MOD terminates Package 1 of the Defence Training Review Programme (DTR)

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Following the Secretary of State’s announcement today, QinetiQ confirms that it has been advised by the Ministry of Defence (MOD) that the procurement for Package 1 of the DTR programme is to be terminated with immediate effect. The MOD has stated that it believes that commercial and financial close, scheduled for March 2011, cannot be achieved within the prescribed period and the project is unaffordable. As a consequence, the MOD has concluded it is necessary to terminate the DTR procurement and Metrix’s appointment as preferred bidder.

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The MOD has confirmed that it intends to examine a range of alternative proposals for the rationalisation of defence training. These will consider how training may be delivered in the future from a Defence Technical College and St Athan in Wales will continue to be an option for its location. The MOD will commence work on alternative options as soon as possible.

Since the appointment of Metrix as preferred bidder in 2007, QinetiQ has incurred costs of £37m which to date have been capitalised on the balance sheet of the Group. We expect to write off the capitalised costs as an exceptional item and the QinetiQ Board’s expectations of Group underlying performance for the year remain unchanged by this.

Commenting on today’s announcement, Leo Quinn, Chief Executive said: “We are disappointed by today’s news, but believe that the principles behind the programme remain unchanged. We look forward to discussing alternative solutions with the MOD for providing consistent high quality training across the Forces in a way which delivers value for money within the current budgetary constraints.”

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