Mumbai: India’s largest software services firm Tata Consultancy Services Ltd (TCS) is the only firm left in the fray for a contract to administer the UK’s new national pension scheme that is still in the works.
Other information technology (IT) service providers such as Arbejdsmarkedet Tillaegspension Group, Great-West Retirement Services (Europe) Ltd and Logica Ltd withdrew during the “competitive dialogue” phase of the bidding after they decided that the project was not commercially viable. While ATP and Logica had pulled out in October and November respectively, the latest to withdraw from bidding was Great-West, which pulled out on Monday.
Neither the pension administering authority nor TCS disclosed the exact size of the contract. But analysts say that this could be TCS’ largest win in the UK’s public sector to date. The deal could also help other Indian firms get a foothold in the UK, where the government is looking to cut costs by better use of IT and increased outsourcing.
The national pension scheme, which is being designed and implemented to augment the existing employer-provided schemes, is expected to benefit nearly six million British citizens, when it becomes fully operational.
“This is definitely positive news for TCS, which is more or less the only Indian IT service provider that has made any significant headway in the UK public sector,” said Ankur Rudra, IT analyst with UK-based investment advisory Noble Group Ltd, who tracks TCS. “And if they win this deal, it could be a banner deal for not only TCS but also other Indian service providers looking to make inroads in this sector in UK.”
Other notable deals TCS has won from the UK government agencies include a £150 million (Rs1,139 crore) contract from local government authority Cardiff Council, signed in November, and a £55 million deal with Child Maintenance and Enforcement Commission of the UK, signed in April.
Following Great-West’s exit on Monday, Tim Jones, the chief executive of Personal Accounts Delivery Authority (PADA)— which is in charge of appointing an IT service vendor to manage the pension scheme—said that he will work with TCS to finish the bid process.
“They (TCS) are an exceptionally strong bidder and we are making excellent progress, but we need to conclude the procurement process appropriately and evaluate their proposals,” Jones said.
Asked about when the deal is expected to be finalized, a PADA spokesperson said in an email response that the procurement process is “now in the final stage”. About the likelihood of TCS winning the contract, the spokesperson added: “We expect TCS to submit strong final proposals, but we obviously need to evaluate these against our evaluation criteria.”
The PADA spokesperson said that signing a contract with TCS is “not a foregone conclusion” but that “we have high expectations that an agreement can be reached”. “TCS has responded positively to all PADA’s requirements and are providing excellent evidence about how they intend to deliver these,” the spokesperson said.
A spokesperson for TCS’ UK operations said: “We are keen to continue working with PADA to develop our proposed solution for the personal accounts scheme. This project will help millions of people.”