The Victorian Government is currently assessing the performance of its $461 million suite of whole-of-government telecommunications contracts in the lead up to a possible approach to market to renew the arrangements.
The contracts have all been signed as part of the Whole of Victorian Government Telecommunications Purchasing and Management Strategy (TPAMS). The eight year strategy, which comprises of the Telecommunications Carriage Services (TCS) contract, the Victorian Office Telephony Services (VOTS) contract and Whole of Victorian Government Internet services panel, is currently under review.
“The Department of Treasury and Finance is currently conducting a thorough analysis of existing arrangements and market intelligence, which is [to be] completed prior to announcing the TPAMS direction to the market,” said a spokesperson for the department.
The largest of the TPAMS contracts, the TCS contract, is due to expire in September this year, and a fresh approach to market would give any telecommunications providers previously locked out of this market the opportunity to re-capture Victorian Government telecommunications business.
The contract covers all fixed voice, mobile and data services. Recently published contract details have revealed that $385 million in fixed voice and mobile service contracts were signed under the arrangement over its eight year term.
They have also revealed that Optus won $300 million in contracts for fixed voice services. For the provision of mobile services, Optus also won $30 million worth of contracts, whilst Telstra won $55 million. No pricing information relating to data contracts (which were awarded exclusively to Telstra) has been released.
Another component of TPAMS is the Victorian Office Telephony Services (VOTS) arrangement, which has seen NEC Business Solutions provide the Victorian Government with $61 million worth of telephony and related facilities management services.
Contract details on the Victorian tenders website show that the initial approved value for VOTS stood at $34 million, $27 million less than the final value. The VOTS arrangement is due to expire on 30 September 2012.
The final TPAMS component, the Whole of Victorian Government Internet Services Panel, was valued at $15 million on the Victorian tenders website. The panel consists of four providers: Pacnet Australia, EFTel Limited, Optus and Netspace (now iiNet), and will expire on 11 February 2012.
In accordance with the TPAMS Head Agreement, which is an evergreen contract, all signed TPAMS contracts and arrangements between agencies and suppliers will continue under the same terms, conditions and pricing even after the expiry of these contracts, until either the supplier or the procuring agency chooses the terminate the contract.
This means that it is possible that all business conducted under TPAMS will continue as usual until the Strategy’s lead entity, the Department of Treasury and Finance, determines the future direction for procurement of telecommunication services for the State.
According to a media release issued in September 2004, TPAMS is a purchasing arrangement aimed at increasing agency bandwidth capacity, enhancing service delivery and reducing telecommunication service costs.
“This outcome will enable Government to significantly re-invest in its telecommunications services after signing deals for fixed voice, data and mobile services,” said the then Victorian ICT Minister Marsha Thomson in 2004.
Established as a new national pricing benchmark for government telecommunications use, it was expected that TPAMS would save the Victorian Government $73million over five years in telecommunication costs.
Aside from costs, time would be another commodity saved through TPAMS. The Strategy enabled all Victorian Government agencies to acquire telecommunication services without the need to establish a formal tender process. Agencies instead use a tendering process that is specific to the TPAMS arrangement, fast-tracking the turnaround time for all service contracts obtained under the agreement.