§ Mr. Wareing
To ask the Secretary of State for Social Security what factors underlay the policy of privatisation of medical testing for sickness and disability benefits; what financial benefit to Her Majesty's Government has resulted; and if she will make a statement. 
§ Mr. Keith Bradley
[holding answer 9 March 1998]: My right hon. Friend the Secretary of State for Social Security announced on 31 July how we would proceed with a number of projects for the use of the private sector which were in the pipeline and which we had inherited from the previous administration. The projects were reviewed against the criteria announced in July:
- our objectives for modernising the Social Security system;
- our commitment to work within the announced spending totals for the first two years of Government;
- our aim of getting best value for public money and of reducing the burden on taxpayers;
- the scope to apply private sector expertise, discipline and economies of scale in procuring public services and the ability to secure increased investment from the private sector;
- the need for continuing flexibility for government to make future changes to services;
- the opportunities for improving the quality of service for customers;
- the implications for staff
When I announced on 19 February that all three contracts for BAMS were to be awarded to Sema I explained that we have established a minimum quality of service threshold against which we have assessed all bids from the private sector. There will be greater evaluation of performance against the new quality standards. We have also placed greater emphasis on the management of staff when evaluating the contracts.
The contract award is not part of the welfare reform programme. The responsibility for the overall service and for the determination of the entitlement to benefits remains with the Department. The award of the contract makes no change to the rules for entitlement to benefits and the rights of customers will not be changed in any way. Rigorous procedures will be put in place to ensure that we continue to receive independent, objective medical advice. We see the contract as providing an improved service to the customer and good value for money for the taxpayer.68W
The award of the contract will result in a saving of 10 per cent. over the cost of the present service.