Fujitsu makes revised offer on NPfIT contract

Several people in the NHS say that health officials and Fujitsu have returned to the negotiating table after talks had stalled over a “contract reset” over the supplier’s £896m deal for installing Cerner’s Millennium systems in the south of England.

Officially nothing is being said about progress, particularly as the local elections are tomorrow [1 May 2008], but an employee at a local service provider says that a meeting was held last Thursday which involved:

– David Nicholson, Chief Executive of the NHS

Sir Ian Carruthers, who is a former acting Chief Executive of the NHS, a senior responsible owner of the NPfIT and now Chief Executive of the South West Strategic Health Authority

– a European director of Fujitsu

– A director from Fujitsu’s headquarters in Japan

As a result Fujitsu has made significant concessions – a revised financial offer – and the NHS would have to pay tens of millions of pounds, not hundreds of millions, to keep Fujitsu in the National Programme for IT [NPfIT]. The figures being discussed are not dissimilar to the £55m extra paid to BT as part of its contract reset.


It’s not a done deal. Staff at BT, the NPfIT supplier to London, say they were asked to look at whether the company had the capacity to bring Fujitsu’s work in the south of England into BT’s contract. This work could be resurrected if talks between the NHS and Fujitsu stall again.

The problem for Fujitsu is that its contract on the NPfIT could probably be absorbed by BT. But a deal with Fujitsu would still involve the NHS [taxpayers] in paying extra money; and it’s not clear if some of the risks which suppliers took on as part of the original contract – risks which the former NHS IT head Richard Granger fought hard to transfer to suppliers – would come back to the NHS.

It’s understood that if Fujitsu withdrew from the NPfIT it could cost the company up to £340m. It’s also being said that whereas NHS South East Coast and NHS South Central were willing to handle going it alone with Cerner, without Fujitsu’s help, NHS South West was not.

If the NHS accepts Fujitsu’s offer the two sides will work under a memorandum of understanding for the time being.

Links

Fujitsu and the NHS – bound by obsolete contracts

Sir Ian Carruthers – the NPfIT’s fifth senior responsible owner

Have NPfIT talks in the south stalled?

Fujitsu and NHS to sign NPfIT MoU

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