National secretary Steve Jary said: “It is bizarre that MOD has recommended this sell-off. Recent events, especially the Haddon-Cave review into the Nimrod disaster, have made very clear that outsourcing has played a role in the diminution of MOD’s ability to act as an intelligent customer.

“What DSDA needs is a period of stability, not more upheaval. Some military chiefs are understood to be opposed to any sell-off because of the nature of DSDA’s work.

”The vultures are circling around the DSDA – not because the private sector can best provide logistic support to the armed forces and the front line – but because of the value of its non-reserved assets, property and land,” said Jary.

MOD has excluded any in-house bid for DSDA despite MOD’s own efficiency savings programme, which has yielded a 13 per cent increase in productivity and a reduction of 5.5 per cent in operating costs per annum over the last five years.

The union says part-privatisation of DSDA will damage support to the troops. “It appears to be the only game in town, because of the bidding war between the political parties to cut MOD civilians and because of the need for capital investment in a period when MOD has no money for infrastructure projects,” said Jary.

Jary warned that key capabilities will be lost because DSDA is not just a warehousing and distribution agency, it also processes munitions.

DSDA has eleven major sites in the UK and one in Germany, and currently stocks over one million stock lines worth £13bn. It was created as an agency in 1999 and employs 4,500 civilian staff.