Agenda item

Report of the Deputy Chief Executive (People)

The Cabinet considered a report of the Deputy Chief Executive (People) that sought approval for the procurement of a new three year contract to appoint a reseller for the renewal of the Council’s Microsoft Enterprise Agreement (EA).

The EA was a volume licensing agreement that allowed the Council to legally access all of the licenced software products obtained from Microsoft. These products included Windows, Office 365 (including SharePoint and OneDrive) and the licensing for all back-end infrastructure supporting the systems in use across the organisation.

The maximum licence period for the EA was three years and the Council could not procure direct from Microsoft. For this reason, the Council engaged with a Microsoft reseller for transacting the EA. The Council’s current reseller is Bytes Software Services Ltd, the existing 3 year EA transacted through them expired on the 31st March 2019. 

ICT had been working with Microsoft and Bytes to audit the existing EA to ensure the Council only purchased the number of licences required for the new agreement.  The Council’s requirements had not changed significantly but the cost price had increased since 2015. The current indication was that the like for like renewal would be £1,073,000 per annum which represented a 30% increase.

Since the previous EA was procured, the Council had also taken the decision to move it’s corporate telephony solution from Mitel to Microsoft Skype. Skype licences could be procured as part of the EA agreement, so this cost, which equated to approximately £365k per annum for the new contract, would also be added to the new EA. Work was underway regarding procuring a specific telephony solution for the Customer Service Centre, the new solution would be in addition to Skype for Business therefore the potential costs for that, sat outside the scope of this report. The indicative total at the time of this report for the EA was £1.4m per annum (£4.3m for the 3-year contract).

Microsoft had confirmed there would be another 6% increase to its public sector pricing in October 2018. The Council had agreed an extension to this deadline to allow for further audit work to be concluded. By committing to the new EA before the 30th November 2018, the Council would avoid a further £86k per annum approximate increase in cost.

Although the Council were not in a position to compete for an alternative licence, it could still compete the spend to appoint the reseller. By completing a further competition through a national procurement framework, it would ensure it paid the lowest possible margin whilst giving compliance to its spend.  The resellers also offered added value to the Council in terms of auditing its requirements and offering guidance and support as required.

Procurement intended to complete the further competition under Kent Commercial Services (KCS) Central Buying Consortium (CBC) Software Products and Associated Services framework (Y170358) Lot 1 - Microsoft.  The framework had several approved Microsoft approved resellers including ther Council’s existing reseller Bytes that would allow for a competitive procurement process.

RESOLVED that the Cabinet:

1)  Authorises the procurement of a new three year contract to appoint a reseller for the renewal of the Council’s Microsoft Enterprise Agreement.

2)  Delegates authority to the Deputy Chief Executive (People) and Director of Finance and Corporate Services to agree the award of contract(s) following the procurement process.