Government IT contractors face profit probe

Quarterly profit data are to be required from the government’s strategic suppliers – including IT contractors – to ensure taxpayers are getting value for money, it was reported yesterday.

According to the Sunday Times, 40 suppliers of services like IT, such as Fujitsu, BT and IBM, must report their revenue and profit margins to the Cabinet Office every three months.

Led by the government’s chief commercial officer Bill Crothers, the reporting programme will monitor suppliers’ health, and the health of their contracts from a taxpayer perspective.

Although the firms were reportedly informed of the programme before the general election (when efficiency savings were pursued), it is said to be a result of issues with G4S and Serco.

Some of the strategic suppliers are already familiar with disclosing profit figures to Whitehall, but the programme now means such reporting will be mandatory for all contractors.

A recent Cabinet Office paper braced them: “Government is not looking to introduce burdensome reporting requirements, but rather to see data that suppliers should already hold on contracts”.

To head off claims that the data will be used to squeeze their margins, the government paper states that it is “mutually beneficial” if the firms make a “healthy and competitive return.”

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