Framework agreement for the provision of Airwave radio terminals, accessories and managed services

Report: 11
Date: 22 September 2011
By: Director of Information on behalf of the Commissioner

Summary

This report describes the outcome of the formal competitive tendering exercise for the setting up of a replacement multi-supplier framework agreement for the supply of Airwave radio terminals, accessories and managed services. This framework will be for a term of four years with a total contract value of up to £160M for all forces and organisations and up to £20M for the MPS. The new framework will be open to all public organisations that use the Airwave Service. It replaces an existing compliant MPA multi-supplier framework that was used by 49 forces and organisations.

The existing Airwave Hardware Procurement Consortium Framework expires in September 2011. In accordance with the MPS objective “to deliver efficient and effective services at the lowest possible cost”, a review was undertaken to determine whether a new framework was required.

The new framework offers significant benefits to the MPS and other public organisations. Despite the maturity of the market, the MPS has obtained improved pricing on commonly purchased items together with the flexibility of additional options such as accessories, hire and lease. This will result in significant savings for the organisations that use the framework. Depending on use of the framework, these savings could be between £1.5M and £2M nationally over its term.

This framework will also allow forces the flexibility to set up collaborative purchasing arrangements, for example for managed radio services.

The estimated MPS spend is based on a refresh of Airwave radios terminals during the contract length together with business as usual activity. Each procurement made by the MPS under the framework will go through the normal procurement initiation and approval processes.

The overall estimated value is based on the maximum utilization of the framework by the public organisations who will use it but it is anticipated that actual spend under the framework will be less than this declared contract value. It will be down to each body to decide whether or how much they utilize the framework. An Appendix detailing PQQ and ITT scores supporting this report is exempt.

A. Recommendations

That members

1. Approval is given to award a Framework Agreement for the supply of Airwave radios (Lot 1), managed services (Lot 2) and accessories (Lot 3). This Framework Agreement will allow contracts to be called off with the following suppliers:
   • Abiom Beheer AV Lot 3
   • Arqiva Ltd Lots 1, 2 and 3
   • Airwave Solutions Ltd Lot 2
   • Capita Secure IS Ltd Lot 2
   • Cassidian Finland OY Lot 1
   • Cleartone Telecoms Ltd Lot 1
   • Motorola Solutions Ltd Lots 1, 2 and 3
   • Peter Jones (ILG) Ltd Lot 3
   • Savox Communications Ltd Lot 3
   • Sepura plc Lots 1 and 3
   • Sonic Communications (Int) Ltd Lot 3
   • Telent Technology Services Ltd Lot 2
   • Thales UK Ltd Lot 1

B. Supporting information

Background

1. This framework will be for a term of four years with a total contract value (for the entire term) up to £160M for all forces and organisations and up to £20M for the MPS. It will replace the Airwave Hardware Procurement Consortium Framework contracts that were let by the MPA in 2003 and expire in September of this year. This framework, available to all UK police forces and other users of the Airwave service, allowed organisations to compliantly purchase Airwave radio terminals and managed services. 49 UK police forces and law enforcement agencies have used this framework. The MPS made a saving of over £2.5M when it made its bulk purchase of radios under the existing framework

Procurement Strategy Information

2. The Home Office has committed to greater savings and efficiencies across police authorities with increased collaborative procurement a prime objective. Consultation between Procurement Services, DOI and NPIA concluded framework contracts for these requirements should again be available to all UK police forces and other Airwave users which supports the collaborative objective. NPIA has engaged with other police forces by various means, including written notifications, updates at meetings, requests for management information and entries in the NPIA newsletter. In addition, the MPS Radio Client Unit has engaged with other forces at various Airwave user group forums.

3. The market for Tetra Radio terminals is ‘mature’, where the limited number of suppliers and the use of the previous framework have reduced pricing significantly for Airwave users. However, there is still scope to achieve further savings by using mini- competitions and reducing the total cost of ownership through including accessories, lease and hire options within the framework package.

4. Some of the key aims of the procurement have been met:

• improved pricing for radios under the existing framework;
• inclusion of hire options to cover short term requirements;
• Inclusion of lease options giving forces a range of finance options to make their purchases;
• Inclusion of managed services allowing forces to reduce operational costs via collaboration and /or outsourcing

5. The new framework is divided into three Lots: Lot1 -Hardware (radio terminals), Lot 2 -Managed Services and Lot 3 -Accessories.

6. The total estimated spend under the framework is up to £160M over four years (£68M Hardware, £72M Managed Services and £20M Accessories).This figure includes potential spend by all UK police forces and other Airwave users. The tender documentation emphasised that these are estimated figures with no spend commitment.

Tendering process

7. This procurement was undertaken using the ‘Restricted’ OJEU process and was also advertised through CompeteFor. There were 15 companies that submitted PQQ documentation. 14 of these companies were invited to tender and 13 of them submitted tenders. The tenders were evaluated by DOI and Procurement Services and also by NPIA. All the companies that have submitted tenders are leading players in the categories covered by this framework. As this is a multi-supplier framework identical contracts will need to be signed with all the framework providers and it is confirmed that all the suppliers have agreed to the contract documentation.

Responsible Procurement

8. All bidders comply with the WEEE regulations and carbon offset guidelines covering disposals.

General Contract Information

9. Pricing is better than the existing framework, examples of items being cheaper in percentage terms are the handheld radio (2%), the mobile radio (30%), the enhanced warranty (17%), the vehicle radio (10%) and the motorcycle radio (30%). See Appendix A.

10. This more competitive pricing together with the additional options such as accessories, hire and lease will result in significant savings for the organisations that use the framework. Depending on use of the framework, these savings could be a minimum of between £1.5M and £2M nationally on like for like replacements on the framework prices offered. It is anticipated that even better pricing (and larger savings) will be made when mini-competitions are held for bulk procurements.

11. Organisations using the framework will be required to run mini-competitions for their requirements. Direct awards will only be made where the value of the purchase is below the OJEU threshold or where the circumstances of the purchase justify the application of regulation 14 (1) (b) (ii) of the Public Contract Regulations relating to supplier specific technical characteristics of the requirement. A full description of how the framework will work is outlined in the Contract and has been accepted by the bidders. This advice will also be circulated as guidance to all organisations that will use it.

12. There will be six companies on Lot 1, five on Lot 2 and seven on Lot 3. This will allow good competition between companies and because many of them have differing specialisms it is anticipated that companies will only bid for requirements that they can provide e.g. on Lot 1 three companies can supply motorcycle radios and on Lot 3 four companies can provide carriage options.

13. There will be a short gap between the expiry of the existing framework and the award of the new framework. NPIA has kept forces and organisations updated on this in order that they have been able to forward plan their requirements, and there is no issue for the MPS due to previous forward ordering.

C. Other organisational and community implications

Equality and Diversity Impact

1. This framework is aimed at rationalising the method by which police forces obtain radio communications equipment and services in accordance with EU procurement rules. There is no reason why the approval of a list of suppliers selected on the grounds of their ability to provide the relevant equipment or services should have any impact on equality or diversity. The suppliers themselves at PQQ stage (Pre-Qualification Questionnaire) are required to confirm that they operate according to a policy which meets the legal requirements for equality and diversity.

Consideration of Met Forward

2. This framework supports the Met Streets, Met Specialist and Met Olympics strands in that the end result is the right equipment for our operational officers and staff. There is relevance to Met Partners in that a framework is provided for all emergency services in Great Britain to purchase radio equipment which is interoperable with ours on the shared national radio network. Most of all, it underpins Met Support as the agreed preferred method of enabling value for money in our procurement of the equipment and services from the preferred suppliers.

Financial Implications

3. The total ceiling value for the contracts under this framework is £160M over four years. However, this value has been set to cover the potential requirements of all framework users, i.e. all UK police forces and other public organisations (mainly blue light emergency services) that use the Airwave service. There is no commitment to spend against this framework and all future purchases using the framework will follow the normal approval and governance processes. The total ceiling value for the MPS is up to £20M over four years.

4. It is anticipated that purchases made through this framework should at least equal and potentially improve upon pricing under the existing framework. The new framework also provides greater flexibility than the existing framework in terms of inclusion of hire and lease options to cover short term requirements.

5. All future purchases under the framework will follow the normal terms and conditions associated with MPS procurement. The MPS and NPIA will monitor spend under the framework in conjunction with forces and organisations and with suppliers to ensure that the total ceiling values are not exceeded.

Legal Implications

6. DLS engaged external solicitors TLT to assist on this procurement. TLT advised on matters such as lengths of call-off contracts under the framework and how direct awards should be incorporated into the framework. These advices will be incorporated into the framework guidance that will be made available for forces. TLT also advised on the terms and conditions to be used for the framework agreement and for the call-off terms - there are call-off terms for hardware (Lots 1 and 3) and managed services (Lot 2) and the strategy for getting all the recommended bidders to agree identical terms and conditions.

7. On the basis of information contained in this report, DLS confirms that the recommendation can be lawfully approved in accordance with EU and UK Procurement Regulations and MPA Contract Regulations.

Environmental Implications

8. There are no direct environmental issues associated with the proposal. The suppliers themselves at PQQ stage (Pre-Qualification Questionnaire) are required to confirm that they operate according to an appropriate policy on environmental impact

Risk (including Health and Safety) Implications

9. No risks are identified. There are clear opportunities in enabling value for money in the procurement of radio equipment and services for the MPS and all emergency services in Great Britain. The suppliers themselves are required to conform with all applicable Health and Safety legislation and practice.

D. Background papers

• Appendix A - Supplier price reductions, PQQ and ITT Results

E. Contact details

Report authors: Jim Strother, Chief Inspector, Command and Control User Support manager, MPS

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

PART 2: EXEMPT SECTION OF THE REPORT

1. The reasons for Appendix A shown as ‘Exempt’ is under Paragraph 3 of the Local Government Act 1972 - which states that information relating to the financial or business affairs of any particular person (including the authority holding that information). It is not considered to be in public interest to disclose the level of detail contained in this report.

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