1.23 GPT and Nortel bid on the basis of a five year period, but Racal stated they would require a minimum period of ten years. BT bid on the basis of a five year implementation contract, but also showed that they could produce greater savings if they were allowed a longer contract period. BT and Racal's preferred solutions involved managing the Department's fixed telecommunications for up to five years after implementing the new system.
1.24 In December 1995, the Department invited BT and Racal to submit further bids, known as Best and Final Offers, for a ten year contract period, as their assessments of the earlier bids showed that ten years offered the greatest savings. The longer period also allowed annual charges to the Department to be reduced as bidders would have longer to recover the costs of their investment required to implement the new system. The Department considered that ten years also allowed more scope for innovation than a shorter period and more flexibility than a longer period. In addition, this was a complex project requiring a three year period before the new form of service delivery was fully operational.