Recommendations & Conclusions
16 items
1
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
On the basis of a report by the Comptroller and Auditor General, we took evidence from National Savings & Investments (NS&I) and from HM Treasury (the Treasury) on NS&I’s Business Transformation Programme.1
Government response AI summary
The government acknowledges the Committee's foundational conclusion and provides an update on NS&I's Business Transformation Programme, including plans for developing options for a revised Full Business Case by Q2 2026-27 and leadership changes to address operational failures.
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HM Treasury
10
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
Despite the lack of information on timetable and cost, NS&I claimed it was confident that it could find a way to deliver the Programme by 2028, by “deprioritising” some aspects of the Programme.22 When asked how it could be confident without an agreed integrated plan, NS&I could only say this …
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Despite the lack of information on timetable and cost, NS&I claimed it was confident that it could find a way to deliver the Programme by 2028, by “deprioritising” some aspects of the Programme.22 When asked how it could be confident without an agreed integrated plan, NS&I could only say this was a “good question”.23 NS&I acknowledged it should have appointed a “big, heavyweight” systems integrator earlier, and said this could have improved its planning process.24 When asked what evidence or assessment had led it to conclude that the Programme’s approach of introducing multiple contracts to manage would be easier than managing one large contract, it had no answer, other than there were benefits of being able to switch suppliers in future.25
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Government response AI summary
The Treasury and NS&I acknowledge concerns about the lack of information on timetable and cost and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
11
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
When we asked if decisions were being taken based on evidence, NS&I said that “there is always a chance that assumptions are incorrect”.26 The National Infrastructure and Service Transformation Authority had found that NS&I’s understanding of the alternative approaches had not been robust, and NS&I said its understanding had improved …
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When we asked if decisions were being taken based on evidence, NS&I said that “there is always a chance that assumptions are incorrect”.26 The National Infrastructure and Service Transformation Authority had found that NS&I’s understanding of the alternative approaches had not been robust, and NS&I said its understanding had improved since the Programme started. However, it also sought to blame Atos’s financial difficulties, saying it had needed to spend time, energy and resources developing continuity plans instead of on the Programme.27 NS&I dismissed suggestions that it should have done more work at the start, saying “you can always do more analysis”, and appeared to blame suppliers for not bidding for Programme contracts.28 A good news culture can prevent lessons being learnt
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Government response AI summary
The Treasury and NS&I acknowledge these concerns and are committed to addressing them through robust planning, risk management, and governance. NS&I is working to develop a comprehensive integrated plan that includes clear timelines, cost estimates, and resource allocation.
Read full response →
HM Treasury
12
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
The external organisations that have reviewed the programme told the NAO that NS&I was sometimes or often slow to act, or did not act at all, on advice.29 We asked whether NS&I’s leadership had learned from the issues with the Programme. NS&I offered two lessons: it acknowledged that it had …
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The external organisations that have reviewed the programme told the NAO that NS&I was sometimes or often slow to act, or did not act at all, on advice.29 We asked whether NS&I’s leadership had learned from the issues with the Programme. NS&I offered two lessons: it acknowledged that it had over-estimated the complexity of the Programme; but then claimed there was a positive lesson because it had continued to operate the organisation as a whole despite the delays.30 When asked if it regretted that more money 22 Q 21 23 Q 23 24 Qq 1-2 25 Q 6 26 Qq 7-8 27 Q 9 28 Qq 10-11 29 C&AG’s Report, para 19 30 Q 1 10 was being spent on the Programme instead of being available for improving public services, it could only reiterate how much funding NS&I had raised for government through its activities.31
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Government response AI summary
The Treasury and NS&I acknowledge concerns about NS&I's slowness to act on advice and commit to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
13
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
We asked the chief executive if he was creating a ‘good news’ culture, which the NAO has identified as a factor in why programmes resets may not work, and which can lead to a situation where decisions are not made and disagreements between stakeholders are not resolved. He told us …
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We asked the chief executive if he was creating a ‘good news’ culture, which the NAO has identified as a factor in why programmes resets may not work, and which can lead to a situation where decisions are not made and disagreements between stakeholders are not resolved. He told us that having a “can-do” attitude meant NS&I staff were committed to its objectives and transformation, which was “invaluable”, and he was pleased to see higher scores on NS&I’s recent annual staff engagement survey.32 But these scores do not give a full view of the lack of progress on the Programme because the survey only covers NS&I employees and not the large number of suppliers working on the Programme, meaning NS&I is missing an external perspective.33 We questioned whether NS&I had taken action to ensure a “good news culture” did not prevail, but NS&I gave us no details, and could only acknowledge the importance of the tone set from the top.34 NS&I conceded there had been occasions when its culture led to staff being overly optimistic about the delivery of the Programme.35
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Government response AI summary
The Treasury and NS&I acknowledge concerns about a 'good news' culture and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
14
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
The Government Internal Audit Agency’s review of NS&I’s culture in December 2024, found that staff felt decision-making was slow and hierarchical, decision-making processes were not understood, and there was a lack of transparency within Programme processes.36 NS&I introduced a leadership development programme as a response to the review, and NS&I …
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The Government Internal Audit Agency’s review of NS&I’s culture in December 2024, found that staff felt decision-making was slow and hierarchical, decision-making processes were not understood, and there was a lack of transparency within Programme processes.36 NS&I introduced a leadership development programme as a response to the review, and NS&I said that from this it had found that where issues were raised, “there was not always recognition that those leaders in the room were going to address those issues and drive it forward”. NS&I noted that moving to a multi-supplier model takes a shift in mindset and accountability, and that strategic workforce planning and management is a key part of how it continues to develop that capacity to get the change.37 31 Q 4 32 Q 45; C&AG’s Report, para 3.5 33 Qq 50-51, 60-61 34 Qq 47-48 35 Q 46 36 C&AG’s Report, para 3.5 37 Q 49; C&AG’s Report 11 2 Conditions for success Improving understanding and management of risk
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Government response AI summary
The Treasury and NS&I acknowledge these concerns and are committed to addressing them through robust planning, risk management, and governance. NS&I is working to develop a comprehensive integrated plan that includes clear timelines, cost estimates, and resource allocation.
Read full response →
HM Treasury
15
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
In taking forward the Programme, NS&I launched multiple procurements and planned to deliver four transitions in parallel, with no understanding of the risks that this was exposing the organisation and its customers to. NS&I said it had identified supply chain risk as a key area of focus.38 However, NS&I focused …
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In taking forward the Programme, NS&I launched multiple procurements and planned to deliver four transitions in parallel, with no understanding of the risks that this was exposing the organisation and its customers to. NS&I said it had identified supply chain risk as a key area of focus.38 However, NS&I focused more on how it had handled past issues, telling the Committee how it had developed contingency plans when Atos had financial difficulties in 2023; it did not provide evidence that it had considered how to manage the current contracts.39 When asked if it was confident that it had resolved the issues with procurements, NS&I could only say that it had awarded contracts. NS&I acknowledged that these still contain the original milestone dates, which would need to be changed to take account of delays in NS&I’s Programme implementation.40
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Government response AI summary
The Treasury and NS&I acknowledge concerns about the Programme's procurements and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
16
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
There are still many risks for the Programme to manage, for example the replacement of the ‘core banking engine’ is extremely high risk, but the main work has yet to start.41 NS&I agreed that when it replaced its banking engine, data migration would be a “huge consideration”, and said it …
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There are still many risks for the Programme to manage, for example the replacement of the ‘core banking engine’ is extremely high risk, but the main work has yet to start.41 NS&I agreed that when it replaced its banking engine, data migration would be a “huge consideration”, and said it knew this would need to be managed “in minute detail”, but gave no details of how it would do this. NS&I’s contract with Atos to run the banking engine expires in 2028, and it will need a new contract after then to ensure continuity.42
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Government response AI summary
The Treasury and NS&I acknowledge concerns about risks to the Programme and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
17
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
In 2025, NS&I implemented a new Risk Management Framework, but has not yet fully embedded the framework throughout its organisation.43 We wanted assurance that this framework is good enough to ensure that risks to customer data could be managed, and NS&I claimed it was “comprehensive”.44 NS&I did say that it …
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In 2025, NS&I implemented a new Risk Management Framework, but has not yet fully embedded the framework throughout its organisation.43 We wanted assurance that this framework is good enough to ensure that risks to customer data could be managed, and NS&I claimed it was “comprehensive”.44 NS&I did say that it had improved its risk management processes through greater involvement of its risk directorate, but also 38 Qq 6, 11; C&AG Report, para 2.4 and Figure 6 39 Q 65 40 Q 22 41 C&AG’s Report, paras 20 and 24 42 Q 78 43 C&AG’s Report, para 3.23 44 Q 66 12 said that it was relying on GIAA, as “we accept that we do not have all the expertise in these areas”.45 GIAA is intended to be an internal audit function which should be assuring risk management, rather than doing the work. Having the right skills and capability to deliver the Programme
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Government response AI summary
The Treasury and NS&I acknowledge concerns about risk management and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
Read full response →
HM Treasury
18
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
NS&I had most of its operations contracted out when starting the Programme, and it had limited capability to deliver a digital transformation.46 NS&I told us it has found it difficult to recruit the additional skills and capability the Programme needs. It has made substantial use of consultants in the Programme, …
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NS&I had most of its operations contracted out when starting the Programme, and it had limited capability to deliver a digital transformation.46 NS&I told us it has found it difficult to recruit the additional skills and capability the Programme needs. It has made substantial use of consultants in the Programme, spending £43 million on advice.47 NS&I has found it particularly difficult to recruit technical roles, and is using secondments and temporary staff from other departments and the private sector, saying “it would not have made sense” to recruit into permanent roles.48 Since 2024, NS&I has added capability at senior levels, for example, by appointing a new commercial director, but it still relies on consultants to fill skills gaps.49
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Government response AI summary
The Treasury and NS&I acknowledge concerns about skills and capability and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
19
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
We pushed NS&I to tell us if it now had the skills and capability it needed. NS&I acknowledged that it had needed to bring in more capability, including in systems integration and at senior levels.50 It also, eventually, recognised that for a Programme “this big and complex, we will not …
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We pushed NS&I to tell us if it now had the skills and capability it needed. NS&I acknowledged that it had needed to bring in more capability, including in systems integration and at senior levels.50 It also, eventually, recognised that for a Programme “this big and complex, we will not have all the skills”. NS&I said it now has non-executive directors with private sector experience of digital transformation. The Treasury added that appointing non-executive directors (NEDs) was giving it more confidence that costs were being managed by NS&I.51 The Treasury also noted that as this was a complex programme, a systems integrator is “very necessary”.52 This had not been in place from the start, and we noted that not managing systems integration is the cause of problems on other programmes.53
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Government response AI summary
The Treasury and NS&I acknowledge concerns about skills and capability and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
Read full response →
HM Treasury
20
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
NS&I said it was now developing a plan for workforce management in a more structured way, but did not provide details.54 It had identified the need to transfer knowledge from consultants to permanent staff.55 Its recruitment 45 Q 63 46 C&AG’s Report, paras 8, 13 47 Q 67; C&AG’s Report, …
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NS&I said it was now developing a plan for workforce management in a more structured way, but did not provide details.54 It had identified the need to transfer knowledge from consultants to permanent staff.55 Its recruitment 45 Q 63 46 C&AG’s Report, paras 8, 13 47 Q 67; C&AG’s Report, para 3.10 48 Qq 67, 69 49 C&AG’s Report, paras 3.10 and 3.11 50 Qq 22, 35 51 Qq 37-38 52 Q 70 53 Q 73; C&AG’s Report, paras 15 and 21 54 Q 22 55 Q 36 13 increased the NS&I headcount from around 200 to over 350 people.56 This includes increasing its commercial team fourfold.57 It said this increase was temporary, and that its target was 270 people.58 NS&I tried to claim that the additional costs of these extra people were built into the budget, but we were sceptical of this given that NS&I’s latest cost estimate is from 2024.59 We noted that adding more skilled capability would increase costs; while NS&I initially claimed this was accounted for in its estimates, it later acknowledged that the longer timeframe would mean that costs would increase.60
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Government response AI summary
The Treasury and NS&I acknowledge concerns about workforce management and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
Read full response →
HM Treasury
21
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
NS&I will continue to rely on Atos, which suffered financial distress in 2024, until at least 2028. NS&I told us it now has a contract management framework to manage Atos and the contracts with new suppliers. NS&I will need to be much better at managing supplier contracts to maximise the …
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NS&I will continue to rely on Atos, which suffered financial distress in 2024, until at least 2028. NS&I told us it now has a contract management framework to manage Atos and the contracts with new suppliers. NS&I will need to be much better at managing supplier contracts to maximise the benefits of transformation.61 NS&I told us it now had an additional 75 to 80 people with technical skills from the system integrator.62 When asked how it was judging supplier performance, it said it was paying based on interim milestones, which were being met although it also knows that these will need to be reset in future.63 56 Qq 3, 22 57 Q 7 58 Qq 22-33 59 Qq 36, 79 60 Qq 23-24 61 C&AG’s Report, paras 11, 17 62 Q 22 63 Qq 23, 58-59 14 3 Governance Improving Programme governance and financial reporting
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Government response AI summary
The Treasury and NS&I acknowledge these concerns and are committed to addressing them through robust planning, risk management, and governance. NS&I is working to develop a comprehensive integrated plan that includes clear timelines, cost estimates, and resource allocation.
Read full response →
HM Treasury
22
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
NS&I has its own accounting officer and its own Board, and is responsible for the Programme, while the Treasury is NS&I’s sponsor in government and also has a role overseeing major programmes across government.64 The Treasury told us that it has to judge how it provides this oversight, operating an …
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NS&I has its own accounting officer and its own Board, and is responsible for the Programme, while the Treasury is NS&I’s sponsor in government and also has a role overseeing major programmes across government.64 The Treasury told us that it has to judge how it provides this oversight, operating an “earned autonomy model”, so that “If everything is going well, we will leave it more alone, and if not, we will intervene”.65
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Government response AI summary
The Treasury and NS&I acknowledge concerns about the Treasury's oversight role and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
23
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
The NAO found that the Treasury has increased its scrutiny of the Programme since 2024, and had instigated changes to governance, including appointing new NEDs.66 The Treasury noted that it has now moved to a “quite interventionist” approach, but agreed that this could have happened earlier.67 Although the Treasury knew …
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The NAO found that the Treasury has increased its scrutiny of the Programme since 2024, and had instigated changes to governance, including appointing new NEDs.66 The Treasury noted that it has now moved to a “quite interventionist” approach, but agreed that this could have happened earlier.67 Although the Treasury knew that the programme was already rated “red” in Infrastructure and Projects Authority’s 2022–23 annual report, it took until 2024 to get a grip on the programme and appoint new NEDs, a new chair of the transformation board and, in November 2025, asking Mr Goldstone to look at the programme.68
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Government response AI summary
The Treasury and NS&I acknowledge concerns about the timing of increased scrutiny of the Programme and commit to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury
24
Conclusion
67th Report - NS&I’s transformation pro…
Acknowledged
NS&I said its governance structures had evolved, and it would add more NEDs. It said these changes were improving delivery, but gave no substantive answer to how its governance would ensure problems did not happen again. It also acknowledged that there was still a lack of clarity over the role …
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NS&I said its governance structures had evolved, and it would add more NEDs. It said these changes were improving delivery, but gave no substantive answer to how its governance would ensure problems did not happen again. It also acknowledged that there was still a lack of clarity over the role of governance boards, and said it was again reviewing governance, as a result of the NAO report, to help the programme “deliver at pace”.69 NS&I said that it had only now started reporting programme costs to its transformation and audit committee, which was generating useful insight.70 NS&I said it now added 6 more people in its finance function, an increase of 20%.71 64 C&AG’s Report, para 2 65 Q 69 66 C&AG’s Report, paras 21, 3.18 67 Qq 69, 16 68 Q 16; Infrastructure and Projects Authority Annual Report 2022–23, July 2024 69 Qq 52-53 70 Q 18 71 Q 55 15
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Government response AI summary
The Treasury and NS&I acknowledge concerns about governance structures and are committed to addressing them through robust planning, risk management, and governance, including developing a comprehensive integrated plan and strengthening systems integration capabilities.
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HM Treasury