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Use of frameworks to procure IT services must align with key strategic objectives, says Cabinet Office

New rules governing how Government departments can procure IT services will result in a reduction in the number of large scale 'framework' agreements, the Cabinet Office has said.07 Jan 2013

Following an internal review of Government IT procurement, the Cabinet Office has announced that it has scrapped plans to use some existing ICT frameworks. It has said that Government departments will only be able to establish framework agreements in future if they can show it will "explicitly deliver against key strategic needs" and if suppliers "of all sizes" are given a "reasonable chance" of winning work through the system.

Framework agreements allow buyers to obtain services they want from a select list of "pre-approved" suppliers without "excessive procurement procedures and the need for extensive tendering" to occur, the Cabinet Office said.

"Framework agreements only work if they deliver what they set out to deliver and drive the greatest competition from a wider range of suppliers, including SMEs – that’s why we’re strengthening procurement by ensuring they align with what Government needs as well as working for suppliers," Cabinet Office parliamentary secretary Chloe Smith said in a statement.

In October last year the Cabinet Office announced that David Shields, managing director of the Government Procurement Service, was to lead an internal review of the way Government procures IT services. Following this review the department has now announced that some existing framework agreements have been scrapped.

"Bold action is necessary if we are to find greater efficiencies whilst attracting more innovative suppliers and supporting growth," Bill Crothers, the Government's chief procurement officer, said.

"After looking at the current frameworks in use, we’ve decided to cease the Application Development, Delivery and Support Service (ADDSS) and Hosting Services procurements from today and Service Integration & Management Services (SIAM) will not be progressed through the framework route," he added. "Frameworks which are already operating effectively and delivering significant change such as the Public Services Network (PSN) and G-Cloud provide a model for success and will continue."

IT procurement law specialist Simon Colvin of Pinsent Masons, the law firm behind Out-Law.com, said that it is right for procurement processes to be stopped "where they are not going to achieve objectives".

"It makes sense to scale back to make sure Government departments use frameworks appropriately for procuring services from suppliers," Colvin said. "However where that approach isn’t aligned to the key strategic objectives it is likely that other frameworks may be appropriate or more bespoke procurement arrangements will be needed, as frameworks have a more rigid tie-in of terms at the outset."

"The revised approach set out by the Cabinet Office will not stop procurement through frameworks but will ensure that they are used for the right reasons. That has got to be a good thing both for departments and suppliers, particularly SMEs, given likely bid costs involved," the expert added. "It will be interesting to see whether the Cabinet Office provides any further guidance as to the best way to procure services targeted by the withdrawn framework agreements. Guidance could help provide better alignment across Government departments."

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