The authority relies on Regulation 32(2)(b)(ii) (Use of negotiated procedure without prior publication) of the Public Contracts Regulations 2015 namely: the services can only be provided by a particular economic operator, the incumbent supplier (CGI IT UK Limited), who has been providing the services forming the subject matter of this contract under a contract with the authority for the last 5 years three months which is due to expire on 30 November 2020, because competition is absent for technical reasons, and no reasonable alternative substitute exists and the absence of competition is not the result of an artificial narrowing down of the parameters of the procurement for the following reasons.
(a) no other supplier has the necessary technical knowledge and experience to provide the services, because
(i) most of the applications are bespoke and ‘heritage applications’ with many over 15 years old. The heritage applications are difficult to maintain because of their age and complexity and the extent to which they have been changed over the years and require very specialist technical knowledge and experience, e.g. skills/experience in using aged programming languages such as Fortran, COBOL, Pascal and C. The number of people with the skills, knowledge and experience to maintain and/or enhance them is limited outside CGI, which has developed significant knowledge and experience of how the applications were built and developed and how they operate and interface with each other; and
(ii) delivering the services relies on non-live development and test environments, and management access to the live environments, both to provide ongoing support and to undertake application development/enhancement. For a replacement supplier to provide the services, they would need access to the same/equivalent existing non-live development and test environments. To build and implement equivalent development and test environments would take around 12 months and be challenging, expensive and risky without the necessary application knowledge/experience. A replacement supplier would additionally need to establish infrastructure, connectivity and processes to allow secure management access to the live environments, e.g. to investigate maintenance issues or for boarding purposes i.e. to deploy new applications/code.
(b) even if it was theoretically possible that another supplier did have the necessary technical knowledge/experience, which the authority does not consider to be the case, it is estimated to take a minimum of 18-24 months for a procurement to be run and any replacement supplier to be able to deliver the services (6 to 12 months to run a competition to award to another supplier depending on the route/process and around 12 months to transition) whereas the services are required from 1 December 2020.