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Experiences in Training PPPs in the Defence Sector

Experiences in Training PPPs in the Defence Sector. Allen & Overy 27 October 2005. UK Ministry of Defence.

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Experiences in Training PPPs in the Defence Sector

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  1. Experiences in Training PPPs in the Defence Sector Allen & Overy 27 October 2005

  2. UK Ministry of Defence • “The Private Finance Initiative is an important part of the Government’s efficiency policy, in conjunction with other forms of Public/Private Partnership. MoD ministers have endorsed the use of PFI to provide services throughout the Department. It is therefore Department policy that for all projects MoD will only consider using its own capital funding resources if PFI has been demonstrated to be unworkable, inappropriate or uneconomic.” (MoD Policy) • “There is no dogmatic preference for private over public provision or vice versa ...”

  3. UK Experiences in the Defence Industry (Ministry of Defence) • Skynet 5 military satellite • Attack Helicopter Simulators (Apache) • Future Strategic Tanker Aircraft • Allenby barracks accommodation project • Aquatrine, the MoD water services project

  4. Ministry of Defence Training Project • The Hawk Simulator training project • Joint Services Command and Staff College • Royal School of Signals • Royal School of Military Engineering • Defence Training Review • United Kingdom Military Flying Training System

  5. Outline of presentation • Key issues in defence sector PPPs (analogy with disciplinary services) • Key issues in defence training projects (analogy with disciplinary services)

  6. Defence project – key issues (1) • Issues arising from security and the need to protect certain information

  7. Defence project – key issues (2) • Security: contractual protection + rigorous selection process • Security and sovereignty: Sponsors and lenders (less of an issue for disciplinary services)

  8. Defence projects – key issues (3) • Licensing, IP and IT rights • Change in law risk • Termination • Step-in entity, enforcement of security and third party purchaser • Compensation if termination for security reasons

  9. Defence training projects – key issues (1) • Functionality risk • Level of training infrastructure • Technological risk • Allocation of risk • Scoping of services and performance indicators

  10. Defence training projects – key issues (2) • Revenue structure • Volume risk • Quality of students • Possible mitigants: • Private sector control over input • Input/output formulation

  11. Defence training projects – key issues (3) • Other issues • Change procedures/improvements • Accommodation? • Third party revenues

  12. Experiences in Training PPPs in the Defence Sector Allen & Overy 27 October 2005

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