The Army is set to outsource its recruitment of soldiers and officers to the private sector.
It is holding an event later this month to inform potential bidders about the details of the contract. However, recruitment sources believe that the contract will be worth about £100m over 10 years and will not be finalised until 2011.
A potential bidder added that the Royal Air Force and the Royal Navy will "also be going down the outsourcing route" should the contract prove successful. The source said: "The suspicion is that this will be chased by business process outsourcers, recruitment firms, and service companies.
"That means you can throw into the bidding equation names such as Capita, Serco, Manpower, G4S, Hays, VT Group and the French firm Steria."
An Army spokesman said: "An industry day is to be held on 28 May. Information will be released that day so that there is a level playing field [for any party that wants to bid]."
Outsourcing areas such as recruitment is part of the Government's cost-cutting drive. In last month's Budget, Alistair Darling confirmed that he was looking to make £35bn of savings by 2010-11. Every department is to have a minister responsible for savings.
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