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Failing NHS IT supplier faces dismissal

The biggest single supplier to the £12bn NHS NPfIT white elephant programme is on the brink of being fired from a key part of its contract after failing to meet a deadline to install systems at hospitals in the north west.

CSC, which holds the contract for two-thirds of England, missed the deadline to get the Lorenzo electronic medical record product up and running at the Morecambe Bay NHS Trust’s hospitals.

CSC originally said the system would go live almost two years ago, in June 2008.

The failure is the latest crisis for the much-troubled programme which is running at least four or five years late.

CSC and BT, which covers London, had each been given a deadline to get new systems running smoothly in a big, acute, hospital, with the Department of Health warning last year that it would “look at alternative approaches” if that failed to happen.

BT has since installed a system at Kingston Hospital to the health department’s satisfaction. Christine Connelly, the department’s chief information officer, said it now needs to go through a due process under its contract with CSC which could yet see a new deadline set and met.

But if progress is not made, she told the Financial Times, the department has the option of cancelling CSC’s contract to install the systems in acute hospitals and letting hospitals choose from other suppliers.

Morecambe Bay, she said, remained keen to continue and under the contract CSC has to be given time to propose a fresh deadline for deployment, with the programme then assessing the credibility of that and whether to agree it.

“We have to walk through this step by step,” Ms Connelly said. “In a contract as large and complex as this we cannot just set a deadline and say that’s it. We have to act responsibly and not expose the department and the taxpayer to risk.”

But, she warned bluntly, “we cannot wait for ever”.

CSC has contracts worth about £3.3bn to install hospital, community, mental health and GP systems, with the latter elements progressing much better.

But Ms Connelly said if CSC’s plan was not credible the NHS had the option of cancelling the acute hospital part of the deal, thought to be worth around £1bn. CSC did not respond to attempts to contact it last night.

BT, having hit its deadline, has agreed a contract variation, signed yesterday, which the department said would save the NHS £112m, or about 12 per cent of the contract value, as part of the £600m savings the health service is seeking on the programme as a whole.

As part of the deal, BT is now signed up to install much fewer full systems in London, with about half the hospitals likely to add clinical systems to their existing IT arrangements, rather than replacing everything, Ms Connelly said.

Allowing hospitals to choose other suppliers is already starting to happen in the south of England, although the first contracts for that have yet to be signed. That should start to take place from May this year, she said.

From: http://www.ft.com/cms/s/0/6a9f7ee2-3d26-11df-b81b-00144feabdc0.html

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