The PAC said the rural payments scheme had degenerated into an “appalling Whitehall fiasco”.
The rural payments programme – run by the Government Digital Service (GDS), the Department for Environment, Food and Rural Affairs (Defra) and the Rural Payments Agency (RPA) – aimed to use Gov.uk’s Verify, an online identity verification scheme, to process claims for European Union (EU) subsidy payments to farmers.
Following problems with the IT system after it went live in late 2014, the government was forced to withdraw the service in March 2015, leaving farmers having to fill out the forms in pen and ink, which led to delays in payment for farmers.
A PAC report into the programme found that GDS, which was there to help deliver the programme, ended up obstructing its delivery.
“GDS was created to help improve IT projects, but instead hindered delivery of this programme. In addition to delaying payments to farmers, programme costs have risen by 40% and penalties from the European Commission are likely to increase significantly,” the report said.
“GDS’s focus on developing a digital front end, to allow farmers to apply online, is not a requirement of the European Commission. Moreover, it was clearly inappropriate for a customer group with a lower average level of digital literacy than the general population, and with poor broadband coverage in many rural areas.”
Since 2012, the programme has had four different senior responsible officers (SROs), each changing the direction of the project and its priorities.
The PAC report said there had been a lack of clear and consistent priorities between GDS, Defra and RPA. This led to “disruption and delay at the outset and allowed shifts in direction and focus to occur each time there was a change of SRO”, it said.
“The Cabinet Office, through GDS, focused on trying to encourage digital innovation, reduce costs and develop learning across government. The parties’ differing objectives were never reconciled into a single set of priorities.”
A farmer and his software executive son give their views on the problems with the rural payments digital services.
Serious culture clash and dysfunctional leadership were at the core of the rural payments digital service problems, the Public Accounts Committee heard.
Embarrassing civil servants
Following a damning National Audit Office (NAO) report – which reported that "inappropriate behaviour" and too much focus on IT procurement led to rural payments programme costs spiralling to 40% over budget – those responsible for the programme faced a PAC hearing last year.
At the hearing, MPs critisised the rural payments digital service for failing to deliver the programme – and said it was like watching a "Greek tragedy" unfold.
It was frankly embarrassing to learn of senior and highly paid civil servants arguing to the detriment of hard-pressed farmers
Meg Hillier, Public Accounts Committee chair
GDS chief technology officer Liam Maxwell – who was the SRO for the programme between October 2014 and May 2015 – said the rifts were caused by a culture clash and differences between departments, with the programme team on one floor of the building and the rest of RPA staff somewhere else.
“They were culturally very different. People dressed differently. People used different methods of reporting, much more traditional ways of reporting of management information,” Maxwell told the PAC hearing.
Meg Hillier, chair of the PAC, called the programme an “appalling Whitehall fiasco”.
“It was frankly embarrassing to learn of senior and highly paid civil servants arguing to the detriment of hard-pressed farmers. Explanations such as, 'We worked on different floors' and, 'We dressed differently' are a slap in the face to them and a dismal excuse for failures that could severely hit the public purse,” she said.
“A fundamental part of setting up this programme should have been to establish a clear and robust vision of the final product, focused on the needs of farmers. For it to end up as a digital testing ground was wrong-headed.
“The enduring mental image is of managers – having seemingly lost sight of the purpose of the project – devoting their energies to a childish turf war instead.”
Lack of support from GDS
The rural payments programme became one of GDS’s digital exemplars in 2013, which led to several changes including the programme becoming one of the first large-scale projects to follow GDS’s guidelines for moving spend on large government IT projects away from single-supplier contracts, and to focus on using small to medium-sized enterprises (SMEs) in a multiple-contractor approach.
However, Defra had very limited experience and didn’t have the necessary skills in-house.
The PAC report said that, although it welcomed innovation, GDS did not “provide enough support to the department to help it adapt to and implement the changes required of it”.
“The Common Agricultural Policy Delivery Programme in the department was not as strong as in other departments where ‘digital exemplar’ projects had been introduced,” the report said.
“We welcome digital innovation but it must be introduced appropriately, taking into account the capability of the department concerned and its customers. In this case, GDS failed to take account of these considerations or provide adequate support.”
The report recommended that GDS should “comprehensively assess” the capabilities of departments to deliver any changes it imposes and ensure it supports those changes appropriately.
In a House of Commons debate earlier in 2016, MPs called for guarantees that the rural payments IT system will be able to cope with increased pressure and won’t fail again when farmers apply for their payments.
The MPs said farmers deserved better and Hillier said the department needed to rebuild trust with farmers.
“That starts with setting out exactly when it expects to pay them in future and we will be expecting the department to address this as a matter of urgency,” she said.
