The recent cancellation of FND and FND1 caused distress and much anguish in the sector.
Organisations had spent considerable time, effort and resources preparing for and finally submitting tenders. The financial loss will have lasting repercussions for many years, not least of which is the acknowledgment that contracts are now only as strong as their termination period.
For many, the only saving grace was the twelve month termination notice period negotiated by ERSA
The current Draft framework schedule has raised an uncomfortable problem which is likely to have a knock on effect on contracting and wider investment into the sector.
Schedule 4 Call-off Terms and Conditions
8.3 Break – The Contracting Body shall have the right to terminate the Contract at any time by giving three (3) Months’ written notice to the Prime Contractor.
8.4 Framework Agreement – The Contracting Body may terminate the Contract by giving written notice to the Prime Contractor with immediate effect if the Framework Agreement is terminated for any reason whatsoever.
………..
I do hope that ERSA is negotiating fervently on this matter as it was ERSA that had negotiated the 12 month termination period for FND.
Please bear in mind that DWP is very likely to negotiate/amend this….WHY?…. because they have stated that all documents are subject to change….
The Framework Terms and Conditions and Schedule 4-Call-Off Terms and Conditions. NB these Terms and Conditions remain in draft and DWP reserves the right to make amendments to them.
The 12 month termination period being scrapped is a great idea for the Government and taxpayer.
At current you have to send notice of poor performance, then meet with the provider, make targets, monitor it over 3-9 months, so the 12 month termination clause effectively gave a headache for the Government as its always ended up as 18-24+ months headway before they could take such action.
This meant providers like A4e could sit back and laugh it up. Their contracts were safe, even for fraud, up until it could be proven that fraud was “widespread” which wasn’t ever found to be the case.
I understand they are anxious at the lack of security – but 3 months is a fair period. 1) Poor performance (this is going to be at least 3 months to determine this), 2) notice for improvement and meeting to discuss (approx a month), 3) 3-12 months for the provider to prove themselves, and then worst case scenario, 4) notice of termination (3 months time).
Providers who cant give results to what they are paid for and BID for promising don’t deserve the contracts and someone better suited could deliver them.