Post Office contract with Fujitsu has option to extend into 2028
Extension agreement for controversial Horizon contract with Fujitsu has option that could take the relationship well into 2028
The Post Office’s contract with Fujitsu for the supplier’s Horizon system has a built-in option to continue into 2028.
The news earlier this week that the deal was being extended 12 months to March 2027, costing an additional £41m, was criticised by Post Office scandal victims and campaigners. But the official tender includes a built-in option for up to another 12 months, which sources believe will inevitably be taken up.
The tender said: “However, based on the transition plan from replacement supplier, further extension of 6-12 months may be required.”
If the option included in the latest agreement is taken up as some sources believe will be necessary, it could add another £41m plus inflation to the cost to taxpayers.
One specialist IT contract lawyer, who wished to remain anonymous, said: “I think there is every chance of this dragging over into 2028. It’s not just the system, but data that will presumably need to be migrated. That is a complex process, especially in testing and validating the data transfer.”
The Horizon system is at the centre of the scandal which saw subpostmasters blamed and punished for account shortfalls caused by computer errors. Hundreds of people were wrongly convicted of crimes based on data from the faulty system, with many sent to prison. Many more had their lives ruined as a result of huge financial costs, with the system linked to 13 suicides and 10 attempted suicides.
The tender notice for the recent deal stated: “In order to allow for continuity whilst we complete the procurement exercise and to begin the transition process away from [Fujitsu], an extension of an additional one year to 31 March 2027 is required.”
‘Technical and economic reasons’
It described the reasoning for the Fujitsu extension: “For a number of significant technical and economic reasons, a change of contractor would cause significant inconvenience and substantial duplication of costs for the [Post Office.]”
Following news of the extension earlier this week, the Voice of the Postmaster posted on X: “They (Fujitsu) should provide it free of charge until we have a credible alternative! Customers are aghast when we tell them that we’re still using Horizon!”
The latest contract for £41m includes £3m to upgrade end of life components of Horizon.
Earlier this week, the Post Office said: “We are committed to moving away from Fujitsu and off the Horizon system as soon as possible. We are bringing in a different supplier to take over Horizon while a new system is developed, and this process is well underway.”
Attempts to replace the Horizon system have already seen multiple extensions and a major in-house project scrapped after a government report last year found that budgets ballooned from £180m to £1.1bn.
It was April 2021, following damning findings regarding Horizon in the High Court, when the Post Office announced it was preparing for the end of the Horizon agreement with Fujitsu, adding an extra year to support its transition to a new system.
The Post Office scandal was first exposed by Computer Weekly in 2009, revealing the stories of seven subpostmasters and the problems they suffered due to Horizon accounting software, which led to the most widespread miscarriage of justice in British history (see below timeline of Computer Weekly articles about the scandal since 2009).
Read more: Fujitsu’s role in the Post Office scandal: Everything you need to know, and Everything you need to know about the Post Office scandal.
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