Halfway through a major commercial engagement principally created to enable the tax department to modernise systems, government’s procurement unit has revealed a second, bigger iteration is already in the works

The Crown Commercial Service has provided a preview of plans to create a new and expanded version of a multibillion-pound framework primarily focused on supporting HM Revenue and Customs to upgrade legacy software.

The first iteration of the Digital and Legacy Application Services (DALAS) framework came into effect in two stages, with four lots awarded by CCS in July 2023 and a further three going live in March 2024. Procurement documents published at the time described the intent of the agreement as being to “provide a strategic gateway to support the delivery of future application services and move HMRC toward an application services support model that is less dependent upon legacy technologies”.

To ensure that the framework best met HMRC’s upgrade needs, it is understood CCS worked closely with the department in designing  the arrangement – which can also be used by other organisations across the public sector.

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The first version of the DALAS deal, which came with an estimated value of  about £3bn, was hoped to offer the tax department “a commercial vehicle to replace existing contractual arrangements that are due to expire between September 2023 and January 2025, and… provide the basis for letting a large proportion of HMRC future application services requirements”.

Since DALAS came into effect HMRC has awarded more than £1bn in major digital contracts.

The framework, which features 27 individual suppliers, is due to run until July 2027.

A newly published commercial pipeline notice indicates that CCS is already preparing for the creation of a DALAS 2 agreement, to come into effect around April 2027 and run for a four-year term.

The procurement agency pegs the value of the second iteration of the deal as £6.24bn, including VAT – double the worth of the incumbent deal. CCS expects to launch a competitive tender in October 2026, the notice indicates.

Outside of the framework’s name, value, and projected start date, no other detail is provided in the document. In response to an enquiry from PublicTechnology, CCS said that it could not provide any comment or further information, including the extent to which to new arrangement will replicate the structure and remit of the first DALAS contract, and whether its primary focus will remain supporting HMRC modernisation.