Logica agrees to cut costs on government deals

30 September 2010

30 September 2010 | Lindsay Clark

Technology services firm Logica has become the latest supplier to sign an agreement with the UK government consenting to reduce costs.

It is one of a number of vendors to have signed a memorandum of understanding as part of a process initiated by Cabinet Office minister Francis Maude in July.

In a statement, Logica said it would continue to deliver all of its existing contracts, while agreeing efficiency savings with government. Craig Boundy, CEO of Logica’s UK business, said: “We are pleased to have reached an agreement with Francis Maude and his team in a speedy and straightforward fashion.”

Logica, which runs contracts for the Metropolitan Police and the Foreign and Commonwealth Office, joins IT services firms Atos Origin and Capgemini in signing up to the government’s efforts to slash supplier costs, which form part of a wider project to cut the public debt.

However, 16 suppliers who met Maude in July have yet to commit to the government’s proposal. These include Hewlett-Packard, which owns services giant EDS, British Telecom, Microsoft and Oracle.

Earlier this month, John Collington, head of procurement in the Cabinet Office’s Efficiency and Reform Group (ERG), told the Procurecon Public 2010 conference that he expected the supplier negotiations to produce savings in the order of hundreds of millions of pounds.

In May, the coalition government formed the ERG, jointly run by the Treasury and the Cabinet Office. At the same time, the ERG said it would review the government’s biggest projects, including ICT projects, to see where costs could be reduced and whether wasteful programmes could be stopped altogether.

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