HMRC renegotiates £94m AWS deal

Department replaces existing arrangement with contract under new terms

Credit: Pxhere

HM Revenue and Customs has signed a new and improved deal with Amazon Web Services that will be worth up to £94m over the course of the next three years.

The contract, which came into effect at the start of this month, replaces and supersedes a £41m two-year deal that was only signed in September. In November, Amazon signed the One Government Value Agreement, a memorandum of understanding that offers discounts across a wide range of its services by treating the public sector as a single customer. The cloud firm has also established a “digital skills fund” to support training for 6,000 civil servants.

Although HMRC will be spending £10m extra a year with AWS compared with the deal that has been replaced, the new OGVA-based contract covers a huge array of products and services.

Signed via the G-Cloud framework, the tax agency now has access to about 150 separate AWS products offered via the first lot of the buying vehicle, which is dedicated to cloud storage. 

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From the second lot, which covers cloud software, HMRC will have access to Amazon’s WorkMail, WorkDocs, Alexa for Business, and Chime conferencing applications.

G-Cloud’s final lot addresses cloud support and AWS offers almost 50 different services, many of which will be provided to the department via the tech firm’s ProServe professional services unit.

The deal sets in stone a total annual price of $40.1m for each of the next two years, plus an optional third. The cost to HMRC is locked in at close to the current exchange rate, meaning the department is guaranteed to pay about £31.3m.

The contract indicates that, for this price, the department will have limitless access to AWS’s services.

“The buyer will receive a discount on the service charges in accordance with the mechanism set out in the OGVA,” it says. “It is acknowledged that the supplier is unable to and has no responsibility in terms of limiting the buyer to a maximum quantity or value of services purchased under this call-off contract. Supplier services will not include any projects-specific IPRs (intellectual property rights) or background IPR that could be embedded in any potential projects-specific IPRs.”

HMRC follows several other government agencies in updating their deals with AWS under the new and improved terms. In December, the Home Office swapped out its existing deal with the cloud firm with a £120m contract signed under the OGVA conditions.

A recently published contract award notice from the Driver and Vehicle Licensing Agency reveals that the organisation entered into a new AWS deal on 1 April. The deal is worth £6.74m.

“DVLA requires a three-year call off contract, direct with AWS via G-Cloud 12,” the notice says. “The contract must be under the terms of the OGVA MoU.”


Sam Trendall

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