22. The revised contract signed with ICL in July 2002 covers only the infrastructure element of the Libra project (PCs, printers and standard office software including e-mail). ICL has estimated that the cost of the infrastructure element contained within its original bid of £146 million in May 1998 would have been £94 million (over 11 years). This compares with a cost of £232 million (over 8.5 years) for the July 2002 contract. The number of workstations to be supplied increased over the period by 27% from 8,675 to 11,000; the number of printers by 33% from 3, 790 to 5,050; and the number of users by 74% from 6,333 to 11,000.23 These changes do not explain why the price should have increased by two and half times whilst providing two and a half years less service.
23. The Department employed Gartner as independent consultants to conduct a benchmarking exercise. Both the Department and ICL considered that the infrastructure contract was value for money because the cost was within the cost range estimated by the consultants.24 Nevertheless, the Department was unable to demonstrate how the £232 million figure was arrived at.25 ICL later provided in a note to the Committee a broad breakdown of the costs involved (Figure 4).26 But this evidence was unconvincing in demonstrating that £232 million was not an excessive price to pay for just the infrastructure element of the Libra project.
Figure 4: The £232 million infrastructure contract with ICL
Element | Cost £m | Cost £m |
Helpdesk |
| 18.7 |
Distributed Computing Facilities |
|
|
Workstations and Printers | 29.6 |
|
Application Development and Support | 21.8 |
|
Service Management | 13.1 |
|
Install and Data Cabling | 12.7 |
|
Enhanced Office Automation Facilities | 8.3 |
|
Local Area Networks | 7.4 |
|
Mobile Engineering staff | 5.9 |
|
Technical Support staff | 5.5 |
|
Servers | 5.4 |
|
Software Licences | 4.4 |
|
Management Fee | 2.9 |
|
Accommodation | 1.8 |
|
Datacentre Services | 1.1 |
|
Terminal Emulation | 1.1 |
|
Expenses | 0.9 |
|
Other | 1.2 |
|
Total Distributed Computing Facilities |
| 123.1 |
Wide Area Data Network |
| 23.4 |
Application Migration |
| 13.0 |
Subtotal as per Gartner benchmark |
| 178.2 |
Contingency | 9.7 |
|
Overhead | 9.8 |
|
Profit and Interest | 34.6 |
|
Total contingency, overhead, profit and interest |
| 54.1 |
Total contract value |
| 232.3 |
Source: Fujitsu Services
24. The Department said that 90% of the infrastructure had now been rolled out across the country. In January 2003 the Department signed a separate contract with STL to provide the core software application to support court work (case management, accounting and administration). A systems integrator would then be appointed towards the end of 2003 to roll out and run the application. The plan was for the core software application to come on stream during 2004 and 2005. The Department had no reason to believe that this target would not be met. The core application would help to provide a whole range of management information and statistics essential to the running of a unified court service.27
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23 Qq 149-150; Ev 24
24 C&AG's Report, para 2.56; Qq 101-102, 182
25 Qq 172-185
26 Ev 24 (ref Qq 172-184)
27 Qq 20, 102; C&AG's Report, para 10