The Crown Commercial Service (CCS) recently increased its cloud hosting budget with Amazon Web Services (AWS) by a staggering 89%. This decision has raised eyebrows among procurement professionals.
CCS is overseeing the transfer of workloads from the now-defunct Gov.uk platform to AWS. This initiative is part of a £1.3 million, 36-month contract signed in February 2023 through the G-Cloud 13 framework. However, in May 2024, CCS issued a Change Control Notice revealing that the total contract value jumped to £2.5 million. Such a large increase in contract value typically raises questions, especially since procurement rules restrict increases to 50% of the original contract without reopening the bidding process.
In the CCN, CCS explained the need for this bump in budget. But many are wondering why the contract wasn’t retendered or subjected to competition when it became clear that the original sum wouldn’t cover all expenses. A public sector IT procurement expert, who wished to remain anonymous, pointed out that while the contract was awarded under G-Cloud 13, CCS needs to clarify the reasoning behind this contract escalation, as it seems to breach the required competitive process.
Martin Medforth, a public procurement adviser, noted that while Regulation 72 of the Public Contracts Regulations 2015 does allow for increased contract values, this can only happen incrementally. He indicated that CCS could potentially apply multiple modest increases if they had to adjust for unexpected costs, but it’s unclear from the notice whether they did so or if they pushed through that hefty 89% increase all at once.
When contacted for clarification, a spokesperson from CCS insisted that they follow procurement laws to ensure fairness and transparency and confirmed that the contract was awarded via G-Cloud 13.
Nicky Stewart, a senior adviser at the Open Cloud Coalition, emphasized the importance of transparency in public sector procurement, particularly for visible organizations like CCS. She urged them to lead by example by fostering competitive opportunities in the public cloud space.
The significant uptick in the contract value after just over a year suggests CCS may have underestimated the migration costs from the start. Medforth expressed that he would have set the initial deal at around £5 million to avoid such issues. Owen Sayers, an experienced enterprise architect, echoed this concern, questioning how CCS miscalculated the original contract amount.
Computer Weekly reached out to AWS for comments but received no reply.