Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Memorandum submitted by Accenture (RPA Sub 14)


  1.  Accenture has been and continues to remain committed to supporting the RPA to deliver payments through RITA (RPA Information Technology Application). Accenture understands the importance to farmers of receiving payments in an orderly and efficient manner.

  2.  Accenture was procured in January 2003 after a competitive bidding process to build and maintain a new claim processing system known as RITA. The January 2003 contract was a fixed price, fixed scope contract.

  3.  RITA is part of the wider RPA business processes and IT systems which together are designed to enable the RPA to make payments under the Single Payment Scheme (SPS). Accenture does not have responsibility for these other IT systems or processes.

  4.  In May 2004, a revised contract was agreed in order to accommodate the fundamental changes necessitated by the EU CAP Reforms of June 2003 and to enable as soon as possible the implementation in England of the "dynamic hybrid" system. Major changes to the RITA specification continued to be made until December 2004. This new focus impacted the specifications, scope, delivery timeframe and overall cost of RITA.

  5.  As has been previously recognised, not least by the Office of Government Commerce, it is difficult to implement large scale and complex business change programmes at a time of massive policy change. It is widely acknowledged that the June 2003 EU CAP Reform represented a fundamental change in terms of policy. Those reforms required the RPA to order significant changes to RITA, the scale of which had not been anticipated when the original contract was signed.

  6.  Despite the challenges created by the changing policy environment which required the RPA to request significant changes to RITA between May and December 2004, Accenture has successfully delivered the releases of RITA necessary to make the SPS payments that commenced in February 2006.

  7.  RITA is functioning as designed and has been in operation and fully stable since October 2005. It is available to the RPA from 6 am to 9 pm weekdays and 8 am to 6 pm weekends, and we are proud of what we have delivered.

  8.  Our work met the budget and contractual requirements agreed to by Accenture and the RPA. In January 2003, Accenture and the RPA agreed a fixed price, fixed scope contract. After the EU CAP Reforms of June 2003, the scope of the contract changed and continued to do so. The increased value of the contract has arisen from approved change requests representing changes made to RITA specifications or timescales.


  9.  The 1999 PricewaterhouseCoopers (PwC) review of the administration of EU agricultural payment schemes in England proposed that the CAP administration activities of the Intervention Board and the Ministry of Agriculture Fisheries and Food (MAFF) be brought together to form a new organization (the RPA).

  10.  In April 2001, the Ministry of Agriculture, Fisheries and Food (MAFF) embarked on the RPA Business Change Programme aimed at improving the effectiveness and cost efficiency of key aspects of CAP administration using modern technology while also improving the service and value to its customers.

  11.  To help deliver some IT elements of this Change Programme, DEFRA (the successor Department to MAFF) let the procurement for a system to replace certain legacy information systems. Accenture won the procurement and contracted in January 2003 on a fixed price, fixed scope basis to build and maintain RITA. Accenture is not involved in any other part of the Change Programme.

  12.  Accenture was procured in January 2003 after a competitive bidding process to build and maintain a new claim processing system known as RITA (RPA Information Technology Application). RITA is one of several IT systems designed to enable the RPA to make payments to farmers. RITA is being delivered through a series of software releases since September 2004. Although there were challenges in the early stages of the RITA project prior to the EU CAP Reforms of June 2003, Accenture has successfully delivered the releases of RITA necessary to make the payments under the Single Payment Scheme (SPS) that commenced in February 2006. These releases have been in operation and stable since October 2005. RITA is functioning as designed and continues to be stable, and we are proud of what we have delivered.

  13.  After the January 2003 contract was entered into by Accenture and the RPA, the June 2003 EU CAP Reforms were agreed. As a result of these Reforms and their implementation in England, the RPA changed its requirements for RITA.

  14.  RITA, as delivered, is a new claim processing application. It was a significant development effort, and is only one part of the overall application development landscape needed for the SPS. The success of the Change Programme and the RPA's ability to make payments to farmers is also dependent on a number of other system development projects and business processes, including the finance system, OREGON and the interim entitlements calculator. Accenture has never been responsible for these other IT systems and business processes.


As much detail as possible on the contract tendering process

  15.  Accenture was engaged in January 2003 as a result of a standard EU procurement process. The key milestones of the procurement process were as follows:

    —  Open Supplier Conference (27 November 2001).

    —  Formal Pre-Qualification Stage (11 Feb 2002).

    —  Request for Proposals issued (4 March 2002).

    —  Accenture proposal submitted (29 April 2002).

    —  Contractual negotiations between the RPA and potential suppliers, including Accenture (took place between May and December 2002).

    —  Potential suppliers (including Accenture) invited to submit Best and Final Offers (20 December 2002).

    —  Accenture submitted its Best and Final Offer (3 January 2003).

    —  Contract signed with Accenture (31 January 2003).

Who was ultimately responsible for the Accenture contract at the Defra/RPA end Which Minister signed it off?

  16.  The January 2003 contract was concluded between Accenture and the Secretary of State for Environment, Food and Rural Affairs acting through her agency, the Rural Payments Agency. The contract was signed by Johnston McNeill, RPA Chief Executive.

  17.  Accenture has no visibility of any approval process there may have been on this contract between the RPA, DEFRA and the responsible Minister.

What penalty or incentive clauses were included in the contract?

  18.  The RPA and Accenture agreed a fixed price, fixed scope contract ("January 2003 contract") with payment against delivery of RITA releases on acceptance by the RPA. There were no penalty or incentive figures in the original contract; however, the current contract re-negotiated in May 2004 contains various provisions under which both parties have accepted financial liability in the event of default. Further, payment to Accenture is dependent upon the achievement of Key Milestones and Accenture is subject to service credits, in each case subject to contractual limitations. We believe there is the necessary risk/reward balance on both parties as required for a major project of this nature to be successful.

Whether Accenture thought that the original contract provided sufficient resources at the outset?

  19.  The original contract specifically excluded EU CAP Reform. On this basis, and given the specific policy environment at the time, Accenture believes that the January 2003 contract provided sufficient Accenture resources at the outset for Accenture to deliver the original scope of RITA.

  20.  The January 2003 contract was planned to replace legacy IT support for existing systems. Its scope included a Land Register [Geographic Information System (GIS)], a customer register, a claim processing engine, 68 CAP schemes, a customer service centre (CSC), a document management unit (DMU) and a customer on-line capability. It called for Accenture to build and maintain two releases of software: Release 1 covering GIS, CSC, DMU and land based schemes; Release 2 for trader schemes.


The extent to which the specifications of the RITA contract had to be changed after the CAP reform agreement of June 2003?

  21.  The June 2003 EU CAP reform agreement included, amongst other things, the introduction of the Single Payment Scheme (SPS) which the UK chose to implement in 2005 and that introduced a fundamental and major change in the way agriculture is supported in England:

    —  Cut the decades-long link between subsidies and production.

    —  Payments made to farmers on the basis of land area farmed.

    —  New rules came into force on 1st January 2005 under EU CAP reform.

  As a result of EU CAP reform, new categories of claimants were eligible for payments under the scope of SPS, resulting in a significant increase in the number of one-off registrations for entitlements by landowners to receive payments.

  22.  Changes brought by EU CAP Reform meant that the original contract needed to be revised to include changes to the planned system that would enable the RPA to make payments on the basis of the Reforms. Accenture and the RPA therefore agreed in May 2004 to vary the original RITA contract in order to accommodate the fundamental changes brought about by EU CAP Reform and to enable as soon as possible the implementation in England of the "dynamic hybrid" system. The parties agreed to concentrate RITA development on the implementation of the SPS. This new focus impacted the specifications, scope, timeframe and cost of RITA.

  23.  Over the course of the next seven months, the policy details of EU CAP Reform continued to change. Although it was originally expected that the rules for the reformed payment scheme would be finalised before the end of the calendar year 2003, in fact this did not happen until late 2004. As a result, in addition to the changes to the RITA contract that were agreed between Accenture and the RPA in May 2004, major changes to the RITA specification continued to be made between May 2004 and December 2004. To deliver RITA, software development had to continue in parallel with the finalisation of these rules, albeit with a delay to the implementation date and re-phasing of the release structure, due to the changes in late 2004. Changes in specification necessarily impacted the delivery timeframe and the overall cost.

  24.  On the basis of the revised May 2004 contract and the RITA changes requested by the RPA in late 2004, revised releases of RITA required to meet the needs of SPS 2005 payments were agreed and were all delivered by October 2005. These deliveries took place as follows:

    —  Release 1a—the Rural Land Register went live in September 2004.

    —  Release 1b—the Customer Register went live in February 2005.

    —  Release 3a0—the High Volume Data Capture for SPS Application forms went live in May 2005

    —  Release 3a1—the core validation functions for SPS Applications went live in a pilot July 2005 and rollout in August 2005.

    —  Release 3a2—the core batch functions required to establish entitlements and authorise payments went live on 3 October 2005.

The extent to which the increase in running costs experienced by the RITA contract can be attributed to changes in the contract specifications

  25.  For the original RITA contract, Accenture and the RPA agreed a fixed price, fixed scope contract in January 2003.

  26.  The increased value of the contract has arisen from approved change requests representing changes made to specifications or timescales. In addition to the costs brought on by the changes mentioned above, RPA subsequently procured other items from Accenture not within the scope of the May 2004 contract.


What projections of customer volumes were provided to Accenture and upon what basis were these forecasts made?

  27.  The January 2003 contract included an assumption that RITA would be capable of supporting up to 100,000 customers. This was increased to 150,000 customers as part of the revised May 2004 contract. These figures were provided to Accenture by the RPA.

  28.  In addition to the assumptions provided by the RPA and included in the contracts, the RPA provided an estimated set of volumes for each software release to enable Accenture to create a capacity model to demonstrate how RITA handles the volumes.

What problems were caused to the IT project by there being a larger than anticipated volume of applicants to the SPS scheme?

  29.  The combination of the 50% increase in the number of claimants (from 80,000 to 120,000) and the requirement to register all the land in the first year of SPS (which resulted in an increase of over 1,000% in land changes from 9,000 per annum to over 100,000) unexpectedly increased the load on RITA and led to problems of availability and stability of RITA. These issues had to be rapidly addressed by the RPA and Accenture, spending additional effort and time to increase the capacity and stability of RITA.

  30.  The large increase in volumes has resulted in greater demand from the RPA for RITA. To support this increased demand, Accenture has made enhancements to both the hardware and software to improve the responsiveness and stability of RITA in agreement with RPA.

  31.  RITA has been fully stable since October 2005 and is available from 6 am to 9 pm weekdays and 8 am to 6 pm weekends.


The relationship between core RPA staff and Accenture personnel and the extent to which RPA staff were placed at a sufficiently high level in the IT project, so they knew what was going on

  32.  The governance arrangements for the RITA project include the following:

    —  The DEFRA Executive Review Group (ERG).

    —  The joint DEFRA / RPA Common Agricultural Policy Reform Implementation Board (CAPRI).

    —  RPA Change Programme Board.

    —  RPA Quality Assurance.

    —  RPA and Third Party Programme Management.

    —  Office of Government Commerce reviews.

  33.  The Executive Review Group is chaired by the Permanent Secretary and usually meets on a monthly basis. The focus is to keep departmental stakeholders abreast of progress on the RPA project and to secure agreement to key decisions. Accenture has attended as an invitee in February 2006 and April 2006 and continues to be an occasional invitee on a case by case basis.

  34.  The Common Agricultural Policy Reform Implementation Board (CAPRI) is jointly chaired by the RPA Chief Executive and the DEFRA Director General for Sustainable Farming, Food and Fisheries. Its focus is purely on the implementation of the SPS. It spans new deliverables and releases and operational progress of implementation of SPS. Accenture attends CAPRI meetings as senior IT supplier.

  35.  Accenture attended meetings of the RPA Change Programme Board which until recently met every two weeks during the Change Programme and was chaired by the RPA Programme Director and comprised senior RPA staff, including the RPA IT Director and the RPA Operations Director. The Programme Board was responsible for monitoring progress of the change programme as a whole.

  36.  In addition, for each specific Release, there are a series of reporting structures (for example, Board meetings, Project Team meetings, Business Relationship Manager meetings, Test Governance meetings, Release Owners meetings, Risk and Issues meetings) and there was a Change Control Meeting to manage formal contractual changes to the agreement, all designed to ensure that RPA staff are involved, informed and able to exert necessary control on the RITA project.

  37.  There has been extensive assurance activity from the RPA in relation to Accenture's work—specific RPA staff closely involved with testing and providing assurance on the Releases and on the Accenture live service, as well as external third party reviews commissioned by the RPA.

  38.  Much of the assurance and programme management for the Change Programme is provided by RPA engaged third party companies.


How the advice and progress reports from Accenture were fed into DEFRA and the decision making progress

  39.  Apart from the updates provided at the CAPRI meetings mentioned above, Accenture does not know if or how its progress reports to the RPA are incorporated into DEFRA's decision-making process.

  40.  Accenture has regular meetings with senior DEFRA officials, including the DEFRA Permanent Secretary.


Was it the experience of Accenture that the RPA was unduly risk averse? For example, was it ever possible to cut corners when testing system releases?

  41.  As has been widely acknowledged by numerous commentators and experts, significant IT enabled business change programmes can be difficult to manage. There have been many examples of problem projects in the public and private sectors in recent years with difficulties attributed to poorly defined requirements, changing business needs and lack of business involvement and preparedness that can lead to delivery difficulties.

  42.  As described above, the substantial EU CAP reform in June 2003 and continuing changes to the rules for the SPS presented significant challenges to the Change Programme.

  43.  With this context in mind, Accenture believes that the RPA had a thorough and comprehensive assurance approach (both in quality and in timescale) to the development of RITA.

  44.  The RPA requires and Accenture provides a rigorous testing approach to new system releases. These releases have been in operation and stable since October 2005.

May 2006

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