Gov.uk delves into EDS finances

Four investigations in three years

By John Oates • Get more from this author

Posted in Public Sector, 14th February 2005 11:16 GMT

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The British government has carried out four separate investigations into the finances of outsourcing giant EDS.

EDS has been one of the big beneficiaries of the move to outsourcing government processes to private companies. It runs massive contracts for the Child Support Agency and Ministry of Defence.

Deloitte, the accountancy firm, investigated EDS in 2002 and 2004. The probes were called Ranger I and Ranger II. The Office of Government Commerce, which acts to improve government efficiency, carried out two separate investigations last year.

The government's concerns came to light thanks to the Sunday Times, which applied for details under the Freedom of Information Act. But the government refused to release the final reports saying they were exempt from the Freedom of Information Act because publishing them would be a breach of confidence. The reports could also contain confidential or commercially sensitive information.

The investigations coincided with a difficult period for EDS. A disastrous contract to provide a new network for the US Navy cost the firm $375m. EDS was sacked by the Inland Revenue and threatened to sue the NHS over an aborted email contract.