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Public Sector: IT Projects

My Lords, I, too, am grateful to the noble Lord, Lord Lucas, for securing this debate. I assure him that my contribution will be on only the IT area in which I was involved a number of years ago, which is slowly proving to be a success. That was not always the case but, as your Lordships know, large IT systems cost far more than originally expected and generally take much longer than anticipated. It was and still isso with Airwave, the terrestrial, trunked, digital multi-frequency radio service for police and now, thankfully, for other emergency services in England, Scotland and Wales. Airwave is managed through a programme board made up of representatives from the Home Office, the Association of Chief Police Officers, the Association of Chief Police Officers in Scotland, the Association of Police Authorities and the National Policing Improvement Agency. It is procured by the NPIA and provided by Airwave O2 Limited under a private finance initiative. I must declare my interest in this area. I was a member of my police authority for 20 years and chaired it for almost eight years until 2001. I was also a member and deputy chair of the Association of Police Authorities and sat on a number of national committees including the Police Negotiating Board and the Police Advisory Board. Moreover, I was a member of the National Crime Squad Service Authority before it was absorbed into the Serious Organised Crime Agency. Airwave was crucial to the accurate relaying of messages throughout all the force areas on the UK mainland, before which we all had our own systems and hardware, much of which, in my force, North Yorkshire Police, was at the end of its natural life. Indeed, it was so much at the end of its life that I recall us having to cannibalise old radios to make sure that most of the operational ones that were needed actually worked. It was a desperate and wholly unacceptable situation, which only the introduction of a modern, affordable and technically competent radio system could remedy. I was present when the then policing Minister, Charles Clarke, told a small deputation from the Police Advisory Board that—I will not be able to use the word he chose to use to describe what he would do to the reluctant forces that did not want to purchase Airwave—we would all take it, whatever we thought and whatever the cost, because it was to be the only solution on offer. However, he coated his threat with a promise of more money for forces to purchase the system, on which he was true to his word. Airwave began its life as the Public Safety Radio Communication Project in the early 1990s. It wasto be managed through the Police Information Technology Organisation, which was a public body set up to support police and partnership agencies in the criminal justice community. PITO has now evolved into the National Policing Improvement Agency. Initially, as I well recall, the Government emphatically refused to pay for the PSRCP, knowing that it would cost a huge amount of money, but eventually they capitulated and, in the end, all police forces received a capital grant towards its purchase. A decision was made by the then chief constable of North Yorkshire Police that it was absolutely essential that we were one of the first forces to go ““live”” with Airwave. We took operational early access of the system—which meant that we were going live in one district while Airwave, the company name, was still building sites in other parts of the country—in 2001. It certainly had its teething troubles. Rolling it out over such a huge geographic area, with some officers having access and others still using the old system and kit, was hardly ideal. We finally managed to cover the force area by mid-2002. Officers in Scarborough made the first switchover to Airwave and colleagues within the district soon began to appreciate the benefits from the vastly improved communication in areas where previously their old analogue sets had struggled to get radio coverage—not a pleasant situation to find oneself in when on the tops of the moors, out of radio contact with any help and having to stop a suspicious car with four tough-looking men in it. So it was a great relief to be able to be in contact with the rest of the world in a potentially dangerous situation. Airwave handsets provided emergency buttons for officers, enabling instant radio access to help. The cost of obtaining Airwave was the single most important factor for forces having to make the decision to purchase. The original arrangement with PITO and O2, formerly the mobile communications arm of BT, for a new radio service for police forces, was that O2 would design, build, finance and operate the service, while PITO and the police would pay charges over 19 years of some £1.5 billion. As we will see in a moment, this is now much, much more. In the 64th report of the Committee of Public Accounts—House of Commons Paper 783 of 2001-02, published on 28 November 2002—the conclusions of the committee were as follows: "““In negotiating a deal with O2, PITO and the Home Office failed to secure any clawback for the taxpayer of additional profits if other emergency services decide to join Airwave or if the system is sold by O2 to overseas governments. O2 was prepared to share the rewards from bringing extra users onto the system only if the Home Office was prepared to share the risk if extra users did not join. Failure to negotiate a clawback agreement was a product not just of O2 being in a powerful position as the only bidder but also the inability of the Home Office to bring the fire service and other safety organisations on board by demonstrating the real benefits that Airwave had to offer””." So, in the initial stages at least, proper thought had not been given to such a massive investment, and a public sector comparator was not made until much later on in the procurement process. As it happened, the committee felt that at that stage it was doubtful whether the use of a comparator added anything significant to the decision-making process. It suggested that departments needed to think through what financial and other analyses would be needed at each stage of the procurement process to determine and implement the most effective means of ensuring value for money. Can the Minister assure me that this kind of late comparator is no longer a favoured form of doing business and that in future large projects such as Airwave will be managed in a more efficient manner at the outset? The National Audit Office, in its evaluation of the Airwave project, said in the report of the Comptroller and Auditor General in April 2002: "““When procuring a step change in technology, such as Airwave, it must make sense to develop mechanisms to ensure that the maximum possible benefits are obtained for what will be a considerable investment of public money. This requires the allocation of resources up front to analyse performance before ""the service is introduced. In this deal, such investment was not undertaken either early enough or in sufficient depth during the procurement””." The Airwave system is very significant—currently costing around £4 billion—and we must ensure that we get the planned benefits from it. I understand from the APA that there is still a significant gap in mobile data and information. A number of pilot programmes are running acrossthe UK—in England and Scotland and in non-geographic forces such as the British Transport Police—and the results will help to inform the further work required. The recent sale of O2 valued the Airwave business somewhere in the region of £4 billion. We need to ensure that full value for money is realised and that the planned and envisaged business benefits accrue. We need appropriate structures and processes to allow this important work to continue. Allied to that, we must ensure that large PFI contracts, which are delivered over a series of years, like Airwave—which, incidentally, is the biggest in Europe—and which are necessarily based on principles of partnership delivery, actually deliver in partnership and that the programme does not accept further costs unnecessarily. Right at the start of these huge programmes, we need a common vision about what a service will deliver, how that service will be delivered and what degrees of flexibility it will have. If we begin to learn from the many mistakes of the past, we may begin to have large IT systems fit for purpose and fit for the 21st century.