Atos Origin is the first supplier to announce that it has signed a memorandum of understanding (MoU) with the government to launch a ‘single-client’ approach to IT procurement.
The MoU follows the negotiations that Francis Maude, minister for the Cabinet Office, initiated in July. The other 18 companies involved in the negotiations are expected to make similar announcements in the coming weeks.
A ‘single-client’ approach means that the government will procure for IT projects as a single customer, rather than as separate departments, which is the current practice.
A spokesperson for the Cabinet Office, said: “This process has been about changing the way government does business over the long term. It means that we are now establishing government as a single customer, which is leading to better, more efficient relationships with suppliers.
“Many companies involved have wanted government to act more as a single client for some time, so they could engage with us in a more cost-effective way.”
In a statement, Maude said: “Over the next few weeks as the agreements are signed, I expect to see immediate and big savings for taxpayers. We’re not talking about small numbers here, but a total running into hundreds of millions of pounds.”
He added: “But the work doesn’t stop here. We have substantially changed the way we do business and now we need to build on the really positive engagement of the last few weeks. This means in the future there will be new opportunities for businesses of all sizes, but also further savings for us.”
Atos Origin said that it will continue to deliver all its existing IT contracts to the government, and resume a number of IT projects and outsourced operations that were placed on hold while the negotiations took place.
Although Atos Origin and the government have said that the new approach will deliver cost savings over the long term, both declined to provide any further financial detail “for reasons of commercial confidentiality”.
Nonetheless, a spokesperson for Atos Origin said: “The single-client approach to engagement is also good news for Atos Origin. It will reduce the cost of sale to government and will, Atos Origin believes, open up new opportunities.”
Anthony Miller, managing partner at analysts TechMarketView said in a blog that although Atos Origin will resume its IT projects with the government, it is unclear “how much flesh the government has demanded in return”.
Atos Origin’s existing contracts include those with the Department for Work and Pensions, the Ministry of Justice and the Home Office. It delivers medical advice and assessment services for the DWP,manages the IT infrastructure for the MoJ and provides IT services to the Home Office’s and UK Border Agency’s 24,000 users. Furthermore, it will continue its agreement on the government’s Choose and Book programme.
The other suppliers involved in the negotiations with Maude were HP, BT, IBM , Capgemini, Fujitsu, Capita, IBM, Telereal Trillium, CSC, Logica, Steria, Oracle, Siemens IS, C&W, Microsoft, Accenture, Serco, G4S and Vodafone.