Institute for Government – ‘It’s clear the Digital Marketplace isn’t being used in the right way’

SUMMARY:

Daniel Thornton, programme director, raises questions about GDS’ ability to set standards for buyers using the Digital Marketplace.

The Institute for Government’s programme director, Daniel Thornton, has raised further concerns about the use – or misuse – of the government’s Digital Marketplace, Whitehall’s central procurement tool for the purchase of cloud services and digital skills.

Thornton’s comments come shortly after diginomica raised concerns about government buyers’ use of the Digital Outcomes and Specialists framework, which is one of the key frameworks listed on the Digital Marketplace.

The framework is meant to be a vehicle for SMEs to get business within the public sector and for departments to buy digital outcomes. However, sources have suggested that the framework is being ‘abused’ after some supplier opportunities for the framework have budgets that reach as much as £25 million and don’t resemble anything like a digital outcome.

It has been suggested that the Government Digital Service (GDS) isn’t doing enough to build up buyer capability and enforce projects that comply to their standards.

However, speaking at a Westminster eForum event this week in London, Thornton contributed to broader concerns about the Digital Marketplace, stating that whilst it is “frictionless”, he said that “it’s not leading to the standards being spread across government”. He said:

If you look at some of the contracts that are put out on the Digital Marketplace, there are lots that are a very long way from what GDS would describe as the standards they are putting out there.

I’ve seen things like ‘must know PRINCE2’, ‘must have worked with the MoD for the past three years’. So the idea that you’re opening things up to SMEs to come in and break up these big contracts, you’re just not seeing that in the contracts that are put out there by lots of departments.

And there’s no vetting of these tenders that are put out. They just go up.

The most recent sales data for the Digital Marketplace shows that £1.6 billion has been spent through the ‘store’ (November 2016). However, this is just for the G-Cloud framework, which supplies commodity services to the public sector, but there is very little transparency around the spending on the Digital Outcomes and Specialists framework.

GDS is supposed to approve all spend on digital projects over £100,000, but it was revealed by the department’s Director General, Kevin Cunnington, that this approach would be reversed in the coming weeks. Cunnington is in favour of “much more considered, continuous interactions”.

However, this does raise the question of how GDS is going to get buyers to change their behaviour, without controls in place. How is GDS going to build up buyer capability? Thornton said that the government needs to do more. He added:

We’ve been talking to quite a few contractors about doing business with government and using the Digital Marketplace. I think the Digital Marketplace is a welcome innovation, I think it has brought lots of new suppliers and opportunity to contract with government, with lower transaction costs than previously.

But it’s also clear that the Digital Marketplace isn’t being used in the right way. People are putting out tenders that shouldn’t be there. What I think we are going to be saying to government is that they need to start having a bit of vetting of the stuff that goes up in the Digital Marketplace.

They need to work harder in getting the departments and agencies to understand the standards you set and have you comply with them. The government’s policy is that they want to bring more SMEs and innovation into government, with these contracts – but how are they actually going to do it?

Thoughts on the Strategy

Thornton also had some thoughts on GDS’ recent Transformation Strategy, which had been delayed for several months, but outlines how the government’s vision up until 2020. As many have noted, Cunnington’s strategy is for more conciliatory in its approach compared to his predecessors, but there were also few targets or ambitions included that could be measured.

Thornton said:

I think the strategy did have a change of tone from the previous strategy in 2012, it focused on transformation, rather than ‘the answer is digital, the answer is agile, and we are going to build it all ourselves’. There was much more of a focus on working with suppliers and a view that not all legacy is bad. I think the new team is more pragmatic.

However, Thornton added that if you search for £ signs in the document, you don’t really find any. And that there was no allocation of funding at all in the strategy, which he said was a “problem”.

Thornton suggested that part of the problem with GDS getting departments and the wider public sector to adopt its standards and ways of working is that the new Prime Minister and Chancellor of the Exchequer aren’t as supportive of the digital agenda, compared to their predecessors David Cameron and George Osborne. This has an impact, Thornton said.

While it’s clear that the Bracken era did lead to new ways of working in many departments, new approaches to digital, some services being transformed, there is still a long way to go in terms of the standards that GDS has set reaching the far reaches of government.

We’ve been saying that it’s not enough for the Minister for the Cabinet Office to cheerlead this. It’s not enough for officials, however they good they are, to lead this process. George Osborne got this agenda and David Cameron talked about it and said it was an important part of what government was up to.

I think it’s the case that the Prime Minister and Chancellor have not said anything about the overall agenda. If you work in government, you pick up signals from what senior ministers say. Is this serious or not? Why do departments have to listen to GDS if the Prime Minister and Chancellor aren’t backing it?

My take

It was by pure coincidence that I happened to listen to Thornton speak this week and it just so happened that he raised concerns similar to mine about the Digital Marketplace. But it’s becoming clear that the problem isn’t with the marketplace itself, rather than buyers’ ability, or willingness, to comply with GDS’ new way of doing things. So, why does GDS then want to relinquish more control and argues that change has been embedded? It clearly has not.

GDS needs to come up with a clear strategy of how it is going to affect change within departments, build up buyer capability and enforce the standards it has set. At the moment, things are slipping and that is dangerous territory to be embarking on.

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    1. says:

      The article raises good points about sticking to the principles of the Digital Service Standard but I wonder if vetting contracts is appropriate? Surely depts have the right to say if they want a supplier to have had previous experience in a given area or discipline ie PRINCE2? Yes, contract values do need to be curtailed but this could be implemented as an automated process without the need for vetting. What this demonstrates is that departments aren’t getting the visibility they need into the strengths and weaknesses of suppliers. The move away from prescriptive service listing in G9 will hopefully go someway towards solving that by helping suppliers differentiate themselves.