The Department of Constitutional Affairs has admitted that the cost of the Libra case-management system, due to run the magistrates courts, will rise to £487m, more than three times the £146m originally bid for the system in 1998.
The system will also arrive at least a year later than the most recent roll-out schedule, Alex Allan, accounting officer, Department for Constitutional Affairs, told the Public Accounts Committee in November last year.
Uncorrected evidence to the committee, published this week [June 20 2006], shows that the Libra will incur £40m additional support costs before it is full implemented in March 2008, together with £22m additional software costs, £23m additional services and £12m in increased internal costs.
Allan also said the Department for Constitutional Affair had already begun a tender process for IT contracts covering its entire operations, including Libra. The current contract for supporting the Libra infrastructure, held by Fujitsu, runs out in March 2007, before the system is due to be fully implemented.
The Libra contract, to replace outdated and incompatible equipment with standardised case management software across more than 300 magistrates courts, was signed in 1998.
But, faced with losses after under-pricing its bid, Fujitsu twice threatened to quit: the first time in 1999 only months after the deal was signed; and again in 2001, when Fujitsu had already started to deliver office automation systems to hundreds of magistrates courts. Rather than terminate the contract, the Lord Chancellor's Department agreed to pay more and absolve Fujitsu from responsibility for delivering core case management software for the courts.
In return for receiving more money, Fujitsu provided extra hardware to a larger number of users. The total costs of the project have risen to £390m, from Fujitsu's original tender of £146m.
In a report in 2003, the PAC said Libra was one of the worst public finance initiatives it had ever seen.