No new deal on NHS IT programme until value for money examined

13 May 2011

13 May 2011 | Lindsay Clark

UK Prime Minister David Cameron has declared the NHS will not renew an agreement with a key supplier for the National Programme for IT (NPfIT) until value-for-money reviews are completed.

This week he told parliament that, as yet, there were no plans to sign a new contract with Computer Sciences Corporation (CSC), a key supplier to the project, until reports from the Committee of Public Accounts (PAC) meetings and the Cabinet Office’s Major Projects Authority are produced.

“The Department of Health and the Cabinet Office will examine all the available options under the current contract, including the option of terminating some of, or indeed all of, the contract,” he told Parliament.

Cameron was responding to questions from PAC member and Conservative MP Richard Bacon. Bacon had previously urged the Department of Health not to conclude contract negotiations with vendors until findings from the reports had been analysed.

The Prime Minister said: “We are very concerned that the NHS IT projects that we inherited were of poor value for money, an issue we raised repeatedly in opposition. According to the NationalAudit Office, even in 2008, delivery of the care records system was likely to take four years more than planned. Since coming into government, we have reviewed the projects with the intention of making the best of what we have inherited.”

He said the government had cut £1.3 billion from programme, including planned savings of at least £500 million from CSC. “We are absolutely determined to achieve better value for money,” he added.

An NAO report on the project, which precedes a PAC investigation, is due to be published next week.

Since the NPfIT started in 2003, CSC won a contract worth £973 million and has also taken over contracts from Fujitsu, worth £896m, and Accenture, worth more than £1 billion.

A statement from CSC said it was in the final stages of negotiating a non-binding memorandum of understanding (MoU) with the NHS. “The MoU for the realigned NHS programme is designed to offer the government greater value and flexibility, while achieving desired saving in healthcare. The prime minister’s comments confirmed that the NHS programme reviews must be completed before any NHS agreement would be finalised.”

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