16 The objectives of the Department of Social Security and Post Office Counters Ltd in undertaking the project were different, reflecting their different business drivers. They rightly agreed a memorandum of understanding between themselves before signing the contract with Pathway, which addressed their commercial relationship. But this did not prevent later disputes on matters of detail. For example, arrangements that the Department wanted to ensure security for payments to people temporarily collecting benefits on behalf of claimants proved difficult to balance against Post Office Counters Ltd's commercial interests in maximising the flow of customers through its outlets.
17 We found significant evidence that the Department had shown commitment to the success of the project. In 1997/98 they employed up to 1100 staff plus consultants in designing and implementing their CAPS computer systems that were to link to the Payment Card. They also agreed to the system being installed in 205 offices without the full range of contracted security features. In late 1997, when the project was clearly in deep trouble, they sensibly began contingency planning for a possible implementation of payment by bank transfers, in case the Benefits Payment Card project should fail. Pathway told us that they felt that the Department's commitment had reduced from around this time, in their view because the project no longer had such strong champions within the Department as before. Argument over difficult issues, mainly to do with how best to ensure the security of the system, tended to raise doubts among the participants as to their partners' commitment to timely delivery of the project. Similarly, because Post Office Counters Ltd had a lower financial incentive than did the Department to achieve a quick changeover from order books to the Benefits Payment Card, the Department at times questioned their partner's motivation. Post Office Counters Ltd insist that they too had a strong interest in playing their full part in delivering the entire project to time. In our view, such doubts about partners' commitment inhibited a genuinely open and participative approach to tackling the severe problems of the project.