2.19 ICL's original bid was cheaper than a Public Sector Comparator prepared by the Department (Figure 11). Its raised bid was much closer to the Comparator, which the Department had adjusted for some underestimated costs. But the Public Sector Comparator was not really comparable at all since it did not seek to match the solution offered by ICL. In particular it did not provide the centralised fully managed service proposed by ICL (which would have been impractical for the Department to deliver) but was based on local management of the system in Magistrates' Courts Committees.
2.20 In the absence of competition it is difficult to demonstrate that any offer from a single bidder represents value for money. A "should cost" model is therefore often used to measure the reasonableness of the cost of all the elements of the solution that a bidder is offering. Such a model permits direct comparisons with a single bidder's estimated costs and provides a basis for challenging them. But access to the bidder's financial model is essential to the development of a should cost model. When the Libra procurement was taking place, Treasury Task Force advice was that the procuring Department did not need to examine the bidder's financial model if the bidder was funding the project from internal sources. The Department was only given sight of ICL's financial model at a presentation and had no copy. It was therefore unaware of the detailed make-up of ICL's costs.