Category Archives: IT-related failures

Trust spends £16.6m on consultants for Cerner EPR

Posted on 01/08/2013 | 2 comments

By Tony Collins

Reading-based Royal Berkshire NHS Foundation Trust says in an FOI response that its spending on “computer consultants since the inception of the EPR system is £16.6m”.

The Trust’s total spend on the Cerner Millennium system was said to have been £30m by October 2012.

NHS IT suppliers have told me that the typical cost of a Trust-wide EPR [electronic patient record] system, including support for five years, is about £6m-£8m, which suggests that the Royal Berkshire has spent £22m more than necessary on new patient record IT.

Jonathan Isaby, Taxpayers’ Alliance political director, said: “This is an astonishing amount of taxpayers’ money to have squandered on a system which is evidently failing to deliver results.

“Every pound lost to this project is a pound less available for frontline medical care. Those who were responsible for the failure must be held to account for their actions as this kind of waste cannot go unchecked.”

 The £16.6m consultancy figure was uncovered this week through a Freedom of Information request made by The Reading Chronicle. It had asked for the spend on consultants working on the Cerner Millennium EPR [which went live later than expected in June 2012].

The Trust replied: “Further to your request for information the costs spent on computer consultants since the inception of the EPR system is £16.6m.”

The Chronicle says that the system is “meant to retrieve patient details in seconds, linking them to the availability of surgeons, beds or therapies, but has forced staff to spend up to 15 minutes navigating through multiple screens to book one routine appointment, leading to backlogs on wards and outpatient clinics”.

Royal Berkshire’s chief executive Edward Donald had said the Cerner Millennium go live was successful.  A trust board paper said:

 “The Chief Executive emphasised that, despite these challenges, the ‘go-live’ at the Trust had been more successful than in other Cerner Millennium sites.”

A similar, stronger message had appeared was in a separate board paper which was released under FOI.  Royal Berkshire’s EPR [electronic patient record] Executive Governance Committee minutes said:

“… the Committee noted that the Trust’s launch had been considered to be the best implementation of Cerner Millennium yet and that despite staff misgivings, the project was progressing well. This positive message should also be disseminated…”

Comment

Royal Berkshire went outside the NPfIT. But its costs are even higher than the breathtakingly high costs to the taxpayer of NPfIT Cerner and Lorenzo implementations.

As senior officials at the Department of Health have been so careless with public funds over NHS IT – and have spent millions on the same sets of consultants – they are in no position to admonish Royal Berkshire.

So who can criticise Royal Berkshire and should its chief executive be held accountable?

When it’s official policy to spend tens of millions on EPRs that may or may not make things better for hospitals and patients – and could make things much worse – how can accountability play any part in the purchase of the systems and consultants?

The enormously costly Cerner and Lorenzo EPR implementations go on – in an NHS IT world that is largely without credible supervision, control, accountability or regulation.

Cash squandered on IT help

Trust loses £18m on IT system

The best implementation of Cerner Millennium yet?

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Posted in BT Health, Cerner, consultants, CSC, culture, e-health, Freedom of Information, health records, IT-related failures, NHS, npfit, oversight, Politics, procurement, public sector, public services, software quality, supplier relationships

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Ban the “g” word from outsourcing lexicon?

Posted on 25/07/2013 | 2 comments

By Tony Collins

Is the word “guaranteed” as in “guaranteed savings” just spin –  perhaps the most misused word  in the lexicon of outsourcing? Should it be banned by general voluntary agreement?

It’s commonly used when suppliers are bidding for council contracts; and it is used almost as much by cabinet councillors when they are marketing an outsourcing proposal to fellow councillors and the public.

 It was used a lot by BT in its bid marketing documents that were shown to Cornwall councillors before  they signed a contract with the company. Cornwall’s ruling councillors last year, too, used the phrase “guaranteed savings” to batter their outsourcing critics. 

These are mentions of “guaranteed” from a single marketing document – BT’s Cornwall Council Briefing Strategic Partnership for Support Services, October 2012

– “£149.6m of guaranteed savings”

–  “jobs supported by formal commitments and guarantees on delivery along with clarity on the nature and type of jobs”

– “Guaranteed savings of £60.6m year Core Contract Savings Years 1-10”

– Contractual guarantees for both job creation and performance levels reached

– sales and marketing team and guarantees – £2mpa

But when “guaranteed” faces its most critical test –  in a legal dispute – it appears to mean little or nothing. It’s not a contractual word. [That’s wrong. It is a contractual word says Ali Mehmet in a comment at the end of this blog.]

Somerset County Council portrayed the lowered costs of outsourcing as guaranteed when it contracted out IT and other services to the IBM-owned “Southwest One” joint venture.

Said an IBM-sponsored article on Southwest One in 2008, a year after the joint venture was formed,

“The contract calls for guaranteed [the article’s emphasis] lower costs for service delivery. IBM knows it can lower costs for the partners’ processes, so all three government agencies come out ahead. So do citizens.”

In the end the claimed savings were not achieved, the contract between the council and IBM went into a legal dispute which was settled at a cost to the council of £5.9m, and Somerset’s Cabinet member for resources, David Huxtable, told the BBC last week:

“It was a very complex contract and lots of the savings were predicated on an ever-increasing amount of money being put into public services and we know in the last four years that has gone into reverse.”

Barnet Council uses the word “guaranteed” liberally as it prepares to outsource its New Customer Services Organisation [NCSO] to Capita in a 10-year £320m contract which is part of the One Barnet transformation programme. Says a Barnet statement on the choice of Capita as preferred supplier for NCSO: 

“The contract is worth £320 over ten years and guarantees a saving to the council of £126 million over that period.”

Guarantees are subject to …

The g word may have little meaning in a contract because it is usually tied to variables – such as level of spend – which the public and most councillors rarely ever know the detail of, because the contract is kept confidential.

And against what – subjective? – basis, and baseline, are the guaranteed savings measured? Again it is in the commercially confidential contracts.

Once in a legal dispute between outsourcing supplier and customer, lawyers will argue over the sense, meaning and purpose of contractual guarantees that are subject to an ambiguous string of variables.

 If political parties made manifesto commitments that were “guaranteed” would anyone believe them? If a double-glazing salesmen offered security and thermal insulation that was guaranteed would anyone believe them? 

So why are ruling councillors so inclined to believe outsourcing bidders when they sprinkle their documents with the “g” word? How does it come to mean so much at the pre-contract stage – and nothing afterwards?

A ban on the “g” word? 

If a voluntary ban on the “g” word, at least with reference to outsourcing and related proposals, would be a good idea, please let me know when you see it used and, most likely, abused.  tony@tonyrcollins.co.uk

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Posted in BT, Campaign4Change, IBM, IT-related failures, jargon, legal disputes, local government, public sector, public services

Firecontrol disaster and NPfIT – two of a kind?

Posted on 23/07/2013 | 5 comments

By Tony Collins

Today’s report of the Public Account Committee on the Firecontrol project could, in many ways, be a report on the consequences of the failure of the National Programme for IT in the NHS in a few years time.

The Firecontrol project was built along similar lines to the NPfIT but on a smaller scale.

With Firecontrol, Whitehall officials wanted to persuade England’s semi-autonomous 46 local fire authorities to take a centrally-bought  IT system while simplifying and unifying their local working practices to adapt to the new technology.

NPfIT followed the same principle on a bigger scale: Whitehall officials wanted to persuade thousands of semi-autonomous NHS organisations to adopt centrally-bought technologies. But persuasion didn’t work, in either the fire services or the NHS.

More similarities

The Department for Communities and Local Government told
the PAC that the Firecontrol control was “over-specified” – that it was unnecessary to have back-up to an incident from a fire authority from the other side of the country.

Many in the NHS said that NPfIT was over-specified. The gold-plated trimmings, and elaborate attempts at standardisation,  made the patient record systems unnecessarily complicated and costly – and too difficult to deliver in practice.

As with the NPfIT, the Firecontrol system was delayed and local staff  had little or no confidence it would ever work, just as the NHS had little or no faith that NPfIT systems would ever work.

Both projects failed. Firecontrol wasted at least £482m. The Department of Communities and Local Government cancelled it in 2010. The Department of Health announced in 2011 that the NPfIT was being dismantled but the contracts with CSC and BT could not be cancelled and the programme is dragging on.

Now the NHS is buying its own local systems that may or may not be interoperable. [Particularly for the long-term sick, especially those who have to go to different specialist centres, it’s important that full and up-to-date medical records go wherever the patients are treated and don’t at the moment, which increases the risks of mistakes.]

Today’s Firecontrol report expresses concern about a new – local – approach to fire services IT. Will the local fire authorities now end up with a multitude of risky local systems, some of which don’t work properly, and are all incompatible, in other words don’t talk to each other?

This may be exactly the concern of a post-2015 government about NHS IT. With the NPfIT slowly dying NHS trusts are buying their own systems. The coalition wants them to interoperate, but will they?  

Could a post-2015 government introduce a new (and probably disastrous) national NHS IT project – son of NPfIT – and justify it by drawing attention to how very different it is to the original NPfIT eg that this time the programme has the buy-in of clinicians?

The warning signs are there, in the PAC’s report on Firecontrol. The report says there are delays on some local IT projects being implemented in fire authorities, and the systems may not be interoperable. The PAC has 

” serious concerns that there are insufficient skills across all fire authorities to ensure that 22 separate local projects can be procured and delivered efficiently in so far as they involve new IT systems”.

National to local – but one extreme to the other?

The PAC report continues

“There are risks to value for money from multiple local projects. Each of the 22 local projects is now procuring the services and systems they need separately.

“Local teams need to have the right skills to get good deals from suppliers and to monitor contracts effectively. We were sceptical that all the teams had the appropriate procurement and IT skills to secure good value for money.

“National support and coordination can help ensure systems are compatible and fire and rescue authorities learn from each other, but the Department has largely devolved these roles to the individual fire and rescue authorities.

“There is a risk that the Department has swung from an overly prescriptive national approach to one that provides insufficient national oversight and coordination and fails to meet national needs or achieve economies of scale. 

Comment

PAC reports are meant to be critical but perhaps the report on Firecontrol could have been a little more positive about the new local approach that has the overwhelming support of the individual fire and rescue authorities.  

Indeed the PAC quotes fire service officials as saying that the local approach is “producing more capability than was expected from the original FiReControl project”. And at a fraction of the cost of Firecontrol.

But the PAC’s Firecontrol Update Report expresses concern that

– projected savings from the local approach are now less than originally predicted

– seven of the 22 projects are running late and two of these projects have slipped by 12 months

– “We have repeatedly seen failures in project management and are concerned that the skills needed for IT procurement may not be present within the individual fire and rescue authorities, some of which have small management teams,” says the PAC.

On the other hand …

The shortfall in projected savings is small – £124m against £126m and all the local programmes are expected to be delivered by March 2015, only three months later than originally planned.

And, as the PAC says, the Department for Communities and Local Government has told MPs that a central peer review team is in place to help share good practice – mainly made up of members of fire and rescue authorities themselves.

In addition, part of the £82m of grant funding to local fire services has been used by some authorities to buy in procurement expertise.

Whether it is absolutely necessary – and worth the expense – for IT in fire services to link up is open to question, perhaps only necessary in a national emergency.

In the NHS it is absolutely necessary for the medical records of the chronically sick to link up – but that does not justify a son-of-NPfIT programme. Linking can be done cheaply by using existing records and having, say, regional servers pull together records from individual hospitals and other sites.

Perhaps the key lesson from the Firecontrol and the NPfIT projects is that large private companies can force their staff to use unified IT systems whereas Whitehall cannot force semi-autonomous public sector organisations to use whatever IT is bought centrally.

It’s right that the fire services are buying local IT and it’s right that the NHS is now too. If the will is there to do it cheaply, linking up the IT in the NHS can be done without huge central administrative edifices.

Lessons from FireControl (and NPfIT?) 

The National Audit Office identifies these main lessons from the failure of Firecontrol:

– Imposing a single national approach on locally accountable fire and rescue authorities that were reluctant to change how they operated

–  Launching the programme too quickly without applying basic project approval checks and balances

– Over optimism on the deliverability of the IT solution.

– Issues with project management including consultants who made up half of the management team and were not effectively managed

MP Margaret Hodge, chair of the Public Accounts Committee, today sums up the state of Firecontrol

“The original FiReControl project was one of the worst cases of project failure we have seen and wasted at least £482 million of taxpayers’ money.

“Three years after the project was cancelled, the DCLG still hasn’t decided what it is going to do with many of the specially designed, high-specification facilities and buildings which had been built. Four of the nine regional control centres are still empty and look likely to remain so.

“The Department has now provided fire and rescue authorities with an additional £82 million to implement a new approach based on 22 separate and locally-led projects.

“The new programme has already slipped by three months and projected savings are now less than originally predicted. Seven of the 22 projects are reportedly running late and two have been delayed by 12 months. We are therefore sceptical that projected savings, benefits and timescales will be achieved.

“Relying on multiple local projects risks value for money. We are not confident that local teams have the right IT and procurement skills to get good deals from suppliers and to monitor contracts effectively.

“There is a risk that the DCLG has swung from an overly prescriptive national approach to one that does not provide enough national oversight and coordination and fails to meet national needs or achieve economies of scale.

 “We want the Department to explain to us how individual fire and rescue authorities with varied degrees of local engagement and collaboration can provide the needed level of interoperability and resilience.

“Devolving decision-making and delivery to local bodies does not remove the duty on the Department to account for value for money. It needs to ensure that national objectives, such as the collaboration needed between fire authorities to deal with national disasters and challenges, are achieved.”

Why weren’t NPfIT projects cancelled?

 NPfIT contracts included commitments that the Department of Health and the NHS allegedly did not keep, which weakened their legal position; and some DH officials did not really want to cancel the NPfIT contracts (indeed senior officials at NHS England seem to be trying to keep NPfIT projects alive through the Health and Social Care Information Centre which is responsible for the local service provider contracts with BT and CSC).

PAC report on Firecontrol

What Firecontrol and the NPfIT have in common (2011)

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Posted in BT, BT Health, Campaign4Change, change management, consultants, CSC, data sharing, e-health, efficiency savings, Firecontrol, Government IT, health records, IT-related failures, managing outsourced services, NHS, outsourcing, project management, public sector, public services, shared services, Summary Care Record, supplier relationships

BT gets termination notice on £300m outsourcing contract

Posted on 22/07/2013 | 4 comments

By Tony Collins

Sandwell Council has issued BT with a 30-day termination notice on a 15-year £300m outsourcing contract that has yet to reach its half-way point.

The metropolitan borough council says there are various defaults BT needs to resolve. Based at Oldbury, West Midlands, about five miles from Birmingham, Sandwell has been an outsourcing reference site for BT.

The company quoted Sandwell Council in its presentations that formed part of the bidding for Cornwall Council’s planned outsourcing work.

The “guaranteed” savings in Sandwell’s contract with BT appear to be based on a level of spending the council is not maintaining. One point of contention appears to be the council’s wish for BT to reduce its charges to the council in line with the authority’s lower levels of activity.

In June 2012 Sandwell submitted a change request that asked BT to recalculate the annual service charge because the service volumes delivered through the contract had reduced significantly.

The council wanted the recalculation to be based on a reduction in the workforce from around 7,400 in 2007 when the contract with BT was signed to 4,688 in mid 2012.

Government Computing quotes a council document on the dispute as saying

“A reduction in the workforce should have a corresponding reduction in volumes such as the size of the ICT estate, the payroll, HR support and budget holders. There have been volume reductions in invoices, the number of contracts administered and calls to the contact centre for some services.”

Sandwell’s 30-day termination notice to BT was issued on 16 July so it will expire around that time next month. The council says it is prepared to take back staff.

Sandwell council leader, Councillor Darren Cooper, told Government Computing: “Cabinet has approved a recommendation to start the process of ending our contract with BT. That termination will take effect in 30 days’ time unless BT puts right various defaults we have asked them to resolve.

“If we have to, I am confident we will be able to bring the services BT currently supplies to us back to the council and run them in the most effective way in future.”

Guaranteed

In 2007 BT and its joint bidder, outsourcing provider Liberata, had set out to run the council’s back-office functions at what was announced as a “guaranteed” reduced cost over the lifetime of the contract.

The deal was aimed at cutting costs and improving Sandwell’s IT infrastructure, HR, finance, payroll and customer services functions.

There was some success. The BT-led ‘Transform Sandwell’ team won the UK’s Best Customer Services Management Team at the National Customer Services Awards in December 2010.

BT built a 75,000 square foot office block for Transform Sandwell. It accommodated 400 employees of Transform Sandwell and a 300-strong customer service team working for BT.

Massive mistake?

Independent socialist councillor Mick Davies said “Someone somewhere has obviously made a massive mistake and the taxpayers of Sandwell will have to foot the bill… The writing seemed to be on the wall when BT’s partner in the project, Liberata, was dumped unceremoniously a couple of years ago.”

Sandwell Council’s deputy leader and cabinet member for strategic resources Councillor Steve Eling said: “In view of the current climate and public expenditure reductions, the council is engaging with its partner to determine services that are needed over the medium term and to reduce the overall costs in light of public spending reductions.”

Technologies used in the Transform Sandwell contact centre have included Verint Impact 360, Siebel CRM and Nortel Contact Centre 6.0.

A BT spokesman told the Halesowen News

“BT continually looks at ways to improve the service it provides to its customers. The original contract was signed in 2007 and as is normal with long-term partnerships BT constantly looks at ways to service the changing needs of both the council and citizens of Sandwell.”

BT told Government Computing it “has throughout – and remains – fully committed to delivering the commitments it made through the Transform Sandwell Partnership.”

The European Services Strategy Unit which has carried out detailed research on outsourcing contracts lists some of the terminated and reduced local authority strategic partnership contracts.

Sandwell has 72 councillors, 67 of which represent Labour.

Comment

At some point in a 10 or 15-year outsourcing contract a major dispute seems almost inevitable because a supplier’s business objectives will rarely change when the council’s priorities change.

BT’s deal with Sandwell was signed in 2007 – as was Southwest One’s deal with IBM – at a pre-austerity period.

Now that councils have been making, and continue to make, radical savings, they want the flexibility to cut their outsourcing costs too. But it may not be in the supplier’s interests to take profits that are much lower than expected.

No such thing as a free lunch

How can the business interests of outsourcing providers and their council clients ever completely align and move in time like synchronised swimmers?

The growing number of disputes in local authority outsourcing deals suggests that councils are not properly weighing up the risks when they sign deals.

Perhaps small groups of ruling councillors – such as those at Barnet – are too easily persuaded by the “guaranteed” savings on offer at the start of a contract.

There is no such thing as a free lunch. But try telling that to council Cabinet councillors who have cartoon-character pound signs in their eyes in the Disney period before a big outsourcing contract is well underway.

Let’s hope BT and Sandwell kiss and make up. It looks like the lawyers are already in the middle of them, though; and at whose expense?

Sandwell and BT consider end of strategic partnership – Government Computing

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Posted in BT, change management, efficiency savings, ERP, IT projects, IT-related failures, law, legal disputes, local government, managing outsourced services, outsourcing, private sector lessons for the public sector, public sector, public services, public-private partnerships, risk, shared services, supplier relationships

The story of Southwest One

Posted on 16/07/2013 | 2 comments

By Tony Collins

Dave Orr worked in a variety of IT and project management roles for Somerset County Council and retired in 2010. For years he has campaigned with extraordinary tenacity to bring to the surface the truth over an unusual joint venture between IBM, Somerset County Council, a local borough council and the local police force.

Now he has written an account of the joint venture and the lessons. It is published on the website of procurement expert Peter Smith.

Orr questions whether Southwest One was ever a good idea, since it was formed in 2007.

The deal has not made the savings intended, a SAP implementation went awry, the contract has been mired in political controversy and criticism, Southwest One has repeatedly lost money, and many of the transferred staff and services have returned to the county council, and some services returned to the borough council. IBM and the county council have ended up in a legal dispute that cost the county council £5.5m to settle. Southwest One was not exactly the partnership it set out to be.

The contract may show how an outsourcing deal that doesn’t have the support of the staff being transferred is flawed fundamentally from the start (which is one reason few people will be surprised if a 10-year £320m deal for Capita to run Barnet Council’s new customer service organisation [NSCSO]  ends in tears).

These are some of Orr’s points:

–  Like other light-touch regulators, the Audit Commission repeatedly gave Southwest One positive reports, without ever qualifying the accounts, even as problems with SAP implementation mounted in 2009 and procurement savings were not being made in line with forecasts.

 – The contract called for transformation based upon ‘world-class technologies’, yet all of the IT Service was placed into Southwest One with no IT expertise back in the Somerset County client (until after a poor SAP implementation in 2009). Was the lack of retained IT skills in the Somerset County client behind the formal acceptance of a badly configured SAP implementation?

– Large scale outsourcing over a long contract of 10 years or more requires an ability to foresee the future that is simply not possible to capture in a fixed contract. In a 10-year contract, there will be three changes of national government and three changes of local government. That is a great deal of unpredictable change to cope with via a fixed, long-term contract.

– Local Government will always be at a disadvantage in resources and skills, to a large multi-national contractor like IBM, when it comes to negotiating, letting and managing a complex multi-service contract.

– What was the culture of Southwest One (75% owned by IBM)? Was it private, public or a hybrid? The management culture remained firmly IBM, yet the councils and police workforces were seconded and remained equally firmly public sector rooted. There is such a thing as a public service ethos. In fact, Southwest One was run like a mini-IBM based upon global divisions, complete with IBM standard structures and processes. Southwest One seconded employees were not allowed anything like a full access to IBM internal systems, thus creating additional complexity, as “real” IBM employees relied entirely upon on-line systems.

–  Mixed teams in a single shared service were hard to amalgamate. This meant the IBM managers of Southwest One never really gained the sort of command & control of the multi-tier workforces that their bonus-oriented model needs to function. “I doubt that IBM would ever again contemplate the seconded staff model over the TUPE transfer model,” says Orr.

– Somerset County Council ran with a “thin” client management team that, in Orr’s view, did not have sufficient expertise or enough staff resources to effectively manage this complex contract with IBM. The councils relied upon definitions of “partnership” that meant one thing to the councils’ side and quite another thing to IBM, says Orr.

– In Southwest One, Somerset County Council handed their entire IT Service over lock, stock and barrel. “Can you really consider IT as wholly a ‘back office’ service? Many successful private Companies see IT as a strategic service to be kept under their own control.”

– The real savings might have been found in optimising processes in big departments (like Social Care, Education, Highways) that lay outside of Southwest One’s reach. “The focus on IT rather than service processes was another flaw in the model.”

Orr  concludes that nobody who played a major part in the Southwest deal has in any way been held to account for what has gone wrong.

Southwest One – the complete story from Dave Orr

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Posted in Campaign4Change, change management, excessive secrecy, FOI, Freedom of Information, governance, IBM, IT-related failures, legal disputes, local government, managing change, managing outsourced services, openness and transparency, Politics, private sector lessons for the public sector, procurement, project management, public-private partnerships, SAP, shared services, supplier relationships

Universal Credit – good for its IT suppliers?

Posted on 11/07/2013 | 1 comment

By Tony Collins

The DWP is conceding in its own tangential way that the IT for Universal Credit is not up to scratch; and an article in the Daily Telegraph suggests that Universal Credit this year (and perhaps well beyond) will handle so few claimants that the calculations for the time being could be done by hand, or on a spreadsheet, and not automatically by IT systems. The Register, through anonymous sources, has confirmation of this.

The FT says there will be a progressive national rollout of the coalition’s welfare reform in just six additional jobcentres which it said was the “latest sign the project is falling behind schedule”. It added that a significant shake-up of the IT underpinning universal credit is under way. 

The DWP said David Pitchford, the Whitehall troubleshooter who took over the running of Universal Credit for three months, had been asked to “review” the IT and ministers had “accepted his recommendation that they should explore enhancing the IT for universal credit working with the government digital service”.

“Advancements in technology since the current system was developed have meant that a more responsive system that is more flexible and secure could potentially be built,” said the DWP.

The FT quoted Howard Shiplee, who has led the Universal Credit  project since May, as denying claims from MPs that the original IT had been dumped because it had not delivered. “The existing systems that we have are working, and working effectively,” he said.

He added that he had set aside 100 days not to stop the programme, but to reflect on where it has got to and start to look at the entire total plan.

Iain Duncan Smith, the work and pensions secretary, doesn’t concede that the  timetable for the implementation of Universal Credit has changed. He told the work and pensions committee on Wednesday that numbers of claimants would ramp up during 2014 and he insisted that all claimants would be on the system by 2017, as originally planned.

“We get fixated on things like IT; the reality is it’s about a cultural shift,” Duncan Smith told MPs.

Comment

Iain Duncan Smith makes it clear that his DWP staff and suppliers, with the help of HMRC, are implementing Universal Credit with extreme care. Labour’s  work and pensions spokesman Liam Byrne says the Universal Credit project is a shambles. The truth is hard to fathom.

For years the DWP has rejected press reports that the IT for Universal Credit was in trouble. It is able to do without fear of authoritative contradiction because it keeps secret all its consultancy reports on the state of the Universal Credit project, despite FOI requests.

The Cabinet Office minister Francis Maude and his officials talk much about the need for openness and transparency. Isn’t it time they persuaded DWP officials to release their internal and external reports on the detailed challenges faced by suppliers and civil servants on Universal Credit and other major government IT projects?

All big government IT projects are characterised by secrecy and defensiveness, although a little information about them is in the vague and subjectively-worded Major Projects Authority annual report.

One by-product of departmental defensiveness and secrecy is that the IT suppliers – in Universal Credit’s case HP, IBM and Accenture – are likely to continue to be paid even if the project is halted and redesigned. It’s probable the suppliers would argue that they have successfully done what they were asked to do in the contract. Who knows what the truth is?

The DWP is in effect protecting its suppliers from public and parliamentary scrutiny. It has been this way for decades and nothing has changed.

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Posted in Accenture, Agile, Campaign4Change, excessive secrecy, FOI, Freedom of Information, Government IT, IBM, IT-related failures, Major Projects Authority, managing change, managing outsourced services, openness and transparency, operational issues, outsourcing, oversight, project management, public sector, public services, software quality, supplier relationships

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Whitehall to lose its best troubleshooter

Posted on 05/07/2013 | Leave a comment

By Tony Collins

David Pitchford, who is arguably the civil service’s most able troubleshooter, is to quit the civil service in September and return to his native Australia for undisclosed family reasons. The FT broke the story yesterday.

Pitchford is Executive Director at the understaffed Major Projects Authority. It aims to work in partnership with permanent secretaries and senior civil servants to improve the success rate of major departmental IT and other large projects. 

In practice some senior civil servants in central departments resent the intrusion of the Cabinet Office. They do not like having to present their big schemes to the Major Projects Authority, particularly as it has David Cameron’s mandate to stop or re-scope failing projects.

Fighting intransigence? 

One unanswered question about Pitchford’s quitting is: has his morale been beaten down by departmental intransigence and even ill-will? Has the system defeated Pitchford and the taxpayer – the same system that confronted other Cabinet Office reformers John Suffolk, Chris Chant and Andy Tait?

It is possible that Pitchford feels his work is done now that the Major Projects Authority has finally, and after some departmental resistance, produced its first annual report.

The report’s key feature is its “traffic light” status on the projects it is keeping an eye on. In a foreword to the report, Pitchford wrote:

“April 2013 marks two years of the Major Projects Authority… For the first time, the country’s biggest and most high-risk projects are scrutinised so problems are exposed before they spiral out of control. Over two-thirds of major projects are predicted to deliver their promises on time and on budget, more than double the historic success rate. However, the MPA has studied carefully what goes on in every department, and we have uncovered some weaknesses which we are continuing to address.

“The MPA was established following a landmark report by the National Audit Office in 2010, which recommended a wholesale shift in the administration of major projects. It works closely with individual departments’ project teams and Permanent Secretaries to monitor and improve the management of major projects…the MPA’s Government Major Projects Portfolio has improved the rate of successful project delivery from under 30% to over 70%.

“Our success has been achieved by focusing intensively on the three core elements of successful project management: improving leadership; improving the operating environment; and looking closely at the past lessons.”

Pitchford is a much-valued executive in part because he can see why projects are failing and is straight-talking. He joined the Cabinet Office in November 2009 and in 2010 told a conference what he had discovered so far about the reasons for the failure of UK government projects:

– Political pressure

– No business case

– No agreed budget

– 80% of projects launched before 1,2 & 3 have been resolved

– Sole solution approach (options not considered)

– Lack of Commercial capability – (contract / administration)

– No plan

– No timescale

– No defined benefits

Since then Pitchford has been a little more guarded now about what he says in public. Campaign4Change said in February 2013 that the longer he stays in the innately secretive civil service the more guarded he seems to become but he is still one the best assets the Cabinet Office has. His main advantage is his independence from government departments.

Francis Maude, Cabinet Office minister, said he would “much miss David’s sharp wit and impressive leadership”.

Is Pitchford’s departure a sign that the non-reformers in Whitehall departments are winning the battle against major change?

 

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Posted in Campaign4Change, capacity building, change management, cost reduction, G-Cloud, Government IT, IT projects, IT-related failures, Major Projects Authority, private sector lessons for the public sector, procurement, project management, public sector

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Did officials exaggerate death of the NPfIT?

Posted on 14/06/2013 | Leave a comment

By T0ny Collins

In 2011 the Department of Health made a major announcement that implied the NHS IT programme, the NPfIT, was dead when it wasn’t.

The DH’s press release announced an “acceleration of the dismantling of the National Programme for IT, following the conclusions of a new review by the Cabinet Office’s Major Projects Authority”.

It said the Authority had concluded that the NPfIT was “not fit to provide the modern IT services that the NHS needs…” The National media took the press release to mean that the NPfIT was dead.

What the announcement didn’t mention was that at least £1.1bn had still to be spent, largely with CSC, provided that the company successfully completed all the work set out in its revised contracts, and that the projected end-of-life of some centrally-chosen NHS IT systems was 2024.

Some will say: who cares if the DH issues a press release that is misleading. Others may say that in a democracy one should be able to trust institutions of state. If the DH issues an official notice that has the effect of manipulating public perceptions – gives a false impression – can citizens trust the Department’s other official notices?

The press release in question did not say the NPfIT was closing but gave that impression. The announcement distanced the government and the Department of Health from an IT scheme, perhaps the world’s largest non-military IT programme, that was failing. This was the press release:

The government today announced an acceleration of the dismantling of the National Programme for IT.

“The government today announced an acceleration of the dismantling of the National Programme for IT, following the conclusions of a new review by the Cabinet Office’s Major Projects Authority (MPA). The programme was created in 2002 under the last government and the MPA has concluded that it is not fit to provide the modern IT services that the NHS needs…”

The press release was given added weight by those quoted in it. They included the Department of Health, Francis Maude, Minister for the Cabinet Office and Sir David Nicholson, Chief Executive of the NHS.

But the truth about the press release emerged this week at a hearing of the Public Accounts Committee.

Margaret Hodge, chair of the Public Accounts Committee, began a hearing on the NPfIT on Wednesday by asking Sir David Nicholson, the NHS chief, a canny question.

Hodge:  “There was a big announcement back in 2011 that you were closing the NPfIT programme.”

“Yes,” replied Sir David.

“That’s not true,” said Hodge. “It was a PR exercise to say you closed it.”

Nicholson: “It certainly was not a PR exercise.”

Hodge: “What changed?”

Nicholson: “The governance arrangements changed.  So there are separate senior responsible officers for each of the individual programmes [within the NPfIT].”

Hodge: “With the greatest respect, changing governance arrangements is not closing the programme.. .I think the impression you were trying to give was that you were closing the programme. All you were doing was shifting the deckchairs on the Titanic. You were shifting the way you were running it but you were keeping all that expenditure running… The impression given to the public was that you were going to get out of some of these contracts.”

On the basis of the press release the Daily Mail published a front page lead story with this headline:

£12bn NHS computer system is scrapped… and it’s all YOUR money that Labour poured down the drain

On the day of the press release the Daily Telegraph reported that the £11.4bn NHS IT programme was “to be abandoned”.  Similar reports appeared in the trade press.

But this week’s Public Accounts Committee heard that the NPfIT is very much alive:

– the estimated worth of CSC’s contracts under the NPfIT has risen from £3.1bn to £3.8bn at today’s prices.

–  officials expected to pay CSC a further £1.1bn on top of the £1.1bn it has already received, and this payment may include up to £600m for Lorenzo deployments at only 22 trusts. Hodge said: “You are going to spend another half a billion with this rotten company providing a hopeless system” – to which the DH argues that CSC has delivered thousands of (non-Lorenzo) working systems to the NHS which trusts and community health services rely on.

– About £500m of the £1.1bn still set aside for CSC will go on GP systems supplied by CSC’s subcontractor TPP Systmone.

– Further spending on the NPfIT may come as a result of Fujitsu’s legal action against the DH after it left the NPfIT in 2008, which leaves the taxpayer with a potential pay-out of £700m or more. The outcome of a formal arbitration is expected in about six months. The closing arguments are due at the end of this month.

– £31.5m has so far been spent on the DH’s legal costs in the Fujitsu case, mostly with the .law firm DLA Piper.

– DH has agreed a compensation payment to CSC of £100m. In return CSC has released the Department of Health from a contractual commitment for 160 NHS trusts to take the Lorenzo system. The DH has made a further payment to CSC of £10m in recognition of changes to its software which had been requested by the NHS but not formally agreed with CSC.

Comment

It appears there has been no deliberate deception and no deliberate manipulation of public perceptions of the NPfIT. But the fact remains that the DH made a major announcement in 2011 which gave the impression the NPfIT was dead when this was not true.

When a BBC Radio 4 journalist called me this week and we spoke briefly about the NPfIT he said: “I thought it was dead”.

Perhaps the mindset of officials was that the NPfIT was dead because everyone except the suppliers wanted it to be. But because local service provider contracts had to stay in place – the suppliers being much better equipped than the DH to handle any disputes over early termination – large payments to CSC and BT had to continue.

It’s a little like the political row over weapons of mass destruction in Iraq. It’s unlikely Blair lied over the existence of WMD. He probably convinced himself they existed. In a similar act of self-delusion officials appear to have convinced themselves the NPfIT was dead although it wasn’t.

But if we cannot believe a major DH announcement one starts to ask whether any of the department’s major announcements can be believed.

Uncoloured information on the NPfIT has always been hard to come by. So credit is due to the Public Accounts Committee and particularly its MP Richard Bacon for finding out so much about the NPfIT.  All credit to Margaret Hodge for picking up on Bacon’s concerns. Were it not for the committee, with indispensable support from the National Audit Office, the DH would have been a sieve allowing only bits of information it wanted to release to pass through.

The fall-out from the NPfIT will continue for years. We still don’t know, for example, what all the trusts with BT and CSC systems will do when the NPfIT contracts expire in the next three years. The hope is for transparency – and not of the sort characterised by the DH’s announcement in 2011 of the NPfIT’s dismantling.

This post also appears on ComputerworldUK

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Posted in BT, Campaign4Change, CSC, governance, health, health records, IT-related failures, legal disputes, Major Projects Authority, NHS, npfit, project management

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How to cost-justify the NPfIT disaster – forecast benefits a decade away

Posted on 07/06/2013 | 2 comments

By Tony Collins

To Jeremy Hunt, the Health Secretary, the NPfIT was a failure. In an interview with the FT, reported on 2 June 2013, Hunt said of the NPfIT

“It was a huge disaster . . . It was a project that was so huge in its conception but it got more and more specified and over-specified and in the end became impossible to deliver … But we musn’t let that blind us to the opportunities of technology and I think one of my jobs as health secretary is to say, look, we must learn from that and move on but we must not be scared of technology as a result.”

Now Hunt has a different approach.  “I’m not signing any big contracts from behind [my] desk; I am encouraging hospitals and clinical commissioning groups and GP practices to make their own investments in technology at the grassroots level.”

Hunt’s indictment of the NPfIT has never been accepted by some senior officials at the DH, particularly the outgoing chief executive of the NHS Sir David Nicholson. Indeed the DH is now making strenuous attempts to cost justify the NPfIT, in part by forecasting benefits for aspects of the programme to 2024.

The DH has not published its statement which attempts to cost justify the NPfIT. But the National Audit Office yesterday published its analysis of the unpublished DH statement. The NAO’s analysis “Review of the final benefits statement for programmes previously managed under the National Programme for IT in the NHS” is written for the Public Accounts Committee which meets next week to question officials on the NPfIT. 

A 22 year programme?

When Tony Blair gave the NPfIT a provisional go-ahead at a meeting in Downing Street in 2002, the programme was due to last less than three years. It was due to finish by the time of the general election of 2005. Now the NPfIT  turns out to be a programme lasting up to 22 years.

Yesterday’s NAO report says the end-of-life of the North, Midlands and East of England part of the NPfIT is 2024. Says the NAO

“There is, however, very considerable uncertainty around whether the forecast benefits will be realised, not least because the end-of-life dates for the various systems extend many years into the future, to 2024 in the case of the North, Midlands and East Programme for IT.”

The DH puts the benefits of the NPfIT at £3.7bn to March 2012 – against costs of £7.3bn to March 2012.

Never mind: the DH has estimated the forecast benefits to the end-of-life of the systems at £10.7bn. This is against forecast costs of £9.8bn to the end-of-life of the systems.

The forecast end-of-life dates are between 2016 and 2024. The estimated costs of the NPfIT do not include any settlement with Fujitsu over its £700m claim against NHS Connecting for Health. The forecast costs (and potential benefits) also exclude the patient administration system Lorenzo because of uncertainties over the CSC contract.

The NAO’s auditors raise their eyebrows at forecasting of benefits so far into the future. Says the NAO report

“It is clear there is very considerable uncertainty around the benefits figures reported in the benefits statement. This arises largely because most of the benefits relate to future periods and have not yet been realised. Overall £7bn (65 per cent) of the total estimated benefits are forecast to arise after March 2012, and the proportion varies considerably across the individual programmes depending on their maturity.

“For three programmes, nearly all (98 per cent) of the total estimated benefits were still to be realised at March 2012, and for a fourth programme 86 per cent of benefits remained to be realised.

There are considerable potential risks to the realisation of future benefits, for example systems may not be deployed as planned, meaning that benefits may be realised later than expected or may not be realised at all…”

NPfIT is not dead

The report also reveals that the DH considers the NPfIT to be far from dead. Says the NAO

“From April 2013, the Department [of Health] appointed a full-time senior responsible owner accountable for the delivery of the [the NPfIT] local service provider contracts for care records systems in London, the South and the North, Midlands and East, and for planning and managing the major change programme that will result from these contracts ending.

“The senior responsible owner is supported by a local service provider programme director in the Health and Social Care Information Centre.

“In addition, from April 2013, chief executives of NHS trusts and NHS foundation trusts became responsible for the realisation and reporting of benefits on the ground. They will also be responsible for developing local business cases for the procurement of replacement systems ready for when the local service provider contracts end.”

The NAO has allowed the DH to include as a benefit of the NPfIT parts of the programme that were not included in the original programme such as PACS x-ray systems.

Officials have also assumed as a benefit quicker diagnosis from the Summary Care Record and text reminders using NHSmail which the DH says reduces the number of people who did not attend their appointment by between 30 and 50 per cent.

Comment

One of the most remarkable things about the NPfIT is the way benefits have always been – and still are – referred to in the future tense. Since the NPfIT was announced in 2002, numerous ministerial statements, DH press releases and conference announcements have all referred to what will happen with the NPfIT.

Back in June 2002, the document that launched the NPfIT, Delivering 21st Century IT for the NHS, said:

“We will quickly develop the infrastructure …”

“In 2002/03 we will seek to accelerate the pace of development …

“Phase 1 – April 2003 to December 2005 …Full National Health Record Service implemented, and accessible nationally for out of hours reference.”

In terms of the language used little has changed. Yesterday’s NAO report is evidence that the DH is still saying that the bulk of the benefits will come in future.

Next week (12 June) NHS chief Sir David Nicholson is due to appear before the Public Accounts Committee to answer questions on the NPfIT. One thing is not in doubt: he will not concede that the programme has been a failure.

Neither will he concede that a fraction of the £7.3bn spent on the programme up to March 2012 would have been needed to join up existing health records for the untold benefit of patients, especially those with complex and long-term conditions.

Isn’t it time MPs called the DH to account for living in cloud cuckoo land? Perhaps those at the DH who are still predicting the benefits of the NPfIT into the distant future should be named.

They might just as well have predicted, with no less credibility, that in 2022 the bulk of the NPfIT’s benefits would be delivered by the Flower Fairies.

It is a nonsense that the DH is permitted to waste time on this latest cost justification of the NPfIT. Indeed it is a continued waste of money for chief executives of NHS trusts and NHS foundation trusts to have been made responsible, as of April 2013, for reporting the benefits of the NPfIT.

Jeremy Hunt sums up the NPfIT when he says it has been a huge disaster. It is the UK’s biggest-ever IT disaster. Why does officialdom not accept this?

Instead of wasting more money on delving into the haystack for benefits of the NPfIT, it would be more sensible to allocate money and people to spreading the word within Whitehall and to the wider public sector on the losses of the NPfIT and the lessons that must be learnt to discourage any future administrations from embarking on a multi-billion pound folly.

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Posted in Atos, BT, BT Health, Campaign4Change, change, change management, CSC, e-health, excessive secrecy, Fujitsu, health records, IT projects, IT-related failures, legal disputes, Major Projects Authority, managing change, managing outsourced services, NHS, npfit, public sector, public services, Summary Care Record

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Is Major Projects annual report truly ground-breaking?

Posted on 29/05/2013 | 3 comments

By Tony Collins

Francis Maude, the Cabinet Office minister, describes as “nothing short of groundbreaking” a report of the Major Projects Authority which gives the RAG (Rred/Amber/Green) status of more than 100 major projects.

That the report came out late on Friday afternoon as most journalists were preparing to go home, some of them for the whole bank holiday weekend, suggests that the document was a negotiated compromise: it would be published but in such a way as to get minimal publicity.

Indeed the report is a series of compromises. It has the RAG status of projects but not the original text that puts the status into context.

Another compromise: senior civil servants in departments have persuaded Maude to publish the RAG decisions when they are at least six months old.

This enables departmental officials to argue their case in the “narrative” section of the MPA annual report that a red or amber/red decision is out-of-date and that there has been significant improvement since. This is exactly the DWP’s justification for the amber/red status on Universal Credit.

The DWP says in the MPA report: “This rating [amber/red] dates back to September 2012, more than seven months ago. Since then, significant progress has been made in the delivery of Universal Credit. The Pathfinder was successfully launched and we are on course both to expand the Pathfinder in July 2013 and start the progressive national roll-out of Universal Credit in October.”

That the Pathfinder was launched successfully might have nothing to do with Universal Credit’s amber/red status which could be because of uncertainties over how the IT will perform at scale, given the complexities and interdependencies.  The MPA report says nothing about the uncertainties and risks of Universal Credit.

More compromises in the MPA annual report: the Cabinet Office appears to have allowed departments to hide their cost increases on projects such as HMRC’s Real-time Information [RTI] in the vague phrase “Total budgeted whole life costs (including non-government costs).”

The Cabinet Office has also allowed departments to write their own story to accompany the RAG status. So when HMRC writes its story on RTI it says that “costs have increased” but not by how much or why. We know from evidence that HMRC gave to the Public Accounts Committee that RTI costs have risen by “tens of millions of pounds”. There is nothing to indicate this in the MPA annual report.

Another compromise in the MPA annual report: there are no figures to compare the original forecast costs of a project with the projected costs now. There are only the 2012/13 figures compared with whole-life projected costs (including non-government projected spend).

And the MPA report is not comprehensive. It came out on the same day the BBC announced that it was scrapping its Digital Media Initiative which cost the public £98m. The MPA report does not mention the BBC.

The report is more helpful on the G-Cloud initiative, showing how cheap it is – about £500,000. But there is little information on the NHS National Programme for IT [NPfIT] or the Summary Care Record scheme. 

Yet the MPA annual report is ground-breaking. Since Peter Gershon, the then head of the Office of Government Commerce, introduced Gateway reviews of risky IT projects about 12 years ago with RAG decisions, they have remained unpublished, with few exceptions. The Cabinet Office is now publishing the RAG status of major departmental projects for the first time. Maude says

“A tradition of Whitehall secrecy is being overturned. And while previous Governments buried problems under the carpet, we are striving to be more open. By their very nature these works are high risk and innovative.

“They often break new ground and dwarf anything the private sector does in both scale and complexity. They will not always run to plan. Public scrutiny, however uncomfortable, will bring about improvement. Ending the lamentable record of failure to deliver these projects is our priority.”

Comment

The MPA annual report is a breath of fresh air.

Nearly every sentence, nearly every figure, represents compromise. The report reveals that the Universal Credit project was last year given an amber/red status – but it doesn’t say why. Yet the report has the DWP’s defence of the amber/red decision. So the MPA report has the departmental defences of the RAG decisions, without the prosecution evidence. That’s a civil service parody of openness and accountability: Sir Humphrey is allowed to defend himself in public without the case against him being heard.

But it’s still useful to know that Universal Credit is at amber/red.  It implies well into the project’s life that the uncertainties and risks are great. A major project at amber/red at this stage, a few months before go-live, is unlikely to turn green in the short term, if ever.

Congratulations

The Cabinet Office deserves congratulations for winning the fight for publication of the RAG status of each major project. Lord Browne, the government’s lead non-executive director and a member of the Cabinet Office’s Efficiency and Reform group, has said  that billions of pounds of taxpayers’ money is being frittered away because of “worryingly poor” management of government projects.

“Nobody ever stops or intervenes in a poor project soon enough. The temptation is always to ignore or underreport warning signs,” he says.

The management of some large projects – usually not the smaller ones – is so questionable that departments ignore advice to have one senior responsible owner per major project, says the MPA.

The MPA annual report will not stop the disasters. Its information is so limited that it will not even enable the public – armchair auditors – to hold departments to account. Senior civil servants have seen to that.

But the report’s publication is an important development: and it provides evidence of the struggle within Whitehall against openness. Francis Maude and Sir Bob Kerslake, head of the civil service, have had to fight to persuade departmental officials to allow the RAG status of projects to be published. The Guardian’s political editor Patrick Wintour says of the MPA annual report

“Publication led to fierce infighting in Whitehall as government departments disputed the listings and fought to prevent publication.”

Large-scale change

If Maude and Kerslake struggled to get this limited distance, and there is still so much left to reform, will large-scale change ever happen?

Maude and his officials have as comprehensive mandate for change from David Cameron as they could hope for. Yet still the Cabinet Office still seems to have little influence on departments. When it comes to the big decisions, Sir Humphrey and his senior officials hold onto real power. That’s largely because the departments are responsible to Parliament for their financial decisions – not the Cabinet Office.

Maude and his team have won an important battle in publishing the MPA annual report. But the war to bring about major change is still in its very early stages; and there’s a general election in 2015 that could halt Maude’s reform plans altogether.

The Major Projects Authority Annual Report.

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Posted in capacity building, change, change management, DWP, excessive secrecy, Gateway reviews, Government IT, HMRC, IT-related failures, Major Projects Authority, private sector lessons for the public sector, procurement, project management, public sector, public services, Universal Credit

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