Apologies for another boring 'political (ish)post' but.....

...does anyone here have any insider knowledge how governments calculate cost 'savings' when awarding contracts?
I ask only because of the furore over awarding a contract for the printing of the new passports.
Amber Rudd states the French company will be £100m cheaper which suggests that either:

a) The potential redundancy payments, future benefits payments for the 450 or so laid off plus all the other costs to the economy of a firm downsizing or going bust has not been included in the calculations OR....

b) The UK company currently used is so grossly inefficient and charges 'way over the odds' for the product that adding all those indirect costs still makes the change in supplier cheaper.

I find the latter hard to believe given that a) will be a very high cost to the taxpayer overall (not to mention the not so trivial matter of loss for all the wprkers, their families and suppliers in the affected community

Also not sure how long the contract is awarded for so I am unclear as to the length of time involved to make these savings. Slightly suspicious of the motives for awarding this contract given the political storm taht was bound to arise from such an insensitive decision in teh circumstance.

Without the usual political slagging off of any party can anyone explain how the treasury arrives at the final figure since many decisions never seem to take into account the hit on the social welfare budget when arriving at a cost benefit analysis never mind the ongoing Social cost to individual communities.

 

I have some limited experience of tendering for supply of nhs medical equipment. Cant see the process being hugely different. I would imagine an invitation to tender would have been issued via the European Journal.
A £100m difference is a huge amount.

Was the UK supplier banking on a patriotic, benevolent response from Govt and consequently inflated his price? Just a thought.

 

Am I vain in the hope that the saving will be passed directly to passport holders and I will see a reduction in cost the next time I purchase one?

 

Having some public sector experience Tekktyke, I'd be surprised if a detailed cost-benefit analysis such as you suggest was undertaken. You'd have thought that the obvious potential for another brexit 'bad news' story would have made them think carefully about this one. I'm just glad we renewed ours last year, so they will proudly state 'European Union' until 2027. By which time we may well be back in!

 

That is ridiculous and almost bordering on negligence. Surely all short medium and long term costs should be factored in to any costings when awarding contracts using taxpayers money rather than just the headline figure. So, theoretically a Govt decides to give a contract to an overseas company that would mean a factory of 1000 employees all being made redundant. The cost of losing 1000 employees contributing tax and NI to the coffers , loss of Corporation tax and benefit payments to the unemployed, loss of earnings for local suppliers, shops etc do not come into the equation?
Sheesh!!

Fat chance!!!

 

Unfortunately pal, yes you are.
What a sad reflection on today’s society when this so called saving can just be swallowed up into the abyss whilst the average joe may be looking at redundancy.
If there are inefficiencies then it’s not average Andrews fault who did a typesetting apprenticeship to originally get him the printing job.

 

If the boot were on the other foot there isn't a cat in hell's chance the French would have a UK company making them.
The incompetence of our current government beggars belief.

 

I may be wrong but I suspect that, until we exit the EU, we're bound by a requirement to open the bidding process to any companies based in the EU. Once we exit that's no longer a requirement but from day 1 of the date we exit there'll be a requirement to issue the new style passports so the mechanisms need to be put in place in advance of our exit day which means the bidding process is subject to EU rules.

 

You only have to look at current outsourcing in the Public services to see examples of poor quality service being rewarded with further and more lucrative contracts. G4S in Prisons.The Eastcoast rail fiasco. I remember one in particular in the DWP, whereby after a mammoth ****-up. DWP staff we’re brought back in to sort the mess and after that the company we’re awarded another contract.

 

https://www.telegraph.co.uk/news/20...se-making-postal-applications-1250-expensive/

 

Generally speaking what you can apply to these things under the Tories is that they “know the cost of everything and the value of nowt”

See closure of “uneconomic pits” etc

 

It's quite easy for these foreign company's to tender a cheaper offer and then start ramping the prices up and clawing back the 100m that they quoted less?

 

No - the French specifically exclude these from EU legislation on the basis that printing of passports has national security implications.

Andrea Leadsome wading in telling us we're subject to EU procurement legislation boils my piss

 

Especially when all their fixed costs are covered by their domestic production of their own passports - they can mariginally cost or "dump" as it's known outside the confines of the EU - then once the competition has gone out of business and lost the skill sets - up goes the price..

Economics of the madhouse this EU ******** - can't wait to be out of it.

 

So we can have government departments looking to shift jobs overseas (Poland/India) instead of the UK to save money. Can't go into details, but it will be very embarrassing for a leading Brexiteer when it comes out.

BTW De La Rue are one of the largest printers of bank notes in the world, including the new £5 and £10 - at least some of which are printed in Canada.

 

It's a pity we can't outsource the cabinet, I'm sure Wayne in Bangalore can do a better job the current foreign minister for 1000000th the cost

 

Thanks for the considered replies, although I find it depressing that there was no reassurance that my suspicions are wrong and total costs to outsource abroad fail to take into account the loss of employment in the UK and therefore taxes revenue falling (and with the double whammy of increasing the benefits budget outgoings).

It's bad enough making such a basic financial error but it doesn't even consider the social cost - evidenced by the Pit closures and the farce of no real 'Exit Plan' but simply replacing skilled jobs (mining) with low paid call centre jobs. Without dwelling on it, personally I am glad to see the end of deep coal mining but not the way it was done, with no exit plan and the destruction of close knit communities which have never really recovered.

Even if they did not give a sh*t about the societal damage they caused, you would think something so fundamental as the adverse impact on the economy overall would not be beyond the comprehension of the mandarins in the Treasury. Alas...........!!

EU rules can be, and often are in places like France Germany and here in Italy, circumvented. Only Britain seems to be determined (and ALL Governments do it) to play a 'straight bat'. It must be in our national psyche. Many countries take a pragmatic approach to EU rules and bend them and, in some cases, ignore them entirely.

PS I need a lie down now as I find myself in total agreement with Redstar in post 12) (and in spite of being accused of being a Tory Boy and worse by the likes of Red Kestrel). I have often used exactly the same phrase (particularly during the Thatcher years ).

 

There was a bloke on here the other day who said he could do it really cheap. I think he might print his money in china though.