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back to article OFT probe: Do small UK firms get fair shake in public sector tenders?

Armed with data provided from suppliers and public sector IT bods, the Office of Fair Trading will now launch a probe into the state of the government tech landscape and whether SMEs are getting a fair share. Back in July, the competition watchdog put out a call for information as bids to discover if competition is alive and …

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if you want small players...

You need to think very differently about the contracts and the way systems are specced.

Certainly in some of the ones I was involved with, there was no way little guys could bid (except as a subbie). Building a new benefits system is going to be a larger chunk of revenue than you'd be comfortable with for a small supplier. Unless you radically changed how you build big mission critical systems.

For those with lots of bad things to say about the big boys working on big systems - you have a point as lots of those went wrong (not all though - ESA worked very well for example) but let's not forget smaller firms screw up as well (iSoft for the NHS, COINS, etc) with the same bad results.

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Re: if you want small players...

The other thing to take into consideration is that the UK Public Sector has to follow EU guidelines for procurement and those guidelines state that the fairest way for choosing the winning bid is by price. Unofficially it's said that weighting is between 60-80% of the final score and that is a major issue for SME's whose main differentiator is quality and specialism. The bigger firms know they can offer the service at cut throat prices but exclude items from the bid and charge over the odds for them after the contract has been won.

Also SMEs are very small fish in a very big pond when it comes to public sector contracts and winners are invariably gobbled up by the big fish. If you work for an SME it's often better to be a sub contractor to the contract winner than be the contract winner.

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Re: if you want small players...

I disagree that the main weighting is price. In my experience in the Healthcare IT sector (as a medical doctor and a coder), we regularly find that 60-70% of the marks in tenders are for past history of supplying the public sector. It creates a self sustaining prophecy where the same big IT vendors get the contracts, because they were the ones who got it last time. Performance is seldom examined, so having won a past tender and then making a royal fuck of the cluster variety of it was rewarded with just as many points as a successful supplier. Price tends to account for 20% of the decision.

This is all a moot point though because the tender process is a sham. I know of no example of an NHS Trust who put out a tender for IT without already having a "preferred bidder" in mind. I know of no examples where a preferred bidder didn't win the contract. The Tenders are always written deliberately to favour the preferred bidder.

It all boils down to who you know on the Board and how many dinners you take them out to. Bribing the medical Consultants with a paid half day off every week to be a "tester" also works well. As does helping some of the Board set up their own consultancy company to supervise the roll-out of the IT project and then have the bid winner engaging the services of that consultancy. I've seen it all.

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Anonymous Coward

Hello to

The usual suspects....also check which of their board members have non exec positions

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