Already three years late, NHS finance system replacement delayed again

Project to swap out Oracle E-Business Suite gets another red rating from projects watchdog

The UK's largest NHS management body has postponed the replacement of its aging Oracle finance system again following more than three years of delays.

The Integrated Single Financial Environment (ISFE) processes around £170 billion ($211 billion) in health spending every year for NHS England, which is responsible for running the health service in England.

Plans to upgrade the Oracle E-Business Suite 12.2 system have been afoot since 2018, when the quango under the Department of Health and Social Care said the replacement would go live in April 2021.

An NHS England spokesperson confirmed to The Register that a revised go-live date of April 2024 had been missed.

"A decision was taken to extend the planning and testing for this highly complex critical national infrastructure and a revised launch date in 2025 for the new system will be communicated shortly," they said.

"The current system and service continue to operate as normal and we remain committed to the successful delivery of this next-generation national finance system, ensuring that services, the system, and users are operationally ready for its arrival."

In its annual report for 2023-24, the Infrastructure and Projects Authority, a UK government projects watchdog, said NHS England's project to upgrade ISFE had been rated red, meaning "successful delivery of the project appears to be unachievable."

"The project may need re-scoping and/or its overall viability reassessed," said the report published last month.

The IPA report said the new finance system would support the NHS England Group of organizations, consisting of 42 Integrated Care Boards (ICBs), four Commissioning Support Units (CSUs), NHS England, and a provider organization with annual funding of £170 billion.

The data published with the IPA report said: "Following recommendations from a Red Gate 0 report in February 2024, an action plan is under development and the program is undergoing a re-planning exercise to determine a new go-live date."

Data from the 2020-21 IPA report said NHS England had planned to go live with the system in April 2024.

In December 2022, NHS England awarded the £108 million ($134 million) ISFE contract – without competition – to the incumbent supplier, NHS Shared Business Services, a joint venture between the NHS and French outsourcer Sopra Steria.

The procurement process began in 2018, when a prior information notice (PIN), designed to gather intelligence from suppliers before the formal competition started, priced the project at £200 million ($248 million) and said that a contract notice would be published by March 18, 2019.

In April 2021, NHS England was forced to extend the contract with NHS Shared Business Services for the ISFE to accommodate delays to the procurement, at a cost of £59.2 million ($73.3 million).

"The ISFE re-procurement project is a large and complex project which will deliver a replacement for the current service," the procurement document said. "During the planning stages for the re-procurement, it was identified that short-term uncertainties regarding Group structure posed significant challenges to finalising a tender specification during 2019 with a view to implementing a replacement service by April 2021. The outbreak of the COVID-19 pandemic has meant that the project team and other key colleagues have had to focus their resources on keeping critical business processes running and work on the procurement of the new contract has inevitably been delayed."

NHS England decided to go to market for an HR and payroll system in a separate £2 billion ($2.48 billion) competition, which it launched in August 2021. That month, NHS England missed a deadline in the procurement of the ISFE system.

In the meantime, NHS England decided to go to market for a separate HR system and a new electronic staff records system in a procurement that could be worth up to £1.7 billion ($2.1 billion).

The ISFE runs on Oracle E-Business Suite 12.2 and is expected to migrate to Oracle Fusion Cloud Financials. With the new system, NHS England anticipates a new cloud-based finance service that is capable of integrating the ERP platform with technologies and automated processes to exploit the "unique benefits of cloud-based services." ®