June 24 2025 was a red letter day for Fujitsu, the Japanese tech company. Winning two government contracts worth nearly £300m would be a cause for celebration for just about any company.
The trouble is, just two weeks later, Fujitsu’s name was being (justifiably) dragged through the mud for its role in the Post Office Horizon IT scandal, which led to some truly terrible human suffering and one of the biggest miscarriages of justice in British history.
Some victims of the Fujitsu system’s bugs, which led to false shortfalls in accounts (among other things), were financially ruined. Some were wrongly convicted of fraud and imprisoned. The first part of Sir Wyn Williams’ report into the affair also revealed that there was a “real possibility” the pain inflicted by the affair was linked to 13 suicides.
One former subpostmistress told this newspaper that she would have been the 14th, if she hadn’t been pregnant while in prison for crimes she simply did not commit.
There should doubtless be consequences for those found to be at fault. Yet the company that created the system – and which employed people who knew it had issues as far back as 1999 – was still awarded two lots of government-paid work just a couple of weeks before the first volume of the report into the affair emerged. It beggars belief.
But, wait, I hear you say, didn’t Fujitsu promise not to bid for new government contracts until after the report back in January 2024? Well yes, it did. But here’s the thing. There were carve outs. The pledge did not apply to existing contracts, extensions of existing contracts or to new work where its involvement was specifically requested.
Those carve outs explain the results I got when I turned to a rather useful website called BidStats, a search engine for government contracts and tenders designed for those interested in bidding.
When I looked for Fujitsu contracts over the last year, I found 27 entries. A few of those are double counts: there was sometimes an entry for both tender and contract. But even if you omit those, there were still more than 20 entries, involving a dizzying array of government departments, devolved administrations, quangos and other public bodies.
They include the Home Office, the Ministry of Defence, the Department of Health & Social Care, Social Security Scotland, the Northern Ireland Department of Finance, the Foreign Office and the British Council. Some of the contracts I looked at extend for the next three years. You and I are going to be contributing to Fujitsu’s profits for quite some time.
The really staggering revelation is that the Post Office is shelling out up to £72m to extend the Horizon Services agreement from 1 April 2025 to 31 March 2026. This is, we are told, for “IT services: consulting, software development, internet and support” needed “in order to prepare the Horizon Agreement for expiry and in order to receive transitional support”.
The Post Office told me that “it’s simply not possible to turn off Horizon overnight and get a new system up and running the following day”. “We have been trying to come off Horizon/Fujitsu for a number of years,” I was told.
But another pertinent question is this: why is Fujitsu still making money off Horizon? The company says it is in discussions about contributing to the huge compensation bill that the taxpayer – not anyone connected with the scandal – is having to shoulder. Let me be very clear, I am not arguing against the payments. Far from it. The people who have suffered so horribly deserve every last penny. The government should pull its finger out to ensure they are paid.
But while the discussions proceed, shouldn’t the company be covering the work needed to disentangle the Post Office from its system pro bono until a suitable replacement can be found and installed at the Post Office’s 11,000+ branches? I believe it should.
I received a similar response to that of the Post Office from HM Revenue & Customs, concerning the £300m worth I referred to at the outset. Here it is: “This extension will be for a limited time on strict terms to protect essential HMRC services.”
But then the plot thickens. There was also a £125m contract “to deliver a modern digitally enabled ICT solution that will support the transformation of Land Registration Services” awarded by Northern Ireland Department of Finance. That is new work, not an extension. Fujitsu says it is because it was named as the “preferred bidder” before its promise (a promise that looks to me like it has more holes in it than Swiss cheese).
The Cabinet Office, which is front and centre on this, said: “We have been clear that those responsible for the Horizon scandal must be held to account. Fujitsu has committed to withdraw from bidding for contracts with new government customers until the Post Office Inquiry concludes. We will not hesitate to take action, where appropriate, based on the final findings of the inquiry.”
That’s rather better than the trite message paymaster general Nick Thomas-Symonds delivered when he was questioned on the subject of Fujitsu contracts by LBC, earlier this week: “With regard to Fujitsu, that’s a matter for procurement,” he said. “Those matters are looked at extremely carefully. We have to – procurement has a particular legal framework around it.”
Here’s the problem: Migrating from one IT platform to another is complex and expensive, and also risky. We all know what happened when TSB tried to switch from an IT platform provided by its previous owner, Lloyds Banking Group, to one operated by Sabadell after the Spanish bank took over the UK bank. Chaos ensued, with queues of angry customers lining up at branches after they were locked out of their accounts.
However, given the flaws with Horizon – and especially the way this affair was handled by all concerned, not to mention the damage done – it is simply unconscionable that Fujitsu continues to pick up multi-million-pound awards of work. It doesn’t matter that these are (mostly) extensions designed to ensure “continuity of service”.
The government needs to try harder. It should also reflect on whether it is a good idea to become so deeply reliant on a company that a divorce appears to be horribly difficult – if not impossible.
