Prime Contractor completed March 2006. Some Housing Directorate staff remain to be re-deployed.

5e. To deliver the savings from restructuring and the merger of DE and Defence Housing Executive.
New Housing Directorate Head Office structure in place and nine regional structures have been streamlined into two—North and South. Housing Directorate services managed within reduced budget allocation. Partially achieved—£2.1m merger savings achieved. £500k unable to be realised due to late completion of final structure.

5f. To reduce the management margin of vacant housing to 10% by November 2005 (ie the proportion of working stock that is vacant, excluding housing earmarked for disposal in the next 12 months).
By November 2005 the management margin was 13%. If, however, the proportion of SFA held vacant awaiting deployments and/or rationalisation decisions by the Services is excluded, the margin reduces to 6.8%. The corresponding figures at 31 March 2006 were 13.9% and 7.9% respectively. The number of empty properties will reduce from 1 April 2006 as Gurkha families take up SFA following changes to their terms and conditions of service. Target not achieved—Given the continued uncertainty in respect of many Service deployments and rationalisation studies there is a need to retain a large number of vacant properties (c3,000) to meet potential future requirements. The target of 10% will not be achieved until firm decisions have been taken and implemented.


Annex B

DEFENCE ESTATES

ANALYSIS OF ADDITIONS—2005-06

ASSETS UNDER CONSTRUCTION/LAND & BUILDINGS
Projects over £1m£'000
Single Living Accommodation Modernisation 143,998
North—Woodbridge Barracks51,978
North—Neptune SLA32,411
South-Brize Norton Runway, taxiways20,313
North—Glencorse SFA15,542
Overseas—Project Expenditure9,385
North—Aldergrove C site works8,469
South—Marchwood Housing 8,364
North—Core Services Regional Prime Contract 7,880
Europe—Proj expend6,418
South—Squadron Lines RM Poole6,083
North—Coningsby sq Accom5,434
South—ATC Tower5,315
Housing—Middle Wallop4,749
South—Pirbright New MRS4,234
South—Ashchurch3,816
South—Military Courts Centre Bulford 3,690
North—Ballykinler FQs Work3,496
South—RM Poole3,465
North—Prime Contract One3,273
North—Cottesmore3,196
South—Pirbright JR Kitchen3,131
North—Conningsby Accom for E flight 202 Sqd 2,916
North—Chilwell2,838
South—Bowman Classrooms2,731
South—Falklands Jetty2,720
South—Chickrell Trg Camp additional capacity 2,432
South—Lympstone Galley2,391
North—Beith Roof IWC62,369
North—Chicksands2,221
South—South Cerney2,046
North—WYG Kineton Felix2,016
South—Dalton Barracks2,008
North—DCU MPH1,941
South—Project EMMA1,853
South—Alexander Bks1,782
South—RNAS Culdrose1,719
South—Hyde Park Barracks Stables 1,641
North—East DTEG Services1,573
South—Accom Phase 1 Kitchen1,551
North—Prime Contract One —Ballykinler JRSLA 1,445
South—Controlled Humidity Environment Chal 2 1,434
North—Coulport RIMS Doors1,258
South—South Yard Enclave1,196
South—Dry Scuff1,175
South—Project STAR1,098
400,994


Projects under £1m
16,115
Aquatrine PFI Residual Interest
Package A3,223
Package B1,388
Package C3,054
7,665
TOTAL ASSETS UNDER CONSTRUCTION
ADDITIONS424,774
ACQUISITION OF THE SOMERSET SITE, BRISTOL 20,994
TOTAL ADDITIONS445,768


Annex C

Service Families Accommodation: Standard for Condition Definitions of Categories

  Standard for Condition is calculated from 102 different attributes organised into the following eight categories: Health and Safety, Sanitary, Kitchen, Energy, Efficiency, Building Fabric, Electrical, Security and Bedroom Standard. Standard 1 properties achieve a standard of 1 in all eight categories.

  A property assessed as Standard 2 achieves a standard of 1 or 2 in each category, with a standard of 1 usually reached in at least five categories. Examples of required improvements are: a thermostatic shower, new kitchen, or an upgrade to loft insulation.

  A property assessed as Standard 3 only achieves a Standard of 3 in at least one of the eight categories. Usually a Standard of 1 or 2 is reached in at least half of the categories. Examples of required improvements are: a complete re-wire and consumer unit, new kitchen, bathroom, and an upgrade to insulation of lofts and plumbing.

  A property at Standard 4 is typically assessed as Standard 4 in five or fewer categories. Standard 4 properties will typically require a new bathroom, electrical system, kitchen, insulation upgrade, and health and safety review.

17 April 2007






1   One listing or schedule may cover more than one building or monument. Back

2   In Trust and On Trust-The Strategy for the Defence Estate. Back

3   Anchor locations are defined as those large sites that have an indefinite operational future, have capacity or potential for development, and will be the main foci for future operational activity and investment. Back

4   Due to later starts to Colchester and Allenby/Connaught PFIs. Back


 
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