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Steven Webb- Liberal Democrat MP for Northavon, asked the Chancellor of the Exchequer when he expects the problems with the NIRS2 computer system to be resolved. His first question was refered back to a previous answer given by the Paymaster General, however his second question led to a clearer picture of the current state of the system.
Mr Webb's questions, 'To ask the Chancellor of the Exchequer:
(1) If he will estimate the total cost of the work that will be needed fully to rectify the problems with the NIRS2 computer system;
(2) If he will estimate the total cost of the work that has so far been carried out to rectify the problems with the NIRS2 computer system,'
received the following response from Dawn Primarolo...
'The delay in the implementation of NIRS2 caused arrears of work in both the Inland Revenue and the then Department of Social Security. These arrears are being managed through a recovery plan that has been developed by both Departments and continue to be cleared as quickly as possible.'
'Estimated additional operational costs up to March 2001 are £40.4 million. It is not possible accurately to estimate the future costs until the backlog of cases has been cleared.'
Last year's NIRS2 computer system blunder left 120,000 pensioners underpaid by £41m and drew attention to the skills shortage in the IT sector as suppliers EDS battled to find staff to develop and maintain the system. Former Pensions Minister- Jeff Rooker publicly denounced the Government's IT system as 'rubbish.'
Ms Primarolo attracted further criticism at the time when she announced it would be neither 'sensible nor cost effective' to seek compensation beyond the £4.1m that consultants Andersen had paid back to the Government for late delivery of the system.
Consequently, the Contributions Agency incurred nearly £16m in irrecoverable costs partly as a result of millions of National Insurance records being completed late. £35m was paid out in compensation to private pension providers and claimants as a consequence.
Asked to comment on the situation, Revenue spokesman Dave McKenna told Shout99, "NIRS2 is, and has been stable and functioning well, supporting Government Pensions and NI legislation for well over a year. A major release of latest functionality was implemented in April this year without any problem whatsoever."
"We have a strong relationship with our partners on NIRS2, Accenture. The central premise that NIRS2 is not working is incorrect."
Related stories:
IR admits it is being hit by skilled IT shortage
Andersen to pay no further compensation for IT problems
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Richard Powell, Shout99
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