Accenture Wins £35M More UK Tax Work Without Competition Despite Promise To 'disaggregate'

The UK tax collector has handed Accenture an additional £35.2 million without competition on a £70.4 million contract which was never tendered.

In a procurement notice published late last month, His Majesty's Revenue & Customs (HMRC) said the global tech consultancy and services biz got the extra sum for "additional works" on the original contract, awarded in 2022.

The contract is for business application support and maintenance services for HMRC's National Insurance and PAYE System (NPS), which is part of the UK's critical national infrastructure, collecting 40 percent of revenues into HM Treasury with nearly 40,000 users in HMRC and the Department of Work and Pensions.

The system was first introduced in 2009, when Accenture provided application development and support services to the £10 billion Aspire contract, a tech deal which also included Capgemini, Fujitsu and BT.

In 2016, HMRC said it would exit the Aspire deal — which originated in 2004 — that was scheduled close in 2017. Also in 2016, Accenture announced it had won a deal with HMRC to continue to support its applications, including the NPS.

In 2022, HMRC again awarded Accenture the contract for NPS support and development, valued at £70.4 million, without competition.

"Due to the technical risk, age and intricate interdependencies of the NPS solution, the support services could currently only be provided by Accenture," the award notice said.

"In order to make the services suitable for competition in future and reduce vendor lock-in, the new contract includes modernization services which will deliver an 'NPS Disaggregation Programme.' This programme of work will disaggregate the NPS solution into six components to provide more open and independently maintainable business focused services," the notice said.

The "disaggregation" work appears more involved than initially thought.

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In the most recent procurement award to Accenture, HMRC said the contract was increased by £35.2 million without a new procurement procedure because there had "been a significant increase in the project work which was not envisaged and catered for at the time of the direct award."

It said the enlarged contract fee would "allow the continued provision of critical NPS services [and] support to major transformational projects and the continuation of the disaggregation program."

"A change of supplier is not feasible for technical reasons, as NPS has extremely high levels of technical and functional complexity. Accenture have managed these services for many years and have the in-depth knowledge of the HMRC NPS applications and business services and a change of supplier at this stage of the contract would put key services at serious risk," it said.

The duration of the contract is set to remain at five years from 2022.

A spokesperson at HMRC sent a statement to The Register.

"All government contracts are awarded fairly and transparently, in line with the Public Contracts Regulations 2015." ®