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Non-Competitive Government Contracts: Profit Formula

Volume 589: debated on Wednesday 6 May 1998

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asked Her Majesty's Government:What decision they have made on the report by the Review Board for Government Contracts on its 1998 Annual Review of the Profit Formula for Non-competitive Government Contracts. [HL1773]

The Government have accepted the overall target rate of return on capital employed as recommended by the Review Board in its report. The new rate will be 22.2 per cent. compared with the current rate of 20.95 per cent., both on the basis of historic costs. It will become effective immediately. The report has been printed and copies will be placed in the Library of the House.