DWP picks £40m reseller partner as single route to ‘low-value software purchases’

Department for Work and Pensions becomes the latest government agency to award an aggregated deal for smaller software acquisitions and picks government strategic supplier Computacenter for contract lasting three years

The Department for Work and Pensions has signed a potential £40m deal for a “software value-added reseller” partner to provide a single source for smaller or more niche software requirements.

As of the start of this month, the DWP entered into a three-year contract with IT provider Computacenter. The engagement is aimed at “providing the department with an efficient route to procure DWP’s low-value software purchases”.

Because of the ad hoc nature of such purchases, the deal comes with no spending commitments. But the DWP expects to spend £6m during the first year of the agreement, and could spend up to £37m in total – plus VAT – over the course of the contract.

The deal is very similar to a potential £90m contract awarded by the Home Office in January for an IT reseller partner – in this case Phoenix Software – to serve as an aggregated supplier for the department’s “tail spend” on software products over the next five years.

Tail spend refers to the masses of one-off or infrequent software purchases made by large organisations. These are typically high in volume and low in value, and are made to serve an immediate need, rather than a longer-term or strategic objective.

Large IT resellers – who provide products from a wide range of vendor partners – are well-equipped to serve as a single route through which to fulfil such purchases.

The DWP’s choice of provider, Computacenter, is a major public sector tech supplier. The firm’s recent contract wins include a £150m deal to provide 22,000 devices to the MoD and the military, as well as another engagement with the DWP – a £5m agreement to “refresh the existing ageing infrastructure within the department’s on-premises hosting datacentres”.

Since 2020, the Hatfield-headquartered firm has featured on the cross-government roster of Whitehall’s foremost “strategic suppliers”. Each of the 39 companies on this list works with a specified “Crown representative”, who manages the commercial relationship on a government-wide basis.

Sam Trendall

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