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By | Kat Hall 23rd May 2016 08:05

Business dept sinks £14m into canned shared services plan

Later pulls out of Cabinet Office scheme, but reckons will still save money

The department for Business, Innovation and Skills has sunk £14m in consolidating its legacy kit as part of a cross-government shared services plan that it later pulled out of.

According to an FOI response, BIS invested £13.9m during the first phase of consolidating back office services for the department and 13 public bodies from their legacy systems and services in 2014.

However, as revealed by The Register, the department later pulled out of the Cabinet Office shared services contract - touted to save between £400m-£600m per year - saying it was "no longer viable".

Last week the National Audit Office slammed the Cabinet Office for failing to deliver value for money on its shared services centres, run by IT provider Avarto and Steria respectively.

In the last two-and-a-half years, those centres have cost £94m to set up and only saved £90m.

On one of the centres, four customers have exited their contracts, said the report. In addition to that, just two out the 26 planned customers (including departments' arm's-length bodies) have joined a single operating platform.

Nevertheless, BIS reckons its consolidation plans have not gone to waste and says it is saving £2.1m per annum on service costs.

Sources have suggested the department is considering creating a shared services centre just for itself and its arm's-length bodies.

In its FOI response BIS said it is "considering options" on what to do next. ®

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