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MoD reveals it's tendering for paperless payment system

The Ministry of Defence (MOD) has revealed it is seeking an IT supplier to provide it with an end-to-end contracting, purchasing and finance system.

A tender published in the Official Journal of the European Union (OJEU) explains that the vast majority of the Ministry’s £30bn annual expenditure is currently spent on its Purchase to Payment (P2P) system – despite payments often being made to companies who remain paper-based.

“The Authority recognises the inefficiency of this situation and consequently wishes to undertake a single competition to satisfy two distinct, but inter-related, requirements that will together realise benefits in excess of £120m per annum,” claims the contract notice.

The two-year deal, said to be worth up to £30m, will see the prospective supplier expected to design and build a new purchasing system for MOD and then transition the Department onto it as well an integrating the new with old.

The tender notes that the new service will build upon the existing paperless payment system, replacing or merging with current toolsets such as P2P and Defence Contracts Online.

System support and activities will be managed by Defence Business Services Team, says the document.

MOD claims that although the contract will not be extended beyond two years, it wants the new system implemented as soon as possible in order to receive higher cost savings.

It stresses that the chosen IT supplier must be fully legally compliant with existing and expected EU and UK procurement laws, especially those relating to e-procurement.