Source · Select Committees · Public Accounts Committee
Recommendation 6
6
Accepted
Design a detailed commercial construct for cross-government digital technology procurement.
Conclusion
Government is underestimating how difficult it will be to consolidate its buying power centrally when procuring digital technology across government, in a way that will give it maximum leverage. Spending over £14 billion annually on digital technology suppliers gives government considerable buying power and the potential to make deals that benefit the taxpayer. Historically, government has sought to exercise buying power through competition between technology suppliers. But the digital technology market is increasingly being dominated by a small number of very large suppliers, giving the government limited choice. GDS has a goal to support government to maximise its commercial leverage by moving beyond memoranda and frameworks to a position where different parts of government can commit to contracting with the same supplier. However, in practice it can be difficult to line up multiple customers with differing requirements. Government will therefore need to adopt wide–ranging changes to how it approaches digital commercial activity, which reflect the changing reality of technology markets. For example, it will need more clarity on how the centre of government and departments work together, and more focus on requirements developed in advance of contract awards. In dealing with cloud providers, it will need to more fully understand its negotiation levers and have the ability to commit money in order to have the best possible leverage. recommendation The Cabinet Office and DSIT should design a suitable commercial construct moving from the current conceptual level to a more detailed explanation of how things should work, recognising that this is a new cross–government approach with new processes. 7 1 Building a strategic approach at the centre of government Introduction
Government Response Summary
The government agrees and will adjust functional standards for commercial and digital, develop a standard taxonomy for category strategies, and review control and assurance frameworks to optimise processes. These actions are part of the Cabinet Office departmental transformation programme.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. of the functional standards for commercial and digital and will be adjusted to reflect any proposed changes to the Commercial operating model under the Cabinet Office departmental transformation programme. The review will also include the development of a standard taxonomy from which we can develop category strategies to ensure that we standardise specifications, consolidate demand, and shape our approach to the market, calling on resources and insights from across HMG and the wider public sector where appropriate. A review of the controls and assurance frameworks will be undertaken to ensure that a unified, proportionate and considered approach is taken to optimise the process and accelerate delivery.