Post Office spends millions more on deal to replace Horizon to avert ‘significant technical risk’

Value of contract with Accenture to support delivery of Strategic Platform Modernisation Programme has risen incrementally from £27m to £50m as changing supplier would be ‘very disruptive’ to replacement work

The Post Office has added millions of pounds to the value of its core contract to replace the Horizon IT system, in order to avoid “significant technical risk” in delivering the new platform.

In a newly published commercial notice, the Post Office has revealed that spending via lot 5 of its dedicated Digital Capability Framework – a segment which constitutes a deal with Accenture for the delivery of the organisation’s Strategic Platform Modernisation Programme (SPMP) – will rise by millions of pounds. The SPMP initiative covers the rollout of the rollout of the New Branch IT infrastructure that will replace the troubled Horizon system.

This fifth lot was originally expected to be worth £20m. The call-off contract with Accenture that was awarded via lot subsequently arrived with a price tag of £27m – a figure which has since risen to £37.5m and, in the latest update, to £50m.

The decision to extend spending via this arrangement by another £12.5m – taking the total to more than double its original forecast value – was taken in order to mitigate risks and ensure stability of the programme to replace Horizon, according to the procurement notice. The contract was expanded under the terms of procurement regulations that allow public bodies to make “major changes” to existing agreements in order to avert “significant inconvenience or substantial duplication of costs”.

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The notice explained: “The New Branch IT project is due to issue a release and a change of providers at this stage, given the complexity of the project, would be a significant technical risk to Post Office Limited (POL) and would be very disruptive to the project which is essential in order for POL to replace the current Horizon services.”

The Post Office, which operates as a public corporation, under the oversight of the Department for Business and Trade, signed the contract with Accenture in May 2022 for an initial two-year term. This engagement is complemented by a separate £13m deal Coforge, which represents lot three of the Digital Capabilities Framework.

Since it was first put in place in 2020, the overall anticipated value of that buying vehicle has risen from an original figure £75m to a total of £107m, following the most recent update.

Following the broadcast earlier this year of a major TV dramatisation, there has been increased public and political focus on the Horizon scandal. The faulty IT system, developed by Fujitsu and first deployed in 1999, led to almost 1,000 sub-postmasters being wrongfully prosecuted for fraud or false accounting in what is characterised by many as the biggest miscarriage of justice in British legal history.

Sam Trendall

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