The Channel logo

News

By | Kelly Fiveash 13th September 2006 16:11

iSoft's £82m City sweetener

Public money paid to private firm

iSoft Plc, the beleaguered NHS software provider, has been given two large chunks of cash totalling close to £82m over the last two years, the government has admitted.

An initial payment of £58m was made at the end of April 2005 with a further £23.8m paid out in April this year - just days before the company's financial year drew to a close.

The government bail out helped Manchester-based iSoft secure a its position with the City despite its ongoing troubles, according to a report in The Guardian.

Conservative MP Richard Bacon wrote to health secretary Patricia Hewitt on 9 August requesting details of any advance payments made to iSoft by NHS Connecting for Health. In a written response dated 5 September, Hewitt said: "The Department [of Health] agreed to make advance payments in April 2005 and April 2006 against the charges payable by NHS trusts to iSoft."

She goes on to confirm that iSoft had paid back £37.9m by the end of July this year - leaving an outstanding deficit of £43.9m.

"There has been no indication from iSoft that the advance payments made by the Department of Health (DoH) are the subject of the suspected accounting irregularities that the iSoft Board are investigating," Hewitt said.

The "accounting irregularities" she refers to relate to an audit for 2004 and 2005, which the Financial Services Authority had been investigating.

Hewitt also said that NHS Connecting for Health - acting on behalf of the DoH - has full financial audit rights to inspect iSoft's bank account at any time.

In response, Bacon put the question to The Guardian: "What good reason could there possibly be for what looks like another giant free public subsidy to a failing company?"

As one of the biggest IT projects in the world, iSoft will be looking to turn its bad fortune around, but the NHS may yet be the victim of its bad health. ®

alert Send corrections

Opinion

Alexandre Mesguich

Change is order of day as tech giants shift strategy gears
Partnership

Frank Jennings

Confused? No problem, we have 5, no 6, no 7... lots of standards

Chris Mellor

VC sequence could end not with a bang, but a whimper
Sad man stares glumly over boxed contents of desk. Image via shutterstock (Baranq)

Features

money trap conceptual illustration
Big boys snare the unwary with too-good-to-be-true deals
Angus Highland cow
Pet carriers not wanted for whitebox stampede
FBcoldstoragearray
Sorry OpenStack and Open Compute, we're not all Facebook
Gary Kovacs, CEO of AVG. Pic: World Economic Forum
Scammy download sites? Government snooping? Run of the mill for Gary Kovacs