Why did Cabinet Office Rush through Procurement of Controversial Electoral Services Company IDOX Just Before the General Election?
David Hencke investigates why Boris Johnson’s Government handed out £1.7 million for election management services without a competitive tender.
A large software company whose shareholders include Brexiter and former Conservative Cabinet minister Peter Lilley has been given a lucrative contract by the Cabinet Office without competitive tendering to revamp the management of the electoral register in extraordinary circumstances.
Though local government is in charge of the electoral register, the Government has responsibility to contract an annual national canvas of people entitled to vote. Idox Software Ltd, part of the worldwide Idox Group, won the £1.7 million contract for its revamp just in advance of purdah imposed by the 2019 General Election – purdah is the period in which politically sensitive announcements or decisions cannot be made in the run-up to an election – and before new regulations had come into force that will allow the company to make major software changes to the compilation of the new electoral register.
Another acquired subsidiary of Idox, Opt2Vote, was found to have broken the law by ignoring legal verification procedures in the counting of postal votes in the 2015 General Election following a complaint by a count observer. An analysis by the elections watchdog, the Electoral Commission, upheld the complaint stating that postal voting counts in Birmingham, Sheffield, Edinburgh, Glasgow, Fife, Dundee, Aberdeen, Ayrshire, Moray, Scottish Borders, Angus and Clackmannanshire did not comply with the law.
As a result, in 2016, all electoral registration officers were issued with a circular telling them to revise their procedures and for Idox to make its system compliant with the law, while the Electoral Commission sought more flexibility in future legislation.
Monopoly on Elections
The Idox contract raises questions about how close politicians should be to the electoral process, which has to be neutral.
Until he resigned his directorship in 2018, Peter Lilley, who is an ardent Eurosceptic and a member of the Conservative European Research Group (ERG), was also the director of a company with contracts that covered counting in the 2016 EU Referendum. He has a second biggest director’s shareholding in the group which is valued at $219 million and has risen in value by 32% in the past year.
Idox is also approaching a private monopoly in providing electoral services to local councils. By expanding its contracts and buying-out rivals such as Halarose, Strand and Opt2Vote, the company states that 52% of UK is covered by its electoral management system solution. Its interactive voter response (eCanvass) has been used to register one million people and it has trained 75,000 polling station staff.
The contract awarded by the Cabinet Office will enhance its position still further and it data matches information held on millions of people by the Department for Work and Pensions with local authorities to draw up the new electoral management system. The aim of this new trawl appears to be to find people who are not on the electoral register and include them in future registers.
Idox will set up the software for future national canvassing of all voters in the UK, excluding Northern Ireland, with a target date of completing this next June.
The extraordinary part of the new contract is how it is being rushed through by the Government.
The policy to reform canvassing the electoral register was only announced in September as Boris Johnson arrived in Downing Street, though the Cabinet Office had been working on drawing up a reform since 2015. Idox was awarded its £1.7m contract on 25 October 2019 and the first phase of work was begun on 1 November, four days before the legislation to enable it was written. This first phase completed by the beginning of December, two weeks before the General Election, even though the legislation did not come into force until the end of December.
Around the same time as the annual canvas was announced, leaked memos published by Buzzfeed News revealed that Johnson’s chief advisor Dominic Cummings was insisting that the Cabinet Office collected data from all government digital services as a “top priority”.
The Idox contract is one of three contracts awarded without competitive tendering for an exercise to reform the annual canvassing of people entitled to vote. Each local authority has been left to choose which company it wishes to work with and the data controller will remain with the electoral registration officer of each council.
When it was put to the Cabinet Office that the award of such large contracts breached EU rules stipulating that any construction and works tender above £663,450 should be put out to competition, a spokesperson explained that there were only three specialist companies that could do the work in the UK and each of them had won a contract.
“We are working with three electoral management software (EMS) suppliers to update their systems in order to implement upcoming changes to the annual canvass,” a spokesperson for the Cabinet Office told Byline Times.
However, the reduction in companies that can do the work has partly been caused by Idox buying up their potential rivals.
“All contracts awarded to EMS suppliers were subject to robust scrutiny, in line with government procurement regulations,” the spokesperson added.
Earlier this year, Idox set up a system so that it could continue to prosper in the event of a ‘no deal’ Brexit at the end of 2020. A statement on its website discloses its strategy:
“Idox plc delivers its products and services via wholly owned subsidiary companies registered in the countries in which it operates. In the main, this enables Idox products and staff to be sold and delivered in the countries in which we expect to need to supply products and deliver services.
“They include Idox companies registered in the UK, the EU (France, Germany, Netherlands, Belgium, Malta and Ireland) and countries outside of the EU (USA, India and the Republic of North Macedonia). In most cases, the core skills required to deliver the key products and services are located in both EU and non-EU countries. This mitigates any limitation on staff travel and the ability to export people-based services.”
Byline Times has contacted Idox Plc for comment, but it has not yet received a response.
This article was amended to clarify the roles of local and central government in contracts for the electoral register and the data matching with the DWP. On 10/01/2010 Peter Lilley’s shareholding as a former non-executive director was also clarified.