As the first major prime package is announced, and opposition to it continues, Defence Estates' chief executive explains how he intends to stage the revolution in MOD procurement.
It is 2:30 on a Friday afternoon in January. Defence Estates chief executive Ian Andrews is sitting in his dingy office on London's Embankment at the end of a week in which he has visited half a dozen locations in the Ministry of Defence's far-flung £14bn estate, including Harrogate, Belfast, Sutton Coldfield and the West Country.

On top of the rigours of this itinerant lifestyle, it has just been announced that Ted Pearson, his commercial director, is leaving. Andrews has the job of explaining why this is not a blow for prime contracting, the MOD's new smart procurement method: Pearson was a key orchestrator of Defence Estates' adoption of the system, which will see its £1.7bn construction budget spent on a handful of "prime contractors".

Andrews reels off a catalogue of reasons why Pearson's departure does not imply a lessening of Defence Estates' commitment to prime contracting. Losing the odd individual is not important when there is a strong team in place, he says. And he regards himself as the co-ordinator of this team: "You have one sort of chief executive who does things and one who organises a team and conducts the orchestra. I regard myself as the second." Andrews is understandably anxious to play down the gap left by Pearson's departure. The 48-year-old is stage-managing one of the greatest ever transformations of a construction client, and there are already signs that it may be in a spot of trouble. Although contractors have been noisily enthusiastic about the grand plan, there have also been dark rumblings over risk-laden contract terms and conditions, a slow start to the launch of the massive regional contracts and rumours of entrenched resistance to the procurement route within the MOD. Andrews is aware that he faces a Herculean task. "I have to change the way three groups of people think and behave," he says. "What I do on Tuesdays I don't know," he quips.

At six foot five, Andrews is an imposing yet extremely affable figure who has largely won the industry over with his dry sense of humour and openness. Since prime contracting was unveiled in 1998, Andrews has been on a round of breakfast, lunch and dinner meetings to inform and soothe construction's leaders. Those who have met the man over eggs benedict or grilled sea bass describe him as "sensible", "good company" and "a very good politician".

A degree in geography from Bristol University might not seem an obvious starting point for a career in the MOD, but a stint with the Territorial Army at university and an interest in military history led Andrews to the department. "The idea of being involved in policy-making in government seemed a wider canvas than the armed forces," he explains.

Joining the MOD in 1975, he had an early brush with procurement at the Procurement Executive in Bath where he was responsible for buying underwater weapons. He did taste army life: in the early 1980s, he spent a year in Germany on a short service volunteer E E commission in the regular army, which he says "reinforced my credentials". As assistant private secretary to the secretary of state in the mid-1980s, he has also seen policy-making in action.

By 1988, he was heading Defence Lands and in 1995 became managing director of a division of the Defence Evaluation and Research Agency. This is where he learned his trade, he says, from chief executive Sir John Chisholm, formerly of private sector outfit SEMA Group. Andrews admits: "I went to DERA as a traditional civil servant and had my eyes opened to different ways of managing. I learned the importance of holding people accountable for delivering clear objectives, empowerment and setting a framework." He took this experience with him when he moved to the role of chief executive of the fledgeling Defence Estates Organisation in 1998.

I can be clear that at 3 o’clock I will jump off this cliff, but if my parachute arrives at five past, it’s sensible to wait

Prime contracting has so far only seen a handful of capital works schemes get the go-ahead. What firms are really waiting for are the £400m-plus seven-year regional one-stop shops, the first of which, a £400m deal in Scotland, was announced last week.

The slow start has unsettled contractors. Here Andrews, the earnest politico, launches into a litany of reasons for the delay. For example, Scotland has 20 different MOD parties that need to understand how the deal will be managed, and he did not want contractors to start spending money on bids only for the scheme to be put on hold. "I can be clear that at 3 o'clock I'm going to jump off this cliff, but if my parachute arrives at five past, it is sensible to wait." But he can be a bit sketchy on the finer points. One question on the Scottish deal is the state of the sites. Will contractors be expected to survey all 399 themselves or will Defence Estates provide that information? "They will make a judgement on that and they will have access to the estate to make a judgement on the condition," he says.

The well-publicised criticism of the contract terms and conditions is greeted with a slightly weary response. As he has told his breakfast companions, the terms will become clear when the contract is in use. But he says the apportioning of risk will be discussed thoroughly from tender stage through to contract award. He is adamant that he wants to see contractors make a decent profit and for the MOD to get decent buildings.

He dismisses rumours of a lack of commitment from either ministers or the department. He is running week-long training courses for everyone in Defence Estates to ensure that they have bought into the scheme. And just before Christmas, he says, he submitted an update on prime contracting to the defence secretary and got the nod to carry on. He adds that two all-important players, the National Audit Office and the Treasury, are firmly behind the reforms. Andrews is confident that, by 2004, Defence Estates' repair and maintenance will be in the control of a handful of fully-fledged prime contractors.

In the same way that he wished to be open about Pearson's departure, he also honestly states that he doesn't expect to be at Defence Estates much beyond 2002, when the process should be in full flow.

Personal effects

Who’s in your family? I am married to Moira. We have three children: Jamie, 11, and twins Rosemary and Harry, 8.
What is your favourite building? My home. But I don’t see much of it. Otherwise, the Jubilee Line Extension stations.
Where do you live? Wimbledon, south London.
What are you reading? A Stranger’s Eye by Feargal Keane and Jeremy Paxman’s The English. I tend to read factual stuff.
What are your hobbies? Skiing and travelling.