MoD seeks suppliers for £5bn IT contract

The Ministry of Defence (MoD) is looking for suppliers for the government's biggest technology contract, worth up to £5bn over 10 years.

The Defence Information Infrastructure (DII) programme will consolidate armed forces' IT and provide a managed service across an estimated 300,000 users in 2000 locations worldwide.

The MoD wants to use a Public Private Partnership arrangement rather than a straightforward flat-fee outsourcing deal. Payment will depend on performance and an incentive scheme and 'gain-share' mechanism will share the risks and rewards between supplier and user.

'The partnership approach will give the services that Defence requires for the future. It is a well-tried and tested method,' MoD project team leader Bob Quick told Computing.

The deal will include provision of hardware, application services such as electronic messaging and public key infrastructure, support, security and identification services and management of legacy systems and migration policies.

DII will cover permanent sites, airfields and staging units as well as battlefield environments, ships and submarines.

The programme has three stages - to take on existing systems, to manage an intemediate 'convergent' stage, and to deliver the full DII integrated infrastructure by 2008.

'IT is the gateway to high capability, integrated forces, and better value for money in defence,' said the MoD in the document sent to suppliers interested in bidding.

'The success of Defence and in particular the military operations it performs, is dependent on making information available to the people and processes that need it.'

The contract may be won by a single company or a consortium but the MoD stressed that bidders must prove they are minimising the impact of a failure of any single key supplier.

A shortlist of three to five bids will be decided by June. The contract is due to be signed towards the end of next year and start in early 2005.

IBM, EDS and Lockheed Martin are among suppliers expected to bid.