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UK's NS&I extends Atos contract as procurement drags on

Delays to $1 billion replacement will see March 2024 contract deadline missed

National Savings & Investment has extended its contract with French IT services and outsourcing provider Atos as the UK state-owned bank's struggle to find a replacement continues.

Last year the bank – an executive agency of the UK's Chancellor of the Exchequer – went to market with nearly $1 billion in contracts aiming to replace Atos, which was set to see its contract end in March 2024, according to procurement documents published at the time. Last week, a spokesperson for NS&I told The Register the procurement was in its “advanced stages” and winners would be announced in due course.

“We began a competitive procurement process in 2021 as part of a transformation programme to switch from a single outsource provider to a multi-provider model. To ensure we maintain delivery of services to our retail savings customers while we complete the switch to a multi-supplier model, we have exercised an option for Atos to provide operational continuity through to March 2025. Atos manages NS&I’s sales processing and customer servicing, together with IT and infrastructure services. This contract will expire in March 2025,” it said.

NS&I serves around 25 million people and manages funds worth £202 billion ($255 billion). It is best known for providing Premium Bonds, a form of investment that also offers winnings under a lottery system, an approach designed to persuade people to accrue long-term savings which dates back to 1956.

Last week, The Register reported customers’ ongoing frustration with poor customer service and apparent failures in its two factor authentication system. A spokesperson apologized to customers who had “not received the high standard of service that they have come to expect from us.”

In July last year, IBM won a contract worth £34.2 million (c $41.2 million) to provide NS&I with "Digital integration and ServiceOps", intended to be its technical and operational center.

However, two chunks of work that went to tender over a year ago are yet to be awarded.

In February last year, the bank tendered for Digital Experience and Enablement with up to £172 million ($216 million) in the offing.

In May last year, the bank went to the market for a set of technology contracts worth up to £756.1 million ($938 million). Split into two lots, the contracts were designed to "deliver and integrate front-office (contact centre) services” and core banking services, respectively.

These contracts are yet to be awarded, seemingly forcing NS&I to extend the Atos contracts to allow time for handover of services. Hopeful suppliers had been asked to keep their tenders valid until the end of March this year.

NS&I is not the only UK state-owned financial services company changing its plans for Atos. Earlier this year, The Register revealed NEST, the pensions provider, cancelled a deal with the French outsourcing company just two years into a contract – worth up to £1.5 billion – which could have lasted 18 years. It has retained the service of the incumbent supplier, India’s TCS. ®

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