A report published today reviewing the procurement of the National Roads Telecommunications Service (NRTS) has criticised its cost and procedures.
The Highways Agency signed the ten-and-a-half-year NRTS contract to upgrade, operate and maintain the telecommunications systems along the English motorway network with provider GeneSYS in September 2005 on behalf of the Department of Transport.
It aimed to complete the procurement in 21 months for a cost of 3 million. But the Public Accounts Committee (PAC) found the actual procurement took over five years to complete and cost 15.5 million in advisers' fees.
"Most of the additional time and cost was incurred in meeting the Agency's requirements for high quality bid documents," stated the report.
As a result, it also concluded that the upgrade work, which took two years, had been delivering benefits for road users since October 2007, in line with its original objectives to improved traffic monitoring and travel information.
But the Committee said the 17-month shortlisting procurement period was too long and discouraged potential bidders.
It added: "The agency never had a clear idea about the time and cost needed to complete the procurement. In every updated forecast, the agency's revised budget and timetable were optimistic, often by considerable margins."
The committee also expressed concerns about the accuracy of Public Sector Comparators costings where the calculations underpinning this allowance did not follow best practice and gave a single figure estimate, rather than a range.
It also said the agency should provide enough staff to ensure that its management controls function as intended in future after concluding that the agency did not deploy effective controls over the work of its advisers, who cost 250,000 a month.
"These individuals had insufficient time available to implement effective controls to ensure that advisers conducted their work efficiently," the report said.
Overall, the PSC report found that the NRTS had helped improve road user information, but it should carry out an audit of the contract benefits halfway through the contract term to ensure better value for money.
