1.         The  Ministry of Defence (MINDEF) has awarded a contract to Singapore Technologies Electronics (STEE) to provide shared services to MINDEF and the SAF.  

2.         This is a significant milestone in MINDEF's ongoing effort to outsource non-strategic functions to achieve greater cost efficiency, service excellence and innovation in the provision of public services.  

3.        MINDEF started this process in April 2003 by aggregating the non-strategic executive functions of  its human resource services, finance services and National Service (NS)  administrative services under its in-house shared services entity, the D'eXecutive  Services (DES).  The appointment of STEE to provide shared services currently done by DES marks the next important step in MINDEF's outsourcing efforts. MINDEF will work closely with STEE to manage the transition of DES' operations to the new shared services provider, which is expected to become fully operational by mid 2007.

4.        This outsourcing initiative is expected to yield a potential cost saving of about 3 to 4% of what it would cost MINDEF to provide these services over a 10-year contract period.

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