Headlines: February 7th, 2003

The government has signed what it sees as a groundbreaking deal to work with the Oracle Corporation to develop standardised IT systems for the public sector which will cut costs, end wasteful duplication of effort and deliver more effective systems.The strategic partnership agreement has been announced by Peter Gershon, Chief Executive of the Office of Government Commerce. Transparency and standardisation measures built into the deal should mean departments will be able to secure the best possible prices and terms on Oracle technology products.

Under the agreement the government will work with the company to develop systems based on common requirements. Peter Gershon said this would bring significant benefits by cutting back on the costly work needed to customise systems, and might help to deliver IT that works more effectively. It would also contribute significantly to the Government’s delivery agenda.

He said, too, that the arrangement represented additional value for money opportunities for the public sector in the UK and was on a par with the  deal secured by the US government.

The Treasury Secretary, Paul Boateng, said the groundbreaking agreement   demonstrated how the collective strength arising from effective procurement   could bring substantial direct and indirect value-for-money savings. “By   driving down the cost of goods and services in this way, we have been able to make real savings that can be redeployed to fund front line public services,” he said.

Talking about the deal, Peter Gershon, said, “Support from the whole of the public sector was critical in developing a strong position for our negotiations. Transparency is an essential part of this approach. He said the agreement should now act as the catalyst IT partnership approach with other suppliers.

The three-year Memorandum of Understanding reached with Oracle is a first,  as it enables government departments to see the actual cost that the rest  of the public sector is paying for IT. It will secure an average 11 per cent reduction in the cost of technology products bought directly and indirectly from the company.