PAC: HMRC’s Ability To Successfully Transition From Aspire Contract Questionable

Jan 27, 2015

The Parliamentary Public Accounts Committee (PAC) has today published its latest report on managing the HMRC and Capgemini Aspire contract.

Aspire is the government’s largest ever technology contract, which has to date cost £7.9bn over the last ten years and generated £1.2bn profit for the suppliers.

Most of the government’s major tax collection systems are provided under this one contract and many claim the Department has not managed the costs of the contract very well

Back in July, HMRC came under fire from the National Audit Office (NAO), which criticised the giant contract for only enjoying “limited success.”

Now, PAC has joined the group of voices claiming that HMRC faces an “enormous challenge” in moving to a new contracting model by 2017 when Aspire is set to expire.

“HMRC’s record in managing IT contractors gives us little confidence that it can successfully achieve this transition or that it can manage the proposed model effectively to maximise value for money,” claimed Richard Bacon MP, a PAC member.

When the current contracts reach their end in 2017, HMRC intends to move to a new model of IT delivery which contains multiple short-duration contracts with multiple suppliers.

However, as PAC points out, little has been done to define the Department’s needs and it is yet to present a business case to government.

Once funding is agreed, HMRC will then only have two years to recruit the skills and buy the services it requires to continue.

“HMRC expects the new arrangements to reduce its running costs by 25%. However, the Department still cannot estimate the cost of this change, in terms of moving staff, equipment and office space’ it could not even provide the Committee with a range,” claimed Bacon.

“Unrealistic Expectations”

Cabinet Office Minister Francis Maude’s “red lines” for IT contracts, which cap central government IT contracts at £100m, have also come under fire.

“We do not believe that the Cabinet Office’s ‘red lines’ on IT procurement are realistic in a business as large as HMRC’s, or that transformation on this scale is achievable by July 2017,” claimed Bacon.  

“HMRC and the Cabinet Office should jointly agree key milestones and warning flags leading up to the end of the contract in June 2017, with contingency plans that manage the rusks to the stability of the tax collection system and risk to value for money should these milestones be missed,” he added.


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