Tuesday, 8 January 2013

Procurement S.O.S.

What would you do? You have three bids and one is 20% more than at least one of the others (NB we don't know whether it is 20% more than the other two or just one of the other bids). You have recently been the subject of major criticism based on how you handled a previous procurement evaluation. The bidder, which is now 20% higher, had previously been identified as preferred bidder in an earlier bidding round.

If the facts, as reported in today's Financial Times, are correct and this is a true reflection of the procurement of the helicopter rescue service, that happens to be the dilemma faced by the DfT.

I don't know all of the facts but it is just possible that the higher bidder is the correct price and the remaining two are wrong? Yet the DfT are thought to have rejected the higher bidder based on the price differential. Ironically that is the bidder which, in the previous round, was the preferred bidder. The previous bidding round was set aside due to allegations of corruption, yet the outcome of that investigation is not yet known. What happens if the bidder, who has been rejected from this re-run, is exonerated?

Complicated as it is, to make matters worse, there remain many potential pricing variables yet to be addressed which have an impact on WLC, including, the approach to pilot training and the number of helicopters required! Is the evaluation model robust this time?

I would also like to hear how the outcomes for the service are being considered in the process and how the contract's performance is to be managed?

Has an assurance been given that the lessons from the Rail Franchise debacle have been learnt and transferred?

While a rail franchise is problematic, when you're dealing with search and rescue services at the receiving end of a bad contract are lives.

There's too much at stake for both the DfT and potential users for this to go wrong, yet somehow I'm not convinced we've heard the last of this procurement.

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