The Department decided to continue with the contract

2.24  ICL and the Department assessed the scale of the problem using ICL's financial model. The model included assumptions about additional business opportunities which were not contracted, and which proved to be unfounded. ICL also considered that its projection of costs was underestimated. The Department employed Ernst & Young to assess ICL's capability of delivering the contract. Ernst & Young concluded that the position was worse than ICL had declared: ICL's financial model contained major flaws, was too complex and could not be relied upon for making business decisions. The Department and ICL agreed that a new financial model should be produced and jointly paid for and owned by the two parties to establish a proper baseline for negotiations. The new financial model corrected some of the assumptions in the original model and showed a cumulative deficit for ICL of £47 million over the life of the deal. PACE, independent consultants employed by the Department, considered that the project should be saved on the grounds that the project was basically sound; that the potential benefits confirmed the strategic importance of Libra to the criminal justice system as a whole; and that the project was too important to allow ICL to default.