The MoD and the British government are making increased efforts to use PPP, mostly through the Private Finance Initiative (PFI), largely in an attempt to reduce annual defence expenditure. PFI allows private sector companies to run and maintain defence services that are not considered to be on the frontline, such as training, accommodation, catering services and areas of the supply chain that supports the armed forces. PFI will move to other areas in the coming years, including transport, AAR and SAR. Integrated Project Teams (IPTs) composed of military and civilian personnel manage PFI and other major projects as part of the MoD and DE&S.

The largest PFI contract to date is the provision of three Skynet 5 military communications satellites by Paradigm Secure Communications (part of EADS Astrium). Paradigm was awarded the £2.6 billion contract in 2003 to run the existing Skynet 4 satellite communications (SATCOM) constellation and deliver and maintain Skynet 5. The first satellite, Skynet 5A, was launched into space by an Ariane 5-ECA rocket from Kourou in French Guiana in March 2007. It achieved initial operational capability soon after launch and is currently being used by UK forces in Afghanistan and Iraq. Skynet 5B was launched in November 2007, while the final satellite, Skynet 5C, will act as an in-orbit spare once it has been launched in 2008. Compared to its predecessor, Skynet 5 will be a much improved system. Its bandwidth capacity alone is two-and-a-half times more than Skynet 4.

Paradigm runs the system from three sites at Corsham (main site), Colerne and Oakhanger until 2020 in conjunction with the Defence Communication Services Agency (DCSA), which is tasked with delivering ICS services to the MoD. Other companies involved include Serco Defence (network and facilities management), LogicaCMG (software), Cable & Wireless and Systems Engineering & Assessment (SEA).

Skynet 5 is part of the UK’s larger £3.6 billion network enabled capability (NEC) that will allow the armed forces to operate on the digital battlefield by linking together satellites, airborne ISTAR capabilities and the Bowman tactical communications system, which is replacing Clansman. Much of the exploration of the capabilities of NEC was undertaken during 2003-2006 by the Network Integration Test and Experimentation Works (NITEworks) consortium, composed of nine major UK-based defence companies led by BAE Systems. NITEworks has worked on other projects for the MoD and was awarded a £43 million contract in December 2007 to improve tactics used by British forces to counter improvised explosive devices (IEDs).

The supplier of Bowman, General Dynamics UK (GD UK), as well as other major companies are currently nearing the completion of fitting some 20,000 vehicles, 270 aircraft and 150 vessels with the system at a cost of £2.4 billion. AgustaWestland is responsible for training personnel in the use of Bowman, while DRS Tactical Systems is supplying Bowman-linked Scorpion computer displays for armoured vehicles and hand-held terminals for troops. The basic version of Bowman entered British Army service in 2004 and the system is continuing to be updated as it nears its full operational capability.

In March 2006, the MoD placed a £230 million order placed for BAE Systems Integrated System Technologies (Insyte) Falcon man-portable secure battlefield communications system to equip the British Army from 2010, replacing current systems like Ptarmigan. The system will be a key part of NEC and will be operated by the Royal Signals at divisional and brigade HQ level, allowing senior commanders to receive data via satellite from other communications systems like Bowman and the Cormorant command system, which is used to control Joint Rapid Reaction Force (JRRF) assets. A subsequent £45 million contract was awarded in November 2007 that will see BAE Systems Insyte deliver the Falcon system to the RAF from 2010.

In July 2007, a consortium led by GD UK along with GD Advanced Information Systems, EADS Defence & Security Systems, Marshall Solutions, Systems Consultants Services (SCS) and the Vega Group was named as the preferred bidder by the MoD to deliver a ten-month £1.0 million assessment phase for the Listener Sensor Data Fusion Programme that will link from 2009 British ISTAR assets with US forces and other NATO armies. In addition, Raytheon Systems has led a consortium since 2004 developing the Joint Effects Tactical Targeting System (JETTS) software for the British Army, which allows commanders to simultaneously control all offensive assets to operate in synchronisation on the battlefield. Full operational capability is expected in 2015.