Pressure is mounting on the government to review more than £2bn in new contracts awarded to Fujitsu since a court ruling in 2019 found its Horizon IT system caused accounting errors that were blamed on 900 post offices .
Since the landmark ruling, the Japanese company has won 101 contracts totaling £2,04bn.
According to government procurement analysts Tussell, these include new contracts with the Home Office, HM Revenue and Customs, Foreign, Commonwealth and Development Office and Department for Work and Pensions.
This figure excludes the £2.4bn contract for a lifetime with the Post Office, which was for the Horizon system that had been deemed defective. It is this Horizon system that has led to what has been called the largest miscarriage in justice in UK’s history.
After criticisms of the company’s role in the scandal, the Scottish Government reviewed some contracts with Fujitsu on Wednesday. Angela Constance said that she would be discussing with other ministers a contract signed with Fujitsu in 2020 to support electronic voting counts for local election.
Cabinet Office has not responded to questions regarding whether it will follow Scotland and review Fujitsu’s contracts, its strategic supplier status or why the company was still awarded business even after Horizon’s failure.
David Jones, a former Conservative cabinet minister, said: “I don’t know why the government continues to award Fujitsu very large contracts.” “I don’t know why the government continues to do business with Fujitsu.”
In a ruling from 2019, the court of appeal determined that the Post Office was in “denial”, about “bugs and errors” in Horizon, in the “21st century equivalent of maintaining the Earth’s flatness”. This marked a turning point in the lives of victims.
Fujitsu made nearly £7bn in profit from 200 IT contracts between 2012 and 2015. The Ministry of Defence is its biggest repeat customer, followed by the Home Office, HMRC, and the Financial Conduct Authority. These four customers have given it 68 contracts worth over £2.7bn between them since 2012.
In the next two-year period, £2.9bn of contracts with the public sector are due to expire. The company has not been punished for its role as a result of the Horizon scandal.
Kevin Hollinrake said on Wednesday that Fujitsu, UK postal affairs minister, could be subject to “financial sanction” if found guilty of a mistake. This would include financial sanctions for compensation payments for subpostmasters, their families, and the company itself.
Fujitsu executives will be summoned by the Commons Business and Trade Committee to testify next week.
Two Fujitsu staff members were interviewed by the Metropolitan Police under caution regarding allegations of perjury, perverting justice and other crimes related to Post Office trials.
In 2013, the security companies G4S and Serco member of the Commercial Relationship Board. This board meets every month and gives each company a rating based on its overall performance.
Cabinet Office is ultimately responsible for overseeing suppliers and contracts.
Vincent Kelly has been working for the Cabinet Office as the crown rep for suppliers such as Fujitsu, Virgin Media O2, and Fujitsu.
After the failure of Carillion in 2018, the Public Accounts Committee (PAC) began to look into “weaknesses”. The report that followed criticised the government’s procurement process, which rewarded cost control and did not ensure the right supplier was selected.
Meg Hillier was the chair of the PAC at the time. She said, “It has to examine with new eyes the motivations behind companies that are currently bidding on central government work and develop a strategic approach which requires contract awarding bodies look beyond the bottom line costs.” It is crucial to embedding procurement best practices across departments.
The report also criticised RAG’s rating system for not being effective “either as carrot or as stick”. It said that there should always be an “effective supervision” of the crown representatives system and the close relationships enjoyed with suppliers.
Hillier said that without effective oversight, strategic suppliers could become secretive “sub-departments” of Whitehall.
A spokesperson for the government said: “This is one of the biggest miscarriages in the history of our nation. We have set up an independent investigation to determine culpability, and we are bringing legislation forward to ensure those convicted due to the Horizon scandal will be swiftly exonerated.
“It’s right to not pre-empt conclusions of an ongoing formal investigation, but we will examine all options once we have the facts in hand to hold those accountable for this scandal – both financially and legally.
As with all contracts, Fujitsu conduct and commercial performance will be reviewed in advance.