Company pulled out of marking contract as it was 'too risky'

17th October 2008 at 01:00

A potential bidder for the doomed ETS test contract last year pulled out at the last minute, warning the commercial risk was too high, The TES has learnt.

Logica CMG wrote to the National Assessment Agency (NAA) on the day before the final tender was due to warn that it had decided it would not be in the interests of its shareholders to take on the job.

The company - which has provided IT services for Ofsted, the Department for Children, Schools and Families and the National College for School Leadership - said it was writing the letter in a spirit of "openness and honesty".

The Qualifications and Curriculum Authority, which oversees the NAA, is searching for a new contractor after its Pounds 156 million five-year contract with ETS Europe was terminated after one year.

ETS Europe, the for-profit subsidiary of ETS, a not-for-profit American organisation, said it had lost Pounds 50 million from its involvement in the 2008 Sats, which were beset by widespread problems. Papers went missing, league tables were delayed, examiners unpaid and schools frustrated.

The contract was terminated in August after ETS Europe failed to deliver the test results on time.

The process of appointing ETS begun in March 2006 when David Gee, managing director of the National Assessment Agency, outlined what the contract would involve. He said: "There is no margin for failure, safe delivery is the only option". The two final bidders were Edexcel and ETS Europe.

On November 9, 2006, the day before the deadline, Logica CMG, pulled out of the bid, saying the "commercial risks of the contracts are disproportionate to the financial benefits". Janita Taliadouros, Logica's managing director, public sector, wrote to David Gee, saying the amount of damages that could be claimed if the project failed were "out of the ordinary for the public sector and unreasonable in the context of the project".

The company, she said, also had reservations about the proposed ability of the contract to be terminated due to regulatory changes with no compensation, that inflation on marker fees had to be carried in the five-year contract, but was outside the influence of the contractor, and the rights to "claw back" money that was paid.

Log-in as an existing print or digital subscriber

Forgotten your subscriber ID?


To access this content and the full TES archive, subscribe now.

View subscriber offers


Get TES online and delivered to your door – for less than the price of a coffee

Save 33% off the cover price with this great subscription offer. Every copy delivered to your door by first-class post, plus full access to TES online and the TES app for just £1.90 per week.
Subscribers also enjoy a range of fantastic offers and benefits worth over £270:

  • Discounts off TES Institute courses
  • Access over 200,000 articles in the TES online archive
  • Free Tastecard membership worth £79.99
  • Discounts with Zipcar,, Virgin Wines and other partners
Order your low-cost subscription today