My right honourable friend the Minister for the Cabinet Office (Tessa Jowell) has made the following Written Ministerial Statement.
Today, the Cabinet Office’s annual report and accounts 2008-09 (HC 442) have been laid before Parliament.
The annual report and accounts report a loss and a contingent asset following the termination of phase 2 of the SCOPE programme in July 2008.
The SCOPE programme was an information technology programme working with 10 partners across government. It aimed to extend the benefits of communication and collaborative working afforded by current information technology by improving the way sensitive information was shared between and used by the security and intelligence agencies and government departments.
The first phase of the programme was delivered on time and within budget in 2007. It has delivered extremely valuable benefits to the intelligence community in government and has ensured that all its constituent members are now connected electronically.
Phase 2 was about providing additional functionality; for example, to allow for greater collaborative working between the security and intelligence agencies and departments.
Phase 2 of the programme was cancelled following the failure of the main commercial supplier to the programme to meet key contractual milestones. As a consequence of termination, it was necessary to write off and report as a loss in the annual report and accounts that part of the value of the asset under construction which had no prospect of becoming viable.
The Treasury has approved a write-off of £24.4 million which has been managed within the department’s net resource requirement and budget and constitutes a charge against non-cash programme expenditure in the resource departmental expenditure limit.
My department is now working with the contractor to resolve issues arising from the termination of the programme, including consideration of the legal avenues available. The aim of the work is to ensure that Her Majesty's Government and, ultimately, the taxpayer recover the appropriate value from the supplier which relates to those undelivered parts of the programme. This is noted as a contingent asset in the annual report and accounts. The details of the discussions with the supplier are commercially confidential and are likely to remain so.