NS&I digital overhaul is 1.3B over budget and 4 years late

"The UK's state-owned savings bank has blown past its budget by £1.3 billion on a digital transformation program beset by delays, according to the National Audit Office. National Savings & Investments (NS&I), which brings in government funding through the retail savings market, has pushed the project back by four years after running into procurement snags and technical complexity, the public spending watchdog's report said."

"In 2014, the bank, which handles £240 billion in customer investments, awarded Atos a new contract to run until 2021, and then extended it until 2024 and again until 2028 without competition, handing the French outsourcer another £474.4 million. The total cost of the program is expected to hit £3.0 billion until 2030-31, including its contract with Atos and other running costs. The total cost increase is set for £1.3 billion compared to the 2020 business case."

""NS&I set itself an overly optimistic timetable for the program," the NAO report said. "Decoupling a highly integrated operation, splitting it into smaller parts and then integrating these systems together is highly complex. NS&I had limited experience of delivering a program of this scale and complexity, but it set an ambitious scope and timetable. The timetable did not factor in contingency for delays, allow time for understanding the technical infrastructure and testing solutions, or define how it would resolve interdependencies and manage systems integration.""

NS&I launched Project Rainbow in 2020 to cut running costs, become a self-service digital business, and replace a 20-year Atos outsourcing deal by dividing work into five contracts. Procurement snags and technical complexity pushed the programme back by four years. The Atos contract, originally awarded in 2014 and extended twice without competition, added another £474.4 million. Total programme costs are expected to reach £3.0 billion to 2030-31, an increase of £1.3 billion versus the 2020 business case. Programme planning underestimated systems decoupling complexity and lacked commercial and integration management skills.

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