Category Archives: procurement

CSC NPfIT deal is a crucial test of coalition strength

Posted on 28/09/2011 | 1 comment

By Tony Collins

Comment:

The Cabinet Office’s Major Projects Authority has intervened in NHS Connecting for Health’s running of the NPfIT.

In particular the Authority has taken a role in the negotiations between CSC and the Department over the future of about £3bn worth of local service provider contracts.

Had the Authority not intervened a memorandum of understanding between CSC and the DH is likely to have been signed several months ago. Fortunately for taxpayers a deal wasn’t signed.

According to a leaked Cabinet office memo the deal would have been poor value for money. It would have cut £700m or more from the cost of CSC’s contracts but doubled the cost to taxpayers of the remaining deployments.

The Cabinet Office memo said the “offer [from CSC] is unattractive”. It added:

“This is because the unit price of deployment per Trust under offer roughly doubles the cost of each deployment from the original contract”.

It could be said that signing such a deal with CSC would be as naive as a shopkeeper asking a Cadbury wholesaler to change his order from 100 chocolate bars to 30, and thus agreeing to paying Cadbury double the price for each bar.

Now it transpires that the official within the Cabinet Office who wrote the memo expressing concern about CSC’s offer is leaving. This could imply that an “unattractive” deal between the Department of Health over Lorenzo will go through after all.

Indeed the Cabinet Office has published its assessment of the NPfIT – the “Major Projects Authority Programme Assessment Review of the National Programme for IT” – which includes a section on CSC that suggests a new deal with the supplier may be signed, even though critics say the NPfIT contract with CSC should be “parked” with no further action taken on it.

The DH has accused CSC of breach of contract and vice versa. A legal dispute can be avoided by parking the contract with the agreement of both sides. If the DH signs a new deal with CSC it will be a sign that the intervention of the Cabinet Office has come to little or nothing.  It will also be a sign of coalition weakness. If the coalition cannot have an effect on a deal the DH has long wanted to sign with CSC when can it effect in terms of central government reform?

This is the worrying  section in the report – dated June 2010 – of the Major Projects Authority:

“… if the decision is taken to allow the Lorenzo development and deployments to continue there needs to be a considerable strengthening of the renegotiated position first to give CSC the opportunity to step up to its failings and for a clear statement of obligations on all parties and a viable and deliverable plan to be created and adhered to.

“There is no certainty that CSC would deliver fully in the remaining time of the contract, but the terms of the renegotiation could enable them to have a completed Lorenzo product which can compete in the market which replaces Local Service Providers…”

Other parts of the Major Projects Authority report are highly critical of Lorenzo. It says that in the North, Midlands and East of England there have been “major delays in the development of …Lorenzo”. As a result of the delays “interim and legacy systems have been used to maintain operational capability”.

The report also says the “productisation of Lorenzo is not mature” and adds: “This is evidenced by the fact that bespoke code changes are still being used in response to requirements from the early adopter trusts. This issue will be exacerbated if the remaining product development (of the modules referred to as Deployment Units) is not completed before future implementation roll-outs commence.”

The report says there is a need to be “certain about the capacity and capability of CSC to furnish sufficient skilled resources to undertake the level of roll-out needed to satisfy the existing schedule”.

It continues: “During the review it was mentioned that on occasion, people needed to leave the Morecambe Bay activity to go to the Birmingham installation at short notice to resolve problems. At this stage of the programme, CSC skills, schedule and utilisation rate, including leveraged resources, should be available to support a proposed roll-out schedule…”

There is still a “significant degree of uncertainty both about the planning of [Lorenzo] implementations and also the capability of the solution. The four key trusts chosen to implement the Lorenzo solution are in very different situations. University Hospitals Morecombe Bay is close to sign-off whilst Pennines Trust has stated its desire to leave the programme. Birmingham Women’s Hospital Trust is being held back by one issue which views have suggested are about a difference of opinion with the Supplier believing that they have met the Deployment Verification Criteria whilst the Trust is not happy about the level of functionality delivered. Connecting for Health expect to resolve this difference of opinion soon.”

And the MPA report says the latest implementation of Lorenzo 1.9 is “a long way short of the full functionality of the contracted solution which has four stages of functionality and is intended to be rolled currently out to 221 trusts”.

Lorenzo was originally due to have been delivered by the end of 2005.  If, after all the MPA’s criticisms, a new Lorenzo deal is signed what will this say about the ability of the Cabinet Office to influence decisions of civil servants?

In 2006 an internal, confidential report of CSC and Accenture on the state of Lorenzo and its future was positive in parts but listed a multitude of concerns. The summary included these words: “…there is no well-defined scope and therefore no believable plan for releases beyond Lorenzo GP…”

The current outdated NPfIT deal with CSC should be set aside , and no further action taken on it by both sides. CSC will continue to have a strong presence in NHS IT, at least because many trusts that have installed iSoft software will need upgrades.

But if a new NPfIT deal is signed with CSC it will greatly undermine the credibility of the Cabinet Office’s attempts to effect major change on the machinery of departmental administration; and it could help consign the so-called reforms of central government to the dustbin marked  “aspirations”. It will certainly give ammunition to the coalition’s critics. The Government has said it is dismantling the NPfIT. It didn’t say it was prolonging it.

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Posted in Campaign4Change, change, Government IT, NHS, npfit, procurement, public sector, public services, supplier relationships, Uncategorized

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FOI team hides already released Universal Credit report

Posted on 27/09/2011 | 1 comment

By Tony Collins

Universal Credit is one the government’s most important IT-enabled programmes, along with HMRC’s “Real-time Information” scheme, Whitehall Shared Services and the MoD Change Programme.

If the Universal Credit programme goes wrong benefits claimants could have payments held up or receive incorrect amounts.

For this reason it is important that the coalition doesn’t repeat Labour’s mistake of wrapping IT-related projects and programmes in so much secrecy that the public, MPs and the media only discover problems when it is too late to effect a rescue.

Early warning of faltering projects

There is an early-warning of projects and programmes that are likely to falter or are actually faltering: “Starting” gate reviews and “Gateway” reviews, which are independent assessments of big or risky schemes.

The coalition in opposition promised to publish Gateway reviews if they came to power but civil servants have persuaded ministers to drop the proposal: does the minister want opponents and the media picking up authoritative internal information on projects that may be going wrong?

Our FOI request

Because of the continued suppression of the reports Campaign4Change, on 20 May 2011, made a request under the Freedom of Information for the Department for Work and Pensions to release a copy of Gateway reviews on the Universal Credit project.

The reply was nearly helpful. “There have been no Gateway reviews on the Universal Credit programme.  There has been one Starting Gate review on the Universal Credit programme.” The reply, by Jack Goodwin of the DWP’s Universal Credit Briefing Team, did not include a copy of the Starting Gate review report, so we sent a follow-up email.

We pointed that that Public Administration Committee had already requested a copy of the Universal Credit Gateway Zero Review and, in response, the DWP had sent the Committee a copy of the Stating Gate review, though the Committee decided not to publish it.

On 13 July the DWP said it needed extra time to consider our request. Gina Talbot at the DWP’s “Freedom of Information Focal Point” said: “I need to extend the time limit because the information requested must be considered under one of the exemptions to which the public interest test applies. This extra time is needed in order to make a determination as to the public interest. Accordingly, I hope to let you have a response by 10 August 2011.”

DWP wasting public money

This extra time and consideration was unnecessary and a waste of public money because the DWP had already given the report to the Public Administration Select Committee. Indeed the Universal Credit Starting Gate report had also been lodged in the House of Commons library after an MP asked the Cabinet Office’s Ian Watmore for a copy in May 2011.

So the DWP was considering at length whether to release a report that the Department had already released twice – to two separate committees of the House of Commons.

Grounds for appeal

In August the DWP formally refused Campaign4Change’s request, so we appealed. These were some of the reasons we gave:

i) Universal Credit is one of the government’s “mission-critical” projects and its success will be potentially important to tens of millions of benefit claimants.

ii) In the public interest, MPs, the media and public should understand the project’s feasibility risks and chances of success – in short whether it has got off to a good start. The Starting Gate report could help provide such an insight.

iii) The Public Accounts Committee has recommended that Starting Gates be published. The refusal of our request would appear to be a denial of the wishes of the Committee.

iv) Sometimes statements in published Gateway reviews have turned out to be too weak, sometimes too strong. There is no reason to believe that if the reviewers know their reports are for public consumption they will weaken their comments; and if they do weaken them the published reports will allow the quality of advice to be questioned or challenged by what the Cabinet Office minister Francis Maude calls armchair auditors.

v) The objection to publishing the reviews is that publication may inhibit candour. Starting Gate reviewers have a public duty to give the best advice they can (and indeed are paid for doing so). If they alter their advice to make it more acceptable to the public, media and Parliament they are failing in their public duty to give the best possible advice in all circumstances. Equally, if they give their advice in the expectation it will be kept confidential and therefore that they will not be held accountable for it, and alter their best advice on this basis, they could be failing in their public duty.

vi) There is no certain means for Parliament, the media or the public to know how large IT-based projects and programmes are progressing. Sometimes the National Audit Office reports on large IT-based projects, sometimes not.  The NAO cannot be relied on to produce the equivalent of a Starting Gate review on a large IT-based project or programme. Gateway reviews are not usually published contemporaneously.

vii) Coalition ministers have made it clear in numerous speeches that the public have a right to know how their money is being spent. Universal Credit is costing, as an IT-based  programme, several hundreds of millions of pounds. It is not in keeping with the spirit of ministerial statements on openness that the DWP keep confidential the Starting Gate review on Universal Credit. It is the only independent report on the feasibility of the project.

viii) Universal Credit is known to be a risky programme which senior civil servants have acknowledged. The Starting Gate review is likely to show whether or not those risks are understood.

ix) In refusing our request the DWP has not given any reasons for stating that it is satisfied that the “public interest in maintaining this exemption outweighs the public interest in disclosure”.

DWP rejects our appeal

Our appeal came to nothing. It was refused by the DWP’s David Hodgson Stakeholder Manager, who said in a letter:

“The case has been examined afresh, and guidance has been sought from domain experts to ensure all factors were taken fully into account. I have reviewed the original decision carefully and have decided to uphold the original decision withholding information for the following reason.

“While we recognise that publication of this information would provide an independent assessment of the key issues and risks, we have to balance this against the fact that the review document includes operational details of a sensitive nature whose publication would prejudice effective conduct of public affairs.

“The Department is satisfied that the public interest in maintaining this exemption outweighs the public interest in disclosure.”

The report was  released months ago

The DWP lodged the report in the House of Commons library months ago so it is in the public domain anyway. The department’s effort and time twice refusing the release of the report wasted public money.

Campaign4Change has now obtained a copy of the report via the House of Commons’ library.  We  will, separately, publish an article on the contents of the Starting Gate review report on Universal Credit.

Comment:

This episode suggests that officials at the DWP default to secrecy whatever the coalition says about openness and transparency. There are many superficially valid reasons officials can give to keep Gateway and Starting Gate reports secret. It is up to ministers to challenge that secrecy. If they don’t, the same mistakes and cycles will be repeated:

a) IT-related projects and programmes will continue to falter in secret, as they did under Labour

b) MPs and the media will try and find out the truth

c) Ministers will go on the defensive

d) The truth will eventually emerge and the coalition will be branded as inept when managing large IT-based projects and programmes – as inept as Labour.

If ministers publish Gateway progress reports now – as early warning reviews – we and others will applaud if early action is taken to stop or rescue a failing project. If ministers continue to pander to civil service secrecy the media and Parliamentarians will be right to criticise the coalition. Ministers have a chance to avoid the stigma of mismanagement of public funds. But will they take it?

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Posted in Campaign4Change, change, change management, Freedom of Information, Government IT, improving communications, managing change, procurement, public sector, public services, reforms, Universal Credit

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End of NPfIT? – Campaign4Change on BBC R4 Today programme

Posted on 22/09/2011 | 3 comments

By Tony Collins

Link to Campaign4Change audio on BBC R4 Today programme

BBC Radio 4’s Today programme this morning reported a Daily Mail article that the National Programme for IT in the NHS is being scrapped and that a coalition announcement is to be made this morning.

The Mail says that the money spent on the NPfIT would pay for 60,000 nurses for a decade, and that the scheme will be replaced by a “cheaper alternative”.

It says that there will be a new urgency in “dismantling the scheme”. Campaign4Change told the BBC R4 Today programme this morning that the NPfIT is not being scrapped and that about £4bn has yet to be spent on it. It said that trusts have the freedom to buy their own IT systems but using their budgets. The NPfIT will continue to provide Cerner and Lorenzo systems that are subsidised centrally, which gives the NHS an incentive to continue using NPfIT.

There is a difference of opinion within Whitehall over the NPfIT: that the Cabinet Office takes a rigorously independent view of the NPfIT and wants to wind it down. The Department of Health’s civil servants at a press conference last year justified the spend on the programme and said the contracts with CSC and BT would continue.  Campaign4Change told Today that the Cabinet Office should have the final say, not the Department of Health.

The Government clearly wishes it to be known that the NPfIT is being scrapped but that is not what is happening in practice. Contracts with CSC, which at present are worth about £3.2bn, are unlikely to be scrapped because of the compensation that would have to be paid to the supplier. The contracts may be cut back  by about £800m, though the cost of deployments remaining may double. BT’s contracts worth more than £1bn are also likely to remain.

The Daily Mail says the NPfIT will be “replaced with cheaper regional alternatives” and that the Coalition will “today announce it is putting a halt to years of scandalous waste of taxpayers’ money on a system that never worked”.

“Following an official review, the ‘one size fits all’ IT project will be replaced by much cheaper regional initiatives, with hospitals and GPs choosing the IT system they need.

“And a new national watchdog will be established to ensure such huge sums can never again be thrown away on uncosted projects.”

The decision to accelerate the dismantling of the scheme has been made by Health Secretary Andrew Lansley and Francis Maude, the Minister for the Cabinet Office, says the Mail.

It quotes from what appears to be a leaked memo from the Major Projects Authority of the Cabinet Office which has been reviewing CSC’s contracts.

“The authority said the IT scheme, set up in 2002, is not fit to provide services to the NHS – which as part of austerity measures has to make savings of £20billion by 2014/15.

It concluded: ‘There can be no confidence that the programme has delivered or can be delivered as originally conceived.’

The report is said to recommend that the Government  “dismember the programme and reconstitute it under new management and organisation arrangements”.

It added: “The project has not delivered in line with the original intent as targets on dates, functionality, usage and levels of benefit have been delayed and reduced.

“It is not possible to identify a documented business case for the whole of the programme.Unless the work is refocused it is hard to see how the perception can ever be shifted from the faults of the past and allowed to progress effectively to support the delivery of effective healthcare.”

Daily Mail article on the NPfIT today

Department of Health announcement

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Posted in change, Government IT, NHS, npfit, procurement, public sector, Uncategorized

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EU rules should be changed to give mutuals chance to run public services before full open competition

Posted on 22/09/2011 | Leave a comment

By David Bicknell

A post by Third Sector has made the case for public spin-outs such as mutuals to be exempted from EU procurement rules.

The piece quotes Stephen Lloyd, head of charity and social enterprise at City of London law firm Bates Wells and Braithwaite, who said that EU procurement rules were  currently based on the concept that public service provision was done either by the state or the private sector.

Lloyd said, “We want to move services out of the state and into a social economy, and the rules are not set up to support that. If you set up a new social enterprise to deliver something that was previously delivered by the state, and it has to compete with big business from day one, it won’t work.

“There needs to be a transition process. These organisations need to be protected. The government needs the agreement of the EU that it’s allowed to do so, and this is its opportunity to get it.”

Third Sector says that the Government’s response to the European Commission green paper is that employee-led spin-outs should have time to run services before having to compete with big business.

In its proposals to the European Commission, the Government says, “The revised Directives should make clear that, in circumstances, such as the development of employee led organisations/mutuals, employees should be able to gain experience of running public services for a period of, for instance, three years, prior to full and open competition.”

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Firecontrol: same mistakes repeated on other projects

Posted on 20/09/2011 | 2 comments

By Tony Collins

A report published today by the Public Accounts Committee on the £469m Firecontrol project reads much like its others on government IT-enabled project disasters.

Margaret Hodge, chair of the Committee said:

“This is one of the worst cases of project failure that the committee has seen in many years. FiReControl was an ambitious project with the objectives of improving national resilience, efficiency and technology by replacing the control room functions of 46 local Fire and Rescue Services in England with a network of nine purpose-built regional control centres using a national computer system.

“The project was launched in 2004, but following a series of delays and difficulties, was terminated in December 2010 with none of the original objectives achieved and a minimum of £469m being wasted.

“The project was flawed from the outset, as the Department attempted, without sufficient mandatory powers, to impose a single, national approach on locally accountable Fire and Rescue Services who were reluctant to change the way they operated.

“Yet rather than engaging with the Services to persuade them of the project’s merits, the Department excluded them from decisions about the design of the regional control centres and the proposed IT solution, even though these decisions would leave local services with potential long-term costs and residual liabilities to which they had not agreed.

“The Department launched the project too quickly, driven by its wider aims to ensure a better co-ordinated national response to national disasters, such as terrorist attacks, rail crashes or floods. The Department also wanted to encourage and embed regional government in England.

“But it acted without applying basic project approval checks and balances – taking decisions  before a business case, project plan or procurement strategy had been developed and tested amongst Fire Services. The result was hugely unrealistic forecast costs and savings, naïve over-optimism on the deliverability of the IT solution and under- appreciation or mitigation of the risks. The Department demonstrated poor judgement in approving the project and failed to provide appropriate checks and challenge.

“The fundamentals of project management continued to be absent as the project proceeded. So the new fire control centres were constructed and completed whilst there was considerable delay in even awarding the IT contract, let alone developing the essential IT infrastructure.

Consultants made up over half the management team (costing £69m by 2010) but were not managed. The project had convoluted governance arrangements, with a lack of clarity over roles and responsibilities. There was a high turnover of senior managers although none have been held accountable for the failure.  The committee considers this to be an extraordinary failure of leadership. Yet no individuals have been held accountable for the failure and waste associated with this project.”

Comment:

Firecontrol was a politically-motivated project which used  bricks, mortar and IT to try and change the way people worked. The users in the fire service didn’t want a single national approach of nine new regional centres – complete with new hardware and software – just as NHS clinicians, in general, did not want the National Programme for IT [NPfIT]. The Firecontrol regional centres were built anyway and the NPfIT went ahead anyway.

One lesson is that, in the public sector, you cannot engage users who won’t support the scheme. If they want to change, and they want the new IT, they’ll find ways to overcome the technology’s deficiencies. If they don’t want the scheme – and fire personnel did not want Firecontrol – the end-users will be incorrigibly harsh evaluators of what’s delivered, and not delivered.

It’s better to get the support of users, and involve them in the prototype design and test implementations, long before the scheme is finalised. It’s different in the private sector because the support of users is not essential – those who don’t accept business change and the associated IT will be expected to quit.

So what today is the mistake that is being repeated? The Public Accounts Committee touched on it when it said that the Department for Communities and Local Government – which was responsible for Firecontrol –  “failed to provide appropriate checks and challenge”.

During the life of Firecontrol, the Office of Government Commerce carried out “Gateway reviews” which independently assessed progress or otherwise. The reviews  could have provided an early warning of a project that was about to waste hundreds of millions of pounds. But the Gateway review reports were not published. They had a limited internal distribution and, it appears, were ignored.

According to the Public Accounts Committee, a Gateway review in April 2004, near the start of the Firecontrol project, said the scheme was in poor condition overall and at significant risk of failing to deliver.

Why was this Gateway review not published? If it had, Parliament and the media could have held ministers to account – and perhaps have campaigned to stop the project before millions were thrown away.

There was indeed a media campaign in 2004 – and before – to have Gateway reviews published, but ministers – and particularly civil servants – said no.

Now the same thing is happening. The civil service has persuaded the coalition government to carry on Labour’s tradition of keeping Gateway reviews secret. So Parliament and the media will continue to be kept in the dark on whether a major project is going wrong.

By the time details of the reviews are published, perhaps years later in a report of the National Audit Office,  it may be too late to rescue the scheme. By then tens or hundreds of millions may have been wasted. Gateway reviews should be published around the time they are written, not years later.

Ministers do not have to pander to civil servants. They are paid to stand up to them. They receive a premium over the salary of MPs in part to be independent voices – to provide a challenge.

Subservient ministers in the DWP are among those who continue to allow Gateway reviews to remain hidden. If you ask the DWP under the Freedom of Information Act for the release of the Starting Gate report on Universal Credit (which I am told is not the same as a Gateway review report) the DWP will refuse your request. It refused mine.

So we have to accept the word of civil servants that the Universal Credit programme is going well; but haven’t there been enough IT-related disasters in government for all to know that the word of civil servants on whether things are going well needs to be tested independently? The publication of Gateway reviews – and Starting Gate reviews – could help outsiders hold a department to account. It’s time ministers began to realise this.

Are ministers such as Iain Duncan Smith in control of their departments – or are their civil servants in control of them?

Links:

Margaret Hodge on BBC “Today” programme 20/9/11 – “what could go wrong did go wrong” – did PA Consulting get away without blame?

What the NPfIT and Firecontrol have in common.

Firecontrol:  should PA Consulting share some responsibility for what happened?

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Posted in Campaign4Change, change, change management, Government IT, managing change, npfit, procurement, public sector, public services, risk, supplier relationships

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Are civil servants giving more work to SMEs – or less?

Posted on 15/09/2011 | 2 comments

By Tony Collins

David Cameron, in a speech to a Government procurement conference on 11 February 2011, gave a pledge to ensure that  “25% of all government contracts are awarded to small and medium-sized enterprises”.

He said: “If we meet this goal it will mean billions of pounds worth of new business opportunities for SMEs”.

The Government has since dropped its pledge to give SMEs 25% of public sector contracts, though it remains an “aspiration”. To back this up, departments are under pressure to show they have awarded more work to small and medium-sized businesses.

As part of David Cameron’s Transparency commitments, all departments are required to publish each new contract let over £10,000 and state whether this contract has been let to a SME.

This information is available on the new Contracts Finder website alongside tender documents and opportunities. As part of the business plan process each department is also required to measure and publish the percentage of their third party spend that goes directly to SMEs.

The Government says it is investigating how best to collect data on spend with SMEs as sub-contractors.

That said, the firm target of 25% has been dropped because European tendering rules do not allow officials to give contracts specifically to smaller businesses.

The Cabinet Office says its official position now is:

“We will promote small business procurement, in particular by introducing an aspiration that 25% of government contracts should be awarded to small and medium-sized businesses.”

The Cabinet Office minister Francis Maude has been more cautious. He said at the time of Cameron’s talk that “as much as” 25% of public service contracts will be awarded to the private and voluntary sector in a bid to break up existing public service monopolies.

Have plans for more SME work gone into reverse? 

eWeek Europe now reports the concerns of SMEs that the 25% aspiration may give way to plans to consolidate government administrative work which could end up with major suppliers being given even more work.

eWeek Europe says that at the first meeting of the ‘New Suppliers to Government’ working group, which was put together by the Cabinet Office, members said the government’s aspiration to place 25% of its business with SMEs is in direct conflict with projects such as Sir Philip Green’s ‘Efficiency Review’,  which pushes for consolidation within the supply chain.

“There are two competing tensions inside the government,” said Mark Taylor, CEO of Sirius and lead for the New Suppliers to Government working group. “One of them is the Cabinet Office’s stated commitment to getting more SME involvement. However, the other drive within government is pushing things the other way…

 “The implication of that programme is they will reduce the number of people they buy from to a very small amount of very large suppliers,” said Taylor. While this can be an effective way to cut costs through economies of scale, it is not appropriate to every sector, added Taylor.

In the case of IT innovative ideas are coming from smaller companies, which can help reduce government spending through agile processes and open source.

Taylor cited the Ministry of Justice’s Cipher project as an example of how SMEs are being elbowed out of contracts as a result of these conflicting objectives. In March 2011, the MoJ cancelled freelance IT contractors supplied through SMEs and transferred their work to outsourcing company Capita and its £123m Cipher contract.

“The solution that we are proposing is very simple,” said Taylor. “In the private sector, companies of whatever size will purchase from whichever entity makes the most sense. If it’s a commoditised service, buy it from a huge supermarket at commodity prices. If it’s a specialised service that is appropriate for the business, buy it from an SME.”

Stephen Allott, the Cabinet Office’s crown representative for SMEs, has said it will take up to two years for Whitehall to stop excluding small businesses from work they could do more effectively than larger rivals.

Allott was quoted in the Telegraph as saying that meaningful reforms were being rolled out, but that they would take time to be implemented. “There are a lot of things that need to be fixed,” he said.

Comment:

There is a real risk that the coalition’s laudable aspirations to change the way government works will fall victim to a combination of strong lobbying by the big suppliers and overwhelming forces within the civil service to keep things much as they are, which usually means playing safe – or that is how it is perceived – by continuing to rely on the large suppliers, the so-called systems integrators.   

For decades the big companies have had their way and have been paid very well for services of mixed quality. One result of the domination of big suppliers is that inefficiency is endemic. The Cabinet Office minister Francis Maude wants government to change and we support him. He’ll need to do more to make change happen, though. Meanwhile the civil service is doing what it does best: keeping the hands of ministers off the steering wheel. Maude is being given so much work that, in his words, it’s difficult to “keep all the plates spinning”.

Many in the Cabinet Office want to support Maude and effect reform. But can they do it when Maude is distracted by having too much work, the big suppliers are doing all they can to keep and expand their existing contracts, and departmental civil servants are confortable in their existing SI relationships?

eWeek Europe

An example of one SME’s innovative ideas

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Posted in change, Government IT, procurement, public sector, public services, SME, Uncategorized

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Understanding the impact of the Teckal Test on procurement and competition for mutuals

Posted on 14/09/2011 | Leave a comment

By David Bicknell

I recently wrote about the impact on procurement for mutual and social enterprises of the Teckal Test, which tests whether contracts and the contractor are under the public authority’s direct control.

Broadly speaking, the Public Contract Regulations (2006) apply whenever a contracting authority seeks offers in relation to public contracts. The Regulations give effect in UK law to Council Directive (2004/18/EC) on the co-ordination of  procedures for the award of such public contracts.

This has implications for mutuals, because case law of the European Court of Justice has developed an exception from the normal application of the procurement rules, known as the Teckal exemption, where contracting authorities award contracts for providing services or works to an “in house” provider.

The exemption works on the basis that the contract being awarded is not a “public contract” for the purposes of the Directive and, as a result, the Regulations do not apply and EU law will not require the  contract to be put out to tender.

If you’re interested in Teckal, these links may be useful:

http://opinion.publicfinance.co.uk/2011/07/mixed-up-over-mutuals/

http://www.farrer.co.uk/Global/Briefings/16.%20Briefing/Public%20Procurement%20Update.pdf

http://publicsector.practicallaw.com/blog/publicsector/plc/?p=475　

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Posted in Campaign4Change, law, mutualisation, mutuals, procurement

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Mutuals and SMEs under spotlight as government responds to EC procurement green paper

Posted on 07/09/2011 | Leave a comment

By David Bicknell

A post on Public Service Europe has argued that the govenment needs to explain its positioning on some key public procurement issues, notably in relation to mutuals and SMEs.

The post, written by a UK lawyer, argues that the government’s proposals sound ‘refreshingly promising’ but may reflect some  contradictions in wider policy.

It suggests that “the penny seems to have dropped in government that procurement policy is central to getting the economy moving again and not simply the esoteric occupation of a small number of professionals. The government has now published a Procurement Policy Note (05/11) setting out how it intends to engage with the commission on the reform of the rules. The note states that the rules as they currently stand are too complex, onerous and costly and encourage a risk-averse and over-bureaucratic approach to procurement within the EU.”

It adds that, “The note confirms that the government will be actively influencing the commission, other EU member states and the European Parliament in the run up to the publication of the commission’s proposals for revised and updated directives, and calls on those in the public procurement community who may have links to such bodies or other stakeholders to participate in that process and push the UK message. Whether the government will be successful; only time will tell. In the meantime it could let us know where it stands on the above issues.”

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Posted in Campaign4Change, mutualisation, mutuals, procurement, public sector, public services, SME

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Civil service “full of brilliant people terribly managed”

Posted on 01/09/2011 | 3 comments

By Tony Collins

Andrew Adonis was transport secretary in Tony Blair’s government. Last year he became director of the Institute for Government which Adonis describes as a thinktank that speaks truth to power.  Among other things it produced the excellent System error: fixing the flaws in government IT which advocates an agile approach to innovation at the front line.  

Now in an interview with Politics.co.uk  Adonis points out the institutional weaknesses of the civil service.  “My criticisms are about the machine,” he says. “My own view is that the civil service is full of brilliant people who are terribly managed.”

One of the biggest problems is what he calls the  “laughably” named permanent civil service. People change jobs because of a merry-go-round culture which makes no sense, he says.  It’s not a problem that’s going away: since the general election ten of the 16 departments of state have had changes in their permanent secretary.

“The machine really is very badly run,” he says.

Comment

What Adonis says is important because institutional resistance to change and innovation is largely because what exists is said to be work well. It doesn’t work well because government administration costs tens of billions much more than it should and the National Audit Office has found that fraud and error in two of the biggest departments, HMRC and DWP, are at unacceptable levels. 

It’s time that the point made by Adonis, and many others of some authority, is given more credence.  Systems within government need changing and, particularly, simplifying  – not in a rush and not without proper thought and testing.

The old argument that government administration aint broke so leave it alone doesn’t stand up to independent scrutiny. It is broke and it needs intelligent, inventive and cheap-to-implement change.

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Posted in Agile, Campaign4Change, change management, Government IT, innovation, Lean, managing change, procurement, public sector, public services, reforms, SME, Uncategorized

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CSC optimistic on new NPfIT deal – officials less so

Posted on 24/08/2011 | 1 comment

By Tony Collins

CSC is due to meet officials from the Cabinet Office next month to discuss a possible new deal over the company’s £3bn worth of NHS IT contracts. Proposals from the Cabinet Office’s Efficiency and Reform Group have gone to the Department of Health and Downing Street for approval.

Nobody seems to know yet what the ERG has proposed but CSC remains confident that a new NPfIT deal will be signed that is good for the supplier’s finances and for the NHS.  Not all Whitehall officials share CSC’s confidence, however.

A new deal may be signed – but perhaps without the exclusive arrangements in the original contracts and the NHS commitments to place a minimum amount of business with the company.

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Posted in NHS, npfit, outsourcing, procurement, public sector, public services, risk

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