PFI fails to deliver

The House of Commons Committee of Public Accounts (PAC) has severely criticised all parties for failing to deliver a new computing system to control National Insurance payments on time.
The committee called for a thorough review of the processes that led to OAPs missing out on payments of up to £100 a week.

The PFI project for the revised National Insurance Recording System (NIRS2) - originally expected to be finished by February 1997 - is still not fully operational. The PAC report slams the Contributions Agency and Andersen Consulting for failing to complete the scheme on time, and for a lack of contingency planning.

It also criticised Andersen Consulting for failing to compensate for poor performance.

A source within Andersen Consulting suggested that problems were caused by the distinction between the actual delivery date of the system hardware and the date that the system was fully up and running. These issues were "not fully talked through", he said.

The author of the report, David Davis MP, said that the scheme was marred by a lack of understanding between Andersen Consulting and the Contributions Agency about their respective obligations under the contract. In a statement, he talked of a "clear failure to deliver services to the public" based on a lack of effective partnership.

The Inland Revenue issued a statement admitting that the contract had been "dogged by problems from the outset", and that future contracts would not be entered into in the same way.

Andersen Consulting reacted today by claiming the report data was out of date, and that the system was now functioning ahead of expectations.