Early work on achieving the milestones set out in the contracts with enterprise resource planning vendor Oracle and systems integrator IBM has been set back by eight months, assessment reveals
A multibillion-pound shared services initiative led by the Department for Work and Pensions has experienced “early delays” and a reduction in the benefits the programme is forecast to deliver.
The Synergy scheme – which forms part of the Government Major Project Portfolio (GMPP) – will see four major departments unite on a centralised and cloud-based Oracle back-office software infrastructure, with implementation delivered by IBM. The two tech firms were last year awarded deals cumulatively worth £850m to support the Synergy cluster which, alongside the DWP, also features the Home Office, Ministry of Justice, and the Department for Environment, Food and Rural Affairs, as well as the scores of arm’s-length bodies of these departments.
The overall delivery cost of the project is currently estimated at about £2.5bn, according to the latest set of departmental major project data. The programme will ultimately deliver shared services to about 250,000 civil services – almost half of government’s overall workforce.
In a newly published accounting officer assessment of Synergy – undersigned by permanent secretary Peter Schofield – the DWP states that, in addition to the IBM and Oracle agreements, a business process services engagement will also be put in place in early 2026. The commencement of this deal will be accompanied by an amended version of the full business case for the programme, the assessment says.
“The programme continues to plan and design the ‘Future Shared Services Organisation’, which will manage the overall solution and deliver the corporate shared services functions centrally on behalf of the four departments… once it is live,” the document adds. “This will be hosted within DWP until the end of the programme, at which point a decision will be taken on long-term hosting arrangements.”
Synergy, which still has more than three and half years left of its delivery schedule, has already experienced setbacks, the assessment indicates. The months ahead will represent a crucial phase of the scheme.
“The complexity in delivering business transformation across multiple departments to challenging timescales has caused early delays to the programme,” the formal review says. “A critical milestone will be the agreement of a fully costed and deliverable integrated plan in summer 2025 incorporating the release dates for departments to move over to Synergy services following work to rephase and replan. To lead the next phase of the programme, a new SRO and programme director were appointed in early 2025.”
Spending review
The assessment – the publication of which is a regular requirement for all GMPP programmes – reviews the progress and outlook of the programme in four metrics: regularity; propriety; value for money; and feasibility.
The regularity section notes that, while financial support for delivery is committed until the end of the current fiscal year, “funding beyond [then] is subject to the spending review to be announced in June 2025”.
In the area of propriety, the assessment states that “typical of programmes of this scale, there are risks being managed relating to value for money and feasibility”.
The project “continues to demonstrate a positive net present value – over a business case period reduced from 15 to 12 years”, according to the document.
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However, although “cashable benefits have increased by 10%… overall benefits are reduced by 14%”, compared with previous estimates.
“Whilst this reflects a headline reduction, benefits are more robust than at OBC (outline business case) stage following detailed evaluation with departmental teams,” the assessment adds.
As delivery continues, any additional delays could further impact the returns offered by Synergy.
“The programme value-for-money position is sensitive to delays, which lead to cost increases due to longer running of the programme and reduced benefits as they are delayed within the business case period,” the assessment says. “When the next iteration of the business case is produced, costs will be updated to reflect the business process services procurement outcome. The programme will also undertake work to review benefits and update assumptions around costs of transition to new services, which remain estimates at this stage.”
Considering the feasibility of the programme, the assessment again references delays – in this case related to the milestones set out in the long-term contracts with Oracle and IBM.
“The first phase is ‘common design’, which is the first key milestone to agree harmonisation of policy and processes across the departments,” the review says. “This was originally scheduled for February 2025 but will now be completed in October 2025. The programme plan is being revised to reflect this change and agree revised go-live dates for each department by the end of June 2025. There are key operational dependencies and obligations on Synergy cluster departments to enable the timely delivery of the implementation plan in partnership with the suppliers, including alignment of the new business process services supplier once contract is awarded in early 2026.”
The document adds: “Securing the required funding and resourcing for the programme will be critical to ensure the capacity and capability exists to deliver, both within the programme team and individual departments. The resources required to support delivery remain scarce in the marketplace, and the programme will be delivered by a mix of internal and external expertise. To maintain service continuity and to support transitional arrangements to the new services, extensions to current contracts through to 2028 have been secured.”
In his conclusion to the assessment, Schofield writes that “my overall assessment is that the Synergy programme satisfies the requirements of the four accounting officer tests of regularity, propriety, value for money and feasibility to proceed at this stage”.
PublicTechnology contacted the DWP providing an opportunity to provide comment for this story, but had not heard back at time of going to press.
As part of government’s wider shared services drive, alongside the Synergy cluster – which represents government’s most delivery-focused departments – is: the policy-centric Matrix cluster of nine departments; a Defence grouping for the Ministry of Defence and the Armed Forces; an Overseas cluster largely comprised of the Foreign Commonwealth and Development Office; and the HMRC-led Unity cluster, which also houses the Department for Transport and the Ministry of Housing, Communities and Local Government.
