NHS IT contractors get pay rise

UK health agency Connecting for Health will now pay telco BT £1 billion, 61 per cent more than the original £620 million, to provide the backbone for the NHS National Programme for IT, following a contract reset in February this year.

The amounts which will be paid under the six main contracts have risen from the original total of £5.5 billion to £6.6 billion as a result of those negotiations, according to a parliamentary written answer from UK health minister Ben Bradshaw.

"Where there are increases in the value of the reset contract when compared to the original contract value, this is due to changes or additional requirements that have been negotiated as part of the reset agreement and these have been approved through normal governance arrangements," said Bradshaw in parliament.

"There are no changes to the cost of delivering the requirements of the original contracts," said a Connecting for Health spokesperson. "Additional work for new requirements and additional functionality will attract additional costs: as was always part of the contract."

"The updated Spine contract deals with new requirements that have arisen since the contract was let and include such functionality to support the delivery of 'Payment by Results', the 18-week referral programme and the further development of the Secondary Uses Service to support wider NHS work and requirements," the spokesperson added.

BT declined to comment, citing commercial confidentiality. The firm will also receive more money following the reset in May 2007 of its contract to act as local service provider in London. It will earn an additional nine percent, taking the deal's value to £1.082 billion.

All five of the contracts for the local service providers have been reset to provide payment increases. In September 2005, Fujitsu negotiated an increase of 32 per cent in its fee for providing services to the NHS in the south of England, from £896 million to £1.182 billion.

The firm was fired from the National Programme for IT in May 2008. Bradshaw said that Fujitsu's liability to the government is capped at £100 million for each contract year, to a total of £500 million, while the government's liability was capped at £50 million for each contract year.

In January 2007, CSC got increases of seven per cent on its payment for the north-east region, to £1.179 billion, and 14 per cent for both the eastern region, which is now worth £1.064 billion, and the north west and West Midlands area, now worth £1.11 billion.