Fujitsu Services withdrew from talks to re-negotiate parts of its
£1bn contract with the Department of Health because the terms
set down by the health service were unaffordable, a director has
disclosed to MPs yesterday.
Fujitsu's withdrawal from the talks last month prompted the
Department of Health to terminate the company's contract under the
NHS's National Programme for
IT (NPfIT).
Fujitsu was awarded a 10-year contract in January 2004 as the
local service provider to hospital trusts throughout the south of
England. Its losses on the contract - which was in part for the
supply and installation of the Cerner "Millennium" system - are
understood to be about £340m.
At a hearing of the Public Accounts Committee into the NPfIT
yesterday, Peter Hutchinson, Fujitsu's group director for UK public
services, revealed that his company had been willing to continue
with its original NPfIT contract - even when talks over the
contract "re-set" had failed.
"We withdrew from the re-set negotiations. We were still
perfectly willing and able to deliver to the original contract," he
said.
Asked by public accounts MP Richard Bacon why Fujitsu had
withdrawn Hutchinson said, "We had tried for a very long period of
time to re-set the contract to match what everybody agreed was what
the NHS really needed in terms of the contractual format.
"In the end the terms the NHS were willing to agree to we could
not have afforded. Whilst we have been very committed to this
programme and have put a lot of our time, energy and money behind
it we have other stakeholders we have to worry about including our
shareholders, our pension funds, our pensioners and the staff who
work in the company. There was a limit beyond which we could not
go."
The termination of Fujitsu's contract has left the NHS with a
"gaping hole," said the chairman of the Public Accounts Committee
Edward Leigh.
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