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Serco Denholm Limited was announced as the preferred bidder for a 15-year, GBP 1 billion ($1.75 billion at current rates), Private Finance Initiative contract to provide a wide range of marine services. Subject to ongoing negotiations, the Future Provision of Marine Services (FPMS) contract would see Serco Denholm take responsibility for most marine services throughout the Royal Navy’s three main UK ports at Clyde, Devonport and Portsmouth, and in domestic and overseas waters as well. Serco Derholm would also absorb the current Royal Maritime Auxilliary Service (RMAS).

Announcing the proposed new contract, Secretary of State for Defence John Reid said:

“Subject to successful negotiations we expect to be able to sign a contract later this year, which will generate considerable savings to taxpayers. MOD will now begin detailed discussions with Serco Denholm on what will be provided under the 15 year contract, which includes harbour berthing and towage, refuelling of vessels, passenger transportation, and buoy and navigation maintenance.”

At present, the majority of marine services are currently delivered by Serco Denholm under three Ports’ contracts placed in August 1996 (in-port services), and by RMAS under MOD internal arrangements (out-of-port services). FPMS was announced in 2002, to bring together both in-port and out-of-port services under a single arrangement.

Under Serco Denholm’s proposals, the Royal Maritime Auxiliary Service (RMAS) workforce would transfer to the company under Transfer of Undertakings Protection of Employment (TUPE) regulations. Some personnel reductions are expected as part of improved efficiencies, but at this stage it is too early to determine exactly. The UK Ministry of Defense has committed to liaise with trade unions throughout the process and, where possible, job losses will be achieved through natural wastage and voluntary means.

Subject to successful negotiations the formal contract award is expected later in 2006 with a vesting day some three months after the signing. See MoD release.

UPDATES:

Dec 19/07: A GBP 1 billion, 15-year future provision of marine services (FPMS) contract is signed. Serco will manage, operate and maintain around 110 vessels used in both port and deep water operations, and over 30 new vessels will be introduced into service during the contract which covers the UK’s major ports at Portsmouth, Devonport, and the Clyde.

The contract covers an extensive range of services, including tugs and pilot boats to move the Royal Navy fleet in and out of port, passenger and crew transfer to and from ships, loading of dry and liquid stores and removal of waste from the ships, protection of the environment in the event of oil or other spills, etc. UK MoD release.