One that nearly got away

As we’ve mentioned before, CapGemini has the contract to build the childrens’ Information Sharing Index (allegedly for a mere £224m) so we have more than a passing interest in their special relationship with government.

Better late than never, we’ve just spotted this story from ZDNet that appeared just before Christmas:

Profits from its contract with HM Revenue and Customs (HMRC) are providing Capgemini with an early Christmas present, according to a member of the Committee of Public Accounts

The costs of HMRC’s outsourced IT programme, known as Aspire, have spiralled to £8.5bn, against the £3.5bn planned when the contract was awarded in December 2003, parliament’s Committee of Public Accounts heard.

In the first year, the cost of the 10-year contract with Capgemini reached £539m, against an estimated spend of £385m. Capgemini’s profits are expected to rise from £600m to £1.2bn.

Reading the uncorrected evidence from the Public Accounts Committee session that prompted this story is far funnier than you might expect: from around Q49 things start sounding like a script from ‘Yes Minister’ as strings of incomprehensible figures swirl around to form impenetrable fog. Q74 is an exasperated John Pugh MP saying:

What I glean from the NAO report is that you went for the higher bidder rather than the lower, that your spending could be £6 billion rather than £3.4 billion when the project is finished, and that you spent £47.5 million in transition costs and £7 million to £8 million in bidding costs alone. Company profit in the first year is £53 million, not £38 million. Your spend was £539 million, not £383 million. You do not have any estimate of the final costs, and there have been at least 15 systems failures so far. Is that a good deal? If so, what would a poor deal look like? If a local authority had a bid deal structured like that, the district auditor would be called in and the local press alerted.

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2 Responses to One that nearly got away

  1. […] in silence We mentioned that the cost of the HMRC database has already risen from £3.5bn to £8.5bn, and now MP Vince […]

  2. […] to build Contactpoint – aka the central identity management system for children’s services. Back in January we mentioned the fast-rising costs of HMRC’s ASPIRE system, and now there’s more on […]

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