Ross Clark

Crash course

The government is obsessed with creating databases, says Ross Clark, but its failure to use IT effectively will cost us billions

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I have some native sympathy with the lackeys struggling to handle the Inland Revenue’s computers which, like a berserk one-arm bandit, have just spewed out an excess £1.9 billion in tax credits. I am not sure I am the best-qualified person to expound on the inadequacy of government IT systems. My own computer bears the large indelible bootprint of the Clark school of systems technology. It was imprinted a fortnight ago when the machine crashed, erasing two years’ worth of work, or at least sending it somewhere deep into the bowels of the hard drive where it could only be recovered by the kind of forensic nerds who do kiddie-porn investigations. It is fair to say that if I were put in charge of some government computer system, it would have found some way of transferring the nation’s currency reserves to Botswana before I finally took to the thing with an axe.

But something tells me that the government’s super-nerds ought to have a slightly better affinity with computers. And at present there is scant sign that they do. The fiasco of child tax credits is merely the latest in a long list of government computer failures. Last November the Department for Work and Pensions’s computer system, built by American IT contractor EDS Systems and Microsoft, crashed during an attempt to upgrade it. A £50 million Capita IT system designed to handle the government’s Individual Learning Accounts had to be scrapped in 2001 after it was discovered to be fatally open to fraud. There was the Passport Agency’s computer breakdown in 1999, and the failure of the Home Office’s notorious computer system for handling asylum applications, which led to a huge backlog of applications and the resulting wave of illegal immigration, in 2000–01. That is not to mention the Probation Office IT system, which was scrapped after £120 million had been spent, nor the NHS computer system, whose costs have already run to more than three times its original £6.2 billion estimate. And on it goes.

Admittedly, computer failures are hardly unknown in the private sector. An American study recently claimed that only a quarter of IT systems installed by businesses performed as they were supposed to. But government IT failures seem to be on a scale way beyond that which would be tolerated in the private sector. In the first 20 months of operation of the Child Support Agency’s new £456 million computer system, four out of every five claimants were sent the wrong payments, which resulted in the resignation of Doug Smith, the head of the CSA, last November. If the computers of a high street bank had made errors in 80 per cent of customers’ statements, it would be a bank no longer.

It isn’t easy to find people in the IT business prepared to speak on the record about the government’s inability to use computers effectively — perhaps not surprisingly, given their eagerness to secure a slice of the £2.3 billion which the public sector spent on IT contracting last year. However, one whose company has been involved in government work was prepared to have a blast at the public sector’s bad planning off the record. ‘It is possible to build computer systems on the scale of the government’s systems and to have them delivered on time and on budget; Mastercard and Vodafone do it,’ he says. ‘But what it requires is good project management and no political interference while the system is being built. What tends to happen with IT systems in the public sector is that every minister wants to ride his own hobby-horse. The project suffers mission creep, which leads to greater complexity as bits have to be “bolted on”. This is going to be the problem with the ID card scheme: the government has failed to articulate its goals for the scheme; first it was about fighting terrorism, now it seems to be about identity fraud. By the time the scheme is up and running its scope will have been changed so many times that it is bound to function less well than it would have done had it been designed for its ultimate purpose at the outset. Even if the ID database fails in just 1 per cent of 1 per cent of cases, with 40 million people on the system it could still mean 4,000 people fitting the same description.’

Another IT contractor makes the point that the public sector condemns itself to lousy work by always accepting the lowest bid, regardless of quality. In spite of the public sector’s obsession with national databases, it is failing to use IT in simpler, more proven ways which could cut administrative costs considerably. ‘All our orders are now processed electronically,’ says the head of one IT firm. ‘By doing so it is possible to realise huge productivity gains without any increase in staff. Yet e-commerce isn’t being used to anything like the same extent in government yet.’

Last year the National Audit Office (NAO) published a damning report on the Libra project, an IT system to link all 22,000 staff employed by magistrates’ courts. The Lord Chancellor’s department, found the NAO, failed to take any external advice when signing up for a system which was supposed to cost £146 million when commissioned in 1998. Moreover, civil servants handled negotiations with the contractor, ICL, about as feebly as an octogenarian faced with a cowboy plumber armed with a monkey wrench. Twice ICL came back and demanded more money; yet rather than telling ICL to get on with the job, the Lord Chancellor’s department simply agreed to pay more. ICL never did finish the project, and in the end taxpayers paid £390 million for the system.

Coming from a government which has leaned over backwards to preach the virtues of the e-this and e-that, it is an abysmal record. Three years ago Tony Blair stated his dream of having every Briton online by 2005, to which end the government handed out free computers to the inhabitants of Liverpool. Showing their usual entrepreneurial talents, some of them promptly flogged their machines for £100 a time. That incident sums up the government’s starry-eyed attitude to IT. But the shocking thing is that ministers never seem to learn. Having suffered a litany of computer failures, the last thing the public sector needs is another string of initiatives which would rely on even bigger and costlier IT systems. Yet what are the government’s latest wheezes? An ID card scheme involving a database of biometric data on 40 million adults, and a national road-pricing scheme which would have to track the daily movements of 30 million vehicles.

It isn’t hard to predict where these two schemes are heading: computer crashes, identity fraud, costs over-running by billions, Bob from Bognor surrounded by armed police at Dover because his eyes match those of bin Laden; motorists sent bills bearing no relation to where they have been. Already a study by the London School of Economics has denounced as wildly inaccurate the government’s estimate that the ID card scheme will cost a mere £7 billion. The lowest it could possibly cost, say the academics, is £10.6 billion, and that is before the inevitable bugs and cost over-runs are taken into account. More likely it would cost more than £19 billion.

But at least somebody will get something out of it: the public sector’s avid porn-viewers. After all, this is the one undoubted success of the government’s drive on IT: to provide lurid entertainment for public servants during their lunch breaks and other quiet moments. According to a study by the Audit Commission, 2.3 million pages of porn were called up on the government’s computers in just 10 months. Never mind your overdue tax credit, your delayed passport application or the spurious bill for driving through Stoke last Tuesday morning; Big Brother is too busy salivating in front of a screen full of tit and bum while he awaits the man from systems.