BT objects to NAO criticism

In last week's National Audit Office's (NAO) damning report on the National Programme for IT, BT was heavily criticised for delivering far fewer systems than originally planned, whilst only receiving a trivial reduction in fees.

In London, although the number of acute hospitals in the programme was halved from 31 to 15, as well as 1,243 GP and ambulance trusts being removed completely, BT's £1bn fee was reduced by an inconsequential £73m to £948m.

"The Department has been unable to provide us with a full breakdown of the costs of the revised £948m contract but Departmental papers suggest that the changes agreed by the Department increased the average cost of Millennium per acute trust by at least 18%," the report stated.

Contract renegotiations

The reduction in these installations came about following two significant renegotiations in the DH's contract with BT, which meant the total contract value was increased - thus leading to a cut to the number of systems to be installed.

The first renegotiation occured in May 2007, when BT decided to use a "number of systems instead of one", with Millennium being used for acute trusts, and RiO for mental health trusts and community health services.

The NAO report notes that this increased the total contract value by £55m to £1,021m; extended the contract from March 2014 to October 2015; and configured Millennium specifically for London in three releases rather than in four, as originally planned.

Then, in November 2009, the DH had concerns that "BT had not shown it could deliver Millennium as configured on the scale required under contract", with an assessment of the system revealing it had 84 defects against a contractual testing limit of 30.

When asked to comment on the NAO report, a BT spokesperson told PublicTechnology.net that it is in the process of reviewing it. "While we do not recognise some of the comments made, we will be responding fully at the Committee for Public Accounts hearing on 23 May".

The spokesperson added: "We believe our work for the NHS is helping to deliver efficiencies and benefits. Recent changes agreed to what BT is to deliver have come about because we've been asked to deliver more complex systems at fewer locations, moving from centrally led to clinically led healthcare."

As the local service provider for London, BT also took on some of the work from Fujitsu in the south, after termination of its contract in 2008. Yet BT was only contracted to deliver 35 of the original 90 care record systems at a cost of £454m.

"The costs of delivering three care records systems in acute trusts under this contract are some 47% higher than the cost of delivering the same system in London, although BT advises that the system is being delivered in a different way," the report remarked.

Millennium releases

As of 31 March 2011, three acute trusts had the first release of Millennium and five had progressed to the second release which offers additional functionality, including connection to the Spine. Yet, the report noted, "no acute trusts had been upgraded to the third and final release of Millennium, which delivers the level of functionality anticipated at the programme's outset".

However, the report added, BT says that this release is ready to be delivered with upgrades for live trusts in progress.  All further Millennium upgrades are expected to be delivered across all 15 acute trusts by October 2014.

As for RiO, all deliveries had been completed by the end of March this year, with the first of two new releases being introduced at a Trust this summer. "All subsequent contracted upgrades, releases, and enhancements are expected to be completed across all 37 NHS organisations using RiO in London by October 2014", added the report.

BT was required to provide 25 RiO systems in the South, costing £224.3m - a contract which was agreed in March 2009. However, there was no business case prepared for these systems, according to the NAO report, which added "despite repeated requests [the DH] has not provided us with any evidence of the work it undertook to assess the value for money of the prices agreed for London".

BT also purchased software from the RiO supplier in 2006, at a cost of £46m, but the report said that it wasn't clear "what added value the Department is getting for the additional cost".

Is the future of the Spine in doubt?

The NAO report also expressed concerns over the future of the Spine, one of BT's national contracts. "Some contracts for national systems such as the Spine, which are in regular use across the NHS, come to an end as soon as June 2013," said the report.

"The Department has three options for continuing these services: use clauses within existing contracts to extend them - this would be a short-term arrangement whilst the Department considered other options; procure new national contracts through open competition; give responsibility for procuring services to individual local NHS organisations - this might risk a return to the haphazard procurement practices that the Programme sought to address."

BT has yet to comment on these concerns but did, of course, acknowledge its benefits: "The Spine... has seen over 30 million online hospital appointments booked. It's now the second largest database in Europe, according to Gartner, and has carried 5.6 trillion messages to date."

Finally the report warned of issues regarding remaining work to be completed. In the south, "three separate procurements are being undertaken through a framework agreement to supply care records systems to those Trusts not receiving one through the BT South contract".

The framework agreement expires in December 2011, and the DH anticipated the first procurement to be completed by April 2010 with delivery of the first system starting in December 2010. "These milestones have, however, been missed and no systems have been procured", said the report.

 It added: "The Department expects procurement of the remaining systems under the framework to cost no more than £470 million and be delivered by 2015 in line with the BT contract for the South. The level of funding available for systems is therefore significantly lower than that which is available under the contract held by BT in the south."