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EDS

An intriguing insight into how outsourcing “works”:

The American company EDS is responsible for the computer system running the government’s tax credits scheme. Over £4 billion has been overspent, and the Revenue is now in the unpleasant position of demanding money back from low-income families who didn’t realise they had been overpaid. Plus the government had to shut down their online tax credit portal because there was widespread computer fraud—you know, that thing the government are trying to put a stop to by putting everyone’s most personal details on an enormous computer.

So, after three years of negotiation, EDS has agreed to pay the Revenue £71.25 million in compensation. Though a small puddle of piss next to the £4 mbillion losses they’re so far responsible for, nevertheless at least it’s more than a gentle slap on the corporate wrist.

But! The Public Accounts Committee [Warning! Not an exciting link] points out in its report today that of that £71.25 million fine, £26.5 million—nearly 40 per cent—will only be paid to the Revenue if EDS is awarded further government contracts.

In other words, you’ve done such an amazingly shit job that the only way you’ll be able to afford to compensate us is if we keep employing you. This is a fantastic idea. If only I’d thought of it in my years of temping. “I can't believe you actually burnt our building down. Now we have to keep you on until you’re 50.”

Comments

( 7 comments — Leave a comment )
strictlytrue
Apr. 25th, 2006 04:06 pm (UTC)
So, after three years of negotiation, EDS has agreed to pay the Revenue £71.25 million in compensation. Though a small puddle of piss next to the £4 million losses they're so far responsible for,

I'm presuming that you mean £4 billion losses here, otherwise we're talking a serious deluge of piss.
webofevil
Apr. 25th, 2006 04:33 pm (UTC)
Oh, million, billion; it's not as if I do a job where I have to check that sort of thing...
strictlytrue
Apr. 25th, 2006 05:10 pm (UTC)
Sorry - you did mention £4 billion elsewhere in the post. I just got carried away with extending the piss metaphor.
webofevil
Apr. 25th, 2006 05:28 pm (UTC)
> I just got carried away with extending the piss metaphor

The day I hear someone use this phrase in Committee is the day I retire, as my work here will be complete.
ex_cornfedpi814
Apr. 25th, 2006 04:09 pm (UTC)
Now let me explain co-sourcing....
ruudboy
Apr. 25th, 2006 05:42 pm (UTC)
It's a bit like when companies give the managing director who's just taken them from being hugely successful to making massive losses an enormous payoff, innit. I once heard someone being interviewd about this on the radio, almost certainly Ruth Lea now I think about it and she said that they have to have these big payoffs "in order to attract the right calibre of person." I am not making this up, I promise.
simonbelcher
Apr. 26th, 2006 09:35 am (UTC)
Outsourcing
So it's a bit like having to do the washing-up instead of paying for your retaurant bill...
( 7 comments — Leave a comment )

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