Government IT Gone Wrong

This document is updated from time to time. It was last updated 29 September 2008.

Only 30% of the government’s technology-based projects are a success, a government expert has revealed.

The figures come at a time when taxes are funding a £14bn annual spend on IT – equivalent to 7,000 new primary schools or 75 hospitals a year.

– Computer Weekly

What are the common causes of government IT project failure?

1. Lack of clear link between the project and the organisation’s key strategic priorities, including agreed measures of success.
2. Lack of clear senior management and Ministerial ownership and leadership.
3. Lack of effective engagement with stakeholders.
4. Lack of skills and proven approach to project management and risk management.
5. Lack of understanding of and contact with the supply industry at senior levels in the organisation.
6. Evaluation of proposals driven by initial price rather than long term value for money (especially securing delivery of business benefits).
7. Too little attention to breaking development and implementation into manageable steps.
8. Inadequate resources and skills to deliver the total portfolio.
   Source: Office of Government Commerce

How many government IT projects aren’t delivered on time and under budget?

This is by no means an exhaustive answer:

1. the NHS IT programme;
2. the police computer system, Impact;
3. the Magistrates Courts system, Libra;
4. the National Insurance Recording System (NIRS2);
5. the PAYE end-of-year filing system (ERIC);
6. the Inland Revenue Tax Credits System;
7. the Benefits Payment Card project;
8. the Crown Prosecution Service’s case tracking computer system;
9. the Criminal Records Bureau disclosure service;
10. the Home Office’s Immigration and Nationality Directorate Casework programme;
11. the Air Traffic Control system;
12. the Probation Service system;
13. the Ministry of Defence’s Project Trawlerman;
14. the “flagship elearning project UKeU“;
15. the Northern Ireland Vehicle System Replacement Project;
16. the National Firearms License Management System;
17. FiReControl, the IT contract for nine regional Fire Service centres replacing 46 local offices;
18. the Treasury’s Child Trust Fund;
19. the Treasury’s Pensions Schemes project;
20. a project in the Treasury’s Actuary Department;
21. the Rural Payments Agency’s IT;
22. the DWP’s online retirement planner; and,
23. the births, deaths, and marriages register.

29 September 2008: it is well worth reading two articles by Tony Collins of Computer Weekly: Why is Labour’s record on big IT-based projects so bad? and New Labour’s unlucky 13 IT projects.

(Also see Tony Collins’ blog.)

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Here is some more detail on the government IT projects listed that haven’t been delivered on time and under budget.

 

Please note I do not seek to apportion any blame to private sector organisations, and therefore I don’t mention the names of those involved. Names can easily be found by following the links or looking at the results of a web search.

Instead, the information is intended to provide some context to the discussion of delays and costs elsewhere in the blog, and as a starting point for those interested in this specific subject of ‘government IT gone wrong’.

CS2

After awarding the contract to create the CSA’s new IT system (CS2), the DWP requested 2,500 changes and increased the value of the contract by 7%. The PFI initiative was worth £456m, plus additional work of £30m, with £107m being withheld because of performance issues, another £17m retained depending on a step-by-step plan to fix 500 ‘known faults’. The supplier signed the ten-year deal in 2000, the system was due to go live in 2001, but was delayed until 2003. The system wouldn’t meet the original 2001 specification until 2007.

The system initially processed claims so slowly that it made a backlog of 30,000 new cases every quarter. Millions delayed, many were overpaid. There were 624,000 old cases on the old system, 546,000 new cases on the new system, and 305,000 old cases on the new system. Of the one million cases on CS2, 17,000 were processed clerically and tens of thousands more were stuck. Since its introduction the CSA wrote off £1bn in claims. The CSA contract was the last Private Finance Initiative deal for a technology programme before the Treasury ruled the model was unsuitable. And the CSA has been axed.

NHS IT

The NHS IT programme, “the world’s largest civil computer project”, running two and a half years late four years late and much closer to £20bn than the original budget of £5bn, with 110 breakdowns in four months. The Government is still changing the system’s specifications. Doctors don’t like it, and have complained about not being consulted in the planning phase. Academics have called for a formal audit and there could be a cheaper alternative available from NHS in Scotland.

An NAO report says, “The original timescales for the electronic care records service … turned out to be ‘unachievable’, raised unrealistic expectations, and put confidence in the programme at risk.”

Impact

The police computer system, Impact, delayed for three years (orginally due for 2007), total cost increased from £164m to £367m and ‘it had emerged that the task was more complex than first thought’ (more detail here).

Libra

The Magistrates Courts system, Libra, costing £557m instead of £146m, with the main supplier twice threatening to withdraw unless it was paid more money, issuing deadlines for officials to make decisions on whether to renegotiate the contract, and as a result PFI is now banned from IT projects, and unpaid fines have now reached about a half a billion pounds.

NIRS2

A project once described as the “biggest/most complex in Europe” (the HMRC itself describes it as ‘one of the biggest IT systems in Europe’), the National Insurance Recording System (NIRS2) crashed soon after its introduction in 1999 (perhaps because of ‘1500 unresolved system problems‘?) leading to over £2m in compensation for “unreasonable delays” to benefit claimants, and over £36m in compensation to Pension Providers, with 4,500 ‘bugs’, and many payments made manually without the usual vetting for entitlement. More information here.

ERIC

A four month delay in deployment of the PAYE end-of-year filing system (ERIC), intended to be “easier, quicker, and cheaper”, part of the first phase of the Modernisation of PAYE Processes for Customers (MMPC), with a total cost of £164m over six years, and the delay forced HMRC to defer the second phase for two years, to April 2007, and questions have been asked over the more than £50m in ‘financial aid‘ the Treasury gave to old and new suppliers.

Delay hit cashflow, halted end-of-year reconciliation work, and chasing of underpayments, because staff couldn’t see from their systems if PAYE had been paid in full. There was a backlog of millions of returns, problems with refunds of overpayments and cash incentives for filing online. HMRC had to temporarily switch off its PAYE validation engine and and drop penalties in order to receive an unexpected volume of electronic submissions.

Tax Credits

Hundreds of millions of pounds in write-offs; the Inland Revenue Tax Credits System held up millions of claims and led to 375,000 emergency payments when it was launched in April 2003, and it later emerged that millions were overpaid because of faulty calculations.

In early 2006, HMRC was forced to apologise to 10,000 firms after fining them by mistake.

“The Treasury is poised to write off £2bn – equivalent to 1p on income tax – as uncollectable from Gordon’s Brown’s tax credit scheme, a report by MPs reveals today. The figure is almost four times higher than disclosed a year ago. The complex scheme, which pays out money to the low paid, has been dogged by fraud and error since it was introduced in 2003. Ministers have already admitted that £5.8bn has been paid to people who should not have received the money. In evidence to MPs which is published today, the Treasury admits £1.9bn cannot be recovered.”

Also, “42 Inland Revenue officials who administer the scheme are either facing criminal investigations, criminal charges or have been convicted. The inquiries cover tax credit fraud, conspiracy to defraud, corruption and false accounting.” – the Guardian

Pathway

The Benefits Payment Card project was scrapped after 3 years and an estimated expenditure of £1 billion because the card technology employed was already outdated.

CPS case tracking

The Crown Prosecution Service’s case tracking computer system was installed in just over half of CPS branches by 1997 before being scrapped “on the grounds that the technology was outdated”, the total capital cost of the system was initially projected at £8.0 million but, at the time of the Comptroller and Auditor General’s report, £9.6 million had been spent in implementing it in just over half of the Service and the revised projection for implementing the system nationally was £15.9 million.

The CPS told the then Tory Government that a new case tracking system would be its top information technology priority and estimated that it would be deployed by 1993-94. This did not proceed as quickly as planned, and by September 1997 the system had been introduced in only 53 of the CPS’s 96 branches. The total capital cost of the system was initially projected at £8.0 million but, at the time of the Comptroller and Auditor General’s report, £9.6 million had been spent in implementing it in just over half of the Service and the revised projection for implementing the system nationally was £15.9 million.

Delays in implementing the system had adversely affected the way in which branches operated. Deployment had been hampered by significant legislative changes, which meant that parts of the program had to be rewritten; by organisational changes, notably the introduction of integrated teams of prosecutors and caseworkers; and by technological advances.

In December 1997, after the Comptroller and Auditor General’s report had been published, the CPS decided not to extend the system to the remaining 43 branches, because the benefits of continuing to roll out the system would be outweighed by the costs. The system did not have the capability or flexibility to meet its future needs, in particular for links with other agencies. The CPS accepted that, with hindsight, it could have taken this decision earlier, but stressed the difficulty of determining the optimal point in time to stop the project. As the system will not now be extended across the whole of the CPS, the final capital cost is expected to be £10.6 million, with a further £9.6 million to be spent on running costs.

CRB disclosure service
the Criminal Records Bureau disclosure service suffered backlogs and caused school closures, with the main supplier receiving a £19 million Government bailout, the cost of standard checks doubled from £12 to £24. and performance targets are to be cut. The CRB failed to meet its target of issuing 95% of standard disclosures within one week, issuing only 19.4%.

IND Casework

The Home Office’s Immigration and Nationality Directorate Casework programme suffered “backlogs of 76,000 asylum cases and 100,000 nationality cases”, was eighteen months late, missed three deadlines, and eventually dumped, at a cost of £77m.

ATCS

The Air Traffic Control system, at a cost of £623m, almost double original estimate of £350m, was six years late, plagued by bugs and problems early on (such as on-screen text being too small to read) and has crashed a few times (no pun intended).

Probation Service

The Probation Service system cost 70% more than expected at a cost of £118m, and the management system CRAMS was budgeted at £4m but cost more than £11m.

Project Trawlerman

The Ministry of Defence’s Project Trawlerman abandoned with costs of £41m, a replacement system in 1997 cost £6m.

UKEU

The “flagship elearning project UKeU” cost £62m but was abandoned after attracting only 900 students.

Northern Ireland

The Northern Ireland Vehicle System Replacement Project was abandoned and £3.7 m was written off.

NFLMS

The National Firearms License Management System was intended to be piloted in May 2002 and fully deployed by May 2003, then delayed until January 2005, now delayed until March 2007.

FiReControl

FiReControl, the IT contract for nine regional Fire Service centres replacing 46 local offices, worth aobut £160m, is “two years past the desired timetable”, with some fire services unprepared to sign up to it.

Technology costs for the government’s planned regional Fire Service control rooms have risen by £70m – more than 50 per cent – in just two years.

Contracts for the FiReControl project to consolidate 46 local offices into nine district centres are not expected to be signed until January. But official cost estimates released to Parliament have already reached £190m, up from £120m in 2004.

The Department for Communities and Local Government (DCLG), which is responsible for FiReControl, blames inflation and unrealistic early assumptions.

Child Trust Fund

The Child Trust Fund is six months late.

Pension Schemes project

The Pensions Schemes project is one year late.

Actuary project

One project in the Treasury’s Actuary Department is three years behind schedule.

Rural Payments Agency

According to the Register, ‘Computer problems played a significant role in the chaos affecting England’s Rural Payments Agency (RPA), according to a report by the National Audit Office (NAO).’

Online retirement planner

According to the BBC,

After four years of development, the government has suspended its plans for an internet retirement planner… …£11 million had been spent on the website, halting the work will save the government an estimated £14 million… …the work on the site was halted when the Department for Work and Pensions realised that “delivering accurate online information about state pensions would become increasingly difficult, given the uncertainty about the exact shape of future pension provision”.

Births, deaths and marriages register

The Times reports that,

Hundreds of register offices across the country have been ordered to abandon a new online system for recording births, deaths and marriages in the latest IT fiasco to hit the government.

The Times has learnt that the huge £6 million IT project has met with “complete system failure” and online registration has been suspended in half the 3,000 offices.