The Crown Commercial Service (CCS) is accused of sending mixed messages to non-UK-based cloud service providers that want to participate in the UK government’s G-Cloud procurement framework.
The closing date for supplier applications for the 14th iteration of the cloud purchasing agreement passed on 7 May 2024, with CCS targeting an autumn 2024 start date for the framework.
As stated in CCS’s own “Applying to G-Cloud” guidance, suppliers do not need to be based in the UK to participate in the framework, but Computer Weekly is aware that a handful of overseas tech suppliers ran into difficulties when pulling together their applications for G-Cloud 14.
In the lead-up to the application deadline, CCS invited prospective suppliers to use its Clarification Questions portal to raise any queries they had about how to apply for a place on the framework.
A copy of the Clarifications Questions raised with CCS, shared with Computer Weekly, reveals a recurring concern – raised by five separate non-UK-based suppliers – about not being able to complete the G-Cloud application form because they do not have a non-UK VAT number.
“We are in the process of completing a G-Cloud 14 application to sell cloud software service. We have created an account and started the application process and needed some clarification on the VAT section of the application,” wrote one prospective supplier.
“We are a registered company in Australia with a valid Australian company and Australian tax identification number. We do NOT have offices in UK or EU and subsequently do NOT have a registered VAT number.”
They continued: “The VAT section of the application form is mandatory and we are unable to proceed without a valid VAT number.”
In response, a CCS representative confirmed the supplier would not need a UK-based VAT number to participate in G-Cloud and could use a non-UK one instead.
A similar question, posted by a US-based supplier, also sought further clarification on whether they could apply for the framework without being a UK registered business or having a VAT number, to which CCS responded: “Yes – the Digital Marketplace has been updated so you can enter your non-UK VAT number.”
Computer Weekly understands, however, that in the wake of the deadline for applications passing, overseas applicants have been contacted by CCS and told they will be precluded from participating in the framework unless their company has a UK VAT number.
The change has since been confirmed by a mailout sent from CCS on Monday 20 May to prospective suppliers that states “all non-UK suppliers are required to be VAT registered” if they are based outside the UK and supply any goods or services to the UK – or expect to in the next 30 days.
“Please provide your VAT number … by 1st October 2024, or you may be deemed non-compliant,” the mailout concluded.
When Computer Weekly contacted CCS for comment on this story and asked the organisation for the reason behind the U-turn, we received the following comment in response from a CCS representative.
“G-Cloud 14 Lots 1-3 is currently a live procurement which is being managed in compliance with the Public Contract Regulations 2015,” the representative said.
“CCS cannot comment on individual applications but if there are issues identified during the compliance process CCS will follow the process described within the published tender documentation in order to deal with them consistently.”
Speaking to Computer Weekly, Nicky Stewart, former ICT chief at the UK government’s Cabinet Office, said the shift in stance from CCS would leave some suppliers confused.
“All of the three [UK VAT application] criteria need to be met – including the one that states companies must ‘expect to supply in the UK within 30 days’,” she said.
“With the framework not live until at least October, some of the overseas applicants may have no expectation to supply into the UK before that date. Where does that leave them?”
The situation is the latest in a series of issues that have dogged the procurement process for the latest iteration of the G-Cloud framework and seen CCS come in for criticism on multiple fronts.
For example, the government’s procurement arm was accused of pricing small and medium-sized enterprises out of participating in the framework after announcing plans to hike the amount of insurance suppliers need to participate in it by £20m. It has since revised down the amount of insurance cover suppliers need in response to a backlash against this requirement.
Complaints were also raised about how poorly worded and difficult to follow the data protection documents associated with the purchasing agreement were, although CCS vowed to correct this at the time. A reworked version was published six days before the G-Cloud 14 application window closed.
