3.6 Most of HMRC's core technology functions were outsourced under the Inland Revenue's previous contract with technology firm EDS (which ran from 1994 to 2004). The Aspire contract continued this arrangement, consistent with many other contracts for technology developed at the time. However, by 2006, we were highlighting the importance of government departments building and retaining sufficient capacity and capability to challenge suppliers of outsourced services and hold them to account.21
3.7 We consider that HMRC's ability to manage its data centre costs was weakened in 2007 when it agreed to pay a fixed monthly charge for this service, albeit at an initially lower overall price than it had paid previously. Fujitsu is the main provider for the data centre service, and this accounts for 23 per cent of the total cost of Aspire. With rapid technological change, in which data centre costs are falling, HMRC now considers that its data centre costs are not value for money. This is confirmed by recent benchmarking which shows that HMRC's use of its data centre service is below industry average, indicating relatively low productivity.
3.8 In 2012, HMRC recognised that it had insufficient internal capability to challenge the cost effectiveness and suitability of Capgemini's technical proposals. Since then, it has sought to take more responsibility for strategy and design so as to control its ICT infrastructure more, and prepare to replace the Aspire contract.
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21 Comptroller and Auditor General, Delivering successful IT-enabled business change, HC 33-I Session 2006-07, National Audit Office, November 2006.