Renegotiations of the NHS IT contracts have ended with Fujitsu, supplier for the whole of south and west of England, being fired. Its 10-year contract to provide electronic patient records, worth £896 million, will end early in a termination notice from NHS Connecting For Health, the special health authority responsible for the NHS IT programme.

Fujitsu’s spokeswoman told PharmaTimes News Online that “Fujitsu Services can confirm that we have now taken the decision to withdraw from the National Programme for IT (NPfIT) contract reset negotiations with NHS Connecting for Health as we did not feel there was a prospect of an acceptable conclusion. Our contract with the NHS will therefore end early.”

Reset negotiations fail
NHS Connecting For Health has been engaged in these ‘reset’ negotiations with the contract-holders since 2007, seeking more flexible delivery of the services. Since this would cost Fujitsu more than planned, it proposed either higher payments from Connecting For Health or a return to the original contract specification.

Fujitsu has therefore become the second of the ‘big four’ supplers to quit, after Accenture walked away in 2006, losing a substantial sum. BT, which is implementing the NHS IT programme in London, looks favourite to take over the contract since it uses the same Cerner software.

A spokesman for Connecting for Health said: “Regrettably, it has not been possible to reach an agreement on the core Fujitsu contract that is acceptable to all parties. The NHS will therefore end the contract early by issuing a termination notice.” He added that Fujitsu had made a commitment “to providing a smooth transition to new arrangements”.

A recent report from the National Audit Office pointed out that the IT programme is already running four years later than the original deadline, although it remains within budget having taken a hard line with suppliers such as Fujitsu, Accenture and iSoft. The renegotiations have set out strict local specifications, and continued the original principles that supplier payment only follows successful implementation.