Government Procurement

Trials, tribulations and Wibbies of major contracts, competitive procurements, OJEU processes, frameworks, terms & conditions, post-tender negotiations etc

16 May 2008

Sensible health-records option #3 emerges as CfH stretches to infinity and beyond

The UK’s expensive and dysfunctional clunking great fist of a centralised health records system is going to take four years longer than expected, says the NAO. According to Kable’s mothership The Guardian

A £12.7bn upgrade of IT systems throughout the NHS in England will not be completed for at least another six years, four years behind schedule, parliament’s spending watchdog disclosed today. Revealing that the scale of the delay to the system was worse than previously thought, the National Audit Office said plans for a national electronic record of the medical files of 50 million patients might not come to fruition until 2014-15.

Grrrr....yawn.

Meanwhile the real world moves briskly in a far more attractive direction. An IBM-Hipaat alliance is the latest - after Google-Cleveland Clinic and Microsoft Healthvault - to offer user-controlled online health records. They send me a press release:

The IBM-HIPAAT collaboration extends patient-driven privacy to Electronic Medical Records (EMRs), Electronic Health Records (EHRs), Personal Health Records (PHRs) and Health Information Exchanges (HIEs). Combined IBM and HIPAAT technologies allow patients to easily specify who is granted access to their personal health information (PHI), what information can be accessed and when. They enable caregivers to implement and enforce patient consent directives, providing “break the glass” access to PHI and EHR data in emergency-care situations, where appropriate.

This commercially-available patient-directed solution is a privacy-based approach to securely controlling PHI access across diverse healthcare applications and settings. When installed in HIE environments as the “consent engine,” Privacy eSuite empowers patients and designated providers to create and record privacy directives. The software then evaluates a provider’s authorization to access a patient’s PHI based on such directives. With the combined offerings, a patient can restrict a particular clinician from accessing PHI, even if that clinician – based on medical role – would typically be granted such access. All access requests are recorded and an audit trail is created.

Nothing on pricing but I bet it wont be costing UK taxpayers anything in tne £6bn-30bn price range bandied about for Connecting for Health.

Wibbi we canned our daft centrally-controlled electronic health records system and the D’oH! just asked Google, Microsoft and IBM-Hipaat to confirm to a standard the NHS was prepared to work to. Then we could choose which sort of electronic patient record we used, and our data wouldn’t be subjected to bossy fishing expeditions from national terrorist-prevention services trying to work out whether we eat the right amount of fruit and veg, or the wrong sort of shellfish. Why will it take so many years and so many billions of pounds before we come to our senses?

I suppose the four year delay gives people more time to opt out of centralised health records. I hope our opt-out is final; it would be a drag to have to renew it every year like a pointless TV licence or car tax disk. 

 

13 Apr 2008

ID: bid risk and the vulnerability of IPS

According to an August 2007 article in the FT, contracts will be awarded for suppliers to the NIS this Spring. Now. But will any suppliers bid? After all:

• The NIS may turn out to be a smaller system than suppliers expected and there may be less money to make out of it as a result. Crosby has ruled that the high volume of transactions that go through the banks and the big retailers are not on the menu. There is no reason for suppliers to expect the NIS to be involved in DWP benefit claims nor in the health service nor education. Scotland may refuse to use the NIS, and Wales, too. Its advocates always claim that the NIS will be used to prove everyone’s right to work in the UK but IPS failed to provide the ID checking service they promised. And it may be that, far from everyone aged 16 and over, only certain sections of the population will be fingerprinted.

• The timescales are stretching. Far from starting at the end of 2009, as previously planned, the NIS will not start to be rolled out in earnest now until 2012. And given IPS’s track record, suppliers would be well advised to allow for more delays.

• As the economy dips, people will want more assurance that their stealth tax money is being well spent. Hard to provide that assurance, when a number of prospective suppliers have already pulled out of the bidding, the House of Commons Science and Technology Committee are just as unimpressed with IPS’s plans as Crosby and the biometrics on which the NIS depends are unreliable.

• There are alternatives to the NIS. Identity assurance could be provided by the banks and/or the mobile phone companies and/or the utility companies and/or the credit referencing agencies. The NIS could become irrelevant. These other systems could be more effective and could come on-stream earlier than IPS’s 15-year timetable – a surprisingly relaxed timetable, given that we’re talking here about the UK’s response to crime and terrorism.

• Suppliers to the NIS would be victims of the lack of trust in the government identified by Crosby – they would be tarred with the same brush.

• IPS is not some unstoppable behemoth with a mandate to monitor everyone in the UK. On the contrary, it is a supplicant, in sales talks with prospective customers, and it hasn’t closed a single deal yet.

• Suppliers will be dependent on IPS and IPS are vulnerable. They are dependent on Labour and Labour treat the NIS like a political football. If the Lib Dems or the Conservatives come to power, the NIS will be cancelled, as its equivalent was in Australia, and suppliers cannot expect to be bailed out.

So now how sensible does it look for a supplier to invest in this project? Which sensible chief executive would commit the funds? Why? What return is sensibly to be expected? What price risk?

(This article is the summary of a longer paper on the subject, ‘A risk assessment for prospective suppliers to the UK NIS’, which first saw the light of day on IdealGovernment.com in November 2007.)

 

02 Feb 2008

OGC feedback service: anyone tried it?

Here’ a good idea in the feedback/whistleblowing zone: a supplier feedback service by OGC, the centralised procurement-advice tribe. Beats moaning in the wine bar (and how much of that have we all had to put with?) If it were IDEAL, of course, it would be open and independent, so you could take encouragement from what others were saying. As it is, who knows what happens with the feedback, what they do with it, and how successful it is. But hey, it’s a start. Glad of any feedback from anyone who has used it. (from KableNet)

 

08 Nov 2007

Government: the jolly green giant?

Sustainability and the green agenda is an idea whose time has come globally, and it affects every part of the “transformational” agenda and the work of the government technology community - or so the attendees at a recent Ideal Government dinner agreed. The government is committed to it from the PM down, all our organisations are corporately committed to it and we’re all personally committed to it, whether it’s because we’re thinking of our children or because in many cases we’ve been told to be (and we do what we’re told).

The role of public-sector technology in this agenda is core to Cabinet Office’s evolving transformational government programme, to Defra as lead department, to large departments such as MoD (which already has stations going underwater). Local authorities see it as essential for efficiency and central to their duty of care to citizens. OGC leads on procurement and the auditors must assess effective stewardship of public assets.

It’s everybody’s problem and the downside is that therefore it can feel like nobody’s problem.

 

17 Mar 2006

Government procurement that helps the disabled

Ruth Loebl from RNIB writes in on the question of government procurement:

Perhaps I’m taking this into a different realm, but I am extremely
interested in govt procurement at the moment, due to the introduction of
a new Public Sector Duty to promote disability equality (a new bit of
the existing Disability Discrimination Act), enforceable in December
2006. The Code of Practice for this Disability Equality Duty (DED)
http://www.drc-gb.org/thelaw/publicsectordutycodes.asp specifically
covers the DED in procurement, and there’s even an example (that *isn’t*
about a website for a change):

“A Government department that is planning to procure a new IT system
should ensure that its action plan includes the work it will do to
ensure that the new system is suitable for use by disabled employees.
The action plan should also indicate the way it will develop the
specification so that the system delivers the right products for
disabled customers. This might include having a means of identifying
those customers and their requirements, which could lead to being able
to, for example, print notifications and letters in accessible formats
for visually impaired people.”

This is an enormous advance, holding out the possibility that systems
may cease to exclude disabled people from employment as they do at the
moment. Awareness and knowledge within the public sector of how to
achieve what the law requires is currently very low, given that it’s
new, it’s quite complex, and up to now, a bit of a niche area. So I’ve
been trying to find out from the Disability Rights Commission and anyone
else who’ll stand still for long enough - is ‘government’ going to
coordinate compliance with the DED in procurement across all
departments, or is each central and local government agency going to
start from scratch and repeat all the errors others will have made,
without benefitting from good practice and experience gained elsewhere?

If coordination is to be a reality, then where in government will
responsibility reside? The Disability Rights Commission has many
priorities and procurement is not high on the list, despite the amount
of money involved, and they have no authority to implement, only to
advise. The DWP ‘owns’ the DDA, the Treasury ‘owns’ procurement via the
OGC, the DTI has an interest in eInclusion 2010 and there’s a brand new
Office for Disability Issues but I can’t get a clear idea of where their
priorities lie (and I expect they are only just working them out). RNIB
and other voluntary sector partners are ready and willing to advise and
support, and I would dearly love to know where to approach government to
have the greatest effect.

I could go on about the business case and show that procurement of
accessible IT helps govt save money and meet business and social
objectives, but we’ll take that as read at this point, except for a
single quote from my source within DWP:

“If accessibility for people using various kinds of access technology
had been considered while LMS was being designed, it would have saved a
great deal of expense and time. What’s more, an inclusively designed LMS
would have been more accessible to and usable by all staff, not just
those with disabilities.”

So, ‘wibbi’ I could get this little bit of legislation into the
processes and culture of government procurement effectively, without
stifling innovation or adding unduly to bureaucracy (I promise)? Any
advice and assistance would be welcome.

 

07 Mar 2006

EU-US public procurement trade dispute “over”

Apparently - says the excellent Outlaw.com - the US and EU have resolved a government procurement sanctions dispute that has been going since 1993. I wasn’t even aware of it. Has it been a big deal? Have we been penalising US companies on smaller contracts?

 

24 Feb 2006

OGC lists that create unnecessary middlemen

Lance Piper notes good suppliers often have to launder their bids through an OGC-listed supplier that often adds little value

I maybe don’t feel as strongly as you - so given that that OJEC rules
are unlikely to change - my anecdote only relates to the OGC Lists.

A project decided to invite a tender to all the suppliers on the
appropriate list.  Without exception the bid was prepared by a
sub-contractor who had heard of the opportunity and asked a listed
supplier to do the bid for them.  The main contractor, in effect, only
added cost for minimal value and allowed a faster procurement process.

The impact is that reasonable non-listed companies could not be
approached.  This stifles innovation and the possibility of inviting
smaller companies who are striving to grow in the government market
place.  A public listing is not possible for contracts over the OJEC
limit.

Sorry I don’t have a wibbi, other than removing all external
regulation.  Internal procurement procedures seem quite good.  Perhaps
an alternative might be surveillance from a regional centre of
procurement excellence (but I don’t know how good they are at reducing
bureaucracy).

 

22 Feb 2006

OGC good procurement guidance from 2003 (If you don’t know what you’re doing, just say “No”

Here’s the 2003 state of the art guidance on all this stuf from OGC. In brief, the NAO/OGC warning signs for senior management on common causes of project failure are

1. Lack of clear link between the project and the organisation’s key strategic priorities, including agreed measures of success.

2. Lack of clear senior management and Ministerial ownership and leadership.

3. Lack of effective engagement with stakeholders.

4. Lack of skills and proven approach to project management and risk management.

5. Too little attention to breaking development and implementation into manageable steps.

6. Evaluation of proposals driven by initial price rather than long-term value for money (especially securing delivery of business benefits).

7. Lack of understanding of and contact with the supply industry at senior levels in the organisation.

8. Lack of effective project team integration between clients, the supplier team and the supply chain.

If any of the answers to the above questions are unsatisfactory, an acquisition-based project should not be allowed to proceed until the appropriate
assurances are obtained.

See expanded version below.

Then there’s a positive expression of how to manage partnerships:

Top Management (Permanent Secretaries, Executive Agency and NDPB CEOs) must perceptibly create an atmosphere that encourages innovation and dispels fears about trying new approaches. To encourage a sense of mutual trust, they must ensure that the partners.

• support open and frank exchanges
• pool experience and expertise
• encourage open book accounting
• establish a joint structure to provide effective management
• promote a ‘win-win’ mentality
• enter two-way review process

The larger the contract, the greater must be the involvement of senior management. A senior official should be appointed to take responsibility for the contracts management and care should be taken to ensure that the project is fully resourced, especially in terms of the quality and number of personnel deployed. Managers, on both sides, need to be capable of demonstrating behaviours that reinforce the relationship.

(I always love “care should be taken”. Using the passive tense strikes me as a way to avoid clearly stating who does what. But maybe I’m nitpicking something that is too theoretical anyway)

Then it sets out theIt goes on

Gateway to success

New procurement projects in civil Central Government are subject to OGC Gateway™ Reviews.

What? Gateway is ™ ?? But Cabinet Office called its Microsoft portal Gateway! OGC should have sued!!

The process applies equally for those organisations that already have strategic partnering arrangements in place.The OGC Gateway Process examines a project at critical stages in its lifecycle to provide assurance that it can progress successfully to the next stage. It is designed to be applied to projects that procure services, construction/property, IT-enabled business change projects and procurements utilising framework contracts.

There’s a definition of value for money:

Value for money (VfM) is defined as “the optimum combination of whole-life cost and quality (or fitness for purpose) to meet the user’s requirement”. This is rarely synonymous with lowest price.

And it describes good partnering relations:

Partnering is where two, or more, organisations develop a close and, generally, long-term working relationship. The principle being that a cooperative relationship is better than an adversarial one. A partnering relationship works because both parties derive mutual benefits from the arrangement and so have an interest in each other’s success. For legal reasons ‘partnering relationship’ has become widely preferred to ‘partnership’. The words may be different but the philosophy is the same.

...and finally it talks about

improving the efficiency and effectiveness of procurement to achieve faster delivery

It is a common complaint that government procurement takes too long and people ask why doesn’t the government do something about it? Everybody benefits from fast, effective and transparent procurement. It reduces suppliers’ costs, enables departments to fulfil commitments faster, and more effectively and gives citizens more responsive and better value for money (VFM) public services.

 

Good and bad procurements, and dark rumours

Can someone remind me why there were such dark rumours around project True North? Or is there some legal settlement which means it can’t be spoken of? I do recall people speaking in outraged tones about this, but I’ve forgotten what they said.

And what’s all this about the MoD applying DefStan requirements to packs of tissues?

Given that every contract awarded means one happy winner and several disgruntled losers perhaps we’d expect residual griping. Especially since public servants can’t give the other side on the record. I wonder if we’ll hear about any exemplary procurements as well.

UPDATE Yes. Someone has reminded me.

True North was meant to provide a common-service secure hosting environment for the 2nd Generation Government Gateway & GovDirect. It was to provide content management for all Gov and the secure environment for hosting. 

Suppliers didnt seem to want to bid: EDS withdrew, then Fujitsu. I think the shortlist was Cable & Wireless with Sema (now Atos) against ITnet making final presentations in the luxurious surroundings of some city law firm. C&W/Atos withdrew; ITnet got a contract which was later repudiated, followed by expensive litigation etc.  Serco then took over ITnet and there was an eventual settlement. 

The clunky old Gateway continues to process self assessment returns etc; new competition underway.

Apparently the person who can tell us all about it is Alan Mather. The good news is I wont even need to email him, because he takes RSS feed. Alan - what’s the story here? Or is it all sub judice?

 

Procurement: can we add dates please?

A significantly-placed friend writes in to suggest it’s important we date our anecdotes.

Central Gov has performed better (I think) since Gershon created OGC.  Stuff from four of five years ago is not necessarily relevant today.

My correspondent recalls submitting evidence to Peter Gershon’s original study for the PM. 

I had asked my team to come up with a list of all the failings and problems of public sector purchasing, with evidence suggestions for their resolution. By the time I had combed through the lot and excised the stuff that did not stand up to critical evaluation, the list was not long...I knew [Gershon] would accept only carefully argued, evidence supported suggestions....

Public procurement is often frustrating.  So is any well run competitive purchasing in the private sector, but folk in public sector sales teams
forget that fact.  The private sector can do things quickly, and can be flexible about the sort of deals to cut, but they have their fair share of
difficult and incompetent people too, in my experience.

And as OGC were quick to remind the companies that complained abut the contract terms demanded by Granger “you signed them!” The fallout from that
remains to be experienced though, it remains a serious issue.

There is more fun to be had at some of the commodity level stuff and the fact that small local authorities will impose their own rules on purchasing over and above the usual legislation and OGC guidelines.

 

OGC’s Catalist process does have the odd shortcoming…

A core aim of the OGC is to improve purchasing across government. But its own purchasing frameworks (run by OGCbuying.solutions) are an embarassing example of worst case practice, which generate huge amounts of work for all involved, with a low quality outcome.

Specifically, the competition to get into the new Catalist series of frameworks is being run as a box-ticking exercise in which it is more important to get the word count right than to be innovative or have an enviable track-record.

The criteria for winning a place on the frameworks are based on a complex and mechanical scoring system, where there is little or no scope for an intelligent evaluation based on the overall value of what the bidder can bring. Some examples of the kind of unnecessary things which are asked are as follows: administrative back-up sfatt for consultants; degrees of all consultants (with 1.0 points for a degree, 1.4 for an MA and 1.6 for a doctorate); details of joiner training policies; how to ensure the timeliness of sales information given to the OGCbuying.solutions; sales order system process etc etc.

In answering the huge number of (largely unnecessary) questions, one senses a desperate need at the other end (in OGCbuying.solutions) to ask questions about processes because of a lack of capability to evaluate actual delivery capability.

In case you are wondering, this is not a disgruntled gripe from an unsuccessful bidder. We have done well on Catalist so far.

 

Procurement and Innovation

Whilst I understand the need for procurement rules to protect the public purse I do find that they sometimes seem to conflict with innovation.

About 15 months ago we put a proposal to a large City Council for a project called the Community Campaign Pack.  We worked with the council at our own risk (both time and money) to pitch for ODPM e-innovations fund money.  We were cited as a partner on the bid documents and were successful in getting the funding.

It was at this stage that we were told that the ODPM and council procurement rules would mean that the development work would be tendered and the project management would be taken in house.  We were to be offered a QA role on the project board. We refused.

In the end the lack of in-house skills and resources meant that we did end up project managing the majority of the development of the tool, but the vast bulk of the project was taken out of our hands. 

I shan’t argue the rights or wrongs of the decisions taken, but the whole process makes it extremely difficult for us to take new ideas to councils and work speculatively with them to try and get funding.

I don’t know the best way around the problem, but expecting companies who invest in innovative ideas to pitch against companies who have not invested the same time and money is not in the long term interest of innovation in the public sector.

 

Procurement: sometimes we should just say “No”

The Invigilator John R Behrman writes in with a “classic case of sub-optimization” in government procurement: “trying to do
incrementally better that which should not be done at all”:

a) Procurement of direct-recording electronic (DRE) voting machines and
deployment of a “statewide voter role” (actually the same as your “National
Identity Card") here in Texas

I am the principal political opposition to this in Harris County, the third
largest voting jurisdiction in the U.S. This is not a disinterested or
unbiased role, but it is one in which I am intimately involved being, for
instance, the Primary Election Judge today.

b) Wouldn’t in be better if we (b.1) stuck to the original and simple
constitutional provisions for suffrage rather than hiding an elaborate
political agenda behind a superficial and superstitious characterization of
technology?

It turns out that “human error” in balloting—“spoiled ballots” as the
British say—is a small and nearly trivial problems save for a single
office-seeker now and again. But, attempts to get rid of human error turn
out to be expensive and lend themselves to very large-scale, compound and
cascade failure-modes. Actually, we are experiencing one at this moment.

c) I will collect two more perspectives on this very same matter from (c.1)
a “neutral” bureaucrat who will remain anonymous and (c.2) my partisan
counterpart from the other main party here.

 

Procurement: it’s OK really, but we need higher EU thresholds

From the perspective of the UK local government organisation I’ve worked in recently, and for ICT expenditure running into £six figures, I’ve always found the Council’s procurement processes entirely acceptable - they are after all looking after public money, so perhaps need to be less flexible than can be the case in the private sector.

Where I have deep concerns is with the relatively modest limits* beyond which procurement has to be advertised in the Official Journal of the EU and a rigid process followed thereafter.  The problem, for ICT projects, is that this necessarily adds significant delay so conflicting with any possibility of rapid rollout of new eGovernment services.  Relative to the cost of the procured contract, the cost of following the process can be significant for contracts close to the threshold too The OGC has done a great job with Catalist in providing a solution that is particularly good for established products and services from large companies.  However where a new eGovernment service necessitates use of a product produced by a recently-formed company or where the supplier has not previously seen it worthwhile to engage in the Catalist tendering process, the only option to procure quickly is to buy through a Catalist-listed organisation who understandably demand a percentage of the contract value for fronting it.

I’m no procurement expert.  However I would have thought that one or both of adding a middle tier to the EU procurement legislation that enabled faster/cheaper procurement for medium value goods & services, or finding a way of getting new suppliers onto Catalist quicker, would solve many of these concerns.

*Just checking on the recently updated thresholds, note that the OGC web page covering these http://www.ogc.gov.uk/index.asp?id=1004560 is currently blank!

Charles

 

Crikey! Be careful what you ask for!

Our Customs Agency decided some years ago to develop a new inwards freight
clearance system.  Despite the fact that every trading country in the world
probably has one of these, did they do initial research to identify best of
breed?  No they didn’t!  Did they assemble a short list of suppliers who may
have had experience in developing delivering similar best of breed
applications elsewhere in the world?  No, they didn’t!  Did they at least
seek out architects/designers of these types of systems?  No they didn’t!

What did they do?

Well, they decided to spec the system in-house and then, using the good ol’
tender system, contracted various entities on the basis of lowest cost.

So, they developed something at lowest cost, did they?

Hardly!  Each and every public sector project problem identified in the
McCartney Report arose and recurred, so that an initial estimate of around
$AUD30m blew out tenfold, and the project delays ran into years.

And this is after Customs went through extensive outsourcing procurements in
the mid-90’s

Normally, I am totally opposed to capital or even corporal punishment, but
this sort of active negligence really tempts me.

I hope the Wibbis are fairly obvious, but to spell them out:

Most governments are doing the same thing—in tax collection, benefits
payments, audit and so-on; look for best of breed.  Taxpayers are not
technologically patriotic.

There are firms that have had experience in building and delivering these
systems; a list of these should be the starting point for procurement.

Push the project ownership and risk reporting right up the organisation, and
ensure political accountability to the taxpayer (ok, perhaps it might be
easier to reintroduce corporal punishment..!)

 
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