Q71 Mr Allan: The Board, in a sense, was working on a false premise in that it was talking about a project that was all about building costs and there was this little element of peanuts for technical transition. Can I ask, was there an IT expert on the Board?
Sir David Omand: Yes, we had a Director of Technology.
Q72 Mr Allan: A Director of Technology at that point when you were doing this did not put his or her hand up and say "Actually, there is all this stuff coming down the track"? We are talking about 1998, it is not very far away, saying "This is going to cost maybe a little bit more", like 15 times as much.
Sir David Omand: As we have said, it was a couple of years before the problem was articulated in that way. It seems obvious to us now but it did not seem so obvious at the time. For those of you who might have invested in PCs for home use, which were just beginning to come into general usage, it was quite difficult to predict at that time where all of this was going to end up.
Q73 Mr Allan: We have now 50% internet usage, 10% then, we have got mobile phones, and I am assuming your new system has all of the functionality that you need to cope with all this extra traffic.
Sir David Omand: Yes.
Q74 Mr Allan: I do question why a Director of Technology sitting on a board, looking at a project that had funding going forward to 2003, was not sitting there with the Director of Technical Expertise and saying "Well, in 2003 we will need all of this".
Dr Pepper: The Director of Technology was in the same situation, the same mindset if you like, as the rest of the engineers back in 1996. We were in a period of very rapid transition and we-including the Director of Technology as much as the engineers-failed to recognise quite the extent and the full implications of the transition we were going through, the totally new IT world that we were moving into. None of them had made that shift of mindset to realise that the world was now a very different place.
Sir David Omand: The truth is that it was too easy to take the existing plans for the new computer hall and simply transfer the thinking on to the larger programme. It was too easy to do that and, if you like, it was sloppiness and we should have thought about it much harder than we did.
Q75 Mr Allan: We should not be suspicious that there was a mindset of "we want a new building so we will not raise all these awkward questions that are going to cost lots of government money now or we will not get our building"?
Dr Pepper: Certainly not. The NAO have looked at the paperwork, we have had Sir Edmund Burton look at the history of what happened. That was absolutely not what happened. Had there been any suggestion of that I would suggest the NAO would have drawn attention to that.
Q76 Mr Allan: You talked about direct contact with other agencies and I am interested in the move of the Health and Safety Laboratories who are moving a complex technical system from Sheffield to a single new greenfield PFI site somewhere near Buxton. Have you spoken to the HSL about this because clearly there are a lot of lessons from what you have done here and I would have thought maybe they would be applicable to an agency like that?
Dr Pepper: I have not. I do not know whether they have contacted us. My expectation is that they will be working through the OGC guidance, which we have contributed to. If they wish to come and talk to us we would be very happy to give them the benefit of our painful lessons learned.
Q77 Mr Jenkins: Coming so late in the order most of the questions have already been asked so I have to reform or reframe these questions. When you were doing the bidding there were four main contractors, two of them were very good quality bids but a bit high on price. The preferred bidder, because you made certain adjustments, increased their price by 21%. Would you have been able to negotiate with Turing, who had a good quality building, and got a similar level of price?
Dr Pepper: We could not have negotiated just with Turing, we would have had to treat all of the bidders the same obviously. There was no reason to believe at the stage we made the selection that there was any particular asymmetry in the amount of work that had to be done. There was no reason to believe that Turing were there and would have stayed where they were whereas everybody else would have moved. All the bids needed a lot of work. All the bids were deficient in various respects. The team were pretty confident that Turing would have risen perhaps not by the same amount but there was no reason at all to suppose that they would have changed their place in the rating.
Q78 Mr Jenkins: After you allocated this preferred bidder status I see your Project Director left.
Dr Pepper: Yes.
Q79 Mr Jenkins: Was there any reason why he left at that critical stage?
Dr Pepper: He chose to go off and pursue a career in the private sector, as people do.
Q80 Mr Jenkins: Rather a strange decision for a Project Director to make just after you have got the preferred bidder.
Dr Pepper: Not necessarily. I think if you look at it from his point of view, and I have not spoken to him, I have not seen him for a long time, by that stage he had acquired a considerable expertise in managing a PFI project, there was a lot of PFI going on in the marketplace and he probably thought that it was a good opportunity to go and sell his skills to other bidders.