Newcastle-under-Lyme Borough Council has extended a telecoms contract with supplier BT – because it has failed to achieve predicted savings.
The council has published a notice in the Official Journal of the European Union publicising its decision to extend the original five year contract for three years at a cost of £272,000.
However, it said that it would not consider any further contract extensions at the end of the extension period.
The council said: “The services included within the contract were not executed as anticipated due to technical obstacles which have only now been overcome.
“Due to the significant amount of time between the award notice and the effective provisioning of the contracts services, the council does not anticipate it will fully achieve the benefits originally intended within the remaining contract period.
“It is therefore the council’s intention to extend the contract for a further period of three years.”
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The council said that costs involved in terminating the current contract and delivering a solution that would support its imminent office rationalisation programme “would constrain other economic operators in delivering a better value for money solution”.
In addition, terminating the current contract could cause “incompatibility and disproportionate technical difficulties in operation and maintenance”, the council said.
The original five year contract, worth £302,000, was awarded in April 2013 and covers telecoms, data, wide area network and tier 1 internet feeds across multiple, geographically disparate sites.
At the time, the council said that consolidating the contracts into a single agreement would achieve value for money.
“This approach would also place the council in a stronger position with one co-terminus end date, to seek future engagement with market providers for a single contract,” it said.
