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The UK government’s proposal to outsource more than 40 per cent of the MoD budget to private contractors – the so-called government-owned, contractor-operated (GOCO) option for Defence Equipment and Support (DE&S) – is moving in the opposite direction to the US, whose experience of placing more procurement functions with private sector results in higher rather than lower costs, states new RUSI briefing paper.  

What the Government must do in Defence Procurement: The Inherently Governmental Function and the GOCO Proposal for Defence Equipment and Support, written by John Louth and Trevor Taylor, highlights the question of whether most aspects of defence procurement and contracting for equipment and support are fundamental government responsibilities that should not be passed to others. 

The paper argues, in the United States, defence acquisition is seen as ‘core business for the government, with significant restrictions placed on what can be entrusted to the private sector. In the US, the term ‘inherently governmental function’ is an established part of discourse, policy, regulation and debate, with a clear definition as outlined by the Office of Federal Procurement Policy Letter in June 2011; in the UK, at present, there is no similar definitive description which could clarify the roles of a proposed DE&S GOCO.

‘In the United Kingdom, the extensive privatisation of public bodies and outsourcing to the private sector of services funded by government has taken place with little explicit discussion of what responsibilities the government cannot pass across.’

‘There is no intrinsic reason for the UK to follow an American definition of the concept of the inherently governmental, but there would seem to be a case for the British government to articulate its own thoughts in this domain.... The significance of the landmark British court judgement, in June 2013, that UK soldiers at war in foreign lands are owed a duty of care and are covered by human-rights law should not underestimated.’

‘The MoD may well be recognised as legally vulnerable to claims by personnel that they have been improperly or inadequately equipped, which would suggest real limits to the risks and responsibilities that could be passed to a procurement contractor, and to the risks and responsibilities that any contractor would accept.’

‘Finally, there are the implications of the UK’s defence choices for its foreign relations and economy, as well as for the military freedom of action underlined as central to sovereignty in the 2012 White Paper National Security through Technology. It is these factors that frequently make defence equipment a topic of interest to government departments beyond the MoD.’

To read the briefing paper What the Government must do in Defence Procurement in full please visit www.rusi.org/GOCO  

Any enquiries and interview requests, please contact : Daniel Sherman / +44(0)20 7747 2617 / +44 (0) 7917 373 069 / daniels@rusi.org