Digital Agency Bid, etc. Monitoring Committee (4th)

Overview

Date: Thursday, February 29, 2024
Location: Digital Agency Shared Conference Room
Name of Committee member (honorific title omitted, in alphabetical order):
- Ryota Kaneko, Professor, Faculty of Economics, Kokugakuin University
- Yoshiko Kawasawa, Representative Director, Social Policy Lab Co., Ltd.
- Yuichi Mochinaga Professor, Graduate School of Accounting, Waseda University
Period for deliberation: From April 1, 2023 (2023) to September 30, 2023 (2023)
Number of extracted projects: 3 (346 target projects)
Number of proposals deliberated: 3

Materials

Proceedings Summary (PDF/178KB)

Summary of proceedings

Contract with design development for the third phase of the Information Provision Network System Infrastructure

Serial number: 24-02-01
Contract method: General competitive bidding contract (comprehensive evaluation bidding method)
Counterparty: NTT Data Corporation
Contract amount: 9,988,803,000 yen
Agreement Date: May 19, 2023 (2023)

Comments and Questions	Answer
Regarding the fact that prior hearings are conducted before the submission of a Reference Quotation, to whom and specifically to what kind of person is the confirmation made?	When we talked to the four parties, they refused to submit a reference quotation at the first stage. In the end, the quotation was accepted from the two parties, and the bidding participant was one party.
What is the difference in price between the two parties to whom the Reference Quotation was submitted? Is the amount assessed?	When multiple quotations are obtained and the estimated amount is far from each other, confirmation is made with the business operator.
While ensuring competitiveness by conducting split procurement by nature, one party bidding has occurred even if it is split. Even if transition is made to the cloud, one party bidding will not be resolved unless a wide range of business operators are contacted and communicated. We hope that the system will be extremely rigid, competitiveness will be ensured, and the validation of price appropriateness will be continued.	All right.
If the first bid for the Infrastructure Support Services is made by a single bidder, it is expected that it will be difficult for another bidder to enter the subsequent related contract. Therefore, there is a possibility that the economic rationality of the subsequent contract will be lost. Is there realistic room for a party other than the bidder for the Infrastructure Support Services to participate in the bidding, as the procurement of the subsequent contract is scheduled for April 2024?	I think what we can do is to speak to them. On the other hand, since the scheduled procurement is for maintenance, it is an extremely difficult project without considerable internal knowledge.
One of the reasons for the unilateral bid is that' According to the hearings with the business operator who had obtained the quotation, it was difficult to secure sufficient staff to promote this project.' However, considering the current economic situation, it is assumed that this problem will not only always persist but will become increasingly serious in the future. Regardless of this project, we would like you to consider whether it is possible to clearly indicate in advance in the procurement Specifications or at the briefing session, etc., what can be dealt with flexibly, such as the business transfer period and the operation and maintenance start date.	All right.
The Group company of the Successful Bidder has also won the contract for the design development related to the second phase information provision network system infrastructure. Has the Group company accumulated technology and know-how?	It is difficult to understand the accumulation of internal systems and technical capabilities of business operators.
Rather than relying on the risk of relying on a specific group company or accumulating know-how on a personal basis, we would like to see the creation of a system in the future that will require the accumulation of know-how with multiple business operators, even if it is a one party bid, by increasing the performance and the allocation of points to Digital Agency so that organizational system can accumulate know-how.
Rather than relying on the risk of relying on a specific group company or accumulating know-how on a personal basis, we would like to see the creation of a system in the future that will require the accumulation of know-how with multiple business operators, even if it is a one party bid, by increasing the performance and the allocation of points to Digital Agency so that organizational system can accumulate know-how.
If only a limited number of companies are expected to participate in bidding, it may be possible to increase evaluation points by, for example, giving high evaluation points to new young engineers or sending a message to companies that actively secure a wide range of human resources.
As a result, this project has become a one party bid, but we believe that it will be possible to respond by devising the procurement Specifications while securing the appropriateness of the price. In order to build a better system amid the current situation in which know-how and rare human resources are gathered from all over the world due to the mobilization of human resources, we would like you to consider devising the procurement Specifications with expectations.

Fiscal 2023 Renovation of the Supervision and Supervision Support System

Serial number: 24-02-02
Contract method: Discretionary contract (planning competition)
Counterparty: FUJI SOFT INCORPORATED
Contract amount: 72,105,000 yen
Contract date: August 8, 2023 (2023)

Comments and Questions	Answer
While there are projects that have a certain requirement such as' The system must have a track record in the design development within the past three years', there is a demand for the promotion of participation in bidding by startups. Is there a policy to exclude low-cost bidders or to classify contracts and set standards for bidding requirements for each category from the security side as Digital Agency?	For the Agency, the performance with government agency, local government, and private sector is not regulated in the contract. Evaluation criteria are created for each project, and the project management team checks the specifications and evaluation criteria.
Is it normal for the actual number of years to be within the past three years?	In some cases, the number of years is not calculated if the business experience is similar to the actual performance.
If the actual results were limited to "two years in government agency," there would be a high risk that startups would be rejected from participating in the bidding. Therefore, what do you think about the fact that the three year period was discussed within the agency?	There are no clear rules.
The procurement related to this service is "Survey and Research on Data Management and Analysis of Government Information Systems" (2021) and "Set of Services for Modification of Supervision and Supervision Support Systems" (2022). The same operator has been receiving orders continuously, but another operator has received an order this time. Four operators have participated in the bidding for the procurement of this service, but are the operators contracted in the previous year included? In addition, if the technical points of the four parties are competing, competitiveness can be expected in the future.	Although there were four companies including the previous year's company, there was a considerable difference in the technical points of the four companies, and it is difficult to say that competitiveness could be expected.
Competitiveness seems to be secured because there are four bidding participating business operators. We would like to make efforts to ensure competitiveness in future procurement projects by following up with business operators with low technical points on how to read the specifications and if there are elements that lead to improvements on the ordering party side. In addition, since this project does not seem to have complex specifications such as design, which is the base, we would like to consider increasing the number of years of performance and widely evaluating the number of orders received not only from public organizations but also from private sector, as discussed earlier, even if we are using proposal type planning competition in anticipation of the entry of start-ups.	All right.
Among the elements with high technical points, there are efforts to prevent vendor lock-in and flexible responses to changes in user needs. Are there any notable contents?	As a vendor lock-in measure, each time a contractor changed, the system modification part became a splice, making it difficult for subsequent contractors to enter the system. The proposal to take a system configuration that can be handled on behalf of other contractors and create a document for it led to high points. As a measure to reduce the burden on users, in fiscal 2022, it was necessary to collect basic information on more than 1,000 systems compiled by the Supervision and Supervision Support System from PJMO and contractors over a three month period. While the information to be collected differs depending on the nature of the system, there were some parts that could not be responded to the needs of users, such as the fact that it is a little difficult to be flexible on the web form. However, we received a concrete proposal for a flexible design. In addition, it was evaluated that the content of the firm support in terms of operation was written more specifically.
As the government as a whole is working to expand the entry of small and medium-sized enterprises, including startups, I think Digital Agency has also been working to improve IT-related procurement. If there is no hindrance to procurement, it would be even better to consider relaxing the requirements such as performance. In addition, I feel that there are things that can be devised from the viewpoint of effectively and efficiently enhancing competitiveness. I would like you to continue to improve procurement activities for the future.

Fiscal 2022 Government Solution Service equipment maintenance set (5th change)

Serial number: 24-02-03
Contract method: Discretionary contract (change contract)
Counterparty: NEC Corporation
Contract amount: 232,905,299 yen
Contract Date: June 20, 2023 (2023)

Comments and Questions	Answer
The content of the change contract includes the purchase of a simple device that can be provided even by a person other than the maintenance service provider. If the appropriateness of the price has been validation, it would be more efficient to purchase the device under the change contract than to conclude a new contract. When purchasing the device, is the appropriateness of the price validation, such as obtaining a quotation from another service provider?	Although the official quotation is only from the contractor, we compare the general selling price on the Internet with the received quotation to confirm whether or not unreasonable pricing has been made.
Is the initial contract content and written specifications managed in an integrated manner by repeating the change contract? How is information managed in a unified manner?	In the contract, whenever a change contract occurs, necessary specifications are entered in the necessary parts of the original contract, operations to be performed are clarified, and corresponding delivery and operations are performed and managed.
Although there are some unavoidable parts, contracts in which changes are made repeatedly are different from normal contracts. Please note that accountability for the necessity of changes and the appropriateness of prices may be strongly required.	All right.
How many of the total number of contracts in Digital Agency are cases in which the amount of the changed contract is significantly higher than the amount of the contract at the time of the original contract? In addition, it seems that there are some parts that have to be changed due to changes in the circumstances of the other government agency because of the bulk procurement with other government agencies. What kind of policy will be issued and controlled for the entire Digital Agency?	The reason why there are many change contracts is the relationship between GSS and My Number. Digital Agency as a whole, in response to the advice of the Committee members, created the rules for change contracts in fiscal 2023, and set the number of changes per contract to be twice a year and the range of change amount to be not more than 40%. Regarding the relationship between GSS and My Number, it is necessary to explain the reason for the change, although it is due to unavoidable circumstances as a passive factor.
Since this kind of contract will not be made in the future, is it correct to understand that the contract will change as the way of leadership changes, because Digital Agency will design the entire thing, take the initiative to some extent, and manage the connection schedule?	Since it depends on the network procurement of each Cabinet Office and Ministry, there are cases in which it will not be known until the last minute, and irregular cases in which it will be dealt with sequentially from places that are politically urgent and have been coordinated, such as this case. However, we would like to implement it while setting a future outlook as much as possible.
Although the amount has been increased by the amendment contract, is it being used within the limit amount of the act of bearing national treasury obligations?	As business expenses, multiple cases are budgeted together for cash flow management. Since it is unknown when a change contract for an increase in the amount will be concluded, in order to reduce the contract amount, after the contract period for this equipment maintenance contract expires, general competitive bidding will be newly conducted for subsequent operations.
It seems that there is an uncertainty of national treasury expenditure to manage within the project cost. It seems that it is better to prepare by always explaining the whole picture and the validity of the price.	All right.
We strongly felt that we should be ready to explain the reason for the change, especially the appropriateness of the price, when making a change contract. Therefore, we would like you to proceed smoothly with the connection with GSS as soon as possible, and in that process, we would like you to proceed so that you can be accountable for the legitimacy of this procurement activity.
This is the fourth meeting of the Bid, etc. Monitoring Committee, but the content of the committee's discussions has changed significantly from the past. It seems that the committee has been able to discuss from the perspective of how to enhance procurement in operation and how to connect the know-how devised by everyone to the improvement of procurement activities in the entire Digital Agency. I understand that the GSS, which is the last agenda item of today, is difficult in terms of policy and how Digital Agency will take leadership in the existing system, but I think that Digital Agency's wonderful procurement is expected, including these. Therefore, I would appreciate if you could continue to advance your ingenuity and others.