Fed: Labor accuses govt of presiding over logistics deal blowout

AAP General News (Australia)
12-18-2003
Fed: Labor accuses govt of presiding over logistics deal blowout

The opposition has accused the government of presiding over a major cost blowout in
a multi-million dollar contract for defence logistics services.

The government and company TenixToll Defence Logistics have signed a contract worth
up to $920 million to handle the storage and distribution of defence supplies over the
next 10 years.

Labor's defence spokesman CHRIS EVANS says the cost of the Defence Integrated Distribution
System has increased by $40 million since the winning tenderer was announced 14 months
ago.

Senator EVANS says Defence Minister ROBERT HILL originally declared the deal would
cost $880 million and result in savings of around $80 million over 10 years.

The government says the contract will cost $920 million with savings of $40 million
against current costs.

TenixToll --a joint venture between defence company Tenix and transport company Toll
Holdings -- will progressively take on the work over the next year.

AAP RTV mb/sb/rd/rp g

KEYWORD: LOGISTICS (CANBERRA)

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