UK Government Agree Major Settlement In IT Contract Dispute


The UK Government has agreed to pay a major settlement of National Programme for IT with Fujitsu. According to what HSJ can reveal, the dispute of a £700m has been resolved. The hundreds of millions to be paid after an agreement in principle shows a major step towards a final settlement of the decade-long dispute. For 10 years, the Legal row has hung over the Department of Health and Social Care.

HSJ has been informed about the agreement on a settlement between the government’s DHSC and the technology giant. The final settlement, however, has been held up due to a related legal dispute between Fujitsu and another NPfIT era IT supplier. According to what the HSJ has been told, the final payment to be paid by the Department of Health and Social Care as agreed is in hundreds of millions of pounds.

There was a £10bn programme put in place to digitise the NHS which failed to meet most of its aims. The public accounts committee described the programme as “one of the worst and most expensive contracting fiascos in the history of the public sector”.

The news about the settlement came in just a few days after Matt Hancock, the new health and social care secretary announced to an audience that the NHS would no longer get into large, long-term IT contracts. Hancock accused some suppliers of the services of taking advantage of the service.

Since 2008 the two parties have been in a legal dispute involving settlement agreement solicitors. This was after the DHSC terminated a £896m contract with Fujitsu of running a large chunk of the National Programme for IT to cover most of the south of England. Previous reports claim that Fujitsu which has been seeking £700m from the DHSC was only ever paid £151 under the original contract.

What the HSJ revealed in January showed that the DHSC had already paid Fujitsu at least £65m in October 2017 as part of the settlement. The DHSC in addition also spent tens of millions of pounds to settlement agreement solicitors in the 10 years they have been in a legal brawl with the technology giant. The Department of Health and Social Care public records have since been tampered with to erase references to payments to Fujitsu.

When approached by HSJ, both the DHSC and Fujitsu refused to comment citing legal confidentiality. According to Fujitsu’s group last publicly available accounts for 2016-17, the company expected the disputed matter to be fully settled by a deadline of April 2018.

To extricate the government from the IT programme contracts, the DHSC struck a deal in 2012 and is now paying a former major NPfIT contractor, CSC, which is now part of DXC Technologies tens of millions of pounds in addition to the Fujitsu settlement.