Cloud of suspicion: Why don't councils use G-Cloud?

Only about a quarter of local authorities plan to use G-Cloud next year, CRN research has found. Hannah Breeze finds out why

The government's flagship SMB-friendly IT framework G-Cloud is heading towards a "downward spiral". That is according to one of its suppliers who claims his firm and others are backing away from the framework because not enough public sector authorities use it.

Since it was set up in 2012, 76.5 per cent of the total £559m of sales put through the framework were among central government departments, of which there are just 24. The 433 local councils in the UK accounted for a paltry six per cent of the value, prompting some suppliers to call on the Government Digital Service (GDS) to do more to spread the message of G-Cloud beyond Whitehall.

In February and March, CRN sent Freedom of Information (FOI) requests to all 433 local councils and quizzed them on their involvement with G-Cloud. Some 168 authorities replied in the official four-week period public bodies have to do so, and the responses painted a bleak picture for G-Cloud's presence across the country.

Just 27 per cent of council respondents told CRN they had firm plans in place to use G-Cloud in FY15/16. Forty per cent ruled out using G-Cloud completely, and a cautious 33 per cent said they might consider it if it fits in with their own IT plans. Two per cent of those authorities that got back to us had no idea G-Cloud even exists, let alone what it does.

Good intentions
One of the government's key aims when launching G-Cloud was to level the playing field for smaller suppliers and break big-supplier monopolies when it came to government technology in both central and local government.

But according to Hugo Pickford-Wardle, CIO of G-Cloud supplier Matter, the changes the government made to the procurement process to make this happen have prompted local authorities to do the exact opposite.

"G-Cloud is trying to create fairness and stop corruption and do positive things, and in the process, dehumanise the [procurement] process," he said, pointing to the scoring and rating process which must be done to ensure supplier bids are assessed fairly. "It means a bunch of people [in local councils] who don't know about technology sales are involved in a procurement process where they are asked to rate things, but they don't have the base knowledge to be given a fair attempt at doing so. The people we speak to in the government sector are having to get their heads around an entirely new technical concept.

"Often [procurement chiefs] might be working in housing or social services, which is its own discipline, and they have to rate IT suppliers because they are part of an arbitrary panel and they have no knowledge underpinning the decision. It tends to end up getting done on price."

He said it is this process which - against the government's best intentions - is encouraging local councils to ignore frameworks such as G-Cloud and opt instead to go with bigger suppliers.

"I think GDS is fantastic and what has been happening in central government is fantastic in supporting SME specialists who can provide that value to government," he said.
"[But] I think the current system has totally backfired, really, because people are not using G-Cloud, suppliers are getting fed up with G-Cloud, and it is going into a downward spiral. It is very difficult [for councils] to even understand how to use it - very difficult."

Push in the right direction

CRN's research also found that 40 per cent of respondents said they had not been actively encouraged by the government to use the G-Cloud framework.

G-Cloud supplier Streamwire's CEO Anne Stokes, whose firm has not transacted any business through G-Cloud despite being an accredited supplier, said the few local councils that have adopted G-Cloud need to speak up.

She pointed to a government-sponsored initiative in the US through which federal organisations are officially recognised with an award for working with small and medium-sized enterprises in their supply chain.

"We need something like that," she said. "They need to have a look at the ways in which they can make [G-Cloud] more visible in terms of those organisations that can demonstrate it has worked well. [They ought to] showcase where... local authorities have worked with SMEs and it gives people more comfort that they are not the first footer."

Of those councils which did say they had been encouraged, some classed an occasional email or flyer as active encouragement. Ross MacMillan, market intelligence consultant at G-Cloud supplier Allpay - which has worked with two local authorities through the G-Cloud framework - questioned the effectiveness of such campaigns.

"Where are those emails going?" he asked. "Do they go to procurement heads? Are they getting to the right place?

"I think regular procurement events would be good. We just lack a few test cases or stories where a local authority has procured a service and passed on the merits to other authorities. [We need] events where authorities are invited to stand up and explain how easy it was."

But according to CRN's figures, of those councils that said they had been encouraged to use G-Cloud in the past year, just over a third (37 per cent) said they will actually do so in this financial year.

Matter's Pickford-Wardle said many local councils are reluctant to pursue G-Cloud for fear of setting themselves up for unwanted efficiency-based measures.

"A lot of them have seen part of what GDS is doing in central government and are probably worried about the impact it will have long term on local government," he said. "If you look at the numbers and the financial situation and you look at what digital can do... when you see that together with large deficits and money needing to be saved, I am sure there is concern in local government about the centralisation of those services, especially with the new government."

In a statement, the Cabinet Office told CRN: "We are working hard to increase awareness and understanding of the advantages of G-Cloud in the wider public sector. The Public Cloud First policy is mandated to central government and we strongly recommend it to the wider public sector."

We asked some public sector experts: What does the government need to do to encourage the use of G-Cloud and other SME-friendly frameworks among local authorities?

"I would really like to see the new government encouraging larger providers to engage with the SME community on a more strategic basis, working in partnership on tenders and delivering solutions. If this is implemented, and the big providers are committed to the SMEs they work alongside, local councils will reap the benefits of working with innovative and agile SMEs within a larger delivery team, and the SMEs will become more than just a name on a list." - Mark Evans, commercial director, Imerja

"The G-Cloud framework terms need to evolve to meet the needs of the market as a whole, introducing more flexibility to accommodate complex legacy and future requirements, and optimising the opportunities afforded by the new public contract regulations. The introduction of the Experian score as the sole means of determining a supplier's financial health in the G-Cloud 6 framework is very SME-unfriendly. I think the drafting needs to be revisited for G-Cloud 7." - Nicky Stewart, commercial director, Skyscape Cloud Services

"The new government needs to continue highlighting the benefits of G-Cloud and improve the CloudStore so that it is much easier to shop for products or services and purchase them. Our technology is user-friendly enough for frail and elderly people to manage and purchase their own care online, yet the CloudStore is still a ‘brochureware' site that is not transactional." - Ronald Duncan, chairman, cloudBuy