Delays in delivering major public sector IT projects are resulting in existing contracts being repeatedly extended at a cost of hundreds of millions of pounds to taxpayers, an Audit Office report has said.

Northern Ireland’s Comptroller and Auditor General Dorinnia Carville said extending contracts on legacy systems “risks a gap growing between the system’s functionality and the needs of citizens, businesses and communities”.

Her report gives an overview of 29 IT projects being delivered by Northern Ireland’s government departments and their arm’s length bodies between April 2022 and March 2025.

The report said the total cost of the portfolio is estimated at £5.2 billion, with more than two-thirds of these costs relating to the Department of Health (£2.47 billion across eight projects) and the Department of Finance (£1.12 billion across six projects).

It said that 24 of the case projects aim to replace existing business critical legacy systems operating “well beyond their intended life”.

The report said that in almost all cases the legacy contract has been extended multiple times, with an average contract extension of around eight years and the longest extension around 18 years.

It said in many cases these extensions “were not a strategically planned choice but rather made out of a necessity to maintain continuity of service”.

The report looked in detail at five projects which each experienced delays or issues, with subsequent contract extension costs totalling in excess of £573 million.

The auditor general said key factors contributing to the delays included a lack of clarity on the scope and the intended outcomes and benefits of new systems, as well as a lack of appropriately skilled staff.

The report said this resulted in the complexity of projects not being fully understood, leading to unrealistic delivery time and cost estimates.

The report has recommended the development of a Northern Ireland civil service-wide strategy to build the capacity and capability to successfully deliver major IT projects.

It also recommends that public sector bodies undertake urgent cross-sector planning to identify legacy systems in order to prioritise investment decisions and maintain or replace systems well in advance of the current contract expiring.

Ms Carville said: “The successful design, implementation and delivery of IT projects presents an opportunity to improve and transform public services.

“However, extending contracts on legacy systems risks a gap growing between the system’s functionality and the needs of citizens, businesses and communities.

“It represents very poor value for money and a missed opportunity to have more modern and efficient systems in place earlier.

“Major IT projects are recognised as being complex, but this is all the more reason why the NI public sector needs to adopt a much more strategic approach.

“This means planning and working collectively to maximise potential synergies in IT solutions, to better understand shared risks and to ensure best use of skills and resources.”

She added: “Fundamentally, the public sector needs to approach these IT projects in terms of how they change the way services are delivered, ensuring clarity on the improvements to be achieved and how these benefits will be measured and monitored.”

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