Case studies

In our 2015 report on health and disability assessments, we recommended that the Department for Work & Pensions should develop an overarching commercial strategy. The subsequent Committee of Public Accounts report stressed the importance of considering different commercial approaches, particularly where competition is limited. Otherwise, the Department would not be well placed to deliver value for money if market interest fell. While the Department said it felt positive about finding multiple bidders, there were some indications this was optimistic given previous experiences.

Our 2015 report on the Home Office's E-Borders programme found that the Department had a more realistic strategy for its later programmes but needed to tailor its ambitions and prioritise its capabilities on projects with highest value. Programme delays and problems showed the knock-on effect of not having a realistic strategy and understanding complexities (see Figure 6). The commercial strategy adopted - a fixed price with deadlines that left detailed requirements open - caused later programme issues as the risk transfer between the Department and supplier did not work as envisaged.

We reported in 2016 that as part of HM Revenue & Customs' management and replacement of its Aspire contract to provide information, communication and technology services, it had developed a strategy to bring services in-house and improve its technical skills. The Department also assessed its skills and made senior technology appointments, filling 18 of 20 relevant posts permanently. This followed our 2014 findings that the Department recognised it had insufficient internal capability to challenge the cost effectiveness and suitability of its supplier's technical proposals.

Our 2016 report on Transforming Rehabilitation found the Ministry of Justice objectively tested the appetite of prospective bidders to accept payment by results for outcomes not fully in their control, and reflected this in its payment mechanism.

The Department for Work & Pensions designed its commercial strategy for the Work Programme (2014 report) to promote better outcomes and innovation. It reflected lessons from previous programmes (2012 report) which were introduced quickly and not based on strong assumptions.