Section one: Contracting authority
one.1) Name and addresses
H M Revenue & Customs
Customs House Annexe,20 Lower Thames Street
LONDON
EC3R6EE
Country
United Kingdom
NUTS code
UK - United Kingdom
Internet address(es)
Main address
one.4) Type of the contracting authority
Ministry or any other national or federal authority
one.5) Main activity
Other activity
Direct and Indirect taxation
Section two: Object
two.1) Scope of the procurement
two.1.1) Title
Core Business Platform Support and Maintenance Services
Reference number
SR685055970
two.1.2) Main CPV code
- 72416000 - Application service providers
two.1.3) Type of contract
Services
two.1.4) Short description
The contract is for business application support and maintenance services for a set of business-critical legacy HMRC applications. The contract includes options to provide decommissioning and application modernisation services for the business applications in scope. The purpose is either to decommission services during the initial term of this contract or prepare enduring applications and services to go to market in future. The contract will have a duration of 3 - 5 years.
two.1.6) Information about lots
This contract is divided into lots: No
two.1.7) Total value of the procurement (excluding VAT)
Value excluding VAT: £214,542,937
two.2) Description
two.2.2) Additional CPV code(s)
- 72250000 - System and support services
- 72261000 - Software support services
- 72262000 - Software development services
- 72263000 - Software implementation services
two.2.3) Place of performance
NUTS codes
- UK - United Kingdom
two.2.4) Description of the procurement
HMRC has awarded a contract to Capgemini UK Ltd to provide Business Application, Support and Maintenance (BASM) services for a set of business-critical legacy HMRC applications which are part of the Core Business Platform ("New Contract"). Prior to this Capgemini was the incumbent service provider to HMRC for these services (and other business applications, which are part of other replacement contracts or which are now decommissioned and no longer supported). This expires in June 2022 ("Prime Contract"). The equivalent services under the Prime Contract shall terminate when the New Contract takes full effect.
The services under the New Contract are: Business Application Support and Maintenance (BASM) services; and optional business application development and enhancement services, system integration services; strategy, architecture and feasibility analysis services and decommissioning services related to the applications, which HMRC can use on a call off basis.
The term of the New Contract is 3 years with two extension options of 1 year exercisable by HMRC. The consumption of the services for the legacy applications under the New Contract is planned to decrease over the contract term as some services are decommissioning, as a consequence of separate replacement Programmes which are already in-flight.
The legacy applications supported by the New Contract are either (1) services which are in the process of being replaced and will be decommissioned within the New Contract initial term or (2) services which are aging and require some form of consolidation or modernisation in order to mitigate technical risks and prepare for going to market in future.
HMRC has awarded a contract to Capgemini UK Ltd to provide Business Application, Support and Maintenance (BASM) services for a set of business-critical legacy HMRC applications which are part of the Core Business Platform ("New Contract"). Prior to this Capgemini was the incumbent service provider to HMRC for these services (and other business applications, which are part of other replacement contracts or which are now decommissioned and no longer supported). This expires in June 2022 ("Prime Contract"). The equivalent services under the Prime Contract shall terminate when the New Contract takes full effect.
The services under the New Contract are: Business Application Support and Maintenance (BASM) services; and optional business application development and enhancement services, system integration services; strategy, architecture and feasibility analysis services and decommissioning services related to the applications, which HMRC can use on a call off basis.
The term of the New Contract is 3 years with two extension options of 1 year exercisable by HMRC. The consumption of the services for the legacy applications under the New Contract is planned to decrease over the contract term as some services are decommissioning, as a consequence of separate replacement Programmes which are already in-flight.
The legacy applications supported by the New Contract are either (1) services which are in the process of being replaced and will be decommissioned within the New Contract initial term or (2) services which are aging and require some form of consolidation or modernisation in order to mitigate technical risks and prepare for going to market in future.
(1) Services which are in the process of being replaced and will be decommissioned within the New Contract term:
• Computerised Environment for Self-Assessment (CESA)
• The Pension Scheme Service
• Integrated Debt Management Service
• New Tax Credits
• Banking & Payments
(2) Services which are aging and require some form of consolidation or modernisation in order to mitigate technical risks and prepare for going to market in future:
• Inheritance Tax
• Employer Scheme Processing (Construction Industry Scheme Reform / Employer Compliance Service / Penalties and Appeals Service / Contact History Framework)
• Tactical Support Services
• Corporate Data Frameworks
• Security Services
• Student Loans Service
• Cross Border Tax Services (Complex Personal Tax Teams / Foreign Entertainers Unit / Non-Resident Landlords)
• Other small services / tools
Some of these applications will be replaced or consolidated allowing the legacy system to be decommissioned as part of the overall modernisation of HMRC IT. Applications which are enduring and will continue to remain in use at the end of the contract term will be modernised where possible.
The New Contract value is £214.54m. Payments are supported by service levels and service credits and are structured as a combination of fixed price support and maintenance charges and rate-card based charges for projects including decommissioning and application modernisation services.
two.2.5) Award criteria
Price
two.2.11) Information about options
Options: No
Section four. Procedure
four.1) Description
four.1.1) Type of procedure
Award of a contract without prior publication of a call for competition in the cases listed below
- The services can be provided only by a particular economic operator for the following reason:
- absence of competition for technical reasons
Explanation:
The services required by HMRC consist of the provision of Business Application Support and Maintenance (BASM) services; and optional business application development services, system integration services; strategy, architecture and feasibility analysis services and decommissioning services to support business critical legacy HMRC applications. The applications in scope are either (1) services which are in the process of being replaced and will be decommissioned within the New Contract term or (2) services which are aging and require some form of consolidation or modernisation in order to mitigate technical risks and prepare for going to market in future. The applications generate substantial taxes and revenue for the UK and a number of the applications are classified as business critical and therefore must be wholly reliable. It is therefore imperative that the support of such applications continue to be delivered safely and without interruption.
The award of the New Contract to Capgemini ensures the secure and continued support of the legacy applications whilst they are either decommissioned or undergo technical modernisation.
HMRC's assessment is that support services for applications which only have a time-limited life before they are decommissioned can only be provided by Capgemini. This is due to the increased technical risks involved during the migration of services to a replacement application and the decommissioning of all elements of the legacy application that requires a considerable level of in-depth knowledge and experience of the solution, which only Capgemini have because of their 18 years of supporting those services.
Due to the age and intricate interdependencies of the legacy applications which are deemed to require consolidation or modernisation, the support services for those applications, until they are modernised, can only be provided by Capgemini. These applications are a complex environment of small solutions which require extensive knowledge of HMRC's business processes to manage and some are also on aged technologies for which there is a reducing skills-base available. Modernisation is necessary to bring them to the required technical level and reduce inter-dependencies whilst preparing them for going to market in future.
As these are business critical tax and benefit applications, HMRC requires the secure and uninterrupted delivery of support to those applications and considers the award of the New Contract to be the only option for securing delivery of those services until they are either replaced and decommissioned or have been brought to a suitable technical state via consolidation or modernisation. The resulting contract enables HMRC to deliver on its strategic priorities to protect live services and deliver contractual flexibility to manage decommissioning. In parallel, HMRC will be able to work with Capgemini to prepare enduring technologies and services to go to market.
This is an award of a contract via the negotiated procedure without prior publication under Regulation 32 of the Public Contracts Regulations 2015. HMRC's view, having taken advice, is reliance on Regulation 32 is justified because services being procured under and for the term of the New Contract can only be provided by Capgemini because competition is absent for technical reasons.
Accordingly, HMRC concluded that for technical reasons HMRC would procure services under the New Contract which only Capgemini could provide and for which there was no reasonable alternative.
four.1.8) Information about the Government Procurement Agreement (GPA)
The procurement is covered by the Government Procurement Agreement: Yes
Section five. Award of contract
A contract/lot is awarded: Yes
five.2) Award of contract
five.2.1) Date of conclusion of the contract
21 March 2022
five.2.2) Information about tenders
Number of tenders received: 1
The contract has been awarded to a group of economic operators: No
five.2.3) Name and address of the contractor
Capgemini
Surrey
Country
United Kingdom
NUTS code
- UK - United Kingdom
The contractor is an SME
No
five.2.4) Information on value of contract/lot (excluding VAT)
Initial estimated total value of the contract/lot: £214,542,937
Total value of the contract/lot: £214,542,937
Section six. Complementary information
six.4) Procedures for review
six.4.1) Review body
HMRC
Plaza 2, Ironmasters Way
Telford
TF34NT
Country
United Kingdom