Government signs new deal with controversial IT supplier

Ministers' hands are tied as they enter into fresh contract for troubled Lorenzo patient records system

Despite axing the NHS National Programme for IT with the admission that it had been a huge waste of taxpayers’ money, the Government has controversially signed a fresh deal with one of the leading suppliers.

Even though the company fell years behind schedule with the rollout of its Lorenzo patient records software at NHS trusts across England, CSC has seen its contract renewed until July 2016.

It is understood minsters’ hands were tied because cancelling the £1.3billion contract entirely would have incurred huge costs.

ours is not a Government that will tolerate poor performance – and today’s announcement will leave suppliers in no doubt that we will act to strip out waste from contracts where they offer poor value for the taxpayer

But, despite the new deal, the Government is making it clear that individual trusts will be able to choose the solutions that suit them and will not be forced into a regional procurement as they were under the national programme.

However, if they do choose to go with the Lorenzo system, they will be able to access centralised support and funding providing they have developed a robust business case and can demonstrate value for money.

Commenting on the announcement, Health Minister, Simon Burns, said: “By dismantling the National Programme for IT, this new agreement will save taxpayers over £1billion, which will be re-invested in patient care and frontline services. We’ve removed the restrictive, top-down, centralised approach and given the local NHS the power to make their own decisions about which IT systems they use.

“The modern NHS still needs healthcare IT systems to exchange information securely and meet the needs of patients. By re-shaping this contract, delays will be avoided in delivering much-needed IT systems to the NHS and will ensure the investment made to date is not wasted.

ours is not a Government that will tolerate poor performance – and today’s announcement will leave suppliers in no doubt that we will act to strip out waste from contracts where they offer poor value for the taxpayer

“This agreement marks a step in the right direction and a move to a new way of working which will allow the NHS to secure value for money and tailor its IT systems to meet the needs of its local patients.”

Minister for the Cabinet Office, Francis Maude, added: “Since May 2010 we have been building a strong operations centre at the heart of Whitehall to ensure the Government runs more like the best businesses.

“As part of this we have been negotiating with our major suppliers, acting as a true ‘single client’, and generating savings of £806m and £437m respectively in the first two years of this Parliament alone. As I emphasised when I met with 20 of our top suppliers just last month, ours is not a Government that will tolerate poor performance – and today’s announcement will leave suppliers in no doubt that we will act to strip out waste from contracts where they offer poor value for the taxpayer.”

Under the new deal, CSC will continue to be responsible for the solutions it has already rolled out at 10 NHS organisations in the North, Midlands and the East of England. However, the company has agreed to non-exclusive deployment rights in its designated regions, meaning that, unlike under the national programme, trusts are not bound to adopt the system.

The news was welcomed by Mike Lawrie, CSC’s president and chief executive officer, who said work to improve the system was continuing.

He added: “This agreement is a significant milestone in our relationship with the National Health Service and represents a renewed commitment by the NHS and CSC to a long-term partnership as well as CSC’s healthcare solutions.

“Under this agreement CSC will continue to have the opportunity to support the NHS information and communications technology infrastructure through deployment of our ground-breaking Lorenzo base product solutions, now rigorously tested and approved for wide-scale deployment across NHS. We are already seeing strong demand from NHS trusts that are confident our solutions will bring the safety and efficiency gains required by a modern NHS.”

Companies