07 December 2001
In a report published this week, the PAC blames the disaster on a string of basic project management failures involving a series of government departments, specifically the then Department of Social Security – now subsumed into the Department for Work and Pensions.
'This is a sorry tale of waste amounting to more than £1bn,' said committee chairman Edward Leigh. 'There is no excuse for the department's failure to manage this project correctly, or for the very laboured process of actually putting it out of its misery. Better arrangements are now in place for managing government IT projects, but for the moment my committee remains sceptical about the new department's ability to deliver.'
The contract for the card was awarded by the Department of Social Security and Post Office Counters Ltd in May 1996 to Pathway, a subsidiary of the ICL computer services group. The government aborted the scheme in May 1999.
The report said: 'While the various parties identified many of the risks at various stages, they underestimated the difficulty of attempting to tackle a huge and complex project, at the heart of improving benefit delivery and Post Office automation in one go, using relatively untried PFI arrangements.'
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