Select Committee on Social Security Minutes of Evidence

Examination of witnesses (Questions 380 - 396)



  380. So it is not cash up-front?
  (Dame Ann Bowtell) No ***

Mr Wicks

  381. There seem to be two problems. One is that the thing is not working or not as well as people thought, it is going to take longer, it is going to be more expensive, which is the usual story, is it not, about computers, as far as I can tell?
  (Dame Ann Bowtell) This is quite an extreme version of it.

  382. Okay, but the other thing is that it seems that you have changed your mind about the usefulness of the product. You mentioned that Sainsbury's are now doing this and others. Did we not really know that at the time, that there were going to be these developments with more people going to Sainsbury's for all these things? It was not that long ago.
  (Dame Ann Bowtell) This was 1993 when we first signed up to it. It has been clear that ACT has been the cheapest solution for us and always has been. It is just that the more that other sorts of facilities become available, the less attractive this sort of payment card looks. Even so, had this been running ahead and if there had not been a question of more money and all the rest of it, I do not think we would be hesitating. It is just that it can only go ahead at the price of a much longer contract and much more money and then it really does not look as attractive. That is our problem.
  (Mr Lord) That is the question being addressed. We are asking these questions because of delay. *** Given that we are taking stock, we are taking stock in the environment of 1998, not that of 1993. We are already that much nearer the end of the contractual period and the aspiration of the Benefits Agency would have been to go towards ACT at the end of that period, but for how long might people have these cards if we carry on without having the extension, so it is the delay that prompts the questions about whether it now makes sense.

  383. Was it only ICL that bid for this?
  (Dame Ann Bowtell) No.
  (Mr McCorkell) There were two other consortia that bid for this, one of which was led by IBM, and I am trying to think who the other one was. We can let you know.

  384. Presumably you awarded it to ICL partly because you liked what they were saying about the timescale and costs?
  (Dame Ann Bowtell) Absolutely.
  (Mr McCorkell) It was indeed awarded on the combination of the two things.
  (Dame Ann Bowtell) If there were to be a question giving the sorts of extensions that ICL have asked for, I think there would be a real question about whether that was do-able within the terms of the contract. You can vary the terms a bit, but there are limits.

  385. Is the contract a secret document?
  (Mr McCorkell) The contract is commercially confidential.
  (Dame Ann Bowtell) It is also probably about that big (indicating).

  386. The thing is stacked against the taxpayer, is it not, when it is a secret document and no one can see it and they give predictions about the timescale and costs which turn out to be twaddle? I am just wondering how on earth we stand any chance of safeguarding the taxpayer's interest.
  (Dame Ann Bowtell) Well, all of these big computer projects are very complex, difficult things to cost when you start off. They should not go as wrong as this one has gone.


  387. But it is particularly inappropriate or inapposite at this stage for ICL to contemplate going to the market and this is a flagship project for them.
  (Dame Ann Bowtell) Well, this is why it is all so difficult for them ***

Ms Stuart

  388. As I understand it, and you will correct me if I am wrong, it is not just simply that you would push your card in and you get your entitlement to money out, but if we were to go via the post office, you would have a screen which gives the entitlement to benefits. All of us at some stage, it is not just a rural issue, but it is also the urban representatives who have this struggle in keeping the post offices open and it is a real debate, and I think what would be quite useful is if you could let us know what would be your assessment of the training needs for the Post Office to actually administer the system in that way rather than just going for the automatic cash transfer because it would help us with an informed debate. If we have the Post Office coming to us, as MPs, and saying, "If only you can convince the DSS to continue with that, the member of staff sits behind the machine, calls it up on the screen, it has got all the entitlements, he knows Mrs Bloggs, they know the environment, this really is the best way to deliver", then it is a very seductive argument.
  (Dame Ann Bowtell) And I think if it was here today, which it almost ought to have been on the original timetable, the system would be fine. The actual training needs, according to ICL, are a day's training for those 70,000 staff, so it is that there are 70,000 of them which is difficult. The problem is not with the system now that we, I think, believe that it is technically suitable, but it is with the length of time it is taking and the extra money that ICL want and it is then a value for money question, but it is very difficult.

  Ms Stuart: I think it would be useful to have that, with this debate, in our own minds.


  389. I do not know if there are people who could produce that.
  (Dame Ann Bowtell) I am not sure exactly what it is you want.

  390. The point that Gisela makes is a powerful one from our perception as ordinary Members of Parliament. There will be a huge public argument and a lobby in support of the Post Office.
  (Dame Ann Bowtell) Absolutely.

  391. And you have made the absolutely crucially important point that there are training requirements that they may be under-estimating, so if there was some way of being able to put that question back to the Post Office, it may put the debate in a slightly more meaningful perspective.
  (Dame Ann Bowtell) Well, I doubt that we can challenge what they say and if they say it is a day, I accept it is a day. I just think that training 70,000 people is a pretty big demand, but in a sense that is not the crucial issue.

Mr Flight

  392. If I have understood you correctly, your assessment, if a decision is taken to cancel and after all the rowing, is that it probably will not have cost the taxpayer anything because you have got a good case for cancelling and it is going to cost ICL who will have to write off all their costs. Is that the commercial bottom line?
  (Dame Ann Bowtell) I think that whichever way you turn, there is going to be a cost because if we cancel ***

  393. ***
  (Dame Ann Bowtell) ***


  394. We could go on for the rest of the week on this.
  (Dame Ann Bowtell) ***

  395. Fine, but, believe me, we are not looking to put you into any kind of difficulty at all and we will arrange a satisfactory accommodation of that question, I am sure. One of the things we should take forward is perhaps if you were able to give us some private, off-the-record briefing of your own as these things develop, then this does not land us in the sort difficulty we are facing at the moment.
  (Dame Ann Bowtell) I would be very happy to do that.

  396. I do assure you that we are a mature Committee and you can trust us and that we are willing and anxious to help, subject to the rules that Select Committees operate under, so if you bear that in mind and there are appropriate moments when you think you could have us to share some of these things with us, that would be enormously helpful.
  (Dame Ann Bowtell) We will do that. We would be very happy to do that.

  Chairman: Well, I know you have spent an enormous amount of time, as one has to, doing the work in preparation for this morning, but we are really very grateful and thank you very much.

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