4.22 Market testing is ineffective as a means of assessing the value for money of services which EDS wishes to retain or win because of the contractual requirements which require the Department to provide evidence that EDS prices are out of line with the market and which allow EDS to match the indicative market price if it wishes to do so. Only if EDS declines to match the indicative market price, can a formal competition take place.
Recommendation 16 | The Department should only use formal external competitions to test the market when it, and EDS, if it is contractually entitled to provide the service, are genuinely prepared to see the service being tested awarded to the bidder offering the best value for money. |