When low-balled projects go bad: Scottish pensions agency starts £10m procurement to buy the system Capita could not
- Reference: 1599135008
- News link: https://www.theregister.co.uk/2020/09/03/scottish_pensions_agency_starts_10m/
- Source link:
In a [1]prior information notice , the agency – which administers about 500,000 people's pensions – said it is looking to "initiate engagement with the market for the provision and procurement of solutions required to manage the administration of pensions, payments and the provision of related customer and employer organisation interfaces and services".
Turning to the IT industry to seek "views from potential providers and partners regarding delivering of part or all of the range of services", the SPPA will consider bids including "on-line self service facilities for scheme members covering a range of platforms and channels; integration with voice based telephony services which may include the use of chat bots; data integration and interface coordination services with employer organisations and payment management services; analytics and reporting capabilities."
"Management of data to include validation, enhancement and augmentation; workflow, activity and task management; and, opportunities for process automation and machine based learning" are also mentioned in the tender.
Project failure
Although at early stages of vendor discussion, whoever wins the final contract will have large and perhaps rather smelly shoes to fill. Capita won the public sector pensions IT contract in 2015 with a bid later described by Audit Scotland as "abnormally low" in terms of overall costs. The 18-month timescale was "unrealistic", the spending watchdog said in [2]a 2019 report [PDF] .
"Capita was not able to provide a working system and did not achieve any of the project milestones. This was a main contributor to the project failure," the country's auditor general said.
The contract was cancelled in February 2018 and Capita paid the SPPA £700,000 in November 2018 following the conclusion of a legal process.
According to Audit Scotland, the SPPA spent £6.3m on the project and a further £2.4m extending contracts with existing suppliers when the project failed to meet the original timetable.
The project failure left the SPPA "unable to progress strategic, business and workforce plans as originally intended" and it therefore required an additional revenue budget of £9.8m between 2019/20 and 2022/23, as well as capital allocations of £13.6m over the next five years, the report said.
According to the new notice, the SPPA intends to publish a contract notice in January 2021. It has not responded to The Register 's request for comment. ®
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[1] https://ted.europa.eu/udl?uri=TED:NOTICE:410302-2020:TEXT:EN:HTML&src=0
[2] https://www.audit-scotland.gov.uk/uploads/docs/report/2019/nr_190625_sppa.pdf
[3] https://whitepapers.theregister.com/
And the winner is ...
Capita! Come on down!
Icon: I'm not sure it is though.
How hard can it be ...
... to be an auditor?
"Capita was not able to provide a working system and did not achieve any of the project milestones. This was a main contributor to the project failure," the country's auditor general said.
Oh, really?
Re: How hard can it be ...
What were the other contributing factors for the project to fail, if meeting none of the milestones by Capita was "only" the main contributor?
So...
> "Capita was not able to provide a working system and did not achieve any of the project milestones. This was a main contributor to the project failure
> According to Audit Scotland, the SPPA spent £6.3m on the project and a further £2.4m extending contracts with existing suppliers when the project failed to meet the original timetable.
They spent £6.3 million on a project where Capita both failed to meet any milestones *and* failed to deliver a working system.
And they only got £700k back?
TBH, sounds like Capita were the winners here, especially since failures like this don't seem to have any impact on their ability to bid for future work...
Re: So...
I think that's crapita's business model.
1, Win bid
2, Fail to deliver
3, Profit
Re: So...
Sounds like poor contract drafting to me. No penalties for missing the milestones? No penalties for consequential costs (the £2.4M for the other suppliers)? Not even retention of payments due?
I suspect that Crapita's lawyers were much better than SPPA's.
Re: So...
> Sounds like poor contract drafting to me. No penalties for missing the milestones? No penalties for consequential costs (the £2.4M for the other suppliers)? Not even retention of payments due?
TBH, it sounds like Capita could have literally put zero people on the contract, defaulted on it and still come out of this with a large wodge of pure profit!
Re: So...
It's far worse than that.
" The project failure left the SPPA "unable to progress strategic, business and workforce plans as originally intended" and it therefore required an additional revenue budget of £9.8m between 2019/20 and 2022/23, as well as capital allocations of £13.6m "
So it's 6.3 + 2.4 + 9.8 + 13.6 for a grand total of £32.1 million. And Capital paid back £0.7m.
So yeah, get project, fail to deliver, profit from not having to pay back more than a tenth of what it got and impose four times the amount in cost to the organization that was foolish enough to trust it.
One of these days, the British Isles are going to get the message. One of these days.
Any time now, just you wait and see.
"...the use of chat bots"
Please put me out of my misery and just shoot me.
There is nothing that gets my blood pressure shooting up quicker than the next lie from Boris or Trump than to be confronted by one of these
Pensions legislation is some of the most complex there is. Good luck to anybody taking it on.
Can we change things round and only report on Capita when they successfully complete a project? They would be in the news a lot less though.....
"They would be in the news a lot less though....."
I assume by a "lot less" you mean never.
The problem with public tenders...
Doing public tenders leaves very little room to reject a supplier because you simply don't trust them to actually deliver. This is part of the reason why companies like Capita keep getting projects like this. Whatever you say about them, they are really good at doing tenders, that is their main expertise.
I do see a potential way around this. If you where to keep track of the projects a company has done before you can determine a 'failure rate' and a percentage to go over budget on average. These two numbers can then be used in tenders, just apply the 'average over budget' factor before comparing prices and demand a failure rate below a certain percentage. That way you can take past performance into consideration, which generally doesn't happen right now. It also motivates companies to do a decent job because not doing so will harm their ability to win other tenders.
Me! Me!
https://pensions.gov.scot
For £8.7m less £700 clawback I can do a crap Drupal 8 site in couple of days.