Decision

Salford City Council – Record of Decision

I, Paul Dennett, City Mayor, accept the recommendation of the Procurement Board and in exercise of the powers contained within the Council Constitution, do hereby approve:

·      to award the Contract for the Supply of Microsoft Licensing 2026 to Phoenix Software Limited, as detailed in the table below:

Detail required

Answers

Title/Description of Contracted Service/Supply/Project

Microsoft Licensing Agreement 2026 – supply of Microsoft 365, Microsoft Azure and associated subscription licences for Salford City Council.

Procurement Reference numbers (DN and CR number supplied by Procurement)

S1080

Name of Successful Contractor

Phoenix Software Limited

Supplier Registration Number

02548700

Supplier Identifier Reference

(Central Digital Platform FTS) for awards above £30,000 (inc VAT)

N/A

Proclass Classification No.

(to be completed by procurement)

271330

Type of organisation

Private Limited Company[CF1] 

Status of Organisation

SME

Contract Value (£)

£1,917,365.24 (Year 1) / £1,994,865.24 (Years 2 & 3)

Total contract value £ (including extensions)

Initial 3-year term: £5,907,095.72 (ex VAT). Maximum potential term with both extensions: approximately £17.7m over 9 years, subject to annual true-up/true-down and re-procurement at each break point.

Contract Duration

36 months (initial term)

Contract Start Date

1 July 2026

Contract End Date

30 June 2029 (initial term)

Optional Extension Period 1

36 months (optional)

Optional Extension Period 2

36 months (optional)

Who will approve each Extension Period?

Procurement Board / City Mayor (subject to value thresholds at the time)

Contact Officer (Name & number)

Matt Wall, Head of Cyber & Technology, Digital, Data and Technology

Lead Service Group

Corporate Services – Digital, Data and Technology

How the contract was procured?

(to be supplied by procurement)

Further competition under an existing framework

Procurement Legislation

Public Contracts Regulations 2015

Framework Details (where applicable)

(procurement body, framework reference & title, start/ end date

Crown Commercial Service (CCS), RM6098 Technology Products & Associated Services 2, Lot 3: Software. Framework period: 10 October 2023 – 9 October 2027.

Funding Source

Revenue Budget

Ethical Contractor (EC): Mayor’s Employment Charter

Yes

EC: Committed to sign The Mayor’s Employment Charter

Yes – already signed

EC: Committed to the principles outlined in the Mayor’s Employment charter

Yes

EC: Accredited Living Wage Employer

Yes

EC: Committed to becoming Accredited Living wage Employer

Yes – already accredited

?

The Reasons are: Following a compliant further competition under Crown Commercial Service framework RM6098 Technology Products and Associated Services 2, Lot 3: Software, Phoenix Software Limited submitted the Most Economically Advantageous Tender, achieving the highest score in every weighted category – price (65.00% of 65%), quality (19.00% of 20%) and social value (8.14% of 15%) – with an overall score of 92.14% against four compliant bids. Microsoft 365 is the foundational platform on which the Council’s day-to-day operations depend (productivity, collaboration, identity, endpoint management, cyber security and the Council’s public cloud infrastructure on Microsoft Azure), and a continuing licensing agreement is essential to the delivery of services to Salford residents and businesses. The Council’s current Microsoft licensing agreement expires on 30 June 2026; awarding this contract now secures continuity of access, fixed pricing protected against the 1 July 2026 Microsoft list price increases, and year-on-year discounts of £287,500 across the three-year initial term.

Options considered and rejected were:

(1) Allowing the current agreement to expire and reverting to Microsoft standard (non-discounted) pricing – rejected on the grounds that it would expose the revenue budget to a forecast uplift in the hundreds of thousands of pounds per annum and forfeit the £287,500 of year-on-year discounts secured through this tender.

(2) Direct award to the incumbent supplier – rejected on the grounds that Contractual Standing Orders and the CCS RM6098 framework require a further competition where one is available and suitable.

(3) Use of an alternative procurement route or framework – rejected on the grounds that RM6098 Lot 3 is the most appropriate compliant route to market and provides access to the Strategic Partnership Arrangement 2024 (SPA24) discounts negotiated by CCS with Microsoft for the UK public sector.

(4) Migration to an alternative platform – rejected on the grounds of cost, operational disruption, loss of integrated identity and cyber security controls, and the absence of a comparable single-vendor offering that meets the Council’s current and forecast requirements.

Assessment of Risk: HIGH (if the award is not made or is delayed). Failure to award in time would result in the Council reverting to standard Microsoft list pricing on contract expiry; progressive loss of access to M365 productivity services, Intune device management (over 4,000 endpoints) and Azure-hosted infrastructure; degradation of the Council’s cyber security posture through loss of Entra, Defender and Purview controls licensed under M365 E5; non-conformity with Microsoft’s terms of service; and reputational risk with citizens, partners and regulators. Awarding the contract as recommended is the lowest-risk option available.

Innovate / Best Value – the relevant corporate priorities specific to Salford: tackling poverty and reducing inequalities (the locked-in pricing and year-on-year discounts protect the Council’s revenue budget from inflationary pressures, preserving funding for front-line services); a modern, connected and inclusive city (the M365 platform enables digital service delivery, hybrid working under the Council’s MyWork principles, and digital inclusion across the workforce and communities); a learning and innovative organisation (the agreement secures access to Microsoft AI capabilities including Copilot, Copilot Studio and Agent 365, along with the governance tooling – Purview, Entra – needed to adopt these technologies safely); and climate change (the underlying Microsoft cloud services are delivered from data centres covered by published environmental sustainability commitments).

The source of funding and financial advice obtained: Revenue Budget within Digital, Data and Technology (DDaT). Expenditure Code C1058 – M365 Licence; Cost Centre / Code 5744 – IT Licence Fees. Tendered values: £1,917,365.24 (Year 1, 26/27); £1,994,865.24 (Year 2, 27/28); £1,994,865.24 (Year 3, 28/29). Three-year total: £5,907,095.72. The licensing volumes have been sized to include the expected returning headcount from Project Unify and the unwind of the Section 75 legal agreement covering Adult Social Care, and the ESA structure permits annual true-up and true-down. Financial advice obtained from the Finance Team.

Legal Advice obtained: from the Shared Legal Service. The further competition has been conducted under Crown Commercial Service framework RM6098 Technology Products and Associated Services 2, Lot 3: Software, established in October 2023 for a four-year term and compliant with the Public Contracts Regulations 2015. The award has been evaluated on a Most Economically Advantageous Tender (MEAT) basis in line with the framework’s published requirements. As the contract value exceeds £1,000,000, the decision is to be made by the City Mayor in consultation with Procurement Board and Lead Member.

Procurement Advice obtained: from the Corporate Procurement Team. The procurement has been conducted in accordance with the Council’s Contractual Standing Orders, which require use of an existing framework where one is available and suitable. The CCS RM6098 framework was the most appropriate compliant route to market, providing access to pre-vetted Microsoft Licensing Solutions Partners and to the Strategic Partnership Arrangement 2024 (SPA24) discounts negotiated by CCS with Microsoft for the UK public sector.

HR Advice obtained: not applicable. The contract is for the supply of software licences and associated managed services from the supplier; there are no staff transfer (TUPE) implications. The licences will continue to be administered by existing Digital, Data and Technology resources.

Climate Change Implications obtained: from the Climate Change Team. The Microsoft 365 and Microsoft Azure services are delivered from Microsoft data centres covered by Microsoft’s published 2025 Environmental Sustainability Report, which sets out commitments and reported progress on contracted carbon removal, renewable energy procurement, water replenishment and hardware reuse. The Clarity FinOps Portal included by the successful bidder will enable the Council to monitor consumption and identify opportunities to reduce unnecessary cloud usage.

Documents

The following documents have been used to assist the decision process:

·      Procurement Board Report – Approval to Award the Contract for the Supply of Microsoft Licensing 2026 (8 June 2026); Procurement Board Report – Approval to go out to competition for Microsoft Licensing (2026); Phoenix Software Limited tender submission (Appendix A – Pricing; Appendix B – Quality, Round 2; Social Value response); Equality Impact Assessment – Procurement of Microsoft Licensing 2026; CCS Framework RM6098 Technology Products and Associated Services 2 – Lot 3: Software framework agreement and further competition guidance.

Contact Details:

·      Contact Officer: Matt Wall, Head of Cyber & Technology, Digital, Data and Technology, Corporate Services.

Please delete from the bullets below any which are not relevant:

·      This matter is also subject to consideration by the Lead Member for Finance and Support Services (Councillor Cusack). The Lead Member has been consulted and is supportive of the proposed contract.

·      The appropriate Scrutiny Committee to call-in the decision is the Customer and Support Services Scrutiny Panel.

Signed:   Paul Dennett        Dated:   8 June 2026.

                 City Mayor

FOR DEMOCRATIC SERVICES USE ONLY:

·      This decision was published on 16 June 2026.

·      This decision will come in force at 4.00 p.m. on 23 June 2026 unless it is called-in in accordance with the Decision Making Procedure Rules.

 [CF1]Type and status of Organisation

Lead officer to complete using Supplier information provided in the quotation/tender