Bank of England Oracle Cloud bill balloons – but when you print money, who's counting?

Old Lady of Threadneedle Street to pay millions for 'amended implementation methodology'

The Bank of England has nearly doubled the money it is dedicating to partner spending for an Oracle cloud transformation, which it began imagining in 2020.

According to a recently published procurement note, the 330-year-old institution said it was increasing the contract value awarded to its Oracle implementation partner Version 1 to £13.8 million. This is a significant increase from the £8.7 million awarded and nearly double the £7 million originally advertised. Still, if you're printing the money, who's counting?

Aside from buying some additional software, the bulk of the increase is due to an "amended implementation methodology, from a two phase approach, to a multiple phase approach with Oracle Modules going live based on the Bank's priorities" – or £4.07 million in cash terms.

When asked for more details about the dramatic increase – whether system delivery dates had slipped, whether a new go-live date had been set, and whether there was any commensurate increase in internal costs – the Bank was as relaxed as a man sipping port in an oak-paneled room, looking forward to a generous pension.

"The Bank is implementing Oracle Cloud to consolidate several different systems which will help the Bank fulfill its mission. We aim to achieve value for money in all our procurement," a spokesperson said.

The Bank of England is a public body that raises money from the institutions it regulates, the printing of bank notes, the banking services it provides, management fees charged to government agencies, and investments it has built up over 300 years. It generates more income than it spends and contributes millions of pounds to the UK Treasury, it says.

The contract was originally advertised in September 2022 for £7 million following the Bank's consideration of plans to move applications to the cloud in 2020. Logica was previously contracted to support the Oracle HR system.

Version 1 won its initial £8.7 million contract to move to cloud-based Oracle applications in September 2023 in a deal set to last 55 months, with the option to extend for a further 24 months. The contract was "intended to deliver a step change in the capabilities and value delivered by the finance, procurement and recruitment functions in the Bank, leveraging the existing Oracle Cloud tool set to drive sustainable business change."

The Register notes that the only "step change" delivered so far is in the cost of the project and the rewards collected by its tech supplier. ®