As department retains supplier on datacentre deal, government initially stated there was a wider drive to ‘remove Fujitsu from government systems’, but has now indicated this applies only to HMRC
As HM Revenue and Customs reveals the agreement of a new £200m-plus deal with Fujitsu, government has stressed that the deal is awarded for with a “limited time and strict terms”, as the department strives to remove the vendor’s tech from its estate.
However, government has swiftly retracted part of its initial response in which it said it was part of a wider drive to “quickly and securely remove” Fujitsu systems across Whitehall.
HMRC has agreed its latest contract with the firm as a contingency measure while it progresses longer-term plans to vacate three datacentres operated by the Japanese IT giant.
Over the past two decades, HMRC has spent billions of pounds with long-term supplier Fujitsu. But, in the last few years, the tax department has been engaged in efforts to move out of three on-premises datacentres run by the tech firm.
This work is slated to be completed via a planned £500m 10-year contract with a major cloud firm due to come into effect next year. A commercial document published in March informed the market that HMRC will shortly be “seeking to appoint a hyperscaler to manage the migration of servers from the current on-premise solution to the hyperscaler’s cloud environment”.
In the meantime, Fujitsu is set to be retained on a new three-year deal – due to come into effect on 1 July – covering “datacentre services and project services” that, according to a further procurement update, can only be fulfilled by the incumbent firm while switchover work continues.
The engagement, which runs until 2028 and is valued at £220.3m, is intended to fulfil “a requirement for a bridging contract to ensure continuity of essential services as we migrate to new arrangements”, the contract-award notice said.
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In response to enquiries from PublicTechnology, a government spokesperson indicated that HMRC’s latest agreement with Fujitsu– whose faulty Horizon IT system led to a massive miscarriage of justice in which almost 1,000 sub-postmasters were wrongfully prosecuted – did not affect plans for the tax agency to move away from the vendor.
But, following the initial publication of this story, the government amended its initial statement in which it indicated it intended “take action to quickly and securely remove Fujitsu from government systems” more widely. It is understood that there is not currently a Whitehall-wide initiative to do so.
In an updated statement, a government spokesperson said: “This contract was inherited from the previous government, and this extension will be for a limited time on strict terms to protect essential services. We must never forget the lives ruined by the Horizon scandal, and no amount of redress can take away that pain. This government has more than quadrupled the amount of redress paid to the victims and in March, the Business Secretary met with Fujitsu to begin the process of paying victims compensation.”
In a procurement notice released in March, HMRC said that it is seeking to work with a cloud-computing giant in order to deliver “the primary objective of the… programme to exit three Fujitsu-hosted datacentres – and migrate associated services to new destination platforms”.
That document specified that the department wished to work with a hyperscaler – a term applied to the world’s biggest public cloud hosting firms. The sector is dominated by Microsoft and Amazon Web Services which, between them, hold as much as 80% market share in the UK, according to a recent regulatory report. Other firms often grouped in the hyperscale bracket include Google, IBM, and Oracle.
“It is anticipated that the appointment will be limited to a single hyperscaler, but this will be validated during the procurement,” the document says. “The authority acknowledges that hyperscalers may wish to sub-contract elements of the service delivery, but it is mandatory that the contracting entity is a capable hyperscaler who will manage the migration and hosting from the current [Fujitsu] on-premises solution.”
