DWP adds agile development into IT contracts for £2bn Universal Credit system

The Department for Work and Pensions (DWP) has modified contracts governing the supply of its £2bn Universal Credit system by adding clauses encouraging suppliers to use agile methods in its development.

The late modifications are an attempt to ensure suppliers abandon conventional systems development methods blamed for the failure of other large IT projects.

The clauses will incentivise large systems integrators to adopt agile methodologies that the DWP hopes will ensure completion of the Universal Credit system by its tight 2013 deadline. But the agile development community has criticised systems integrators for not being adept users of agile, while the big suppliers have warned DWP it may have to undergo more cultural change than it can manage to carry the move through.

Stephen Dover, head of major programmes at the DWP, told Computer Weekly the department concluded contract negotiations with suppliers bidding for its £275m Applications Development (ADEP) contract in March, but had since developed an agile addendum that "supports and incentivises service providers to act in an agile fashion".

DWP developed the addendum with the help of Susan Atkinson - a lawyer at Gallen Allience, who has developed what she claims is the world's first dedicated agile contract - Philip Black of Emergn, a US agile supplier employed on Universal Credit, and DLA Piper, the law firm contracted to advise DWP on IT contracts.

"[Susan Atkinson] and Philip Black from Emergn are giving us guidance into an addendum we can fly into our frameworks, which is obviously based on incentivising velocity and throughput," said Dover.

"The DWP has frameworks they contract [with] service providers BT, HP and Accenture. The frameworks are called ADEP. There are five lots but I can't tell you about the others because we've not finalised them," he said.

He refused to talk further on the matter. The DWP did not reply when asked later whether contractual addenda would ensure systems integrators employed agile techniques extensively enough when they started working on Universal Credit and whether partial contractual sureties would be enough to prevent the complex system development slipping behind schedule.

Atkinson was also unavailable for comment on the addendum. But speaking to Computer Weekly earlier about her model agile contract, she branded "ridiculous" those lawyers who insisted conventional contractual practices rendered agile unsuitable for government IT projects.

"I've been working with Emergn Corporation, which has been advising DWP to run the Universal Credit programme in an agile way," she said.

"I worked with Emergn on a model contract and I have since developed it and refined it. What we're saying is the traditional contract has had its day and doesn't work because the pace of change now is so fast that no-one can predict what's going to happen in a year's time."

Dover told a recent meeting of agile developers he had ordered Accenture and other of its framework suppliers to take more notice of agile methods.

He was trying to get them "really embracing it from the start" and "not going through an 18-month OJEU [Official Journal of the European Union procurement process] to get to the point of start - that's not agile," he said.

The ADEP contracts are being let as frameworks, and will be awarded when the Cabinet Office gave the go-ahead, probably by the summer, after 18 months of negotiations that have whittled down a shortlist of 70 suppliers, Dover told Computer Weekly.

Frameworks are more flexible than dedicated contracts. But doubts over the delivery schedule for Universal Credit emerged in April when Stephen Timms, Labour MP for East Ham, read from an Intellect report during the committee stage of the Welfare Reform Bill. The schedule could be met "if done properly using agile," said a group of critical suppliers, but the plan was "unrealistic".

The report, the Universal Credit Concept Viability Study, said British Airways now used agile methods in about a quarter of its projects, but that had taken a five-year cultural change programme it was still expanding.