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Tories move to stall new IT contracts

Sir Gus O’Donnell, the Cabinet secretary, has been urged by the Conservatives to ensure that no big IT contracts are signed in the run-up to the general election.

Francis Maude, the shadow Cabinet Office minister in charge of plans for a transition to government should the Tories win, has told Sir Gus that “there is no conceivable reason why these contracts need to be signed now”.

In recent weeks, the Department for Work and Pensions has signed some big IT deals which, it is claimed, will result in sizeable savings over the current deals.

This week, the Personal Accounts Delivery Authority has announced a preferred bidder to run the new personal pension accounts from 2012 – although that deal has a specific break clause at seven months that would allow an incoming government to scrap it.

At the Department of Health, ministers aim to complete negotiations this month on a revamp of the big local supplier contracts for the NHS electronic patient record. The renegotiation is aimed at cutting £600m out of the contracts’ present value.

But the Conservatives say they fear the price for that may be even bigger cancellation penalties than the large penalties that already exist.

Mr Maude said that if that happened, “then the cost to the taxpayer of terminating these contracts – signed only weeks before – could be literally billions of pounds. This would be scarce taxpayers’ money completely wasted”.

In a letter to Sir Gus, he said: “As you know, we have said that an incoming Conservative government would impose an immediate mortatorium on ongoing ICT procurements so they can be reviewed in the light of the continuing fiscal crisis. This includes contacts for telecommunications services”.

He added that “there can be no possible damage in waiting the few weeks until the election is over”.

The Tories would expect any senior civil servant signing such deals as the accounting officer to require specific written instructions from ministers before their approval. “Without such written directions,” he said, “those officials would have to expect to be held fully to account for any loss of taxpayers’ money that followed.”

Mr Maude said he hoped Sir Gus would “be able to confirm that no major contracts, either new or renegotiated, will be signed this side of the election”.

In view of the “huge amounts of taxpayer’s money at stake,” Mr Maude said he was copying his letter to the National Audit Offfice. No comment from the Cabinet Office was immediately available.

From:
http://www.ft.com/cms/s/0/c71f0886-27b4-11df-863d-00144feabdc0.html?nclick_check=1

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