PCD 1290 Request for additional 12-month contract period for Voice and Data Services further to PCD 1136- BJP

PCD 1290 Request for additional 12-month contract period for Voice and Data Services further to PCD 1136- BJP

This decision seeks approval for a further 12 month contract extension, in addition to the 12 months already approved in PCD 1136, to continue support until the current Vodafone Mobile Voice and Data Services contract is replaced.  

The previous approval for a contract renewal was done in advance of negotiation with the supplier. Having completed the negotiation it would be most economical to change the parameters of the renewal to gain best value and reduce incumbent advantage in the market assessment to be undertaken.  

This decision does not request additional funding or budget growth. 

The Deputy Mayor for Policing and Crime is recommended to:   

1. Approve the award of a 24 month extension to the existing Vodafone Mobile Voice and Data Service contract to the value of £5,800,000 as an update to the previous approval (PCD 1136) for a 12 month extension. This is not a request for additional funding or budget growth. Revenue costs over the 2 years will be funded from the MOPAC Approved Digital Policing (DP) Core Infrastructure Budget. 

PART I - NON-CONFIDENTIAL FACTS AND ADVICE TO THE DMPC 

1. Introduction and background  

1. Following approval of a 12 month extension to the mobile voice and data contract in PCD 1136 commercial negotiations were undertaken with the incumbent for a 12 month extension. One of the key objectives of these negotiations was to secure agreement to include progressively smaller data packages allowing for a ramp down during any transition to a new supplier. The existing contract’s minimum data package is 100,000GB which has a monthly cost of £150,000. The incumbent would only agree smaller data packages in exchange for a 24 month contract.  

2. The 24 month proposal sees the holding of the existing tariff rates in the existing contract along with the provision of an £8.8k monthly airtime credit. Additionally from month 13 of the agreement a more granular range of data packages (50k GB and 25k GB) will be agreed to allow a reduction in the dual running costs if transition to a new supplier is required.   

2. Issues for consideration  

1. Adopting this approach will save a minimum of £400k on exit costs compared to the originally approved 12 month contract. Whilst securing this requires delays competing a new contract and any potential transition, it helps to reduce the incumbent advantage and so unlocks the potential value of the competition by better enabling new suppliers to compete on a cost basis with the incumbent. 

2. This approach provides an 11 month transition period as opposed to the 7 months available under a 12 month award. The revised approach also builds in a 3 month buffer should there be any issues with the transition of 120,000 SIM cards to a new supplier, further de-risking transition.  

3. It was not possible to agree a 12 month offer that would be economical. Instead the new offer provided, which includes stepped down data package costs, is now over a 24 month timeframe including a minimum spend in year 2 of £1.9m which requires additional approval to that given in PCD 1136. 

4. Approval for the long term Mobile Voice and Data contract is planned to be requested in Autumn 2022 following completion of competitive procurement. 

3. Financial Comments  

1. There is no funding implication in this request. The contract will be for a 2 year period, with an estimated maximum value of up to £5.8m for the full contract term based on the current service costs of £3.9m per year and the projected transition time period in the second year of the contract.  

2. It is anticipated that the existing £3.9m budget per year will be sufficient for the dual running of any new supplier in year 2 alongside the exiting Vodafone contract.  

4. Legal Comments  

1. The Mayor’s Office for Policing and Crime (“MOPAC”) is a contracting authority as defined in the Public Contracts Regulations 2015 (“the Regulations”).  All awards of public contracts for goods and/or services valued at £213,477 (including VAT) or above shall be procured in accordance with the Regulations. This report confirms the value of the proposed contract exceeds this threshold.   

2. The MPS must ensure continuity of this service from Vodafone.   MPS have looked into awarding a new contract compliantly under the CCS Network Services Framework agreement via a direct award process (as permitted under the CCS framework).   Vodafone have confirmed they are not willing to provide the preferential terms being offered to the MPS as a standard service offering under the Network Services Framework.  Therefore, use of the CCS framework is not a viable route to market.  MPS may apply Regulation 72 permits MOPAC to modify an existing contract in limited circumstances.  Specifically, regulation 72(1)(b) provides MOPAC may modify a contract where:  

• It is not possible to change contractor due to technical or economic reasons; and  

• to change contractor would cause MOPAC to suffer significant inconvenience or substantial costs duplication. 

3. The contract has been extended previously, however regulation 72(2) allows for successive modifications to be made in accordance with Regulation 72(1)(b), provided each modification is for a value which is no more than 50% of the value of the original contract and the MPS are not deliberately avoiding conducting a competitive procurement.  As MPS have already begun to engage CCS in regard to a new procurement and the value of the extension is less than 50% of the value of the original contract (which was £14.96m), then this extension is compliant and in accordance with regulation 72(1)(b) of the Public Contracts Regulations 2015.  The risk of a successful legal challenge is low. 

4. If the contract is extended under regulation 72(2)(b) MPS should publish a modification notice.  

5. Paragraph 4.13 of the MOPAC Scheme of Delegation and Consent provides the Deputy Mayor for Policing and Crime (“DMPC”) has delegated authority to approve all unforeseen variations and extensions to contracts with an original value of £500,000 or above, when the variation or extension is greater than 10% of the original value and/or is for a period of more than 12 months. 

5. Commercial Issues  

1. Agreement to a 24 month extension will better support the planned re-procurement of the voice and data services by reducing costs of dual running and increasing available transition time to a new supplier so mitigating risks. 

2. The transition to any new supplier will commence in February 2023 which is the first month when spend on the Vodafone contract will start to drop and a small amount of spend on any new supplier will come online. This switch in spend profiles will continue through 23/24 so that total spend on Vodafone reaches the £1.9 million required. The remaining £1.9m budget for voice and data will be spent with the new supplier and will be sufficient assuming costs are below existing contract costs which the competition will aim to ensure. An update in Autumn 2022 will advise if this has been achieved or if further contract headroom is required. 

6. GDPR and Data Privacy  

1. The MPS is subject to the requirements and conditions placed on it as a 'State' body to comply with the European Convention of Human Rights and the Data Protection Act (DPA) 2018. Both legislative requirements place an obligation on the MPS to process personal data fairly and lawfully in order to safeguard the rights and freedoms of individuals. 

2. Under Article 35 of the General Data Protection Regulation (GDPR) and Sections 57 and 64of the DPA 2018, Data Protection Impact Assessments (DPIA) become mandatory for organisations with technologies and processes that are likely to result in a high risk to the rights of the data subjects. 

3. The Information Assurance and Information Rights units within MPS will be consulted at all stages to ensure the project meets its compliance requirements. 

4. The project does not use personally identifiable data of members of the public, so there are no GDPR issues to be considered. 

7. Equality Comments  

1. As this is a continuation of an existing contract no equality issues are raised. 

8. Background/supporting papers 

1. Approval was provided for a 1 year extension to this contract in PCD 1136 in February 2022.