During the debate on the Forensic Science Service Trading Fund (Revocation) Order 2005, which took place on Wednesday 14 December, I undertook to clarify the criteria we intend to apply when considering whether the Forensic Science Service (FSS) should continue as a 100 per cent. Government-owned company (GovCo), or whether there would be advantages in changing the status of the organisation to a Public-Private Partnership (PPP).The context of this statement is the policy decision following the McFarland Review (2003) to promote greater competition in the forensic science market and to convert the FSS into a fully commercial business, allowing it to compete effectively in an increasingly dynamic forensic science market. The McFarland Review originally recommended that the FSS become a GovCo for an interim period (12–18 months) before a change of status to PPP. Whilst accepting that a move to a more commercial status was the right approach for FSS, I, and my predecessor in this post, my hon. Friend the Member for Don Valley (Caroline Flint), have been clear that there is no inevitability about a move to a PPP. It remains the Government's position that FSS Ltd must be allowed to establish its viability as a GovCo. We shall only agree to a further change of status to PPP if there are convincing reasons to do so.The decision as to whether to change status is complicated by the fact that the Home Office is responsible for how forensics benefit the UK criminal justice system overall and is also owner of the leading provider of UK forensic science services. There are, thus, a wide range of sometimes conflicting criteria, which need to be considered and balanced. Moreover, not all criteria will be able to be judged clearly at any one time. Any decision, therefore, needs to be taken in the round. In general, there are four sets of criteria: the needs of the UK Criminal Justice System; the state of the UK forensic science services market; the needs of the FSS; and the requirements of Home Office as shareholder.The needs of the UK Criminal Justice SystemThis is the most important set of criteria. Any proposed change in status for the FSS needs to demonstrate that it would deliver clear benefits to the UK Criminal Justice System. Whilst there are many factors which could be taken into account, the Home Office believes that (i) quality and reliability, (ii) service levels, (for example in satisfying customer turnaround time requirements) (iii) value-for-money and (iv) level of innovation, are the key criteria.The Home Office will consult the principal UK Criminal Justice System forensic science service stakeholders (principally, the Police and the Crown Prosecution Service) to seek their views as to whether a change of status would be beneficial to the overall UK Criminal Justice System.The state of the UK forensic science services marketplaceIn keeping with the recommendations of McFarland, Home Office will need to be assured that a fully competitive marketplace is likely to develop, whatever the merits of GovCo and PPP status in other regards. This assessment will need to take account both of the demonstrated state of the marketplace at that time and the likely future development.The key criteria to be assessed are: (i) evidence of real competitive behaviour in the UK forensic science services marketplace (e.g. price movements for forensic services; movement of market share on competitive tenders; new entrants to the marketplace; (ii) a level "playing field" for all forensic science service suppliers; (iii) development of appropriate procurement practices within the police authorities (e.g. contractualisation); and (iv) a regulatory framework which is clear and fit-for-purpose.The needs of the Forensic Science ServiceThe FSS has many exciting plans for enhancing its services to its UK Criminal Justice System and other customers. These include continuing research to develop the next generation of forensic techniques, upgrading its accommodation to modern, state-of-the-art facilities, being more flexible in its delivery of services to customers, and broadening the base of its science-related businesses. Delivery of this vision will require substantial investment, both in physical and human capital, development of new and existing capabilities and exercising strong implementation skills.In coming to a decision on status change, the Home Office will consult the FSS Board as to the respective merits of GovCo and PPP status in implementing the company's strategy and agreed business plan. Key criteria in this regard are: (i) access to finance; (ii) access to capability; and (iii) freedoms required to implement the agreed Business Plan.The needs of Home Office as ShareholderAs a Government-owned business, the FSS has to compete with other calls on public funds and consequently Home Office's investment in it needs to demonstrate an appropriate risk/return profile.In coming to a decision on the relative merits of GovCo vs PPP, the Home Office will need to consider: (i) assessment of the financial value of the FSS; (ii) the financial risks to Home Office associated with ownership of the FSS; and (iii) Home Office's funding priorities.SummaryAs outlined above, no decision has been made as to whether FSS should remain a GovCo or change status to PPP. The Home Office's principal requirement in coming to a decision is whether a change of status represents the best long-term outcome for the UK Criminal Justice system forensic science marketplace and its stakeholders, bearing in mind the needs of the FSS and Home Office's requirements as a shareholder.In the debate I set out my intention not to make a firm decision until summer 2007, with the proviso that, if the FSS Board, or Home Office exercising its shareholder responsibilities, outlined a pressing need for an earlier decision, I reserved the ability to consider this request and share it with Parliament.

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