The chief executive and other leading officials from Britain’s Defence Storage and Distribution Agency have been suspended while an investigation is carried out involving Donnington’s big military base.
The Ministry of Defence has confirmed a special fraud unit was called in, whose inquiries led to an ongoing internal investigation.
Neil Firth, the DSDA’s chief executive, and the director of corporate services Tim Gall have subsequently been temporarily suspended.
Hannah Fletcher, a spokeswoman on the policy desk for the Ministry of Defence, said: “There is an internal investigation now underway after the Defence Fraud Unit investigated, on invitation from the DSDA, alleged irregularities in procurement activities at DSDA.
“Their report, issued at the end of April did not identify fraud but concerns were raised, hence the internal MoD investigation now ongoing.
“A number of staff, including the chief executive, have been suspended pending the outcome of the investigation.”
It is thought the investigation revolved around a number of allegations.
These included staff employment; a consultancy contract introduced without competition and placing a contract for shelf racking at Donnington through single-source tendering when a contract of that size needed to go out to competition.
Miss Fletcher would not confirm any details, saying issues were being kept under wraps while the investigation was carried out.
An internal note was sent out to all DSDA staff earlier this month informing staff of the suspensions saying it was “accordance with MoD policy” and “a mandated MoD procedure”.
Both Telford MP David Wright and Wrekin MP Mark Pritchard said they were unaware of the situation.
Steve Jary, national secretary for the Prospect trade union – which represents engineers, managers and specialists in both private and public sectors – said: “Public service procurement is bound by much tighter rules than business-to-business contracts.
“There is always a risk of this sort of thing when people are parachuted into public services because of their supposed commercial acumen.
“The injection of commercial business practices can mean the injection of the bad as well as the good.”
“Whatever the results of the investigation, we hope the MoD will learn the lesson of this episode.
“What is certain is that it will have tarnished DSDA’s reputation and damaged its ability to support the front line. And that is what DSDA is for – it is not an entrepreneur’s plaything. The risk of failure is more than lost shareholder value and a few executive bonuses.”
Donnington is one of 10 major DSDA sites around the country and holds huge military stocks. The DSDA is the storage and distribution arm of the Defence Equipment & Support organisation which stores, maintains, issues, processed and distributes materiel for the MoD and other users.
