HP renews multibillion MoD deal, a week after loss of massive DWP contract

HP has won an extension of its largest UK deal, with the Ministry of Defence.

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HP has won an extension of its largest UK deal, with the Ministry of Defence.

The news comes a week after the loss of its desktop management deal with the Department for Work and Pensions, thought to have been worth over a billion pounds.

The MoD and the HP-led Atlas consortium have signed an $890 million (£547 million) increment to the deal, understood to be budgeted within the £7.1 billion lifetime value of the project. The consortium also includes Fujitsu, EADS, General Dynamics and Logica.

The agreement concerns the often troubled Defence Information Infrastructure project, which focuses on providing a single information and communications platform to the MoD, partly by providing hand held terminals to 300,000 forces personnel around the world.

A year ago, the powerful Committee of Public Accounts accused HP of "underestimating the complexity of the software they were asked to deliver", playing a part in severe delays and nearly £200 million of cost overruns. There had been "no proper pilot" to test the technology, it said.

Under the new phase of the scheme, called Increment 3a, HP and its subcontractors will provide 42,000 computer terminals operating in the Restricted and Secret security levels to all the MoD fixed sites that do not yet have the technology. They will replace what the MoD sees as “outdated and expensive” legacy systems.

Sixty thousand personnel, within the Royal Air Force at Joint Helicopter Command and in other MoD locations, will be affected by the new phase.

DII, the largest defence IT programme of its type in the world, was “already delivering operational benefits” to front-line troops and the rest of the MoD, according to HP.

“It is critical to national defence that the MoD and its allies have highly secure and real-time global access to the information they need,” said Huw Owen, chief executive of the HP Atlas Consortium.

The move was also “fundamental” to the MoD’s need for a “single, integrated information infrastructure”, he said. The MoD is attempting to improve shared information between headquarters, battlefield support and the front line.

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