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Mr. Todd: That was not quite what I was saying. I was more concerned about the fact that the preparatory phasewhich involved understanding of the process of business change and the key appointment to which my right hon. Friend has referred, and also the specification processhad not been given enough weight in the project. That is the element that was rushed.
My hon. Friend's other point, which prompted an intervention from the hon. Member for Wycombe, related to the number of changes made to the initial contract. The hon. Gentleman said that there had been 2,500 changes, and that that was reprehensible. I wrote to the hon. Member for Roxburgh and Berwickshire, the Chairman of the Select Committee, giving the details. I am sure that he will share them with other Committee members. In the meantime, I can tell the House that according to the record there were 1,016 requests for changesnot 2,500and 55 were agreed to as proper changes under the terms of the contract, while 657 were agreed by both sides to be defects. When the Department said that a defect should be rectified, it was itemised as a change. The remaining 304 are still under discussion. I hope that that explains the position, and that the hon. Member for Wycombe is now entirely satisfied.
Yes. They are the figures agreed with EDS, which is why I pointed out that 304 changes were still under discussion. I will keep the Select Committee posted on them.
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"Since December 2002, which is the last piece of review that we did, we believe that we have made something like 50 to 55 requests for change, against around 1,000-plus changes that needed to be made to the system" .
Alan Johnson: I cannot put my hand on the letter that I sent to the hon. Member for Roxburgh and Berwickshire, but if the answer is not in that letter I shall write a supplementary letter to ensure that the Select Committee has the information.
The hon. Member for South-West Bedfordshire made an interesting point about Clinger-Cohen. He said that we should consider introducing that American legislation for our UK procurement system. We believe that the steps that we are actively taking to strengthen our ability to manage these large projects are better than the Clinger-Cohen legislation, which could lead to a tick-box approach. That is not just our view. When pressed on this issue by the Public Accounts Committee, John Oughton, chief executive of the Office of Government Commerce, said:
We expected the important points made by the hon. Members for Roxburgh and Berwickshire and for Northavon (Mr. Webb) to be raised, and I hope to cover them in the rest of this contribution. I understand the Select Committee's concern about the publication of the OGC gateway reviews. The House will know that the OGC is considering general disclosure of gateway review information in the light of the Freedom of Information Act 2000, which will come into effect in January 2005, so we will need to use this guidance to judge potential disclosure on a case-by-case basis. I can assure the House that if disclosure is judged to be in the public interest and is not covered by one of the exemptions in the 2000 Act, disclosure will happen.
I must make it clear to the House that, as the hon. Member for Roxburgh and Berwickshire said there will be a number of instances where disclosure will not be in the public interest. For example, if published too early, some financial information could jeopardise our ability to get the best value for money from commercial competition for a contract. Unless there were strong and overriding public interest reasons to the contrary, it would not be sensible to disclose such information. Similar concerns will apply in business cases. Nevertheless, I will do what I can to help the House and the Select Committee to get the information that they need to scrutinise this important area of Government activity. It is fair to say that the hon. Gentleman's disappointment at our response to the Committee's
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recommendations was to a major extent based on this issue. I hope that we will have the OGC report very soon, so that we can take this matter forward.
Mr. Todd: Will my right hon. Friend release the OGC gateway reviews relating to this project, given that it is reasonably clear that selective disclosure will happen at some point? As I pointed out earlier, selective disclosure appeared to be possible at the very start of the OGC gateway process; only more recently have people become rather more chary of it.
Alan Johnson: My hon. Friend seems to be asking whether we will apply this provision in retrospect. I want to have a good relationship with the Select Committee, and for it and the House to feel that we are being as open as we can be. I shall certainly consider what we can do retrospectively with other gateway reviews in the DWP, which is the only Department in respect of which I am able to give a commitment.
The hon. Member for Northavon referred to the question of overdependence on EDS. At one level, we are taking steps to increase the number of suppliers with which the DWP does business. We need access to a greater range of suppliers if we are to take advantage of the best that the market has to offer. Although existing suppliers such as EDS and BT will be free to bid for future work, we have made it clear that a natural result of this strategy is likely to be a reduction in traditional suppliers' share of DWP business. However, our traditional suppliers will continue to be important to our ability to deliver modern and effective services to customers. Consequently, as well as taking steps to access a greater range of suppliers, we also need to improve what our existing suppliers offer us.
I hope that the House will be pleased to hear that we have begun a constructive and frank dialogue with EDS. I met its senior executives from America yesterday evening and made it clear that we intend to extract greater value from Department for Work and Pensions IT contracts. In the case of EDS, we are its most important customer. For EDS to be successful as a business, it needs us to be a satisfied customer. The DWP is currently jointly restructuring its arrangements with EDS to create maximum value. We are looking for a radical transformation to deliver standard services at more competitive prices and we are instigating a programme that, subject to commercial agreement, will simplify existing contractual arrangements and create a catalogue and framework for new services. Overall, that transformation programme will give the Department a greater level of assurance on IT delivery for the future, but let me address in more detail the two most high-profile recent issues with EDS.
First, there is the fault with the digital object identifier system. Hon. Members have mentioned the computer failure that occurred across the DWP two weeks ago and the hon. Member for Wycombe asked several questions about it. I have now received the initial analysis of the incident and provided a copy of the report this morning to the hon. Member for Roxburgh and Berwickshire and to Opposition Front Benchers. I was seeking to make that point when the hon. Member for Northavon was speaking. I was referring to that matter, not to my reply to the hon. Member for Havant
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(Mr. Willetts). The report was marked confidential and sent to the Select Committee and to the hon. Members for Havant and for Northavon this morning, as I said.
Let me be clear about the scale of the problem. It was never about a failure of our main computer systems. As was mentioned in the Queen's Speech, they operated normally throughout. For regular pensions and benefits payments, it was business as usual and customers continued to get their money as normal. The basic problem was that a routine upgrade to a small set of computers was accidentally applied to a larger group than intended. That affected those computers and could not be reversed. To use a non-computer technology phrase, EDS effectively put a round peg in a square hole and could not get it out again. Consequently, a large number of our PCs could not operate properly and there were some delays in dealing with new or amended claims because many staff were not able to access their systems. Thanks to the efforts of our staff, however, we worked round the problem.
Under the terms of our contract, we will pursue compensation from EDS for failures in the level of service, and we are now getting further information on the business impact and the resulting administrative and operational costs to assess the need for further compensation. Much of that information will help answer the questions posed by the hon. Member for Wycombe and I will be pleased to provide it to the House. EDS takes full responsibility and assured me yesterday that it has "bullet-proofed"its term, not mineagainst this happening again. Turning from that high-profile case to
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