The Competition and Markets Authority (CMA) watchdog has accepted proposals from the biggest provider of school information management systems (SIMS) software in England to let eligible schools end three-year contracts early.
Eligible customers will now be able to apply to an independent body to break their contracts with SIMS supplier Education Software Solutions (ESS).
The CMA launched an investigation in April last year to address concerns that ESS had abused its dominant position to force a contract change on schools.
In November the CMA said it proposed “to accept” ESS’ proposals to give “schools the opportunity to apply to an independent adjudicator for a further 12-month break clause, if they had considered switching MIS supplier at the time of the move to ESS’ three-year contract but concluded that they would not be able to switch within the timescales set by ESS”.
And today the CMA announced that it had secured the offer from ESS.
The decision means that schools that had considered switching providers but felt they did not have sufficient time to do so can apply to an independent adjudicator for a 12-month break clause.
Schools can apply for the break clause from noon today until 10 February 2023.
Backlash over SIMS contract change
Any applicants will be notified by independent adjudicator Evelyn Partners as to whether they have been successful by no later than 31 March 2023.
If a school’s application is accepted, it will allow them to exit their current three-year contract with ESS and choose an alternative provider.
The move has brought the CMA investigation to an end, with no decision being made as to whether the Competition Act 1998 has been infringed.
The watchdog had launched a consultation in November on proposals from ESS that would allow eligible customers to apply to an independent body to break their contracts with the company.
Ann Pope, senior director of antitrust at the CMA, said the break clause “will give eligible schools 12 months to decide whether to exit their current contract and, if they do, to switch to a new provider - longer than ESS originally offered”.
She added: “The commitments secured from ESS will also bolster competition in the MIS market, giving schools more choice and ESS’ rivals a further chance to compete.”
In December 2021 nearly 400 schools joined legal action over “legally questionable” contracts proposed by the supplier.
ESS had previously written to schools in November 2021 giving notice that it was ceasing to offer 12-month support contracts and would in future only contract for support on three-year terms. Schools had until the end of March to sign up or find an alternative.
And in January 2022 it introduced a six-month break clause to its criticised contract extension.
The Department for Education had advised schools a year ago to “pause before signing” while it investigated the new terms but later gave the go-ahead in December.
An ESS spokesperson said: “Today the CMA has announced that it is closing the first part of its investigation into ESS’ conduct in relation to its move from one-year to three-year annual entitlement agreements in March 2022.
“This follows on from the CMA’s announcement of 27 October 2022 that it was closing the second part of its investigation into the pricing of FMS [financial management systems] and SIMS.
“ESS welcomes these decisions, which were both arrived at on a ‘no fault’ basis. This is consistent with the position ESS has maintained throughout the investigation, namely that it has acted properly at all times.”
