Fujitsu has been awarded around £510 million ($682 million) in UK public sector contracts since a TV dramatization of the Horizon Post Office scandal – including a recent £220 million ($294 million) deal with the UK tax collector, awarded without competition.
Since the dramatization was broadcast, Fujitsu CEO Takahito Tokita, CFO Takeshi Isobe, and head of UK and Europe Paul Patterson have all apologized for the company’s role in the scandal, which saw hundreds of Post Office branch managers convicted of theft and fraud when computer errors were to blame.
In the first volume of a report from the public inquiry into the scandal, the leading judge concluded that 13 branch workers committed suicide during the prosecutions, most probably as a result of their treatment by the Post Office.
The Post Office began rolling out the legacy Horizon IT system for accounting in 1999, along with two subsequent upgrades. The EPOS and back-end finance system was first implemented by ICL, a UK tech firm majority-owned by Fujitsu in the 1990s and fully acquired in 1998. From 1999 until 2015, around 736 subpostmasters were wrongfully prosecuted and convicted over Horizon errors, devastating lives in the process.
In January 2024, Patterson confirmed an earlier commitment made to Gareth Rhys-Williams, the government’s chief commercial officer, that Fujitsu would pause bidding for work with new government customers until the inquiry had reported, following an outcry from the public and MPs. This was later reaffirmed by Dave Riley, head of UK public sector, in a letter [PDF] to the Cabinet Office. He said Fujitsu would only continue bidding in “re-procurement exercises by existing government customers” and in agreeing to the extension of existing contracts.
Research from government spending analyst Tussell has found that since ITV drama Mr Bates vs The Post Office aired in early January 2024, Fujitsu has won £510 million in contracts from the UK public sector.
The largest and most recent resulted from His Majesty’s Revenue & Customs (HMRC) awarding Fujitsu a £220.3 million deal for datacenter and project services, without competition, in June.
HMRC said: “A change to a different contractor cannot be made for these services because the HMRC applications concerned are hosted and/or operated by [Fujitsu on its] infrastructure in [its] datacenters with connectivity provided by Fujitsu. It would not be possible for another contractor to take over or provide these services using [Fujitsu’s] infrastructure and hosting before they are migrated to HMRC’s new replacement infrastructure.”
In June, HMRC launched a tendering process that could result in contracts worth up to £417 million ($560 million) for hyperscaler services to help it leave Fujitsu’s datacenters.
Other notable Fujitsu wins include one with a new government customer, Northern Ireland’s Department of Finance, which awarded a £125 million ($167 million) deal to build Northern Ireland’s new land registry system. The Northern Ireland government later confirmed it did not ask Fujitsu to continue bidding for the work.
In Parliament, MPs and peers have questioned the government’s decision to continue accepting bids for large-scale IT contracts from Fujitsu, despite the Japanese supplier’s previous pledge to stop bidding. ®