---

Government IT Projects

22. Dr. John Pugh (Southport) (LD): What assessment he has made of the compensation payments paid by IT providers to Government Departments because software provided has not been found fit for purpose; and if he will make a statement. [42336]
 
17 Jan 2006 : Column 700
 

The Parliamentary Under-Secretary of State for the Cabinet Office (Mr. Jim Murphy): The recently published transformational government IT strategy set out a concerted approach to managing IT procurement across government. Individual departments are of course responsible for procurement. If software is not fit for purpose, they may seek compensation on the basis of the contract that they have negotiated.

Dr. Pugh: I thank the Minister for that answer. Can the Government explain the public interest, and the commercial reasons why details of the compensation paid to EDS after the tax credit fiasco are not publicly available, given the apparent strength of the Treasury's case?

Mr. Murphy: Of course, the specifics on many individual procurement compensations are placed in the   public domain. Revenue and Customs announced the details of the settlement with EDS, which was £71 million. I will investigate the issue that the hon. Gentleman raises, but I should re-emphasise that most IT procurements are successful; if compensation is an issue, it is for the individual Department concerned to negotiate it. There have been some good examples in recent months, such as the Secretaries of State for Defence and for Health negotiating specific contracts that are much more generous in terms of compensation.

Rob Marris (Wolverhampton, South-West) (Lab): The Minister refers to the compensation provided for in contracts. During the last Parliament, the Work and Pensions Committee, of which I was a member, looked at EDS, the Child Support Agency and computerisation in general within that department. It became clear that some contracts agreed with computer software and hardware suppliers were very poorly worded. Is his Department overseeing other departments to make sure that the wording of contracts is sufficiently tight, so that, if things break down, the taxpayer is properly compensated?

Mr. Murphy: My hon. Friend is correct in saying that there were weaknesses in previous contracts as negotiated, but the transformational government strategy, which has been widely welcomed, establishes a new way of dealing quickly with contracts, such as portfolio management across government and ensuring capacity and competition in the market. Importantly, it also provides for the recruitment to departments of chief information officers—experienced IT professionals who have first-hand knowledge of how to negotiate such contracts.

Mr. David Heath (Somerton and Frome) (LD): Returning to EDS, it is easy to blame IT contractors when, in fact, the commissioning department is at fault. Will the Minister confirm that the compressed time scale for introduction was set despite warnings from the supplier of a last-minute problem? Indeed, on 4 April 2003—the last day before the introduction of tax credits—the Government demanded a certificate of fitness for purpose, in anticipation of problems. Does not the eventual settlement contain what is described as a "significant confidentiality requirement" specifically
 
17 Jan 2006 : Column 701
 
to avoid embarrassment? Is it not clear that that confidentiality requirement will not in any way inhibit proper investigation by the National Audit Office?

Mr. Murphy: I am not aware of the correspondence that the hon. Gentleman refers to, but I am happy to investigate the matter and report back to him. The fact
 
17 Jan 2006 : Column 702
 
is that the vast majority of Government IT projects, which are more complicated than projects in the private sector, are a success. Very high-profile examples are Directgov, the internet job bank, on which 4 million discrete job searches are made a week, and direct payment. More than 22 million individuals have had payments into their accounts enabled by successful Government IT projects and contracts.

 
17 Jan 2006 : Column 703
 

Speaker's Statement

Mr. Speaker: Yesterday it was suggested to me in points of order that the name of the hon. Member for Bethnal Green and Bow (Mr. Galloway) had been added to a number of early-day motions when he was apparently not in a position to give the necessary authority. I undertook to look into the matter.

Anne Moffat (East Lothian) (Lab): Did you go into the house, Mr. Speaker?

Mr. Speaker: No, I watched it on the television. The motions were signed by the hon. Member and were sent in the post to the Table Office, which checked the signature, as is its usual practice. It is clear to me that the   motions were signed before the hon. Member went out of contact and I am satisfied that the adding of his name was properly authorised. I have nothing more to say on this matter.
 
17 Jan 2006 : Column 704
 

Opposition Day

[11th Allotted Day]

Child Support Agency

[Relevant Documents: The Second Report of the Work and Pensions Committee, Session 2004–05, on The Performance of the Child Support Agency, HC 44-I, and the Government's response thereto, First Special Report of the Committee, Session 2004–05, HC 477.]

Mr. Speaker: We now come to the main business. I inform the House that I have selected the amendment in the name of the Prime Minister.

3.36 pm

Mr. David Laws (Yeovil) (LD): I beg to move,

That this House agrees with the Prime Minster that the Child Support Agency has lost the confidence of the public, that its basic structural problems remain and that it is not properly suited to carry out its task.

I am pleased that we have this opportunity today to debate the future of the Child Support Agency—and to   do so before the long-awaited and, frankly, long-delayed statement that we have been expecting for some months from the Department for Work and Pensions.

All hon. Members have received many representations from constituents, usually over a period of years, about the ineffectiveness of the CSA. The concern that many of us have is that many of our constituents have now given up hope that the problems with the CSA will ever be resolved. We hope very much that when Ministers "come forward shortly", in the words of the Minister, with proposals, they will be radical and will go to the heart of the problems of the CSA. I hope that by having this debate today there will be an opportunity for Ministers to reflect on comments from both sides of the House and from Members with considerable expertise. I hope that it will not be too late to influence the shape and detail of the statement that is brought forward in a few days or weeks.

There is no doubt about the chaotic and crisis-type situation that the CSA has been in since 1993 when it was founded by a Conservative Government. I say that now to save the Minister making that point later on, because we need to focus on what we can do to tackle the problems of the CSA in the future. Clearly, it is common ground across the House that there is a major challenge to be addressed.

As far back as 1998, the Prime Minister acknowledged that the CSA had lost the confidence of the public and described it as "a mess" in need of "urgent reform". Yet seven years on, we still seem to have failed to address the fundamental problems that have been experienced from the founding of the agency until 1998 when the Prime Minister made that statement.

As has been drawn to the attention of hon. Members on the Order Paper today, we have the advantage of the Select Committee report on the subject, a very critical report from a year ago in which the Committee described the CSA as a "failing organisation" that is in crisis. In its indictment, the Committee concluded that it   was difficult to exaggerate the agency's already low reputation with the public and the Committee
 
17 Jan 2006 : Column 705
 
recommended that consideration be given to the option of winding up the CSA and plans being made for an alternative set of policies.

We know that the Prime Minister very much shares those concerns because he said so in the Chamber on 16 November last year. He said:

"I make no defence of the current situation. . . . The truth is that the agency is not properly suited to carry out that task."—[Official Report, 16 November 2005; Vol. 439, c. 964.]

---