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HMRC boss defends shift to AWS, says they got 50% knocked off

Is Amazon the only one who can handle its cloudy needs? No, there is one other...

HMRC's Permanent Secretary has defended the UK tax authority's decision to ditch a British cloud slinger in favour of tax-efficient multinational Amazon, citing bumper savings.

As exclusively revealed by The Reg, the taxman moved its data out of Manchester-based Datacentred six months ago. HMRC was the firm's biggest client and it was unable to recover from the blow, slipping into administrative receivership in August.

Jon Thompson, Permanent Secretary and chief exec at HMRC, was yesterday asked by Public Accounts Committee chair Meg Hillier if that decision "flies in the face" of the government's plans to hand £1 in every £3 to SMEs.

He said the breaking up of HMRC's £700m Aspire IT contract had attracted 100 more SMEs to work with the department. "So I don't think personally there's anything wrong with HMRC contracting with Amazon Web Services."

The market had moved on for very large businesses into hyperscale cloud. "We need resilience in data centres and we need someone who can hold that data for us."

Asked if Amazon was the only company who could handle HMRC's cloudy needs, he said: "No, there are two... and the price reduction on this was more than 50 per cent for us. There was a clear value for money [justification] of moving down this route."

The other public cloud provider that HMRC's boss referred to is Microsoft and its Azure service, sources told us.

Thompson said by scaling up the data held within HMRC, the department would get a more resilient service that was held on multiple sites and would not face the cost of managing its own server farms.

"We are increasing the amount of business in SMEs... but in this one particular case the SME was not successful."

He said the data would be held in the UK and would not be shared with the US. Amazon set up shop in Blighty at the end of 2015, but didn't build its own bit barn and instead rented rackspace from a third party.

The department recently came under fire for appointing a new Chief Digital Information Officer who is currently on secondment from Microsoft for two years.

HMRC said Jacky Wright is to recuse herself from making any decisions regarding Microsoft. It will be interesting to see if Azure gives AWS a run for its money during her time on board. ®

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