FinExperts offers consultancy and training to companies bidding and performing UK MoD defence contracts

UK laws govern pricing and reporting of qualifying single source defence contracts

Significant changes to the legislation came into effect on 1 April 2024, and more are expected in 2025. These changes are span costing, pricing methodologies, profit, and commercial terms and reporting of QDC/QSCs. They bring additional risks to contractors.

The Defence Reform Act (DRA) enables the Single Source Contract Regulations (SSCRs) and the Single Source Regulations Office (SSRO). 

The SSCRs have been updated by subsequent Statutory Instruments (and the changes are ongoing). The law has significant and complex impacts to pricing, government access rights and reporting arrangements of Single Source UK Ministry of Defence contracts and sub-contracts. The Regulations and statutory guidance apply, irrespective of location, to single source prime contractors and their supply chain sub-contractors.

The Single Source Regulatory Office (SSRO) issues supporting statutory guidance. Statutory guidance is required to be followed unless there are sound reasons to set it aside. Contractors need to understand, train, and make their governance and other procedures compliant. Statutory guidance issued by the SSRO covers Allowable Costs; Alternative Pricing Methodologies; Reporting user guides; Defined Pricing Structure; Calculating the Contract Profit Rate; and Penalties. 

Pricing of new contracts which are not subject to regulations

The 810 series DEFCONs are likely to be used. These DEFCONs should not be regarded as fit for the majority of contracts in the majority of circumstances. Each should be fully considered and negotiated accordingly.

Compliance with regulations and other requirements over pricing, contract changes, cost accounting and reporting is essential to business performance. FinExperts are there to support your company though provision of consultancy and training.

Company specific courses are offered in addition to those of a more general nature which are run in partnership with A|D|S.

Contact details:

Tim Watkins: tim.watkins@finexperts.co.uk                

07891 582562      

01935 862863