Modification of TRUSTnet contract

Concepts

• information technology
• trustnet contract
• modification
• trustnet
• miscellaneous networking
• post and telecoms
• software package
• postal and telecommunications
• transmission services
• overlay services

Location

London

Description

This VEAT notice relates to the proposed modification of the TRUSTnet contract between London Grid for Learning Trust (LGfL) and Virgin Media Business Limited (VMB) pursuant to Regulation 72(1)(b) of the Public Contracts Regulations 2015. LGfL proposes to extend the duration of the TRUSTnet contract for a period of 10 years from 2028 – 2038 in respect of the lease of dark fibre infrastructure procured under the original award for the balance of the useful life of that infrastructure. The modification will be limited to the lease and maintenance of the dark fibre cabling and will not include the additional services provided by VMB pursuant to the TRUSTnet contract. LGfL awarded a contract to VMB in 2014 for the supply and management of transmission services, including (but not limited to) leased circuits, dark fibre, wide area Ethernet and xDSL with bandwidths of 10Mbit/s and above. The dark fibre infrastructure, leased as part of the contract has a useful economic life of 25 years, extending considerably beyond the end of the current contract term, which ends in 2028. LGfL has concluded that it is necessary to modify the TRUSTnet contract to allow for the extended lease of the dark fibre infrastructure until 31 December 2038 because any alternative would be uneconomic and would cause significant disruption and inconvenience for users at a time when the users are already experiencing difficult cost pressures. LGfL has therefore determined that a limited modification of the TRUSTnet contract is necessary to protect the interests of the users.

Total Quantity or Scope

1. LGfL was established in 2001 as a Regional Broadband Authority by the 32 London local authorities and the City of London Council. It was established as a not-for-profit company and a registered charity, and is a body governed by public law. Its purpose is to provide broadband connectivity, Information and Communications Technology and related services to schools in London, LGfL’s ‘customers’. It currently provides essential services to over 3,000 schools providing education to more than 1.2 million students each year. 2. LGfL awarded a contract to VMB on 25 March 2014 pursuant to Contract Award Notice No. 2013/S 245-427165 for: a. transmission services, including (but not limited to) leased circuits, dark fibre, wide area Ethernet and xDSL leased circuits and wide area Ethernet services are typically required at bandwidths of 10Mbit/s and above; b. management services of the Core national, regional and to the edge premises equipment; and c. supply of telecommunication and telephone services. 3. The contract was awarded for a period of 14 years, subject to periodic contract reviews, and is due to expire on 24 March 2028. Services provided under the contract may continue for a further two years to facilitate transition to a replacement supplier. The dark fibre infrastructure supplied under the terms of the contract award has a useful economic life of 25 years. 4. The dark fibre network is owned by VMB and VMB is solely responsible for its maintenance and repair. It has become necessary for LGfL to extend the lease of the network until the end of its natural life, because a replacement supplier would have to lay new fibre cabling. This would result in material additional cost, leading to duplication of cost for LGfL by replacing fibre that is still operational as well as significant inconvenience and avoidable cost for LGfL’s schools and their students. In the latter instance, this would include disruptive works to lay new cabling within school buildings, playgrounds and/or playing fields. Furthermore, based on past experience of previous modernisation programmes, LGfL believes it is unlikely that network could be replaced within the existing transition period. 5. Therefore, LGfL has determined that a modification of the TRUSTnet contract to allow for a lease until 2038 is permitted under Reg 72(1)(b) both for economic and technical reasons (because an alternative contractor could not maintain VMB’s network and would need to install a replacement, which would be unaffordable and could not be completed within the transition period) and because an alternative would cause significant inconvenience and substantial cost duplication. The value of the extension does not exceed 50% of the value of the original contract. 6. The proposed modification will be limited to the lease of the dark fibre cabling, together with services for its repair and maintenance, for the remainder of its useful life until 31 December 2038. 7. The remainder of the services provided under the TRUSTnet contract, including managed services and monitoring overlay requirements, will be re-tendered separately in 2028. 8. The modification will enable LGfL to: a. exploit the fibre cabling for the full duration of its useful life; b. contract with alternative suppliers for the provision of overlay services over the dark fibre network; c. separate procurements for the provision of managed services and the provision of network infrastructure, thereby increasing the scope for competition on a fair and equal basis; and d. conduct a procurement for the replacement of the cabling under a timetable that will allow for the timely implementation of a replacement service. 9. LGfL has agreed the terms of a limited modification to the TRUSTnet contract but will voluntarily delay making that modification for a period of 30 days following the publication of this voluntary ex-ante transparency notice.

Award Detail

CPV Codes

• 72000000 - IT services: consulting, software development, Internet and support
• 48219000 - Miscellaneous networking software package
• 64000000 - Postal and telecommunications services

Indicators

Legal Justification

Regulation 72(1)(b) of the The Public Contract Regulations 2015 applies