I am announcing today that I intend to set up a new defence infrastructure organisation (DIO) on 1 April this year. We will now launch a consultation process with the MOD trade unions.
The new organisation will bring together some 7,000 staff currently working on construction, maintenance and utilities management and the disposal of land and buildings across the Department.
By making these changes we expect to save about 2,500 posts by 2014 and some £1.2 billion over the first four years alone, without reducing the effectiveness or reliability of the service we deliver. This measure will make a significant contribution to the civilian staff reductions and efficiency measures set out last October in the strategic defence and security review.
This is the first such change emerging from the work of the defence reform unit under Lord Levene designed to overhaul the structure of the Department. It is a significant change, and demonstrates the radical approach to reorganisation and resourcing which we are taking to ensure that we maximise the amount of the defence budget made available for the front line. I hope to announce further such changes in the near future.