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iSoft was central to Accenture's NHS pull-out

On the day major contractor Accenture announced it was pulling out of the NHS' NPfIT programme, troubled subcontractor iSoft emerged as key to its departure
Written by David Meyer, Contributor

Healthcare software provider iSoft has emerged as the central cause for Accenture's withdrawal from the NHS' massive IT rehaul.

Accenture confirmed on Thursday afternoon that it was pulling out of most of its £2bn contracts with NHS Connecting for Health, the department responsible for implementing the National Programme for IT (NPfIT).

With the exception of its role in moving medical imaging services to a digital platform in the North West, Accenture's work will now all be handled by Computer Science Services (CSC), another of the major NPfIT contractors.

In a teleconference on Thursday afternoon, Guy Hains, the European president of CSC said the rollout of new NHS software and infrastructure could be sped up following Accenture's withdrawal, mainly because of new arrangements surrounding iSoft — which had been subcontracted into NPfIT by both Accenture and CSC.

"In terms of getting [iSoft's Lorenzo package] to market with the highest quality and fastest time, that's most easily done with one set of masters," said Hains.

That sentiment was echoed by Lis Astall, Accenture's European managing director, who refused to be drawn on the company's reason for pulling out of the contracts, other than to say: "We all believe it makes sense at this stage in the project for CSC  to take a single line in… managing the subcontractor."

The transferral of work from Accenture to CSC will take place over the next three months. A sizeable proportion of Accenture's NPfIT staff will move to CSC to ensure "an orderly transfer of services and to minimise disruption", according to NPfIT boss Richard Granger.

Accenture's withdrawal means the technology services and consultancy firm will have to repay £63m of the £173m it has already been paid by the NHS. It will, however, be unable to recoup any of its losses by bringing legal action against iSoft, as any potential litigation relating to the period between 2 April, 2004 and 28 September, 2006 was annulled in the termination agreement between the two companies.

Delays in completing work on Lorenzo are seen by some as the cause of Accenture's departure, as much of Accenture's payment by the NHS depended on iSoft's delivery.

But John White, marketing director for iSoft, told ZDNet UK on Thursday that Lorenzo was modular rather than "a big bang solution" and the main user modules were on track for their scheduled rollout from late 2007 into 2008.

He also attributed today's rise in iSoft's battered share price — 15 percent up from 45p to 52p at the time of writing — to Accenture's departure, saying: "The share price reaction is really very much in response to the fact that for three or four months there has been uncertainty about what was going to happen and what that would mean for iSoft."

"Clarity is what the market needs," he added.

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