Project managers in the public sector could learn lessons from
the failures of the Libra office automation and case management
project for magistrates' courts
Post mortems on the failure of the £390m Libra contract to deliver
a unified case management system to magistrates' courts in England
Wales have identified several key lessons.
They came to light as a result of investigations into the project
by the public spending watchdog the National Audit Office and the
House of Commons Public Accounts Committee, which were published in
2003.
Using the audit office's report as a starting point, the Public
Accounts Committee interviewed Richard Christou, executive chairman
of Fujitsu, and Hayden Phillips, the then head of the Department
for Constitutional Affairs.
Computer Weekly has extracted four key lessons from the
reports.
Standardised computer systems need standard business
processes
Magistrates' courts across England and Wales are largely autonomous
and many have their own way of doing things. But the NAO said the
Department for Constitutional Affairs "sought automation as a
priority before questioning the existing business processes".
In response the department said it recognised that development of
best business processes should have come before seeking an IT
solution. However, with legacy equipment in danger of failing, it
was under pressure to deliver new systems.
Also, the department, like the NHS in its implementation of a
£2.3bn IT-led modernisation programme, pointed out that it did not
have the authority to impose business process change on the
independent Magistrates' Courts Committees. And it was reluctant to
attempt further major change while the committees were going
through other reforms.
But putting IT before consideration of business processes made it
"difficult to obtain a single view of IT requirements across the
various committees and this contributed to the difficulties in
developing the new system", according to the report of the Public
Accounts Committee.
A supplier may so mistakenly under-price a contract that
its future is later put in jeopardy
Christou told MPs that one of the lessons learned from Libra was
that his company had mistakenly under-priced the contract.
"We accepted a contract which, with the benefit of hindsight, was
under-priced," he said.
He went on to tell the Public Accounts Committee that the
supplier's future would have been threatened if it had delivered
the original contract without revision. "The issue was that for us
to finish this contract as it stood it would have seriously
jeopardised the existence of the company," said Christou.
When MPs said that Fujitsu's future was its own affair, Christou
replied, "If, in the end, many IT suppliers suffer these sorts of
things, then the supply of IT contracts for government will no
longer exist, so we had to find a way through this. This is a
serious issue."
Revising a contract time repeatedly - at the supplier's
request - may be less disruptive than cancelling it
Phillips, then head of the department, told MPs that renegotiation
was the least worst option because "the consequences of
termination, of delay, of re-procurement, of loss of service to
magistrates' courts and the cost of litigation itself, had to be
balanced against the opportunity that we could get if we could
renegotiate satisfactory terms, and we believe we did that in 2000
and again in 2002".
There must be a rigorous process of
accountability
The full facts about why Libra's costs had soared have been
difficult to come by, even for members of the Public Accounts
Committee whose job is to police departmental spending.
Computer Weekly has argued that such large gaps in information
could be bridged if the recommendations of its Shaking Up
Government IT campaign were put into action.
The campaign calls for independent Gateway reviews on the progress
or otherwise of IT projects to be published, and a statutory
framework specifically for the public sector, which would enshrine
good practice in law and improve accountability.
When Richard Bacon, a member of the Public Accounts Committee,
asked repeatedly for a full breakdown of the £232m which was due to
be paid to Fujitsu for Libra's office automation systems, the
department referred him to the supplier.
Fujitsu provided a high-level breakdown of its estimate but Bacon
did not get specific answers to his further questions.
The department gave Bacon a copy of a report on Libra written by
independent analyst Gartner but this too did not give the specific
information he sought.
Another member of the committee, David Rendel, wanted a Gateway
review into the Libra contract to be published but senior civil
servants refused. They gave two reasons: possible harm to Fujitsu
because of what the review said about the supplier, and possible
harm to the department's negotiating position.
Rendel said in response, "I am not sure of the relevance of why we
should not be granted something which could be harmful to Fujitsu.
We are, after all, in the business of supporting not Fujitsu but
the public interest.
"And even if it was relevant at the time, it is clearly not
relevant now because the negotiations have finished."
Weaknesses in accountability do not end there. The department
decided in February 2002 not to proceed with Fujitsu's contractual
commitment to deliver core case management software for
Libra.
Three months later, in June 2002, the Public Accounts Committee
asked a senior official at the department for confirmation that it
was not proceeding with the core software. He denied this was case.
When questioned in 2003 on whether he had misled the committee, the
official said he had not wanted to jeopardise negotiations with
Fujitsu, which, in June 2002, were at a sensitive stage.
The Public Accounts Committee concluded that the official could
have handled the situation differently by, for example, presenting
information to the committee in confidence. It said the official
had "expressed regret at giving incorrect information and
emphasised that he had not deliberately sought to mislead the
committee".
But this was not the first time that a Commons committee has been
given incorrect information about an IT project.
A trade and industry committee was told in November 1998 that the
Pathway project for a benefits card was on course just months
before the scheme was cancelled.
MPs on the transport subcommittee were told in December 1999 that a
system from supplier EDS for an Oceanic air traffic control in
Scotland was a model development when officials were, in fact,
considering cancelling the contract.
Libra's 12 years of delays and excuses
- 1992 A contract for national caseworking software, to replace
incompatible systems in use in magistrates' courts, fails. The Lord
Chancellor's Department takes legal action against the supplier
Price Waterhouse
- 1993 The department begins an in-house project using Admiral
and FI Group, but this fails too. The department pays out
£6.8m
- 1995 PricewaterhouseCoopers agrees to pay the department
£1.3m but it is unclear who pays the legal costs
- 1996 The department launches Libra, its third attempt to
introduce national systems for magistrates' courts
- May 1998 EDS withdraws from the bidding leaving only ICL, now
called Fujitsu, which submits a tender for £146m
- October 1998 Fujitsu increases bid price to £184m
- December 1998 The department awards Fujitsu a 10-year contract
for £184m
- October 1999 Fujitsu seeks to renegotiate the contract as it
forecasts a loss of £39m over the life of the deal
- May 2000 The department signs a revised deal for Libra. The
contract is now for 14.5 years and is worth £319m
- June 2001 While rolling out networked office automation
systems to the courts, Fujitsu tells the department it cannot
continue with the contract unless it is substantially revised
- September 2001 Fujitsu threatens to repudiate the contract
unless the department agrees to cover its losses which are now
estimated at £200m
- February 2002 The department decides not to proceed with the
core case management software from Fujitsu
- July 2002 A revised contract is signed with Fujitsu for £232m
over 8.5 years to supply only the infrastructure element of
Libra
- 2003 STL Technologies agrees to supply Libra's core management
system. A further contract is signed with Accenture to roll out
STL's software in court rooms and offices. The cost of the contract
is put at £390m
- 2003 The National Audit Office says Libra from STL and
Accenture is "essential" to a plan to unify the administration of
crown, county and magistrates' courts in April 2005
- September 2004 A leaked document reveals that the Department
for Constitutional Affairs is concerned about software errors, fit
for purpose issues, revising the roll-out timetable and
"performance issues" despite a tenfold improvement. The
implementation is due to be completed in early 2006.
Learning lessons of Libra's history>>
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