Government checks continuing to flow to Fujitsu, despite apologies for Post Office fiasco
In the wake of the Post Office Horizon scandal, Fujitsu continues to hold significant public sector contracts in the UK, despite mounting concerns and questions about its role in the controversy.
HM Revenue and Customs (HMRC) recently signed a £220 million contract extension with Fujitsu for data center and project services, lasting until 2028. This deal, however, is described as a contingency measure while HMRC transitions out of Fujitsu-owned data centers, reflecting the impact of the Horizon scandal on trust in Fujitsu.
Despite pledging in early 2024 to suspend bidding on UK government projects during the ongoing public inquiry into Horizon, Fujitsu was awarded a £125 million contract to modernize Northern Ireland's land registry. The Northern Ireland government did not request Fujitsu continue bidding, yet the company won the contract, raising parliamentary scrutiny.
MPs and peers have expressed concern about the government allowing Fujitsu to continue bidding and winning contracts, given the legacy of wrongful prosecutions linked to the faulty Horizon system. The public inquiry into the scandal, expected to publish its report soon, has added pressure on transparency and accountability.
Fujitsu holds multiple public sector contracts across various departments, including the Home Office, Ministry of Defence, Department of Health and Social Care, and devolved administrations. The Post Office itself is paying up to £72 million to extend the Horizon services agreement through March 2026 for transitional support, underscoring Fujitsu’s continued involvement even as efforts to move away from the system are underway.
Fujitsu’s public sector contract portfolio also includes defense contracts and bids for large IT infrastructure projects, such as a potential £500 million cloud migration contract with HMRC, indicating a complex picture where the company remains integral to UK public IT despite reputational damage.
The Post Office began using the Horizon IT system for accounting in 1999, which was first implemented by ICL, a UK tech firm majority-owned by Fujitsu in the 1990s and fully acquired in 1998. The first volume of a public inquiry report into the scandal concluded that 13 branch workers committed suicide during the prosecutions, most likely due to their treatment by the Post Office.
In January 2024, Fujitsu paused bidding for work with new government customers until the inquiry had reported, following an outcry from the public and MPs. 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.
The Northern Ireland Department of Finance awarded a £125 million contract to Fujitsu to build Northern Ireland's new land registry system. The dramatization of the Horizon Post Office scandal brought to light a scandal where hundreds of Post Office branch managers were wrongfully convicted of theft and fraud due to computer errors.
The HMRC applications concerned are currently hosted and connected by Fujitsu, making it impossible for another contractor to take over or provide these services before they are migrated to HMRC's new replacement infrastructure. The government's position reflects a balancing act: managing the fallout from the Horizon scandal while continuing to rely on Fujitsu’s services under strict terms as it transitions away from the company’s systems. Public and parliamentary scrutiny is strong, but Fujitsu’s role is far from ended at present.
- Fujitsu's public sector contracts extend beyond the UK government, encompassing numerous departments like the Home Office, Ministry of Defence, and Department of Health and Social Care.
- In addition to its existing contracts, Fujitsu is vying for future projects in the government and private sector, such as a potential £500 million cloud migration contract with HMRC.
- The AI-powered Horizon IT system, initially implemented by Fujitsu-owned ICL, has been at the heart of controversy, with concerns raised about its impact on the finance and business sectors, given wrongful prosecutions linked to its malfunctions.
