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HMRC begins escape from Fujitsu’s grip through £500m contract

HMRC looking for a supplier to support its planned exit from three Fujitsu datacentre contracts

Karl Flinders
By
Published: 22 May 2025 10:00

HMRC has begun the process of breaking away from its heavy reliance on Fujitsu for IT services, with a tender worth £500m designed to exit the supplier’s services.

In the clearest sign that HMRC is ready to break away from Fujitsu amid public pressure in relation to the Post Office scandal, it’s looking for a supplier for a 10-year Data Centre Exit (DCE) contract, which will begin in April next year. The loss of the work combined with the end of its Post Office contract will have huge ramifications on Fujitsu’s UK business.

HMRC wants a hyperscale cloud provider to manage the migration from the supplier followed by the provision of cloud hosting. According to the tender, published last month: “The primary objective of the DCE Programme is to exit three Fujitsu-hosted datacentres and migrate associated services to new destination platforms.”

The supplier that wins the HMRC contract will move IT services from Fujitsu’s datacentres to the cloud and then provide cloud hosting, according to the tender. “Following migration, the selected supplier will provide cloud hosting capabilities for in-scope services in a secure cloud environment to ensure continuity of services,” reads the tender notice. “The supplier will be required to provide a platform capable of sustaining business change, as well as mitigating current security and resilience concerns.”

It was Fujitsu’s software and errors that caused the unexplained shortfalls in Post Office branches that devastated the lives of those blamed. Fujitsu stood aside as the Post Office wrongly accused its subpostmasters, despite its knowledge of errors.

The UK government sector is a huge business for Fujitsu, with HMRC the biggest single component of this. But since Fujitsu’s involvement in the Post Office scandal, its activities have become mainstream public interest news, and the government has been under severe public and political pressure to cut ties with it.

HMRC is described as Fujitsu’s UK public sector “cash cow”, with huge contracts involved. The supplier has already landed £123m of taxpayer money from the department this year, as part of its contracts worth billions of pounds. According to the latest HMRC spending figures, which include all contracts worth over £25,000, in March this year alone, the department spent £80m with Fujitsu. Other HMRC spending with Fujitsu in March included about £4.9m for other IT hardware, £4.9m for physical hosting and infrastructure, £4.6m for IT software licenses and support, and £1.7m for desktop services.

Post Office contract

Fujitsu has also been dumped from its lucrative-but-controversial contract with the government-owned Post Office, and its contract finally ends in March next year.

Peer James Arbuthnot, a long-time campaigner for justice for subpostmasters, told Computer Weekly the government should stop handing Fujitsu lucrative contracts.

“Let’s not forget it was Fujitsu that was altering the subpostmasters’ accounts remotely, while denying it was doing it and not keeping a record of what they were doing,” he said. “It was Fujitsu that, knowing of the bugs and faults in their software, were swearing on oath in court that those bugs and faults did not exist. And it was Fujitsu that then watched the subpostmasters be convicted as a result of Fujitsu’s lies, and stood back as thousands of lives were ruined.”

Fujitsu has finally agreed to negotiate its contribution towards the huge costs of the scandal. In March, the government announced there was an agreement to begin talks on compensation. Fujitsu has previously stated it would wait until the public inquiry’s conclusion before committing to talks. The public inquiry has finished its public hearings and there is no date for the publication of the report from chair Wynn Williams.

Computer Weekly first exposed the scandal in 2009, revealing the stories of seven subpostmasters and the problems they suffered due to Horizon accounting software, which led to the most widespread miscarriage of justice in British history (see below timeline of Computer Weekly articles about the scandal since 2009).

Timeline: Computer Weekly articles about the scandal since 2009

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