Government addresses reverse auction criticisms

The government has changed the reverse auction process on its Digital Services 2 framework, after complaints that it would lead to a drop in quality and put off SMEs.

In December, the Crown Commercial opened bids for a place on the Digital Services framework, saying that a reverse auction mechanism would be held to establish suppliers’ maximum day rates.

However, the government has now stepped in to address worries raised about the system, which aimed to award contracts to the lowest 50 bids for each role.

A statement by the Government Digital Service said: “It wasn’t possible to completely remove the reverse auction for DS2, but we have been able to set sustainable minimum day rates per role to prevent suppliers making unsustainably low bids.”

Before Christmas, one supplier voiced his worries on a blog published on ICT website Diginomica.

The supplier said: “Whilst on the surface it may seem that succeeding in lowering day rate costs represents a win for government procurement, in reality it means that the majority of the opportunities being contracted for through the framework have been commercially unattractive to suppliers, particularly SMEs.”

The supplier said that the fact that trusted suppliers were not bidding for work was pushing public sector customers away from the framework.

When the original Digital Services Framework tender was published in July 2013, Cabinet Office minister Francis Maude said that it was part of his drive to open up government business to smaller suppliers.

The replacement framework was delayed because the CCS decided to include it in the scope of work on the new Digital Marketplace, which finally replaced the CloudStore platform in October.

Colin Marrs

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