The Ministry of Defence is considering the part-privatisation of its procurement arm, Defence Minister Nick Harvey has confirmed.
As he took an urgent question on the future of defence equipment and support on 17 July 2012, Mr Harvey explained that officials were weighing up whether Defence Equipment and Support (DE&S) would be best run as a quango in partnership with a private contractor or as a "government-owned, contractor-operated" (GoCo) body.
Shadow defence minister Alison Seabeck, who had tabled the urgent question, warned: "The impact of privatisation could be to weaken public accountability and transparency on multibillion-pound defence decision-making.
"We have seen recently in the case of G4S that outsourcing doesn't guarantee efficiency or effectiveness and can increase risk."
Mr Harvey said work would take place over the summer ahead of a decision later this year, saying the government would only go ahead with the proposal once "the model had been worked up and thoroughly tested".
He believed a shake-up was needed to "tackle the legacy problems in defence acquisition that led to cost and schedule overruns".