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May 26, 2024
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How Fujitsu became embedded at the heart of UK infrastructure amid Horizon scandal

It is “essentially impossible” for the Government to terminate its contracts with Fujitsu, the IT company at the centre of the Post Office scandal, an expert in state digitalisation has told i.

The Japanese IT firm and maker of the faulty Horizon software has been awarded close to 200 public contracts worth a combined total of £6.8 billion since 2012, according to analysts Tussell.

Pressure has mounted on the Government to discontinue its public contracts with Fujitsu after a new ITV drama showed how their IT system wrongly detected financial shortfalls in the UK Post Offices’ accounts – leading to the wrongful prosecution of hundreds of postmasters and postmistresses.

On Wednesday, Prime Minister Rishi Sunak announced that a new law would be introduced to exonerate the sub-postmasters caught up in the scandal. Mr Sunak also announced a new upfront payment of £75,000 for the “vital” group of postmasters who took action against the Post Office.

But according to Patrick Dunleavy, an emeritus professor of political science at the London School of Economics and author of Digital Era Governance, the technology giant has “deeply embedded” itself into Britain’s public infrastructure.

Fujitsu currently provides services such as the Police National Computer, which stores individuals’ criminal records; desktop, print, and workspace services for the HMRC; critical technological support for the Ministry of Defence; and has been involved with creating a national IT programme for the NHS.

Additionally, the Post Office still uses Horizon and awarded the technology firm another £36m last year to keep the system going until 2025.

Most recently, the Environment Agency (EA) agreed to pay £2m to extend Fujitsu’s work with the UK’s flood warning system – bringing the “cumulative final value of the Future Flood Warnings System framework” to an anticipated value of £19.5m, according to EA.

While senior politicians, such as Conservative former minister Mark Francois, have called on the Government to “consider suspending” Fujitsu contracts, Professor Dunleavy said it was “essentially impossible” to do so.

He said the Japanese firm faced “a highly limited amount of competition” owing to the particular needs of the British government.

“[The Government] runs mostly on legacy IT systems, many of which were written in the 1980s, some of which are still written in code that only people from the 1980s would understand,” Professor Dunleavy said.

Additionally, because of a lack of “political accountability” UK ministers face when implementing IT systems – compared to other European countries – Professor Dunleavy said British politicians end up demanding complex, “a la carte IT systems” which only a few companies can cater for.

On Fujitsu’s provision of Horizon, Professor Dunleavy said the Post Office had required a “basic corporate accountancy systems”.

“Why [Horizon] couldn’t cope with all of that, I don’t know,” he said. “There are many that work around the world and don’t lose large amounts of money.”

Critics have also complained about the reliability of the flood warnings system, provided by their IT infrastructure.

In January 2022, flood warnings for the River Severn were issued, predicting the worst floods in recent history. However, “not a drop” of rain came, according to Heather Shepherd of the National Flood Forum.

Another reason why the Government continues to award Fujitsu contracts, despite the controversy, is because the firm has a “natural advantage” over potential competitors, according to Professor Dunleavy, because of their now long-standing expertise in UK public IT infrastructure and, therefore, near-unrivalled knowledge.

Many of Fujitsu’s contracts have been handed through so-called “framework agreements” which allow the Government to make deals with lists of preferred VIP suppliers.

Priority access is given to “pre-approved” suppliers, like, which the Government says have “agreed to provide goods and services to a certain standard”.

What have the Government and Fujitsu said?

Asked if the Government would consider further work with Fujitsu, the Prime Minister’s official spokesman said: “The culpability or otherwise of Fujitsu is something that is being examined as part of the independent inquiry process.”

A Fujitsu spokesman said: “The current Post Office Horizon IT statutory inquiry is examining complex events stretching back over 20 years to understand who knew what, when, and what they did with that knowledge.

“The inquiry has reinforced the devastating impact on postmasters’ lives and that of their families, and Fujitsu has apologised for its role in their suffering.

“Fujitsu is fully committed to supporting the inquiry in order to understand what happened and to learn from it.”

It said it would be inappropriate to comment further “out of respect for the inquiry process.”

The Cabinet Office has been approached for comment.

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