UK tax collector plans £2B tech binge as legacy systems refuse to die
(2026/01/28)
- Reference: 1769595343
- News link: https://www.theregister.co.uk/2026/01/28/hmrc_tech_pipeline/
- Source link:
The UK's tax collector is budgeting to spend more than £2 billion on new tech deals in the next couple of years, including a contract set for AWS and another for Capgemini to be awarded without competition.
According to a spreadsheet of the procurement pipeline for this year and next, His Majesty's Revenue & Customs (HMRC) is starting with a data warehouse transformation program with a contract value estimated at £410 million.
The document says: "HMRC intends to procure a single contract to deliver the transformation of its Legacy Data Warehouses (LDWs), combining existing run and change services with the migration and decommissioning of LDW platforms." The planned procurement replaces no existing contract.
[1]
The legacy technology in question is most likely to be SAP ECC Business Warehouse, [2]according to an earlier framework order . [3]SAP is at the center of an ERP overhaul worth £246 million to the German vendor, which also won an award to upgrade the tax system technology in [4]an uncontested deal worth £275 million .
[5]
[6]
The second-largest tech deal in the offing is for AWS Public Cloud Compute, with a value earmarked at £350 million. It is to replace [7]an existing contract awarded to AWS for £350 million.
The third in terms of estimated value is "Digital Platforms Run and Change Products," which asks for IT services to support application services including legacy live services. HMRC estimates this procurement will be worth up to £306 million. The winner will replace the [8]current contract for "Award of Digital Platforms Run (Platforms and Products)," handed to Accenture in May 2024 for the same value.
[9]
There are four more procurements in the pipeline for more than £200 million in the next couple of years, including Mobility and Workplace services contract (support HMRC's devices including help desk for end users, £250 million), Digital Platforms Run and Change Platforms (IT services to support platform run applications for the Government Gateway, Multi-channel Digital Tax Platform, and Customer Insight Platform, £250 million), and Data Centre Services (£220 million).
[10]SAP scores £275M award from UK tax collector – sans competition
[11]UK tax collector falls short on digital efficiency, watchdog says
[12]Capgemini wins £107M HMRC extension – no competition needed
[13]UK tax collector puts half a billion on table for call center services
Lastly, there is the Legacy - Retained HMRC Services Contract worth £214 million. HMRC promises this will be a "direct award" and will replace Core Business Platform Support and Maintenance Services, which was [14]awarded to Capgemini for £214.5 million without prior publication of a call for competition. The French outsourcer later saw that deal [15]extended without competition for another £107 million.
The Register has asked HMRC if the "direct award" contract means it will once again go to Capgemini uncontested.
In 2024-25, HMRC spent £1.16 billion on IT and telecoms while collecting £858.9 billion in tax. In June's Spending Review, the government said departments would perform a Zero-Based Review (ZBR) of budgets, taking a "digital-first approach" and involving chief digital and information officers. The result was that HMRC received an additional £1.6 billion from 2026-27 to 2028-29 to "modernize and reform HMRC's IT and data infrastructure," according to the National Audit Office (NAO), the public spending watchdog.
In November 2025, the NAO reported that HMRC is taking longer to get off legacy systems than it expected and costs are higher than predicted. " [16]HMRC has not yet achieved the anticipated efficiencies from its digital services," it said. Taxpayers will hope its performance improves as it continues to plow billion of pounds of their money into new tech deals. ®
Get our [17]Tech Resources
[1] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[2] https://www.contractsfinder.service.gov.uk/Notice/Attachment/8a12d596-761b-45a2-af1e-e111935ff627
[3] https://www.theregister.com/2024/11/18/uk_tax_collector_awards_366/
[4] https://www.theregister.com/2026/01/22/sap_275_million_award_
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
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[7] https://www.contractsfinder.service.gov.uk/notice/a3696ada-e3d1-439a-bd47-bf59b6e89b8e
[8] https://www.contractsfinder.service.gov.uk/notice/7d8fb5da-2411-4b81-90aa-64ef7656626f
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://www.theregister.com/2026/01/22/sap_275_million_award_from/
[11] https://www.theregister.com/2025/11/07/uk_tax_collector_falls_short/
[12] https://www.theregister.com/2025/07/31/capgemini_hmrc_extension/
[13] https://www.theregister.com/2025/05/27/uk_tax_collector_puts_500m/
[14] https://www.find-tender.service.gov.uk/Notice/008052-2022
[15] https://www.find-tender.service.gov.uk/Notice/043503-2025
[16] https://www.theregister.com/2025/11/07/uk_tax_collector_falls_short/
[17] https://whitepapers.theregister.com/
According to a spreadsheet of the procurement pipeline for this year and next, His Majesty's Revenue & Customs (HMRC) is starting with a data warehouse transformation program with a contract value estimated at £410 million.
The document says: "HMRC intends to procure a single contract to deliver the transformation of its Legacy Data Warehouses (LDWs), combining existing run and change services with the migration and decommissioning of LDW platforms." The planned procurement replaces no existing contract.
[1]
The legacy technology in question is most likely to be SAP ECC Business Warehouse, [2]according to an earlier framework order . [3]SAP is at the center of an ERP overhaul worth £246 million to the German vendor, which also won an award to upgrade the tax system technology in [4]an uncontested deal worth £275 million .
[5]
[6]
The second-largest tech deal in the offing is for AWS Public Cloud Compute, with a value earmarked at £350 million. It is to replace [7]an existing contract awarded to AWS for £350 million.
The third in terms of estimated value is "Digital Platforms Run and Change Products," which asks for IT services to support application services including legacy live services. HMRC estimates this procurement will be worth up to £306 million. The winner will replace the [8]current contract for "Award of Digital Platforms Run (Platforms and Products)," handed to Accenture in May 2024 for the same value.
[9]
There are four more procurements in the pipeline for more than £200 million in the next couple of years, including Mobility and Workplace services contract (support HMRC's devices including help desk for end users, £250 million), Digital Platforms Run and Change Platforms (IT services to support platform run applications for the Government Gateway, Multi-channel Digital Tax Platform, and Customer Insight Platform, £250 million), and Data Centre Services (£220 million).
[10]SAP scores £275M award from UK tax collector – sans competition
[11]UK tax collector falls short on digital efficiency, watchdog says
[12]Capgemini wins £107M HMRC extension – no competition needed
[13]UK tax collector puts half a billion on table for call center services
Lastly, there is the Legacy - Retained HMRC Services Contract worth £214 million. HMRC promises this will be a "direct award" and will replace Core Business Platform Support and Maintenance Services, which was [14]awarded to Capgemini for £214.5 million without prior publication of a call for competition. The French outsourcer later saw that deal [15]extended without competition for another £107 million.
The Register has asked HMRC if the "direct award" contract means it will once again go to Capgemini uncontested.
In 2024-25, HMRC spent £1.16 billion on IT and telecoms while collecting £858.9 billion in tax. In June's Spending Review, the government said departments would perform a Zero-Based Review (ZBR) of budgets, taking a "digital-first approach" and involving chief digital and information officers. The result was that HMRC received an additional £1.6 billion from 2026-27 to 2028-29 to "modernize and reform HMRC's IT and data infrastructure," according to the National Audit Office (NAO), the public spending watchdog.
In November 2025, the NAO reported that HMRC is taking longer to get off legacy systems than it expected and costs are higher than predicted. " [16]HMRC has not yet achieved the anticipated efficiencies from its digital services," it said. Taxpayers will hope its performance improves as it continues to plow billion of pounds of their money into new tech deals. ®
Get our [17]Tech Resources
[1] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[2] https://www.contractsfinder.service.gov.uk/Notice/Attachment/8a12d596-761b-45a2-af1e-e111935ff627
[3] https://www.theregister.com/2024/11/18/uk_tax_collector_awards_366/
[4] https://www.theregister.com/2026/01/22/sap_275_million_award_
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[7] https://www.contractsfinder.service.gov.uk/notice/a3696ada-e3d1-439a-bd47-bf59b6e89b8e
[8] https://www.contractsfinder.service.gov.uk/notice/7d8fb5da-2411-4b81-90aa-64ef7656626f
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aXnsVxDWmm5mFOdf0fyIUQAAA4U&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://www.theregister.com/2026/01/22/sap_275_million_award_from/
[11] https://www.theregister.com/2025/11/07/uk_tax_collector_falls_short/
[12] https://www.theregister.com/2025/07/31/capgemini_hmrc_extension/
[13] https://www.theregister.com/2025/05/27/uk_tax_collector_puts_500m/
[14] https://www.find-tender.service.gov.uk/Notice/008052-2022
[15] https://www.find-tender.service.gov.uk/Notice/043503-2025
[16] https://www.theregister.com/2025/11/07/uk_tax_collector_falls_short/
[17] https://whitepapers.theregister.com/
HMRC staff are Capgem
Random as if !
I have noticed the staff being tuped out, or in to Capgemini for years from HMRC , so don't expect any groundbreaking stuff, just keeping the sausage factory going and introducing complexity like kubrenetes and docker to modified cots systems , not actually replacing anything, I see pega is still there and some outdated content management systems , yes id enshittify these pronto to ensure tenure.
AWS Compute?
So, they have a cloud computing requirement but have specified AWS? Surely that means only 1 supplier can provide it? Amazon? How is that allowed? I work in public sector and the rules are explicitly clear - we cannot specify specific brands!