Fujitsu will not bid for business until Post Office inquiry closes

Pause comes after controversial supplier wins another 9-figure deal paid for by taxpayers

Fujitsu has written to UK Government to confirm it will no longer tender for business in the public sector amid the ongoing inquiry into the Post Office scandal – weeks after winning a £485 million ($614 million) contract.

Despite the supplier of the controversial Post Office Horizon system being scrutinized in Britain like never before, it continued to be selected for expensive projects that are paid for by taxpayer.

No longer. "We welcome Fujitsu's decision to pause bidding for work with new Government customers until such time as the inquiry concludes," a spokesperson for the Cabinet Office told The Register.

The inquiry, as readers know, centers on the deployment of Fujitsu's bug-ridden Horizon accounting system, which made errors in calculating the finances of local Post Office branches run by postmasters and postmistresses.

Some 736 of those managers were then wrongfully convicted of fraud when errors in the system were to blame. This destroyed the lives of the many involved, leaving some bankrupt and others feeling suicidal, with several succeeding in ending their life. Sixty people died before just seeing any sort of justice served.

This week, Fujitsu admitted it has a "moral obligation" to compensate those that were prosecuted, and has now taken the decision to step back from public sector contract tenders for the time being.

That decision comes too late for a public sector body in Northern Ireland which handed Fujitsu a contract worth £485 million following a competition in which no other suppliers submitted final bids for the work.

In a notice published on December 22, the province's Education Authority awarded the Japanese services and technology company the deal to provide services including a school management system for nursery, primary, secondary, and other education settings.

The strategic supplier agreement is intended to "support and manage a modern architecture, technical infrastructure and secure services for schools," the contract award notice said.

"These services will improve the learning experience of our young people, supporting teaching through technology, develop skills for the future and support the EA and its educational stakeholders to improve educational outcomes," it added.

However, The Register has learned that only one company made a formal bid for the contract. Despite the apparent lack of competition, the authority awarded the work to Fujitsu.

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The number of tenders received highlighted on the contract award notice relates to the initial supplier questionnaire stage. Three companies submitted tenders in December: Capita, TCS, and Fujitsu. By the time of the final tender submission, both Capita – the incumbent supplier – and TCS withdrew.

A spokesperson for the Education Authority (EA) said that as part of the Education Information Solutions program, it undertook a procurement in accordance with the NI Public Procurement Policy and The Public Contracts Regulations (2015) Competitive Procedure with Negotiation.

"EA confirms that four bids were initially received and, following a procurement process which involves numerous selection and evaluation stages, three tenderers were invited to bid in the final stage. At the close of this process, EA received one tender and, following final evaluation, Fujitsu Services Limited was awarded the contract," they said.

"The robustness of the procurement process and detailed evaluation has provided the EA with an assurance that Fujitsu can and will deliver all required services."

The spokesperson said the contract will be strictly managed to ensure the effective delivery of services in line with the UK government's professional standards and Northern Ireland procurement policy.

"The project is in the very early stages of the planning and design phase, and the Education Authority is firmly committed to liaising closely with schools and education settings, and to keeping them informed and involved as this very important work progresses," they said.

The award of a £485 million ($614 million) contract to Fujitsu without competition at the final stage of tendering will raise interest owing to the focus on its involvement in the Horizon Post Office scandal. A television dramatization about how local branch managers were falsely accused of theft and accounting errors when the computer system, which Fujitsu inherited from ICL, was at fault has brought the incident to the public's attention.

Politicians and media pundits have questioned why Fujitsu continues to win billions of pounds in work after some of the victims had convictions quashed in 2019.

The Northern Ireland Education Authority's incumbent supplier is Capita, which in April 2022 secured a two-year contract extension with the body to continue to deliver the managed IT service for all of Northern Ireland schools, extending a 10-year relationship.

Fujitsu provides support services to the authority's HR, payroll, and finance systems in a £20 million ($25 million) 10-year deal first signed in 2015. The value was increased to £29 million ($36.7 million) in June 2021 to "facilitate functionality changes to effectively meet schools' requirements, data migration issues due to the complexity of the variations in employee terms and conditions and project delays due to COVID-19 lockdowns," a tender notice said.

Fujitsu refused to comment. ®

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