NHS Fujitsu talks broke down on localisation costs

The NHS’ contract talks with Fujitsu broke down after the two parties could not agree on the costs of providing localised services, industry sources have told Computerworld UK.

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The NHS’ contract talks with Fujitsu broke down after the two parties could not agree on the costs of providing localised services, industry sources have told Computerworld UK.

Fujitsu was dropped from the £12.4 billion National Programme for IT, it emerged last night. Just days before the talks ended, health minister Ben Bradshaw told MPs that the government was prepared to increase the value of Fujitsu’s contract to allow for the additional functionality being discussed.

Sources have told Computerworld UK that a cost could not be agreed on. The government was looking for specific services to meet the demands of local NHS trusts, and was discussing with Fujitsu how much this would cost, they said.

The NHS, the Department for Health and Fujitsu declined to comment on the detail of the failed negotiations with Fujitsu. But a source close to Fujitsu said the talks had focused “extensively” on localisation, and that this had been “a large point of discussion” where the parties “got stuck”.

BT could fill the gap left by Fujitsu. BT already provides the London part of National Programme for IT (NPfIT) under a near billion pound contract, and is implementing the same Cerner care records system as Fujitsu. CSC, which currently runs NHS IT in two areas of the country, is implementing the rival iSoft Lorenzo system.

A BT spokesperson said: “Were we to be approached by Connecting for Health for extra work, we would consider it.”

CSC has not yet responded to a query as to whether it would take the project given the opportunity.

BT had its own contract reset in January, adding £55 million in costs. CSC is still in talks on its contract, and it is understood this could also be over localisation of services.

Jonathan Edwards, research VP at analyst firm Gartner, said: “Localisation was one of the principal elements in the contract reset. Inevitably this would have cost more.”

The NHS began with a vision of standard services being provided across trusts, he said, but “we’ve moved quite a long way from that vision,” Edwards said.

Reaching an agreement on local needs was difficult as the NHS had become “more and more federated”, with local decision makers having increased influence, Edwards said. This had led to more demands from NHS Trusts for localised services.

Tola Sargeant, senior analyst at Ovum, said that under the National Local Ownership Programme, implemented last year, Connecting for Health retained responsibility for the contractual aspects of the programme, but local trusts took responsibility for implementing some objectives.

“Local power is much stronger now,” she said. “This lay right behind the contract negotiations.”

 
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