Unions have raised concerns that the Ministry of Defence’s decision to outsource functions such as HR to a private contractor will lead to “further attacks” on employees’ terms and conditions despite ministerial claims to the contrary.
Serco has won a £36 million deal to run a shared services organisation, Defence Business Services in a bid to save the MoD an estimated £71 million over the next four years.
In a written statement, Defence Secretary Philip Hammond said: “Serco will be strongly incentivised to drive down costs and deliver efficiencies and we expect savings in the order of around £71 million to be achievable over the life of the contract.”
DBS has been created out of a previously dispersed civilian HR function, a finance shared services centre and some elements of the MoD’s information and commercial operations, which includes vetting. Other areas such as military HR are also expected to be absorbed into DBS by next year, however.
The MoD said that the move was part of a long-term strategy to “radically transform” how services were delivered, adding that DBS would remain part of the department and personnel working for it would retain existing terms and conditions.
But Anna Biggs, a negotiator for Prospect, which represents vetting officers working for DBS National Security Vetting, said that the union had not been informed that the contract had been awarded to the outsourcing supplier – in fact, the first it knew about the move was “when Serco advertised to fill a post”.
Biggs was also not reassured by ministerial promises in relation to staff Ts&Cs. “Company earnings will be performance-related, which can only mean further attacks on terms and conditions for civil servants because Serco thrives by driving down costs and delivering what the government will claim to be efficiencies and savings,” she warned.
The union is in formal disagreement with the MoD over its decision to have Serco provide personnel to fill senior management roles, a move that Biggs said, sent out all of the wrong signals to personnel as it implied that ministers did not trust them to run their own operation.
The Public and Commercial Services Union, likewise told Wales Online that it feared job and pay cuts would follow, adding that it too had not been officially informed of the Serco deal.