Re: Are there ANY success stories?
>These bids are essentially random guesses since the spec is not written at that stage, yet the entire budget must be specified in detail
This isn't just a government problem - I've seen it many times in commerce too.
When the customer fails to provide a spec, things go down hill fast. Incumbant outsourcers love this sort of thing, smaller companies on fixed-price contracts have to have very good legal teams and keep the sales chaps in check.
The best thing to do is to get the spec written as a separate project. If done by an outside company, let them know they have no chance to even bid for the implementation.