Programme Delivery Model
Broadband Delivery Programme
13.4 Procurement terms
BDUK needs local broadband projects to deliver the Broadband Delivery Programme‟s objectives through the individual projects‟ respective procurement processes. BDUK will provide local bodies with support and assurance through the procurement process in order to achieve this aim.
In order to have confidence in an individual project‟s ability to meet the Programme objectives, and to ensure a project can be approved for State Aid (in particular under a BDUK umbrella notification), BDUK will require some minimum requirements for the local bodies‟ procurements.
Potential suppliers are also seeking a high level of consistency from the pipeline of work, so BDUK will also strongly recommend some requirements for the procurements too, where they create a better competitive environment or where BDUK believes they will achieve a better value for money outcome for projects.
BDUK anticipates that each local body will typically describe their requirements and commercial terms in a way that achieves the following outcomes / outputs:
Ensure the availability of wholesale services to minimum service levels (including the end-to-end infrastructure) to various locations or proportions of households in the area – the mix of locations and various service levels will be location specific;
Ensure the availability of affordable residential and business offerings from retail service providers, accessed through an open wholesale platform;
Ensure the availability of benchmarked standard backhaul and open wholesale access products from nodes in suppliers‟ solutions and at required locations (e.g. public sector locations or sites for Broadband Community Hubs);
Ensure minimum and recognisable quality standards are met in order to maximise the chance of takeover and the ongoing continuity of service should a network operator fail or seek to exit the market;
In some instances, provide connectivity to public sector locations as part of a public sector enterprise network requirement;
The level of public sector subsidy will be fixed in the contract and payable at points upon assured completion of the network offering availability at the required service levels, in order to transfer design, integration and delivery risk to the private sector;
The level of public sector subsidy may be independent of take-up, in order to transfer the market success risk;
The supplier will provide sufficient financial transparency such that excess subsidy to create a sustainable business case can be recovered through claw-back (e.g. higher than anticipated take-up);
The suppliers‟ wholesale pricing to be under benchmarking and / or other price controls for at least 7 years to ensure a monopoly provider position is not unduly exploited; and
Broadband solutions to be commercially sustainable after the initial implementation stage, i.e. to not require ongoing public subsidy.
Bidders are expected to differentiate themselves and their solutions on several aspects that should be reflected in a local body‟s evaluation criteria for a procurement:
Design for „day one‟ coverage and speed improvement for the premises passed;
Cost and potential capability of future upgrades from the deployed architecture, including extent to which it meets communities‟ aspirations for incremental expansion;