Decision for the second stage roll out of the Connecting Devon & Somerset Superfast Broadband Programme


Posted on: 29 June 2015

Following weeks of discussions, the Connecting Devon and Somerset (CDS) Programme has been unable to secure a value for money deal, and BT has been told that it will not be awarded a £35m public-funded contract for the next phase of the planned superfast broadband roll-out.

CDS’ decision follows lengthy discussions with BT and BDUK – the Government agency responsible for the national broadband roll-out.

It emerged that BT could not meet the Government’s and CDS target of achieving 95% superfast broadband coverage by the end of 2017.

BT’s best offer does not meet the public value for money standards required under Section 151 of the Local Government Act.

Finance officers, who have a fiduciary duty to tax-payers, said the offer was high risk.

After seeking clarification from BT about their bid, the Connecting Devon and Somerset (CDS) Partnership has decided to reissue the tender for this work as an open procurement exercise.

The local authority partners of CDS are naturally disappointed on behalf of local residents and businesses that they could not agree a contract at this stage.

BT has said they would not be able to deliver the extent of superfast broadband required by 2017, prompting the partnership to re-engage in the market through an open procurement process.

CDS is the largest single superfast broadband programme in England and makes an important contribution to the Government’s national targets for the broadband roll-out.

In January this year Connecting Devon & Somerset announced its plans to publish a tender for the second stage of its Superfast broadband programme, which will bring a further £45m investment, and hoped to increase broadband coverage to at least 95% across the region.

As well as an open tender covering the Exmoor and Dartmoor National Parks, the results of which will be announced next week, CDS also issued a tender for the rest of the area using the national government procurement framework, through which BT responded.

Councillor David Hall, Cabinet Member for Somerset County Council, said:

“This is a huge disappointment for us.  BT has let the County Councils down, they have also let the Connecting Devon and Somerset Partnership down, and worst of all they have let residents, communities and businesses in Somerset and Devon down.

“We have a duty to seek best value for all our residents and their tender for the next phase of the programme was just not up to scratch.

“We are aware of the importance of Superfast Broadband for all our residents, but we also needed to make sure that we get value for money on behalf of our taxpayers.

“In taking this action we have acted in the best interests of those who live and run businesses in the region and we will now do everything we can to minimise the delay this causes to the programme.

“CDS will issue more details once timescales for a new procurement are confirmed.   CDS will continue to work with BT on the delivery of phase one of the programme to meet the Government’s target of 90% coverage by the end of 2016.”

Councillor Andrew Leadbetter, Cabinet Member for Devon County Council, said:

“I feel let down by BT and their lack of ambition, as well as their unwillingness to negotiate a good deal for the residents and businesses of Devon and Somerset!

“What they were offering did not represent good value for money and would not have addressed the issues of providing universal provision.

“I am only too well aware of how important good broadband connections are to our rural businesses and residents.  But we’re committed to delivering value for money for our residents in everything we do.

“In all conscience we couldn’t sign up to this new deal because it just didn’t deliver.  We are, however, still on track through the first phase of the project.  We will now go to an open procurement process without delay. I am determined that this should be done as quickly as possible.”

2 comments on “Decision for the second stage roll out of the Connecting Devon & Somerset Superfast Broadband Programme

  1. Robert Atkins says:

    I am a public procurement tender specialist. I cannot claim intimate knowledge of this matter, but large organisations such as BT have been known to squeeze out smaller firms during the pre-bid period. Often they embark on contracts knowing that they will not be able to deliver 100%. I suspect that they way forward may be to break the work up into package sizes manageable by smaller bidders and award several contracts. Clearly this will require more management effort by CDS but it may be possible to recover at least some of the program slippage. Value for Money is about more than just selecting the cheapest bid, quality and timeliness of delivery must also be considered.

  2. Graham Long says:

    In this Press Release, Messr’s Leadbetter & Hall seem to have forgotten than it was £22.75M that BDUK allocated to CDS in January 2014 for the SEP Phase 2 programme. Fully matched this would produce £45.5M, not £35M. It is not surprising therefore that BT refused to supply 95% coverage for £10M less than it was understood would be required, 18 months ago. What is more, having abandoned an open market tender process for Phase 2 last November in favour of negotiating an exclusive contract with BT, the CDS Board have now failed to agree that contract and believe they have the right to just go back to where they were last November and start all over again.
    CDS abandoned the 26 suppliers who attended the Phase 2 bidder day last November such that they were then not even allowed to put their bids on the table. If I was a supplier, I would not touch a new open tender from CDS with a barge pole! What this means is that the CDS Board have wasted the best part of a year on an abortive contract negotiation with BT and now talk about achieving only 95% coverage by 2021/22.
    Devon and Somerset will be the worst served counties in the UK for fast broadband. We are already the only counties not to have a Phase 2 contract in place….with the exception of the two National Parks for which a Phase 2 broadband contract is now in place at a public cost of £4.6M. This would explain some of the missing £10M, but spending such a large sum on the 3% of the Devon & Somerset’s population that live in the National Parks, has it seems, contributed CDS to not having enough funding for the rest of the two counties.
    It is also known that many District Councils have for months been telling the CDS Board that they would not contribute towards Phase 2 match funding if CDS would not tell the District Councils which of their Council Tax payers would benefit from that investment and when they would benefit. Since this information has not been provided to the Districts (at BT’s insistence, it is believed) it is not surprising that they will not “play ball” on the match funding. All of this cannot be a surprise for the CDS Board.
    Rather than simply assuming they can start all over again, because their chosen exclusive supplier, BT would not deliver a £45M contract for £35M, they should look at themselves. Specifically, the two Board chairmen, (Messr’s Norrey and Flaherty) and the two lead Councillors, (Messr’s Hall and Leadbetter) are now responsible for the fact that rural taxpayers in Devon & Somerset may have to wait another 5 or more years for a fast broadband service. They do not have the right to simply assume they can start over again with another open tender process as if nothing has happened.
    The Devon Place Scrutiny Committee needs to investigate this fiasco with urgency and the CDS Board needs to be disbanded and replaced by a new Board comprising people who actually know what they are doing. Only by taking this action before any new open tender process is started will taxpayers and suppliers have confidence that Connecting Devon & Somerset can deliver a Phase 2 Superfast Broadband programme .

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