Contract Award for LAN-SAN and Server Hardware Supply and Maintenance Services
North Lanarkshire Council · 1 March 2023
Back to Finance and Resources Committee — 1 March 2023 and its agenda
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North Lanarkshire Council Report Finance and Resources Committee Does this report require to be approved? ☒ Yes ☐ No Ref: MB/KH Date: 01 March 2023 Contract Award for LAN/SAN & Server Hardware Supply & Maintenance Services From Chief Officer, Business & Digital E-mail hassellk@northlan.gov.uk Telephone 07903 096121 Executive Summary Committee is asked to approve the award of a contract for Local Area Network/Storage Area Network (LAN/SAN) & Server Hardware Supply & Maintenance (the ‘Contract’) to Virgin Media Business Ltd. The Contract is for a total period of 36 months anticipated to commence on 1/4/2023. The value of the Contract shall not exceed £3,932,110 Pounds Sterling exclusive of VAT. Recommendations It is recommended that Committee approves the award of the Contract to Virgin Media Business Ltd at the maximum value of three million, nine hundred and thirty-two thousand, one hundred and ten Pounds Sterling (£3.932,110) exclusive of VAT. This recommendation follows the completion of a procurement procedure, where the tender recommended for award has been evaluated as providing the most economically advantageous tender in terms of cost and quality for the Council. The Plan for North Lanarkshire Priority All priorities Ambition Statement All ambition statements
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1. Background 1.1 The requirements within the Contract are currently under contract with Virgin Media Business Ltd. This contract is due to expire on 31st March 2023 with the Contract detailed within this report due to supersede it. 1.2 Due to the reliance on connectivity for all digital solutions used within the council, there is a requirement to ensure the associated core network components, which are used to manage, secure, control and monitor network activity, are covered under a maintenance provision. Such provision supports the continuity of digital services across corporate, education and public access sites as well as the continued requirement for remote working. Further, there is also a requirement for the contract to provide support for the physical infrastructure, such as servers, storage, and associated services, which reside in the on-premises datacentres. 1.3 In addition, the contract will also offer a provision to supply replacement hardware with maintenance as the above items reach end of support and therefore become beyond secure and economical use. 2. Report 2.1 A user intelligence group (the ‘UIG’) of technical and procurement representatives was formed to review technical specifications, routes to market and to agree the procurement strategy that would deliver maximum benefit for the Council via the Contract. 2.2 The initial estimated value of the Contract dictated that the procurement procedure be undertaken in accordance with the Public Contracts (Scotland) Regulations 2015. 2.3 The procurement procedure was undertaken as a “Mini Competition” from the Crown Commercial Services, Network Services 2 framework agreement, RM3808, Lot 2 - Local Connectivity Services. 2.4 The Contract award recommendation is made on the basis of the tenderer who submitted the most economically advantageous tender. 2.5 The tender submitted by Virgin Media Business Ltd was the only bid received and has been evaluated as representing the most economically advantageous tender for this Contract. 2.6 In order to demonstrate value can be achieved from this award, a further benchmarking exercise of the hardware component pricing was carried out as part of the evaluation process; this involved two different engagements as follows: a) The pricing received from Virgin Ltd was evaluated against another framework, RM6068, Technology Products and Associated Services, also capable of offering the services; b) Engagement with Cisco, the manufacturer of the equipment, was carried out to understand what level of discount from RRP was being offered within the tender. 2.7 Appendix 1 confirms the scoring achieved by the tenderer and outlines the findings of the hardware benchmarking comparisons. Further details of the procurement procedure are provided in Appendix 2 with the SME status and location of all tenderers located within Appendix 3.
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2.8 The value of the Contract is three million, nine hundred and thirty-two thousand, one hundred and ten Pounds Sterling (£3,932,110) exclusive of VAT. 2.9 The costs associated with contract delivery will be contained within both Revenue for the Hardware Maintenance and Capital budget for the supply of Hardware within Business and Digital. Price Savings / Increases 2.10 There are no savings being offered as part of this contract award. Price Stability 2.11 The maintenance pricing is fixed for the contract term. 2.12 The supply of Hardware from the call off agreement within this contract will fluctuate according to dollar exchange rate however pricing will be fixed for 30 days from quotation and contract management will be applied to constantly benchmark the pricing received throughout the lifetime of the contract. 2.13 The benchmarking exercise discussed in section 2.6 and engagement with Cisco confirmed that the council received on average a 65% discount from RRP within the Virgin tender. The pricing exercise carried out against RM6068 Technology Products and Associated Services demonstrated Virgin Media Business Ltd tender offered best value. Further details can be seen in Appendix 1. Community Benefits 2.14 The Council is committed to maximising the delivery of community benefits. The procurement included a community benefit requirement, this approach is designed to deliver local community benefits where possible. 2.14.1 Within their tender, Virgin Media Business Ltd committed to deliver the following community benefits within the Contract: Community Benefit Type Quantity Committed Supporting basic digital skills for North Lanarkshire: We will work collaboratively with the Council to identify existing, local initiatives and deliver 15 hours of digital skills support via our Connect More programme. 15 Hours 2.14.2 The community benefits delivered as part of the Contract does not include the creation of jobs or apprenticeships. Fair Work First
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2.15 Within their tender submission, Virgin Media Business Ltd advised they will commit to key aspects of the Scottish Governments “Fair Work First” initiative: 2.15.1 Virgin Media Business Ltd have committed to paying the Living Wage for key staff involved in the contract and that they do not use zero-hour contracts. Contract Management 2.16 Officers from Business and Digital will be responsible for managing the Contract which will be undertaken in accordance with the council’s agreed approach to contract and supplier management. 3. Measures of success 3.1 The aim of the contract is to appoint a single supplier to support and maintain the council’s LAN/WLAN, storage & servers and establish a direct route to market for call-off requirements to install new LAN hardware equipment as and when required. 4. Supporting documents Appendix 1 Summary of Tender Evaluation Process Appendix 2 Summary of Procurement Process Appendix 3 SME Status and Location of All Tenderers Katrina Hassell Chief Officer of Business and Digital
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5. Impacts 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality- and-fairer-scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Finance? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? - Contract commit volume is within Business and Digital Revenue Budget commitments. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People Resources? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ 5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☒ No ☐
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If Yes, please provide a brief summary of the impact? - This contract is required to manage, secure, control and monitor network activity to be covered under a maintenance provision contract which will help the council deliver digital services. Where the impact identifies a requirement for significant technology change, has an assessment been carried out (or is scheduled to be carried out) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☒ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☐ No ☒ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? 5.10 Armed Forces Covenant Duty Does the report require to take due regard of the Armed Forces Covenant Duty (i.e. does it relate to healthcare, housing, or education services for in-Service or ex- Service personnel, or their families, or widow(er)s)? Yes ☐ No ☒ If Yes, please provide a brief summary of the provision which has been made to ensure there has been appropriate consideration of the particular needs of the Armed Forces community to make sure that they do not face disadvantage compared to other citizens in the provision of public services.
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Appendix 1 – Summary of Tender Evaluation Process Final Rank Tenderer Name Total Tender Score (%) Recommended for Contract Award (Y / N) 1 Virgin Media Business Ltd 100% Y Benchmarking Exercise as mentioned in 2.6 Hardware Component Type Cisco Switch C9200-48T Cisco Switch C9200-48P Cisco Wireless Access Point 9120-AXI-E Estimated Quantity over 3 years 250 250 3500 RRP CISCO £5,227 £7,113 £1,777 Virgin Bid Pricing £2,001 £2,378 £611 RRP Discount % -62% -67% -66% Computacenter Bid Framework RM6068 £1,894 £2,904 £742.43 Virgin Bid Total £500,470 £594,661 £2,139,040 Computacenter Benchmark Total £473,580 £726,080 £2,598,505 Virgin Hardware Bid Total £3,234,171 Computacenter Benchmarking Total £3,798,165
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Appendix 2 – Summary of Procurement Process Response CPT Contract Reference Allocated: NLC-SLP-22-089 Tender Platform Utilised: PCS-Tender (PCST) Procurement Procedure Utilised: Mini Competition Governing Legislation / Regulations: Public Contracts (Scotland) Regulations 2015 Date Contract Strategy Approved: 25 November 2022 Date Contract Notice Published: 29 November 2022 Number of Companies Invited to Take Part: 35 SME % of Expressions of Interest: 0 NLC Based % of Expressions of Interest: 0 Tender Return Deadline: 12/12/2022 Number of Tenders Received: 1 Where Only One Tender Is Received, Why?: The perception is that as the incumbent supplier Virgin receives the greatest level of partner discount from Cisco RRP this would have negatively impacted the Framework competitors’ advantage on bidding. Tenders Received from SME’s: 0 Tenders Received from NLC Based Tenderers: 0 Number of Non−compliant Tenders: 0 Number of Compliant Tenders: 1 Number of Recommended Tenderers: 1 Basis of Contract Award: Quality: 60% Price: 40% Evaluation Team: Mark Brennan – Supplier Manager (Price Assessor) Viki Forsyth - Infrastructure Team Leader (Quality) Tracey Hughes - Infrastructure Team Leader (Quality) Nicola Stewart - Infrastructure Team Leader (Quality) Evelyn Anderson - Infrastructure Team Leader (Quality) Anticipated Contract Start Date: 03 April 2023 Total Contract Period (Months): 36 months Maximum Total Contract Value: £3,932,110
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Appendix 3 – SME Status and location of all Tenderers Name of Tenderer Size of Tendering Organisation (Micro, Small, Medium or Large) Location (Local Authority / Council Area) Virgin Media Business Ltd Large Reading