Tax agency’s programme to ‘deliver a step change’ in its use of tech begins in earnest

HMRC headquarters in central London     Credit: Gary Todd/Public domain

HM Revenue Customs has awarded the first two significant deals in a major revamp of its IT supplier landscape.

The contracts, cumulatively worth at least £150m, relate to the department’s case-management applications. Both have been awarded to IT and consulting giant Cognizant.

HMRC’s Case Management Delivery Group (CMDG) uses a range of software products, the two foremost of which are the Pega platform from Pegasystems, and Documentum, from OpenText.

The bigger of the two contracts won by Cognizant – with a value of £90m over three years – relates to support and development work for the department’s Pegasystems estate.

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The company will “deliver and provide technical delivery and operational support for project initiatives and provide broad technology expertise across the CMDG Pega technology stack”, the contract award notice said. 

Such expertise will allow the case-management function to “service the expected workflow management business requirements across HMRC”.

“[The supplier will] assist with the projected development projects and ongoing support,” the notice added. “The majority of the projected outcome-based work will be build-related activities funded through relevant business projects.”

The second contract, worth £60m, relates to the delivery of similar work addressing “the wider CMDG technology stack outside of our Pega and Documentum technologies”.

Both deals came into effect on 26 July and last for an initial period of three years, and each provides for two extensions of 12 months each.

The contracts mark the first major engagements that form part of the tax agency’s Technology Sourcing Programme (TSP) which, according to HMRC, will be dedicated to “breaking down and addressing £900m worth of IT spend”. 

“TSP aims to deliver a step change in how HMRC delivers IT, works with IT suppliers to procure and utilise technology, and how we work more broadly as an organisation,” the department said, in a prior information notice published last year.

Since then, the department has brought in several external providers to assist with the conception and rollout of the programme.

Over the course of a nine-month £5.4m contract that concluded on 30 June, Deloitte provided HMRC with “strategy, design and delivery” services for TSP.

Meanwhile, between November 2020 and March 2023 North Highland will be paid £5m to provide the procurement overhaul project with “change management” support. 

Over the same period, consultancy Baringa partners will fulfil a £3m contact to help HMRC “develop sourcing strategies from a deep understanding of supply chains and undertake options analysis [and] recommendations, and assurance/risk mitigation on end-of-life contracts and transition”.