I was led to believe (from a reasonable MCA source) that the RAF charged twice the then hourly price the MCA was paying for civvy SAR.
SARH has decided what level of cover they want provided. If the RAF were to provide that level of service at a price cheaper than civvy, why aren't they? Reading between the lines, someone has looked at this and determined that private finance profit is cheaper than the bureaucratic bunglings within the MOD/RAF.
Whether it will work or not, time will tell. But if SARH expects contractors to take the risk on future fuel/labour/equipment/land rental costs then we the tax payer have to pay for that risk. Perhaps that is still cheaper than the RAF. If the RAF charges were pie in the sky and not realistic then we don't need SARH. Maybe they were realistic and the RAF is more expensive than civvy. But if that's the case we don't just need SARH, we need some radical restructuring of the MOD and gain the efficiencies that the private sector can achieve whilst meeting the specifications.