UK employment service doles out £321m extension to EDS

The UK Employment Service (ES) is to pay services giant EDS £321m in an extension to the 10-year Modernising Employment Service project initiated last year.

EDS did not have to compete with any other companies for the business, as the ES said the project was simply an extension to the original £135m contract. As such, the work has already been subject to open competition. As part of the new deal, EDS will provide job seekers with access to over 300,000 vacancies through the Internet Job Bank - one of a series of 24-hour public services. Employment Minister Tessa Jowell told silicon.com: "This is a clear demonstration that 24-hour electronic access to public services can and will be delivered." The Modernising Employment Service (MES) project also involves installation of 9,000 touchscreen kiosks throughout the UK and replacement of around 3,000 PCs in Jobcentres. An ES spokesman said: "This announcement of the contract extension follows finalisation of the scope of the MES activity and the commercial implications for both ES and EDS. We have had no significant problems with EDS and experience of the contract to date is good. The Employment Service would never have considered contracting with EDS if we did not believe they could deliver." EDS' track record of delivering government projects on time, to budget and to specification has been erratic. Costs for its work for the Inland Revenue have risen from the £1bn to £2.4bn, and the IR imposed penalties of around £2.5m on the services firm during the first five years of the deal for failing to meet its service level agreement. In addition, the new Child Support system being developed by EDS-led consortium Affinity was scheduled to go into operation at the end of this year, but will now be delayed until at least April 2001. Affinity has said the work was more complex than it expected. By Candice Goodwin