The Department for Work and Pensions (DWP) has awarded Atos a contract worth £10 million a year to continue providing IT services to support work capability assessments after it steps down as the main supplier next year.
Atos is due to exit its controversial DWP contract for health and disability assessments by February next year, instead of the original end date in August.
The French multinational has come under fire for the number of work capability decisions that have been overturned and the firm recorded roughly 163 incidents of abuse or assault on staff in 2013.
The firm announced its intention to walk away from the contract in February and the government confirmed that Atos would exit the agreement early in March.
However this new contract means the firm will continue to provide the IT for the assessments until at least 2016, with allowances for it to be extended until 2020.
The contract, which the DWP described as an ‘interim arrangement’, was negotiated and set up without any competition.
The department said that this was for ‘technical reasons’, some of which were set out in the award notice, which was published in the Official Journal of the European Union (OJEU) at the end of last week.
The DWP said that an alternative provider would not be able to set up the new services in time without there being “an unacceptable level of service transition and delivery risk failure”.
In the OJEU notice, the department also claimed: “Another supplier would be unable to provide the IT services using the existing hardware, software, premises, etc, because the physical assets are owned by the current provider of the assessment services rather than the Authority.”
The DWP said: “Another supplier would be unable to replicate the current IT services because there is insufficient documentation to build them.”
It also said that another supplier wouldn't be able to replace the physical assetes on a like-for-like basis because some of the assets were out-of-date and now unavailable.
The DWP told ComputerworldUK that although a new provider is expected to take over the contract next year, the IT will be transferred separately and at a later date.
A spokesperson said: “The DWP is seeking a new provider to help increase the volume of assessments carried out and improve the claimant experience, in particular looking to reduce waiting times and modernise delivery, including looking to replace the current IT.
“To make sure claimants get a good service during transformation, we are transferring the IT separately, and at a later date, than the rest of the service [which transfers in 2015].
“We have therefore asked Atos to continue to provide the current IT services for a further year. In the meantime work has started on planning for how we replace the IT."
Early exit payment
In a statement to Parliament in March, disability minister Mike Penning MP said that Atos had paid the department to terminate its contract early.
He said: “I am pleased to confirm that Atos will not receive a single penny of compensation from the taxpayer for the early termination of their contract, quite the contrary, I can also confirm that Atos has made a substantial financial settlement to the Department for Work and Pensions.”
However the DWP refused to disclose the figure paid by Atos when contacted by ComputerworldUK.
The contract for healthcare assessments between the DWP and Atos was awarded in 1998. It was renewed for seven years in 2005 and then extended for a further three in 2010 through to 2015.