HMRC begins move to bring some IT back in-house as it exits Aspire contract

Paul Snell is managing editor at Supply Management
6 August 2015

HM Revenue and Customs (HMRC) has announced its intention to bring some IT services back in-house as it winds up what was the UK government’s largest IT deal.

The three services, and 250 staff who will be transferred from current supplier Capgemini to HMRC, are case management, which handles compliance cases; customs and international, which manages the movement of duty-suspended goods and exchanging claims for VAT refunds between EU member states, among others; and third party supplier contracts for IT hardware, software, services and consumables.

The department claimed this would help it save 24 per cent on its £800 million annual IT budget by 2020-21.

“The changes we’re announcing today will allow us to maintain consistency of service for customers while we plan for the future which, as now, will include a mixed model of both internal and external delivery using multiple partners,” said Mark Delaney, chief digital and information officer at HMRC.

The Aspire contract, which is due to expire in 2017, is being replaced by a range of short-term deals with a variety of providers. Capgemini will now also continue to provide 'test and release' services, which test new code to make sure it works correctly, until 2020.

In January MPs on the Public Accounts Committee said it would be “an enormous challenge” to switch to a different contracting model, and they had “little confidence” HMRC would be able to manage the transition.

The National Audit Office blamed a lack of rigour in contract management on the deal, with HMRC expected to have spent £10.4 billion by the end of the contract – double what had been anticipated.

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