Consistency, transparency, and an end to gerrymandering – what government IT suppliers want

A range of IT providers tell PublicTechnology what they would like to see during a defining period for the Crown Commercial Service

The Crown Commercial Service is set to award billions of pounds worth of government contracts over the next couple of years  Credit: PA

The next year or two are set to be a landmark period for the government IT procurement space. 

Between May 2018 and March 2019, the Crown Commercial Service (CCS) intends to launch a total of five major IT frameworks: G-Cloud 10; Application Solutions; Technology Products 3; Network Services 2; and Crown Hosting Services 2.

The five replace outgoing deals that have been worth as much as £10bn to thousands of suppliers over a number of years. 

Outside of these, in the next couple of years there will be an additional £3bn-4bn in overarching contracts with one or a limited number of suppliers that will be broken up and taken back out to market, CCS has said. These contracts, the organisation believes, represent an “inflection point” in its drive to disaggregate monolithic deals and work with more SMEs.

Alongside which the organisation is also striving to widen its procurement model, and look beyond the framework as its default buying vehicle. A dynamic purchasing system (DPS) – which is being used to allow buyers to access the health and social care network – is one alternative. The DPS model can, unlike a framework, last for longer than four years and, crucially, new suppliers can be added over the life of the deal.

“The LASA framework has been in place three years – but the solutions evolve quicker than that”
Denis Kaminskiy, Arcus Global

This is a development that is welcomed by Harry Metcalfe, managing director of government digital specialist dxw.

“We want to try and join the Cyber Security Services 2 framework, but that runs to 2019. It is not ideal that the opportunity to join frameworks comes around so rarely,” he says. “Also, they are limited in the degree to which they can be flexible. If we have a service on G-Cloud, it is over a year until it can be reiterated. And they don’t let you change the pricing if the service changes. We would like something a bit more dynamic, where they allow new suppliers to join, and to update their service.”

Cloud-specialised software developer Arcus Global is on the Local Authority Software Applications (LASA) framework, one of two major contracts that will be replaced by the incoming Application Solutions deal. Co-founder Denis Kaminskiy says that a model that allowed companies and products to move between lots would be top of his wish list for future engagements with the government.

“LASA has been in place for three years already – but the solutions evolve quicker than that,” he adds.

The “limiting” nature of the contract also leads to some creative bidding, he says.

“There has been some gerrymandering between different providers to try and encourage customers to go for a certain lot,” Kaminskiy says. “Requiring people to publish transparent pricing would be very valuable. Many times customers buy something, [only to be told] they will then need to buy 30 Oracle licences as well. [It should be clear] whether the price that is displayed is actually the only price that you are going to be paying, or whether a solution needs any third-party software.”

Opening up
Transparency is important to dxw’s Metcalfe too. CCS has said it is considering making it easier for public bodies to directly award contracts to a supplier of their choice, rather than opening them up for providers to bid. The dxw boss has mixed feelings about such a possibility but, overall, would “cautiously welcome” it.

“It has high potential for abuse, where a buyer gets into a comfortable place with one or two suppliers that they work well with, without ever checking back in with the market,” he says. “For me, it is a matter of transparency… [and knowing] whether a buyer is awarding contracts to the same supplier again and again.”

Metcalfe is clear that no buyer should “be forced to use someone else”, but that if multiple contracts are going to one supplier without a bidding process, such practices should be open to scrutiny. The MD adds that dxw would be more than happy to be as open as possible about its government engagements – but that such transparency will only work if every supplier either agrees, or is obligated to be so open.

“The reality is direct awards happen all the time anyway, whether or not CCS wants to acknowledge it”
Harry Metcalfe, dxw

Whatever the theoretical constraints, “people will always find a way to get the result they want”, Metcalfe says.

“Direct awards [effectively] happen all the time anyway,” he adds. “If the [tender] just said ‘we have a preferred bidder, we have worked with them a lot and they are great’, that would radically alter our approach. We would either go for it hell for leather, knowing there was a [strong incumbent], or we would say ‘OK, they are doing great, we’ll leave them to it’.”

Metcalfe adds: “As opposed to the current situation, where it is quite hard to tell the difference, and it often wastes a lot of people’s time. The reality is that this happens all the time anyway, whether or not CCS wants to acknowledge it. Do we bring it out and accept the reality, and try and find a mechanism to make that more transparent than it currently is? Or do we go the other way and try and prevent it?”

David Aspindle, head of public sector at IT supplier Littlefish, which has a number of Whitehall customers, is another to call for government customers to publish a greater volume of data and what they spend, and with whom. This, he says, would benefit customers in picking suppliers for engagements that are, often, seen as simple commodity exchanges.

“The IT market is moving further towards a commoditised model – using standard contracts that enable direct-award capability,” he says. “This will enable faster, simpler procurements for buyers and suppliers. In essence, it will be just like buying mobile phone contracts, where a buyer compares the market for the best price against their preferred service requirement and length.”

Aspindle adds: “We’d like to see more open data and visibility around external procurement spend, or indeed, the internal cost of provision of service, supported by a contracts database across government. We know that the government publishes data above £25,000 monthly – CCS could collate this and provide an analysis platform to enable standardisation and further commoditisation.”  

Framework fans
While there are a number of gripes about frameworks – from both suppliers and buyers – many seem to accept that they are the most workable government procurement model currently available. The contracts even appear to have some supporters, such as Simon Pettit, corporate director at Stone Group, a system builder and IT services provider on the £4bn Technology Products 2 framework that expires next year.

“I like the way that CCS is now setting out its framework agreements and I do not see any other viable alternative at the moment,” he says. “The marketplace is starting to become accustomed to what the framework means from a supplier perspective, and how to use it. If they continue to invest in gathering user feedback via the supplier sessions and continue to truly collaborate with suppliers for Technology Products 3 – and not just paying lip service to it – then it will continue to improve.”

IT reseller and managed services provider Fordway is on the Technology Services 2 framework, which launched in September. The company’s founder Richard Blanford is another to see progress from CCS on how it creates and delivers framework agreements.

“What they are doing in frameworks is good – they opening up, and being less limiting with suppliers,” he says. “With the first Technology Services, they were extremely prescriptive about what went into each lot. If you wanted to do a large transformation project, you would need to use more than one lot, and use two or three suppliers. The second is a lot more useful; it doesn’t prescribe the solution, it just [allows for] what the customer wants to do.”

“We haven’t taken any work through G-Cloud.. and we had to jump through unusual procurement hoops to get listed”
Jon Topper, The Scale Factory

While Blanford contends that “frameworks are certainly getting better for SMEs”, not everyone shares this view. 

The G-Cloud framework, and the Digital Marketplace platform that serves it, are often held up as a beacon of CCS’s work to make the central government IT market a more SME-friendly environment. But Jon Topper, co-founder of hosting provider The Scale Factory, is yet to be convinced.

“We’re currently listed as suppliers on G-Cloud 9 and the Digital Marketplace, but haven’t yet taken on any work through those platforms,” he says. “The unusual procurement hoops we had to jump through to get listed there are ostensibly designed to favour smaller suppliers such as us, and yet the majority of people I know in the DevOps community who have worked on public sector contracts have all done so under the umbrella of the usual large consultancy organisations. This seems somehow mismatched.”

In the print sector, Kyocera Document Solutions is one supplier that sees frameworks as the best option for the time being, according to head of business development Pauric Surlis.

“In terms of managed print services, it will be tricky for any organisation operating within the European Union to procure via something that isn’t a framework, although this is an option that could open up after Brexit has been completed,” he says. “When it comes to smaller, specified procurements, often the motivation for using frameworks is driven by a need to ensure [buyers] are fully compliant with regulations. So, any alternative would have to meet this need.”

For CCS, meeting the needs of both buyers and the suppliers that serve them seems set to remain a tricky balancing act during what will be a defining period for the central government IT space.

Sam Trendall

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