Department of Health tenders for £450m NHS electronic staff records service

The Department of Health (DH) has released an official tender for a new outsourcing provider to manage and enhance its NHS Electronic Staff Records (ESR) service.

DH had released a prior information notice in September revealing its plans to find a new supplier to provide the Oracle-based service, which is being run by healthcare IT provider McKesson until August 2015. The new contract is worth £250 million to £450 million over a five year and nine month period.

“DH wants to ensure the continuity of the ESR solution and related services following the expiry of the current contract,” said DH in a contract tender notice.

“To do so, DH wishes to re-procure the provision of the ESR service on the basis that the new service provider will be expected to transition the existing ESR solution from the current supplier and operate it and upgrade it.”

The system is based on Oracle’s E-Business Suite (EBS) solution, which was upgraded to EBS Release 12 in 2011.

The main services of the ESR include payroll, supporting pensions, core HR, recruitment, integrated identity management, finance, e-learning, manager and employee self service, data warehouse and management reporting.

The ‘enhancements’ that the DH is looking for include ensuring that the NHS has access to a robust and reliable HR and payroll solution and workforce management data beyond the end of the current contract. The new supplier will also be required to improve the user experience of the system, and to adopt a flexible, commercial model that enables the system to respond to ongoing changes.

According to McKesson, the ESR is the largest implementation of Oracle Human Resources Management System (HRMS) in the world, paying over 1.4 million NHS employees every month. The supplier was awarded the £325 million contract by DH in 2001.

The current contract is worth £70 million a year to McKesson, which completed the rollout of the system to 586 NHS organisations in April 2008 under the initial 10-year contract. DH extended the contract with McKesson in June 2005, bringing the total contract length to 12 years and nine months.

Copyright © 2013 IDG Communications, Inc.

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