Friday, October 18, 2024

Post Office and Fujitsu: From Allies to Adversaries

Recent testimony from senior IT officials at the Post Office has highlighted the increasingly strained relationship with its primary IT vendor. This was revealed during the statutory public inquiry into the Post Office Horizon scandal, specifically in phase seven, which could bring to light ongoing issues related to replacing software from Fujitsu—a crucial element of the scandal that has been described as the largest miscarriage of justice in UK history.

Chris Brocklesby, who served as the Post Office’s chief transformation officer until recently, presented evidence at the inquiry. With a wealth of experience including CIO positions at Tesco Bank, EasyJet, Vodafone UK, and Dunelm, Brocklesby depicted an organization grappling with conflict against its main supplier. He had joined the Post Office in August 2023, at a time when the relationship with Fujitsu was already deteriorating following years of revelations around the Horizon system. This tension intensified months later, particularly after the public became more aware of the scandal due to ITV’s dramatization of the events.

Misaligned Interests
For years, the Horizon contract had proven lucrative for Fujitsu, but shifts in the landscape prompted them to distance themselves from the Post Office. Although both parties had experienced a challenging partnership, they had managed to avoid serious disputes. However, a recent inquiry session revealed correspondence from Fujitsu to Simon Oldnall, the Post Office’s Horizon IT director, indicating doubts about the organization’s commitment to moving away from the problematic contract. Fujitsu’s letter stated, “We have seen limited formal engagement from the Post Office to meaningfully progress the planning of exit and the exit date. Post Office is instead seeking to secure an extension and for exit to occur before the end of the contract term.”

Brocklesby emphasized that while progress had been made, challenges remained before the ultimate goal of retiring the Horizon system could be achieved. He noted that upon his arrival, the timeline for deploying the New Branch IT (NBIT) system was poised for full deployment by March 2025. However, he found “little to no software” had been developed, and existing software was in dire need of fixes in various areas, including security. He acknowledged the deployment would take around two and a half years, meaning the software would have needed to be ready by the time he joined, which it wasn’t.

Strategic Maneuvering
Brocklesby criticized Fujitsu for their request that the Post Office appoint an exit manager for the Horizon contract, which was originally set to conclude in March 2025. “Fujitsu was aware, and had been for some time, that we needed an extension,” he explained. “It was seen as slight game playing by Fujitsu to ask for an exit manager when they were very clear there wouldn’t be an exit in March 2025.” Additionally, Alisdair Cameron, the recently departed CFO of the Post Office, confirmed that continued reliance on Fujitsu was necessary until a viable Horizon replacement was ready.

He remarked that, although discussions had been ongoing about the transition, it was difficult to envision anyone other than Fujitsu managing the Horizon system until a new solution was dependable and ready to implement. “That was never visible when I stopped working at the Post Office,” he said.

Project Willow Overview
Brocklesby was also queried about Project Willow, which aimed to address concerns regarding the NBIT teams reported to the Post Office board. Issues related to misinformation regarding NBIT’s progress were underscored, suggesting that information had been presented skewedly to influence outcomes, leading to flawed past decision-making. Brocklesby confirmed that this sentiment accurately captured the situation, indicating it was likely the result of a whistleblower’s revelations.

Former Post Office Chair Henry Staunton, during his testimony the previous week, affirmed that an intentional withholding of information from the board was plausible, citing the dramatic cost escalation of the project—from over £300 million to beyond £800 million—as suggestive of a hidden agenda.

NBIT Project Timeline
Initially announced in May 2022, the NBIT project was expected to replace Horizon by 2025, but significant setbacks have led the Post Office to seek an additional £1 billion from HM Treasury for its revival. Costs have continued to rise, as noted earlier this week.

Brocklesby outlined a potential roadmap for the troubled NBIT project, anticipating an incremental roll-out starting with a limited number of transactions used by postmasters, followed by expanded functionality. The system will be piloted in up to 50 branches to gather feedback before being scaled up. If successful, the deployment into branches could commence in June 2026, allowing the Post Office to gradually transition away from the Horizon system. He projected that training for postmasters on the new system and the full transition would need until the end of 2028, during which some Fujitsu services would be phased out.

The Horizon scandal first came to light thanks to Computer Weekly in 2009, which detailed the harrowing experiences of several subpostmasters affected by the faulty accounting software—culminating in what has been deemed the most extensive miscarriage of justice in British history.