Whitehall's computer chaos grows investigated

THE RISING tide of failed government computer projects, which have so far cost the taxpayer hundreds of millions of pounds, is to be investigated by the MPs' spending watchdog.

As details emerged yesterday of how 1,500 faults in a new National Insurance system had left some pensioners pounds 100 a week out of pocket, the chairman of the Commons' Public Accounts Committee (PAC) promised a full inquiry.

Citing 40 separate problem projects, PAC chairman David Davis said the same mistakes were being made time after time in different departments. Badly written briefs and poor planning were leading to projects which came in late and over-budget, he said.

Yesterday's report said delays of more than a year had led to "unreasonable delays" in the payment of benefit to widows, pensioners and the disabled. It followed a series of similar cases, and then this summer came the passports fiasco. Now Mr Davis's committee is launching an inquiry into how so many projects have gone badly wrong.

The Government said last night that it shared the PAC's concerns about the problems with the National Insurance system and was working to overcome them. A spokesman said: "If in the same position again, the contract for a computer system of this size would not be entered into in the same way." Already this summer, thousands of people have been forced to queue for new passports because the installation of a new computer has coincided with a rule change which demanded that children should have the documents.

Among the most costly mistakes was a new air traffic control computer, installed by Lockheed Martin, that came in almost pounds 90m over-budget, at pounds 217m. In another case, a computer system called Trawlerman, which cost pounds 40m and which was developed for the Ministry of Defence, was abandoned without ever going into service.

In the National Health Service, a clinical information service developed by a GP came in at several times its pounds 32m budget. In that case, the PAC found that the NHS Executive had not carried out an appraisal of costs, benefits and risks before approving the project.

Mr Davis said some of the problems were caused by officials' failure to write adequate briefs for the work they needed doing. Then when changes were needed, the completion date receded and the price went up. The situation has been made worse by a shortage of computer-literate staff in the public sector. People with such skills can earn far more as private consultants, who are in great demand from companies wanting to upgrade to avoid the millennium bug.

Yesterday's report, on a private finance initiative project involving the old Contributions Agency and Andersen Consulting, provided a classic example. It should have been complete by April 1998, but delays were still occurring, partly because changes to the original specification had dragged out the work.

"Delays to the implementation of this vital new system have resulted in unnecessary hardship and suffering to many vulnerable groups in society, including pensioners, widows and benefit claimants," Mr Davis said.

Fifteen months after the PAC first took evidence on the problem with the new National Insurance recording system, the situation had become much worse. At the end of last year there were seven million items waiting to be input into the system - a backlog which could take years to clear. At the end of March 1999, the number of items stood at 4.5 million.

Mr Davis said he would ask his committee to look at various cases to see whether guidelines could be drawn up to prevent such disasters happening.

The Conservative spokes-man on social security affairs, David Willetts, said the Government had demonstrated "sheer incompetence".

"This time the victims are some of the most vulnerable people in society - pensioners, widows and disabled people. We have been warning for months about the problems with the new NI computer system," he said. The Liberal Democrat social security spokesman, David Rendel, said there had been little progress since he raised the problem last year.