BT's writedown on London NPfIT contract

Whenever I’ve asked BT in the past whether its £1bn contract as a local service provider in London has been profitable and, if not, why it has not announced any losses, the reply has been to the effect that all is well, and that the contract will prove profitable over its lifetime.

Today’s Financial Times reports:

“Of £1.3bn in writedowns at [BT] Global Services, £1.2bn was down to two contracts, one of which is to provide IT services to NHS hospitals in London. BT estimated the entire value of that contract, for 10 years and signed in 2003, was £1.1bn.”

The writedown by BT is at least a vindication of the terms and conditions of the NPfIT contract put in place by Richard Granger when he was head of NHS Connecting for Health.  

A BT press release yesterday said:

“We continue to make progress on our NHS National Programme for Information Technology (NPfIT) contracts. In an extension to our work in London, as the local service provider responsible for upgrading NHS IT systems in the capital, we have taken over the running of IT systems at eight acute hospitals in the south of England where we are also working with a further four acute trusts which have yet to roll out new systems as part of NPfIT.

“We will also implement 25 new systems in community and mental health trusts in the region, building on our success in London, where the roll out is now 70% complete.”


On a wider, more general point, is there much point in annual company reports and accounts if people cannot know the full position until years after contracts are signed? And how many many financial companies, particularly US-based, have gone bust after audit firms signed off their accounts, depicting them as being in reasonable health?


BT frightenened by enormity of NHS IT Programme – Computer Weekly 2004

FT article today

BT to cut 15,000 more jobs – Computer Weekly

BT cuts 15,000 jobs – Management Today

BT and CSC deals under threat from Conservatives – ComputerworldUK