Recommendations For The Extension Of The Existing Information And Communications Technology (ICT) Outsourced Contracts

Report: 15
Date: 22 Jul 2004
By: Commissioner

Summary

The negotiations with the current ICT outsourcing suppliers on extending the existing contracts have been completed. This paper seeks approval from members to implement extensions to the following ICT contracts:· Atos Origin (Information Systems)· Damovo (telephony)· EDS (Crime Report Information System)· NTL (radio)· Unisys (Command and Control)The extensions to existing contracts will allow a smooth transition to the new ICT Core Service supplier by April 2006.The services to be provided under these contract extensions have not substantially changed from those currently delivered, although some service improvements have been achieved.

A. Recommendation

Members are asked to approve the following:

1 An extension to the Atos Origin contract of up to 18 months (from 1 November 2004 to 30 April 2006) in accordance with the negotiated changes summarised at exempt Appendix 2;

2 An extension to the Damovo contract of up to 18 months (from 9 August 2004 to 8 January 2006) in accordance with the negotiated changes summarised at exempt Appendix 2;

3 An extension to the EDS contract of up to 3 years with breakpoints (from 1 January 2005 to 31 December 2007) in accordance with the negotiated changes summarised at exempt Appendix 2;

4 An extension to the NTL contract of up to 3 years (from 20 October 2004 to 19 October 2007) in accordance with the negotiated changes summarised at exempt Appendix 2B;

5 An extension to the Unisys contract of up to 3 years (from 4 October 2004 to 3 October 2007) in accordance with the negotiated changes summarised in exempt Appendix 2.

B. Supporting information

Background

1. The MPA has previously given MPS the authority to negotiate the extension of all the existing ICT contracts. The previous papers submitted to the Finance Committee are listed in the section “Background Papers”.

2. Letters have been sent to each of the five existing ICT outsourced suppliers informing them of the intention to extend, as required within the terms of the existing contracts.

3. The MPS has initiated a statutory procurement exercise to let a new contract for the provision of core ICT services and support over the next 7 to 10 years. This procurement exercise will in due course identify the supplier for the provision of these core ICT services. Appropriate approvals for this new contract will be sought from the MPA in due course.

4. The ICT re-tender exercise is expected to reach a conclusion during July 2005 and will lead to the introduction of new service arrangements shortly thereafter. The services currently provided under the existing ATOS Origin, Damovo and EDS contracts will be taken over by the ICT core service supplier and the extension durations reflect this. However, the Unisys and NTL services will not initially be included in the new ICT core service contract so as to protect the transition to the C3i service, although potential suppliers have been notified that both Command and Control and Radio Services may subsequently become part of the ICT core service supplier’s portfolio of services in the future. The Unisys and NTL extensions will be for a period of 3 years.

5. Previous reports to the Finance Committee (24 October 2002, 10 July 2003, 23 October 2003) highlighted the completion dates and contractual extension options for all the existing ICT contracts.

The Contract Extension Project

6. Following the proposals made to the Finance Committee on 22 October 2002, 10 July 2003 and 23 October 2003, the MPS prepared the strategy for the contract extensions with the overall objective of taking the opportunity to extract value and deliver benefit to the MPS. In particular, the objectives of the negotiations with each supplier were as follows:

• · to guarantee continuity of service,
• · to safeguard C3i, Airwave and other major MPS projects in the process of implementation during 2005/6,
• · to provide adequate time for the re-tendering activity and a safe transition,
• · to obtain the best possible deal as a result of agreeing extensions.

7. Each of the negotiations commenced in August 2003 when the MPS asked existing ICT suppliers for their initial contract extensions proposals. A separate MPS team for each supplier was created from representatives of the Directorate of Information and Procurement Services, supplemented by skilled external negotiators.

8. The MPS required, as a minimum condition of the contract extension process, the continuation of the contracted service levels from each of the current suppliers. In addition, the MPS aimed to improve the value obtained from the total portfolio of business being conducted between MPS and its existing ICT suppliers.

9. Legal advice and assurance was sought and confirmed, concerning the MPS’ ability and rights under EU regulations, to extend the contracts beyond the expiry date of the initial period of the existing agreement.

Outcome of the Contracts Extension Negotiations

10. Atos Origin (Information Technology)

The existing contract with Atos Origin reaches the end of the 5-year initial period on 31 October 2004. The extension will be for a minimum of 18 months, after which the new ICT core service supplier will take over the provision of the IT services. A summary of the benefits is contained in the exempt Appendix 2 to this report.

11. Damovo (Telephony)

The existing contract with Damovo reaches the end of the 5-year initial period on 8 August 2004. The extension will be for a minimum of 18 months, after which the new ICT core service supplier will take over the provision of the telephony service. The notice period for termination will be 12 months, although early termination arrangements have been negotiated. A summary of the benefits is contained in the exempt Appendix 2 to this report.

12. EDS (CRIS)

The existing contract with EDS reaches the end of the 5-year initial period on 31 December 2004. The extension will be for 3 years with breakpoints to provide flexible contract arrangements and a smooth transition to the new ICT core service supplier. A summary of the benefits is contained in the exempt Appendix 2 to this paper.

13. NTL (Radio)

The existing contract with NTL reaches the end of the 5-year initial period on 19 October 2004. The extension will be for 3 years with breakpoints to provide flexible contract termination arrangements and a smooth transition to the new ICT core service supplier. A summary of the benefits is contained in the exempt Appendix 2 to this paper.

14. Unisys (Command and Control)

The existing contract with Unisys reaches the end of the 5-year initial period on 3 October 2004. The extension will be for 3 years, with options to extend for a further two periods of one year. A summary of the benefits is contained in the exempt Appendix 2 to this paper. As a consequence of a recent upgrade of the system, Unisys has agreed to raise service availability levels, reflecting the business criticality of the service.

15. A timeline for each of the suppliers showing the termination of the existing contracts, the duration of the extension periods and the planned commencement of the new ICT service provider is shown at Appendix 1.

C. Race and Equality impact

1. All IS/IT solutions provided through the MPS Information Strategy pay particular attention to the needs of special groups. The contract extension negotiations have not modified these arrangements.

2. Consultation processes with MPS staff with regard to future requirements regarding these extensions have been ongoing through both the use of user work-shops undertaken by the extension team and through the Outsource Service Programme consultation processes. A Trades Union representative attends relevant meetings in each work stream and bi-monthly briefing meetings continue to be held between the programme director and relevant Trades Union and Staff Association representatives.

D. Financial implications

The cost of the extensions to the existing ICT contracts will be met from existing budgets. Full details are set out in the exempt Appendix 2 to this report.

E. Background papers

• Exempt Paper to Finance Committee – 18 April 2002 entitled “Outsource Contracts in the MPS-Proposed Strategies For Renewal”
• Exempt Paper to Finance Committee – 24 October 2002 entitled “Programme for Re-tendering the Services through the Current Outsource Contracts”
• Exempt Paper to Finance Committee – 10 July 2003 entitled “Programme for Re-tendering the Services through the Current Outsource Contracts”
• Exempt Paper to Finance Committee - 18 December 2003 entitled “Programme for Re-tendering the Services through the Current Outsource Contracts”
• Exempt Paper to the Co-ordination and Policing (COP) meeting – 24 January 2004 entitled “The Future Procurement of Information and Communications Technology Outsourced Services “
• Exempt Paper to Finance Committee – 22 April 2004 entitled “Programme for Re-tendering the Services through the Current Outsource Contracts”

F. Contact details

Report author: Director of Information

For more information contact:

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

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