How Not to Ambulance 11 replies

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Serio VIP Member

The Dane

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#1 2 years ago

A few years ago, the contract between Region Syddanmark(administrative region) and Falck(ambulance service) was up for renewal. The region decided it was too pricy, so they put out a call for private companies to bid in. This resulted in Dutch Bios offering a cheap enough solution.

Well. That didn't quite go well. Between poor service, a lack of ambulances and generally just an administrative nightmare, they were just forced to file for bankruptcy today.

On top of that, Bios has by mistake received an extra month of pay from Region Syddanmark, which demanded the money back as soon as the error was discovered.

However, the financially-stricken company is unable to pay the 31,5 million kroner back at once and has instead asked for a repayment scheme over a year.

Region Syddanmark has declined the proposal because it would have been illegal.

http://cphpost.dk/news/ambulance-company-in-southern-jutland-going-bankrupt.html




Nemmerle Forum Mod

Voice of joy and sunshine

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#2 2 years ago

I just don't get why government agencies jump into bed so readily with obviously seedy companies rather than going with folks with a proven track record. It's nuts. One would almost suspect corruption of some sort :rolleyes:




Serio VIP Member

The Dane

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#3 2 years ago
"Nemmerle"I just don't get why government agencies jump into bed so readily with obviously seedy companies rather than going with folks with a proven track record. It's nuts. One would almost suspect corruption of some sort :rolleyes:

One would, but that's not the case. Denmark is one of the least corrupt countries, and corruption is usually exposed quite quickly either by internal or state investigations. The problem was entirely financial. The contract Falck wanted was too expensive for the region. 

Bios isn't an "obviously seedy" company either. They're an ambulance service that has operated primarily in Netherlands. Usually they just do special taxi services, though. Having to take over from a big, global organisation like Falck was probably too much for them, though.




Nemmerle Forum Mod

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#4 2 years ago

How was this not flagged up in the due diligence phase of procurement if everyone was dealing honestly?




Serio VIP Member

The Dane

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#5 2 years ago

Hanlon's razor. It's a simple case of a company accepting a contract that they simply weren't able to carry out. 

They took over from Falck in September 2015. Since then, they've not been able to supply the contractually obligated number of vehicles, so they've instead been hiring a company called Responce to cover for them. When publishing their first annual results, it was revealed they'd received a monthly payment too much.

The region hadn't noticed the fault(no worries, that is being investigated too), but demanded a full return of the funds upon discovering the fault.

Since Bios has been in the red, they were unable to pay back the funds. Which leads to this situation. They want to pay it off over a year, but the State Attorney pointed out that would be an illegal setup. So yeah. Incompetence, really. 

So why did they go with Bios in the first place? They wanted to save. Our healthcare system is expensive, so they wanted to save where they could.

If there's any indication of corruption, rest assured it'll be investigated thoroughly. 




FileTrekker Über Admin

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#6 2 years ago

Honestly this happens seemingly every single time a government agency privatises services. It's all about who bids cheapest while maintaining the scope of the tender.

The result is a company trying to make money by cutting costs anywhere they can be cut, often at the expense of the end user. Staff are often stretched to do too much at once, resources are cut and management care only about what is being spent, not why it's being spent.   It's all about the $$$.

Sometimes, infact quite often, companies will go in with a stupidly low bid, fail to meet the KPI of the contract, and fail. This is a pretty spectacular case since there's incompetence shown on both sides.

But yeah an all-too-common story.


Danny King | Community Manager | GameFront.com



Nemmerle Forum Mod

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#7 2 years ago

Yeah. I just don't get how they can screw up this badly without corruption. Like I get that it's a common thing, I get that people want to save money. But due diligence isn't particularly hard. You know? There are limits to incompetence.

Do we need a national office of due diligence or something? Are we in that sort of situation where... Just, ouch, Jesus Christ. What the heck? How do you screw that up?




Aeia

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#8 2 years ago

Here's how, Nem.

I wanted to add two more living rooms, two bathrooms, one kitchen and a gallery to our house. I consulted a contractor and he bid at Rs 140,000 (around $1400) for building the thing (I'd have to provide him all the material and he'd get it built for me). I was about to finalize it, when another (younger) contractor stepped in and bid it at Rs 112,000 ($1120). Naturally I went with the lower bid.

This guy has worked exquisitely fine. Everything is built much better than I expected it. The sad thing is, he hasn't finished the contract and he has already spent all of the cash and is now perpetually glum and downcast. I have decided to pay him extra, but the bottom line is clear. Folks would bid too low in order to secure a contract and then their math goes wrong and they start pulling at their hair.




FileTrekker Über Admin

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#9 2 years ago

"Nemmerle"Yeah. I just don't get how they can screw up this badly without corruption. Like I get that it's a common thing, I get that people want to save money. But due diligence isn't particularly hard. You know? There are limits to incompetence.

Do we need a national office of due diligence or something? Are we in that sort of situation where... Just, ouch, Jesus Christ. What the heck? How do you screw that up?

Like I say, in my experience they don't care about due diligence, they just want whatever is cheapest. Corners are cut in every other respect. Corruption is also very much commonplace, especially when it comes to who work gets subcontracted to.

I speak from experience on that, at least.


Danny King | Community Manager | GameFront.com



Admiral Donutz VIP Member

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#10 2 years ago

I do wonder how authorities keep falling for outsourcing over and over again. If a bid is much much cheaper that should be  red flag. It may be a sign of underestimating the task at hand or it means lots and lots of corners will be cut to reduce costs. Running wages down to the social minimum. In the Netherlands and I assume other nations compagnies have taken bids on personell that assists elderly who need assistance of various sorts. It won't be a suprise that with wages at the social minimum and having to perform a lot of tasks in minimal time, quality went down the drain, no time to talk with the clients (missing out many changes of catching certain signs of illnesses or other trouble early) or indeed simply not being able to deliver what was promised. Same with cleaning services, with an insanely low budget you can be assured that this mean rushing, doing things too cheap etc. 

Those people selling these stories must have great salespitches. But who buys them? If a bid is much lower that means quality and staff will take a big hit. If it's barely cheaper, why bother? In the end a private company wants to make profit and more profit.. That works in many areas but when it concerns things such a health... maybe not so much.




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