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G-Cloud 7 procurement rules could derail public sector cloud adoption, suppliers warn

G-Cloud 7 procurement limits risk putting public sector off using the framework, it has been claimed

The Crown Commercial Service (CCS) has been accused of attempting to stifle the public sector’s appetite for cloud, by introducing limits in G-Cloud 7 that will allegedly make it harder for buyers to scale-up their use of off-premise services.

Under soon-to-be introduced rules, framework users will be forced to re-tender via G-Cloud if they intend to buy additional capacity or services that will cost more than 20% of their original contract's value.

Industry body EuroCloud UK has described the move as an unnecessary piece of “time-wasting procurement bureaucracy” that serves to undermine G-Cloud’s over-arching aim to make public sector procurement simpler, faster and less costly.

“It is inevitable that this will deter buyers from using the G-Cloud framework, because it actively discourages the pay-for-what-you-use principle and will prevent buyers from achieving economies of scale as they roll out new cloud services,” said Neil Bacon, managing director of Global Introductions and a member of EuroCloud’s G-Cloud working group.

“Buyers are perfectly capable of assessing pricing for their potential needs when they make their initial G-Cloud evaluation. If a buyer has assessed best value across their expected demand parameters, whatever the scale increase, why force them to re-tender?”

G-Cloud suppliers speak out

The seventh iteration of the cloud procurement framework is set to go live on 23 November 2015, and in the run up to the launch a groundswell of disquiet among the supplier community has begun to grow in response to the new rules.

To date, this has seen several G-Cloud providers, including not-for-profit EduServ and Skyscape, outline their concerns about the move in writing to the Cabinet Office. Meanwhile, John Glover, sales and marketing director of cloud-based collaboration firm Kahootz, told Computer Weekly the new 20% rule will be unworkable.

"It has the potential to kill the whole premise behind G-Cloud as it takes us back to the days where buyers have to pay for IT licenses/services that they may never actually use," he said.

"The fundamental principle of a pay-as-you-go facility is totally wiped out and so is any thought of business agility." 

In a statement to Computer Weekly, Skyscape commercial director Nicky Stewart backed Bacon’s view that public sector organisations could stop using the framework altogether as a result of the change, which she described as a “retrograde step” that is at complete odds with the ethos of G-Cloud and cloud computing generally.

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“Cloud gives our customers the ability to scale on demand, to meet peaks in the business year, without having to pay for an infrastructure geared towards and costed for peak capacity. This delivers substantially efficiency and flexibility to our customers,” she said.

“Placing an arbitrary cap of 20% goes totally against the grain of cloud computing and G-Cloud, in particular, and may well drive buyers away from G-Cloud."

Computer Weekly contacted the Cabinet Office for clarification on why the 20% cap was being introduced, and was told the rules governing how the framework operates are regularly reviewed by the powers that be.

"G-Cloud has revolutionised government IT, with spend through the framework now reaching more than £800m – half of which is with small and medium-sized enterprises. We're always improving the framework to make it easier for suppliers and buyers to use and will consider this feedback carefully,” a spokesperson said.

Safeguarding G-Cloud's future

Phil Wainewright, chair of EuroCloud UK, told Computer Weekly he hopes the Cabinet Office treats the feedback received from EuroCloud and others as "constructive criticism" that is being offered to ensure framework continues to flourish.

"As G-Cloud is being pushed more into the mainstream of government procurement, the people coming into it may not have been involved in the founding of G-Cloud itself and are perhaps bringing some of these more old-fashined procurement concepts [to the fore] that are not approapritate in the concept of the framework," he said.

EuroCloud's G-Cloud working group was set up to help make it easier for suppliers to share their views about the framework with the powers that be inside the Cabinet Office and CCS in a more co-ordinated manner, Wainewright explained. 

While he hopes the decision to speak out will result in CCS rethinking its stance on the 20% rule, suppliers might have to wait until G-Cloud 8 is launched for any changes to take effect.

"It's a tender process so it may be difficult for them to make a change right now, although if they are able to it would be very welcome, but I think the more important thing we want to do is surface the fact there is widespread dissatisfaction with these changes," said Wainewright.

"We do feel there needs to be more engagement with the supplier community in future iterations, but we particularly want the CCS to consider removing this rule as early as possible, and certainly by the time G-Cloud 8 comes out."

In the meantime, Kahootz's Glover said – until the matter is resolved – he will be instructing his staff to avoid using the G-Cloud 7 framework.

"I would hope the CCS and GDS will be able to clarify this new extraordinary contract clause. Fortunately, as two G-Cloud iterations are live at any one time, I will instruct my sales staff to continue to use G-Cloud 6 as our preferred contracting vehicle."

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