BT charging small NHS hospitals '£8m for disaster recovery'

BT charging small NHS hospitals '£8m for disaster recovery'

MPs question value for money in times of renewed pressure on NHS finance

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Small southern NHS trusts providing community and mental health services are each paying BT approximately £7.7 million for disaster recovery services and standard support, MPs have stated.

Patrick O’Connell, president at BT Health, was asked at a Public Accounts Committee hearing on Monday to explain the average £8.9 million cost to cover the services plus the system itself, RiO, under the failed National Programme for IT.

The system is available off the shelf, MPs said, with support services from its creator CSE Healthcare, for £1.24 million – a seventh of the price.

“I think [what BT offers] is value for money,” O'Connell said. “We offer a package, things like disaster recovery.”

O’Connell added that he was not able to “reconcile” the figures provided by the PAC. The figures were an average based on the total £224.3 million cost of RiO from BT, divided by the 25 mental health trusts it serves in the south of England, as detailed in last week’s National Audit Office report.

Richard Bacon MP, a member of the PAC, aggressively challenged the cost of the services from BT and said that a “typical mental health trust” would be able to deploy the system outside of the programme for “£1 million to £2 million” with the necessary services.

In one example where disaster recovery was added, at a procurement outside the main programme at Bradford District Health Trust, the cost was still low, at £1.3 million.

In the context of the tough financial pressures on the NHS, charging more for IT to trusts still in the National Programme resulted in even worse consequences for their other budgets, he said.

In an angry exchange with health officials on these costs, Bacon said the price of having the system had effectively “gone up from £2 million to £9 million” under the programme. “So what do you get [for the extra money]?” he asked.

The NHS insisted the two figures could not be compared, because trusts received more services under the programme, and contracts under the programme were typically for six years, compared to two years less in some of the cheaper examples given by the PAC.

“What you quote is for about four years and for us [under the programme] it is six years,” said Christine Connelly, NHS chief information officer. “We get 24x7 full support and disaster recovery.” BT had also taken a “significant reduction” in its profit margin, Connelly insisted.

Bacon replied: "No matter how you cut it, it's impossible for me to see how it adds up to £9 million."

Health officials also faced tough questions on BT’s wider work and costs under the programme, in larger trusts. Another deal with CSC - the programme’s other main supplier which is facing the risk of a potential contract cancellation - was the subject of much discussion. Connelly said it would cost more to cancel that deal than to continue for the next five years contracted.


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