Memorandum from the Department for Transport
Question 78 (Mr Davidson)
on whether any DfT programmes had been cancelled or curtailed
as a result of the Department funding cost increases on the Shared
Services Programme
The Shared Services Programme has been funded
from the Department's Departmental Expenditure Limit (DEL). The
Department manages its administration and programme budgets carefully
on an annual basis. In line with the Consolidated Budgeting Guidance
from HM Treasury, in the years leading up to 2007-08, the Department
built up end-year flexibility within its DEL and was then able
to use this to fund the majority of cost increases relating to
the Shared Services Programme. As a result the Department has
not considered cancelling or curtailing any of its planned spending
in order to channel additional resources into the Shared Services
Programme.
Question 82 (Mr Davidson) regarding savings lost
as a result of not outsourcing as much software development work
to India as had been planned
IBM and the Department considered offshoring
some of the software development work to India. The NAO observe
in paragraph 1.18 of their report that, while IBM and the Department
believed that software development abroad restrained Programme
costs, the reduction was not as great as had been envisaged because
of delays and additional costs associated with complying with
the stringent government security accreditation requirements regarding
software development abroad. However, at the time of the report
neither IBM nor the Department had been able to supply figures
for the cost reduction including the effect of increased security
accreditation effort.
As a result of reviewing information with IBM
that was not available at the time of the report, the Department
has compared the number of development days actually off shored
with those planned, and taken account of the additional equipment
and accreditation costs, and has estimated that the use of off
shoring has saved the Department some £44,000 to date.
Question 119 (Mr Bacon) on details of amounts
paid by the Department to Deloitte for their work on the Shared
Services Programme and setting out what other DfT projects Deloitte
are engaged on
In April 2004, Deloitte won an open competition
to provide consultancy support to the Department for Transport's
Support Services Review. The contract was subsequently extended
to provide client side advice, enable the development of the outline
business case; and handover the design stage to IBM. The total
value of that contract was some £2 million.
Following agreement to engage IBM as the main
delivery partner, the Department held an open competition for
consultants to provide quality assurance, challenge and client
side support. This competition was won by Deloitte and to date
some £2.6 million has been expended.
Other major activities Deloitte have been involved
in for the Department in the last two years are Road Pricing Support,
let under the Road Pricing Framework Agreement, and the Internal
Audit Co-sourcing.
30 June 2008
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