Electronic Data Systems is reported to be on the verge of securing one of the world’s biggest ever technology outsourcing deals with the Ministry of Defence, despite several high-profile IT failures over the last few years.
The 10-year, £4bn outsourcing deal to run the UK’s defence information infrastructure contract (DII) is being fought between two consortia, the EDS-led Atlas consortium, that includes Fujitsu and IBM, and the CSC-lead Radii consortium, which includes BT and Thales.
The MoD’s selection committee is thought to be preparing to announce EDS as its preferred bidder by the end of this week.
The MoD has targeted £174m in efficiency savings through the DII contract that aims to overhaul the UK’s defence IT infrastructure. The new system is intended to provide everything from battlefield communications to information on salaries and pensions and will connect 150,000 desktop computers and laptops.
The contract also includes a failure clause to ensure that if any one member of the consortium fails to fulfil its role, another will replace it.
The deal will be a huge relief to the world’s second largest computer services group that has been blighted with problems during its time with large government clients, namely the Inland Revenue and the Department of Work and Pensions.
Last week our sister title, Accountancy Age, also reported that Whitehall procurement watchdog, the Office of Government Commerce had twice drafted in Big Four accountancy firm Deloitte to examine EDS’s finances between 2002 and 2004.
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