HMRC gave Fujitsu £1.4bn in new contracts after landmark 2019 Post Office court case

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HM Revenue & Customs awarded Fujitsu £1.4bn in contracts after a landmark 2019 court case laid bare the Post Office Horizon scandal, according to new data obtained by MPs.

The data throws fresh light on the extent of the company’s dealings with government after faults in its systems became widely publicised.

The £1.4bn figure was included in data released on Saturday by the House of Commons Treasury select committee, which showed that three bodies linked to the Treasury have had active contracts with Fujitsu worth £3.4bn since the 2019 court ruling.

HMRC accounted for the lion’s share of the total, along with smaller amounts for the Financial Conduct Authority and the Bank of England.

The committee of MPs wrote to HM Treasury and public bodies linked to the department last month to request details of their contracts with Fujitsu. Their inquiries came after the Financial Times reported that Fujitsu had landed £4.9bn of joint and solo contracts since its role in the Horizon scandal was laid bare in a court ruling in 2019.

At that time the High Court found there was a “material risk” that “bugs, errors and defects” in the company’s Horizon IT system were at fault in the prosecutions of hundreds of sub-postmasters on charges including fraud and false accounting.

The £1.4bn HMRC figure is nearly double the amount previously disclosed according to research by Chris Smith, an independent procurement consultant, using data from Contracts Finder, a website run by the Cabinet Office which publishes details of all government contracts worth more than £12,000.

Contracts Finder lists just £752mn of contracts awarded by HMRC to Fujitsu, Smith said.

Smith said the discrepancy reflected wider shortcomings by government departments and agencies. “What [HMRC has] reported is inaccurate . . . these figures [on Contract Finder] should be accurate,” he said.

Harriett Baldwin, chair of the Treasury select committee, said the data discrepancies showed that Fujitsu’s contracts were more extensive than the Cabinet Office database suggested.

“We have unearthed some information which, I believe, goes beyond what is known by the Cabinet Office. I hope this will aid transparency and scrutiny around the role of Fujitsu as a public sector supplier,” she said.

The select committee’s data included figures for multiple framework agreements, a type of contract with suppliers that does not require the government to procure the full amount of quoted services.

Mike Bracken, former head of the Government Digital Service, said the committee’s findings highlighted a culture across government of awarding large IT contracts to a single supplier. He said the approach made it harder for departments to detangle themselves when a provider failed to deliver.

“The government needs a broader supply chain for all services. The way to do that is to have open competition rather than large single contracts,” he said.

Fujitsu provides the backbone for much of the tax authority’s digital services, according to one former senior HMRC official.

Last month it said it would suspend bidding for government contracts pending the outcome of a public inquiry into the Horizon scandal.

According to Contract Finder, HMRC has awarded a total of £4.25bn in public contracts since the beginning of 2020, including its contracts with Fujitsu.

HMRC said it worked with “hundreds of IT partners” and that multiple partners were involved in building and maintaining its services.