Tuesday, 10 February 2009

Defence Training Review for the chop?

Back in December AV reported that the Defence Training Review (DTR) had suffered a major blow when Land Securities Trillium, one of the two companies involved, withdrew from the scheme. A suitable partner for Qinetic has still not been found.
A report in yesterday's Guardian now argues that the whole project itself is in doubt due in large part to the Recession but also to delays and spiralling costs.

DTR, which at £12billion (up £1billion from initial estimates) is the UK's largest ever private finance initiative (PFI) project, is aiming to centralise nearly all of the UK Armed Force's training facilities at a new tri-service Military Academy at St Athan in the Vale of Glamorgan.
In a statement to the Guardian, the MoD said the project had been "more difficult and prolonged than expected" and could fall victim to the "abnormal market environment" - a reference to its dependence on banks affected by the credit crunch.
Even were the funds available, this was always going to be ambitious scheme for the MoD to take on, especially in view of its track record on managing large-scale projects (see the recent National Audit Office report on MoD Major Projects 2008).

However, economists are arguing that heavy public spending on infrastructure and construction projects is a proven way for governments to dig a way out of recession (the Hoover Dam and Nazi autobahns come to mind). So, spending the odd £12billion at St Athan may be seen as a good way to help kick start the economy.

The Guardian: Credit crisis puts £12bn MoD training project in jeopardy