Source · Select Committees · Public Accounts Committee
Recommendation 2
2
Accepted
Ensure PwC delivers full loan system functionality by September 2025 and prepare for contract end.
Conclusion
The Department’s management of its contract with PwC has been poor. The Department originally appointed PwC to advise on options for the management of its loans. After PwC identified the need for a managed service provider, the Department appointed PwC to this position after a competition, with a contract running to March 2025. The Department subsequently expanded PwC’s brief to include the delivery of an integrated loan management system, paying an extra £900,000 for this. However, the system was delivered in June 2024, 15 months later than originally planned. It also did not provide full functionality required, with loan agents having to maintain their own spreadsheets that the system was meant to replace. 4 The Department has had to enter into another contract with PwC and pay an extra £300,000 to get the additional functionality required. It expects this to be in place by September 2025 at the latest. recommendation The Department should ensure that PwC delivers the full additional functionality required to the loan management system before September 2025 at the very latest and for no more than £300,000, and should begin preparations now for the approaching end of PwC’s original contract.
Government Response Summary
The government states that PwC delivered the full additional functionality for the loan management system in March 2025 for under £300,000. They have extended PwC's original contract for a year for business continuity and a strategic review will inform the future requirement for a Managed Service Provider, with re-tendering planned if needed.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. the department, was implemented in March 2025 for under £300,000 and in line with the committed plan. The original PwC contract, which expired in March 2025, has been extended for a further year, as permitted through the original tender, to preserve business continuity and ensure appropriate support remains in place for LMS V2 functionality. The strategic review of the loan book (referenced in 1.5) will inform the requirement for a Managed Service Provider. If the role is to be retained, the Managed Service Provider contract will be re-tendered in line with appropriate government procurement guidelines and with an expectation that no further variations of the current PwC contract will be required.