IBM is bidding for a Post Office contract worth hundreds of millions of pounds, a decade after it was paid to walk away from a contract it won to replace the controversial Horizon system.
Computer Weekly has learned that the US tech giant is bidding for a contract as part of the Post Office’s plan to replace Fujitsu’s Horizon system, with DXC partnering with it on the bid.
This is not the first time IBM has bid for a major contract at the Post Office. In 2013, work began on a £100m multi-supplier contract, which included IBM, but it was cancelled in 2015. The Post Office had to pay IBM millions of pounds of taxpayer funds for work already done.
The contract with IBM was reported by Computer Weekly in June 2015, after Andrew Bridgen, former MP for North West Leicestershire, said he had an email that proved the Post Office was looking to replace Horizon.
But speaking at a Post Office scandal public inquiry hearing in May 2024, Alisdair Cameron, Post Office chief financial officer who joined the Post Office in 2014, said there were problems understanding the Horizon system without Fujitsu’s support.
“[We got] into difficulty relatively quickly because no one knew how Horizon worked … recreating it without the help of Fujitsu was phenomenally difficult,” he said. “We were really in doubt that it could be properly finished and rolled out by the date when Fujitsu’s contract ended, so we extended the support contract with Fujitsu to give us more time.”
The IBM deal was never done, and the controversial Horizon system is still used today.
In a recent interview with Computer Weekly, the Post Office’s IT boss, Paul Anastassi, said Fujitsu will be out next summer and there will be no trace of Horizon, which has more than 80 components, by 2030.
The £323m contract now being bid for by IBM will see the successful bidder take over the existing Horizon services. It will include application support for subpostmasters, application development and release management, migration from the on-premise datacentre to the cloud, and the establishment of a cloud-native back-office and channel platform.
This is Lot 1 of the Post Office’s tender, for which a handful of suppliers made the shortlist.
Lot 2, worth £160m, seeks a supplier to provide an off-the-shelf electronic point of sale (EPOS) system to replace the Horizon front end. A dozen suppliers bid for this £169m contract, but only three made the shortlist.
Among them is a familiar face. As revealed by Computer Weekly in July last year, EPOS software maker Escher, which supplied middleware in the Post Office Horizon system, was eying Lot 2.
The Post Office would not comment on suppliers because the tender process is ongoing. One of the criteria for suppliers, all very aware of the Horizon troubles, is a desire to make things right at the Post Office.
The Post Office scandal was first exposed by Computer Weekly in 2009, revealing the stories of seven subpostmasters and the problems they suffered due to Horizon accounting software, which led to the most widespread miscarriage of justice in British history (see below timeline of Computer Weekly articles about the scandal since 2009).
