By Richard Johnstone | 27 January 2014
No government information technology contract should be worth more than £100m, according to Cabinet Office guidance intended to give smaller firms an improved chance of winning deals.
In rules published on Friday, Cabinet Office minister Francis Maude also set out three other ‘red lines’ for Whitehall IT deals, including an end to automatic contract extensions, and a stipulation that hosting contracts – such as for government websites – should not last more than two years. In addition, companies with a contract for service provision will not be allowed to provide system integration in the same part of government.
Maude said the changes were intended to encourage the widest possible range of suppliers to compete for public sector technology contracts and ensure government acts as an intelligent customer.
He said that smarter procurement had saved £3.8bn in 2012/13, with more focused IT provision saving an additional £500m in the year's efficiency drive.
‘Big IT and big failure have stalked government for too long; that is why this government is radically rethinking the way it does business,’ Maude said.
‘We are creating a more competitive and open market for technology that opens up opportunity for big and small firms. These red lines will ensure the government gets the best technology at the best price and we will be unashamedly militant about enforcing them to provide value for hard-working taxpayers.’
