Microsoft beaten down 16pc on software sales to NHS

UK.gov lifts ban after cost-cutting crunch talks

The UK's Cabinet Office has lifted the embargo on NHS Trusts buying Microsoft software after negotiating a double-digit discount on current pricing, according to sources familiar with the deal.

As revealed by El Reg in the summer, Crown representative Stephen Kelly told trusts to freeze all but essential product spending with the vendor as it negotiated more aggressive terms.

The talks took six months to reach a conclusion but from December NHS Trusts are able to buy licences at 16 per cent below Microsoft's previous public sector agreement (PSA09), insiders claim.

"The NHS is now being actively encouraged by Microsoft to take advantage of the pricing being offered this month to remedy any shortfall in licenses," the source revealed. From next month, the rest of the public sector will be able to buy licences at a cost six per cent below the the previous PSA09 pricing.

The Coalition shelved the pan-NHS Microsoft Enterprise Wide Agreement eighteen months ago, claiming that there was no business case or budget to push through a renewal, handing more purchasing power to local trusts.

The UK's Paymaster General, Francis Maude, met the twenty largest suppliers of products and services to government to discuss ways to seek cost savings in tandem with efforts by the Cabinet Office to procure public sector goods as a single client.

A Cabinet Office Spokesperson told The Register: "The Cabinet Office are currently in negotiation with a number of suppliers, whilst negotiations are ongoing we will not be providing comment due to commercial sensitivity."

Microsoft refused to comment. ®