2.8 Between May 1997, when the Contributions Agency and Accenture agreed the arrangements for pricing system enhancements, and April 1999, when the Contributions Agency was transferred from the Department of Social Security to the Inland Revenue, the Government announced a number of significant legislative changes which affected the areas of national insurance and pensions dealt with by NIRS 2 (Figure 4). The Department of Social Security provided advice to Ministers on the technical feasibility and costs of each of these policy changes. The implications of each policy were assessed separately, but the Department's ability to assess the overall capacity for NIRS 2 to accommodate the package of changes within the proposed legislative timetable was limited by uncertainties about the initial stabilisation of the system. This meant that they were not in a position to establish fully the aggregate effect of the changes on NIRS 2.
2.9 Furthermore, as the original system had not yet been fully delivered, it made it more difficult to assess the extent to which it would need to be modified. So it was not apparent to the Department of Social Security that the required developments might, in aggregate, exceed the annual enhancement limit included in the NIRS 2 contract. At the time of the transfer it was not clear to what extent, if at all, the legislative changes proposed, together with their respective implementation dates, would result in the annual 2,000 function point limit being exceeded, or more fundamentally, whether the system had the technical capacity to absorb the level of change required.