Revenue pays bidders to try for EDS contract

Officials at the Inland Revenue have confirmed that the department is to meet some of the costs of companies that bid against EDS...

Officials at the Inland Revenue have confirmed that the department is to meet some of the costs of companies that bid against EDS and Accenture for Aspire, the UK's largest public-private partnership technology contract.

The agreement to pay nearly £9m towards the bids, which is thought to be the first time this has happened on a non-defence contract, is seen as a tacit acceptance that without such an incentive no strong competitors to the incumbents would have come forward.

The current contracts to run the nation's tax and national insurance systems are due to expire next year. The follow-up deal is expected to be worth between £3bn and £4bn over 10 years. It will involve about 2,500 staff, serve at least 65,000 desktops, a number of ICL mainframes, and 177 IBM and HP-UX servers.

The Revenue said it will obtain value for money by paying bidders for what it calls a "design and implementation study".

"Any funding of bid costs would therefore be based wholly on value-for-money grounds, to ensure that a direct link exists between any funding and the tangible benefits coming to the department. That is why the department has met the costs of the design and implementation study," an Inland Revenue spokesman said.

Computer Weekly understands the Revenue is paying $4.5m (£2.9m) to each of three shortlisted consortia. EDS and Accenture are bidding jointly. The other bidders are Cap Gemini Ernst & Young and a consortium of BT, CSC and SchlumbergerSema.

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