Credit: Jacob Edward/CC BY 2.0

In the first quarter of the current financial year, HM Revenue and Customs spent an additional £1.2m on rolling out Microsoft’s Office 365 technology, taking total spending on the deployment to about £7m.

On 22 January, the tax authority received Cabinet Office approval to spend £4.9m on O365 software. The green light for an additional outlay of £850,000 was granted exactly two months later.

Newly published data, covering April, May, and June, reveals that HMRC requested – and was given – central approval for another seven-figure tranche of spending. On 6 June, the Cabinet Office approved the department to spend £1.2m on “2019/20 project costs to complete the rollout of O365 for HMRC staff”. 

The additional money takes cumulative spending on the project to £6.95m.

O365 is Microsoft’s flagship hosted software product, and offers cloud-based versions of a range of popular productivity programs, such as Word, Excel, and Outlook.

Alongside the additional spending on the Microsoft kit, HMRC also received approval in FY20’s first quarter to spend £5.9m on an IT-based programme of work concerning the processing of charges related to the department’s Simple Assessment service for individuals to pay income tax.

Related content

• NHS Wales signs national Office 365 deal
• HMRC floats £24m in contracts to support key digital platforms
• Ministry of Defence returns to SBL for £190m Microsoft product deal

The project in question will “complete work required for customers to continue to receive Simple Assessment charges and to ensure that the accounting for the charges can then be reconciled”, the department said.

Both this project and the O365 rollout pale in comparison to the £106m the department recently spent on Microsoft E5 licences – a souped-up version of O365 that includes more security, communications, and analytics tools. Approval for this outlay was granted in March.

All the discussions this year concerning spending on Microsoft products will have taken place without the involvement of Jacky Wright who, until last week, served as chief digital and information officer of HMRC. Wright was at the department on a two-year “loan” from the software vendor. Under the terms of the arrangement, the CDIO “recused” herself from all commercial discussions related to the Microsoft.

PublicTechnology revealed last month that, in Wright’s absence, the procurement decisions were taken by HMRC’s chief financial officer Justin Holliday, chief operating officer Rob Woodstock, and the CDIO’s chief operating officer Martin Coombs.

Following Wright’s return to Microsoft – for whom she will now serve as chief digital officer of the company’s US operation – HMRC is yet to confirm her successor as CDIO. The department said this week that it “will be covering the position of chief digital and information officer internally in the very short-term”.

It added: “We will make an announcement once a replacement has been found.”