NS&I to Break Up Atos Contracts in Cost-Cutting Drive
National Savings & Investments (NS&I), the UK government-owned bank, is planning to split its IT contracts, ending a long-standing relationship with Atos and aiming to reduce escalating costs. the move comes after a programme expected to cost £3 billion by 2030-31, a £1.3 billion increase from the 2020 business case, according to a report by the National Audit office (NAO) in November 2024.
For two decades, atos has been the primary IT provider for NS&I. The relationship began with a contract awarded in 2004, which was renewed in 2014 until 2021. This was then extended, without competitive tender, to 2024 and again to 2028.
In December 2023, Atos secured a £474.4 million contract (approximately $612 million) to modernize NS&I’s core banking engine and manage payment, reporting, and business-to-business services until March 31, 2028. NS&I initially sought a competitive tender for a new core banking system, but ultimately awarded the contract to Atos, citing the “interdependent leveraged technology and resources” of the existing platforms.
However, NS&I is now shifting strategy. The organization intends to divide the work currently handled by Atos into five separate contracts. This decision is driven by a desire to control running costs and foster competition.
According to a letter from NS&I CEO Jack Harkins to the Public Accounts Committee (PAC),NS&I is collaborating with Capgemini to complete an options analysis by the end of march 2026. Approval for the new plans is anticipated from HM Treasury by June 2026.
Sources:
* The Register: NS&I to ditch Atos, split IT contracts in cost-cutting drive
* The Register: NS&I core banking upgrade costs balloon by £1.3B
* The Register: Troubled French outsourcer Atos finds £474.4m NS&I gig
Worth a look