Feeds

OFT probe: Do small UK firms get fair shake in public sector tenders?

Special 'scoring' criteria is against SMBs customers, says tech distie

Top three mobile application threats

Armed with data provided from suppliers and public sector IT bods, the Office of Fair Trading will now launch a probe into the state of the government tech landscape and whether SMEs are getting a fair share.

Back in July, the competition watchdog put out a call for information as bids to discover if competition is alive and well, which is pretty much what the government wants taxpayers to believe.

ICT goods and services accounting for £13.8bn of the public sector purse in fiscal '12, but those that responded to the OFT survey voiced concerns that will sound all too familiar to anyone in the industry.

"Most notably concerns were raised that certain businesses appear to have a large share of contracts in some areas of the sector, that there are high barriers to entry and expansion (especially for smaller scale ICT businesses) and that public organisations face difficulties and high costs in switching suppliers," the OFT said.

Procurement practices are also to fall under the radar with the OFT set to look into the extent at which these "interact with the market structure and suppliers' behaviour".

The competition watchdog will specifically place a magnifying glass over commercial off-the-shelf software of all flavours including management information, and revenues and benefits systems.

And outsourcing will also fall under the beady eye of those terriers at OFT – who are free to make recommendations for government to ignore – with a focus on contracting suppliers to build or manage infrastructure and applications.

Nishora Arora, senior director of services, infrastructure and public markets at OFT, said that when competition works well it can lower costs, nurture innovation and help taxpayers get better value.

"We want to look further into this market to understand whether it is really serving its customers' interests," Arora added.

How realistic is the 25% goal?

Government plans to funnel 25 per cent of IT spending through SMEs by 2015, presumably before the election in May that year. The figure currently stands at 10.5 per cent, so there is a long way to go.

The Cabinet Office has made some moves to centralise procurement but there are still too many disparate framework organisers and government departments are free to make their own buying decisions below a certain spend.

In fact the heads of procurement within the departments are reluctant to even share information about suppliers etc, let alone let relinquish control of their budget to a centralised model.

Iain Tomkinson, sales director at distributor ASM Technologies, which tries to pair small and large players together to win public sector contracts, said he doubted competition would improve dramatically.

"The usual suspects, the big players, have invested hundreds of thousands of pounds to build the infrastructure and skills to deliver these projects. How can small companies compete?"

Tomkinson said the scoring criteria for government business – which range from financial stability and headcount to skills – were such that many SMEs are precluded from tenders.

He pointed out a fact well known to many firms in the UK's technology channel: that small players already deliver more specialist elements of large contracts after SIs have won them.

As we've said before, bringing these relationships to the fore and accounting for them is probably how Cabinet Office will reach its 25 per cent target.

The OFT findings of the study will be launched in March. ®

SANS - Survey on application security programs

More from The Register

next story
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
One year on: diplomatic fail as Chinese APT gangs get back to work
Mandiant says past 12 months shows Beijing won't call off its hackers
Whoever you vote for, Google gets in
Report uncovers giant octopus squid of lobbying influence
Lavabit loses contempt of court appeal over protecting Snowden, customers
Judges rule complaints about government power are too little, too late
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Don't let no-hire pact suit witnesses call Steve Jobs a bullyboy, plead Apple and Google
'Irrelevant' character evidence should be excluded – lawyers
EFF: Feds plan to put 52 MILLION FACES into recognition database
System would identify faces as part of biometrics collection
Putin tells Snowden: Russia conducts no US-style mass surveillance
Gov't is too broke for that, Russian prez says
Ex-Tony Blair adviser is new top boss at UK spy-hive GCHQ
Robert Hannigan to replace Sir Iain Lobban in the autumn
Alphadex fires back at British Gas with overcharging allegation
Brit colo outfit says it paid for 347KVA, has been charged for 1940KVA
prev story

Whitepapers

Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.