DWP cans £300m Fujitsu contact

HP to assume temporary control of desktop support contract after Fujitsu's endeavours fall short of expectations

The Department for Work and Pensions (DWP) has canned its £300m desktop support contract with Fujitsu before work on it had begun in earnest.

Fujitsu wrested the contract, which involves the management and transformation of 140,000 DWP desktops across 1,000 offices, from incumbent HP last February. HP and Cap Gemini were the other two firms shortlisted.

Work was meant to begin in September but sources close to the situation understand that Fujitsu had migrated just 100 test users when DWP pulled the plug on the contract.

According to sources, the project had been helmed by four CTOs in its short lifetime and the virtual desktop infrastructure (VDI) component of the project had fallen short of DWP's expectations.

A DWP representative confirmed that HP was still working on the "phase-in period" with Fujitsu when the contract was terminated.

"In the short term, HP will continue to provide the services while we look at how we deliver them in the future," they said.

All government ICT projects are subject to scrutiny from the Efficiency and Reform Group but Fujitsu argued last summer that the DWP contract would be safe from cuts.

Oren Taylor, managing director of distributor CDG, said: "This is a blow to Fujitsu from a prestige level. It was always going to be a difficult contract for them, especially with some of the technology choices they were looking to move with. But Fujitsu has other big projects and I am sure they will learn from this and bounce back stronger."

The DWP representative declined to comment on whether the contract would be re-tendered.

In a statement, a Fujitsu representative said: "Fujitsu can confirm that it has received notification from DWP that they wish to bring the desktop contract, awarded in February 2010, to an end. We are not able to provide any further comment at this stage."

HP refused to comment.