Davis and the Cabinet Office's Major Projects Authority are discussing with the Department of Health whether a memorandum of understanding should be signed with CSC, which would secure the future of the NPfIT and give officials in Whitehall continued control over large parts of NHS IT.
The Cabinet Office is concerned that a deal with CSC would be poor value for money. It could reduce the value of CSC's NPfIT contracts by about £700m, but could double the cost of the few remaining deployments. The Major Projects Authority is considering the implications of cancelling the CSC contract - although the Department of Health has put a case for not cancelling.
Today's Public Accounts Committee report will strengthen the hand of the Major Projects Authority and indeed endorses its scrutiny of the CSC contract.
"... we consider it essential that the Major Projects Authority now exercises very close scrutiny over the Department’s continuing negotiations with CSC, and that Government gives serious consideration to whether CSC has proved itself fit to tender for other Government work," says the Committee's report.
The Cabinet Office has a mandate from Downing Street to stop contracts that are not value for money.But it's the Department of Health that is accountable to Parliament for its contracts.
The outcome of the disagreements between the Cabinet Office and the Department of Health may determine the credibility of the Major Projects Authority. The question is: does it have the will to stop the UK's biggest government IT-enabled programme descending from failure to disaster?