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Central Bank did not tender contract worth up to €58m


Contract: The Central Bank has faced questions over tender process. Photo: Jason Alden

Contract: The Central Bank has faced questions over tender process. Photo: Jason Alden

Contract: The Central Bank has faced questions over tender process. Photo: Jason Alden

The Central Bank awarded an IT contract that could be worth €58m without putting the work to tender, the bank has admitted.

In September, minutes released of a Central Bank Commission meeting confirmed the Commission’s approval of a large new IT contract to an Irish subsidiary of DXC Technology, Global Entserv Solutions Ireland Ltd.

The Irish Independent first reported that the contract had been awarded without being put to tender.

Now, new documents released by the Central Bank show that the maximum value of the contract with Global Entserv Solutions Ireland Ltd is €58m.

Global Entserv Solutions Ireland’s parent firm, DXC Technology is a global IT firm listed on the New York Stock Exchange (NYSE).

A spokeswoman for the Central Bank said yesterday that the potential €58m cost represents the total estimated potential spend under the contract including all options and potential extensions.

She stated that the contract with Global Entserv Solutions Ireland is for a two-year period with the option to extend the term by two one-year periods if required.

“The total projected value of the contract over two years is €29.73m. It is envisaged that a competitive tender procedure for future services will be issued in 2021 and completed within the 2-year timeframe,” she said.

The spokeswoman stated that the new contract came into effect upon termination of the previous contract on November 17.

She stated: “On a like-for-like basis, the annual costs are reduced by 13pc under the new contractual terms.”

Last year, Global Entserv Solutions Ireland received €15.72m in payments from the Central Bank. It received €15.66m from the Central Bank in 2019.

The spokeswoman said the contract had not been tendered due to the pandemic and that it had been awarded without a competitive procedure on grounds of extreme urgency.

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She stated: “A competitive tender for services of this nature requires significant effort and time to complete and also requires stable market conditions to ensure receipt of qualifying responses.”

She explained: "While the Central Bank had commenced preparation for a competitive process, the onset and impacts of Covid-19, both on the organisation and the market, meant that completion of this process was unachievable in the time available."

She stated that the services to be provided by Global Entserv Solutions underpin and support all aspects of critical IT operations, IT delivery, and IT security at the bank and are delivered to industry standards on a 24/7 basis across multiple locations.

The services incorporate the provision and management of two Data Centre facilities including the uplift of the current secondary Data Centre to a highly resilient tier-3 facility.

Global Entserv Solutions Ireland more than doubled its pre-tax profits to March 2019 to €8.8m on revenues for the 12 months of €92.93m.

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