Justice ministry aims for £100m saving on £14m annual ERP costs

The Ministry of Justice (MoJ) spends £14m per year running its ERP systems, but hopes for major savings through shared services.

The Ministry of Justice (MoJ) spends £14m per year running its enterprise resource planning (ERP) systems, but hopes to save over £100m through a new shared services approach, according to a parliamentary answer from justice secretary Kenneth Clarke.

The seemingly high figure annual figure is due to the MoJ having three separate ERP systems as a result of the department having being formed out of the prison, probation and court agencies. During 2010-2011 the MoJ spent £7.98m on ERP supplied by Phoenix, £3.64m on its Chrimson system and £2.38m on its Aramis ERP.

As part of the MoJ’s Transforming Justice initiative the three systems are to be replaced with a shared services ERP platform, in a move expected to save £102m over 10 years and due to go live in 2013-14, said Clarke.

“The new solution will deliver significant savings of £40m per annum through increased efficiency, reduced systems maintenance and support and improved management information. These benefits are quoted excluding any sharing of our platform by other departments and will increase should this occur,” he said.

In comparison, the Department of Health (DH) spends £1.4m on ERP per year, with over £1m of that going on application support and maintenance costs alone, according to a separate parliamentary response from the DH.

The question was raised by chairman of the Public Administration Select Committee Bernard Jenkin, following a refusal by the MoJ to answer Computer Weekly’s Freedom of Information request on its ERP expenditure. The department had originally cited commercial sensitivity as the reason for its refusal, despite the government’s transparency agenda to open more public sector spending data.

The news follows research from Computer Weekly which revealed that some government departments were spending three times more than others on ERP licencing costs.

In its response to Computer Weekly’s findings, the Cabinet Office singled out Oracle and SAP  as having the most inconsistent prices for providing ERP licence and maintenance support across central government departments.

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