The UK's state-backed savings bank has set out options for finishing its disastrous transformation program, including busting the current timeline.

In its response to a Parliamentary watchdog report that branded National Savings & Investments' (NS&I) long-running digital overhaul a £3 billion "full-spectrum disaster," the government said it would decide the future of the project in the second quarter of this year through a Full Business Case. The overhaul is already £1.3 billion over budget and four years late.

It will set out what it can achieve within the limits set out by HM Treasury in the 2025 Spending Review and also discuss options for extending the timelines beyond the March 2028 finish line and getting more funding.

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Last month, NS&I boss Dax Harkins [2]resigned after around 37,500 people faced delays in processing bonds belonging to deceased relatives, worth an estimated £476 million. He is being replaced by Sir Jim Harra, former chief executive of His Majesty's Revenue & Customs.

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NS&I began the business transformation program dubbed Project Rainbow in 2020, aiming to reduce the bank's running costs, make NS&I a self-service digital business, and replace its 20-year outsourcing deal with Atos by splitting the work into five separate contracts.

In 2014, the bank awarded Atos a new contract to run until 2021, then extended it until 2024 and again until 2028 without competition, [5]handing the French outsourcer another £474.4 million . The total cost of the program is expected to hit £3 billion by 2030-31, including its contract with Atos and other running costs. The total cost increase is set for £1.3 billion compared to the 2020 business case, the National Audit Office said in [6]November .

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In a transparency statement in January last year, Harkins said the direct award to Atos was made because "un-picking and re-integrating 25 years of complex IT infrastructure has been more challenging than originally envisaged."

[8]MPs brand NS&I's £3B IT overhaul a 'full-spectrum disaster'

[9]Troubled French outsourcer Atos finds pot of gold at the end of UK state bank Rainbow

[10]Bank's struggle to replace Atos threw system back to dark ages

[11]IBM wins National Savings & Investment bank tech and ops deal

In [12]a report in February [PDF], the Public Accounts Committee (PAC) said that recent work by NS&I's consultants suggests the program cannot be delivered by March 2028, when the Atos contract ends. "NS&I is still trying to complete the Program even earlier, with high-risk work on replacing the core banking engine still at an early stage. We are not convinced that even now NS&I has the realism needed for the Program, and we are not confident that NS&I will deliver the Program successfully," it said.

The PAC concluded that NS&I was overconfident, had no workable plan, and no idea of eventual cost. It recommended the bank should stop trying to compress work to deliver the program by March 2028 and instead provide a "realistic bottom-up integrated plan."

In its response, HM Treasury said NS&I was setting out a clear view on what was deliverable within its Spending Review settlement alongside two further options. One is to deliver the full scope of the program as quickly as possible, presumably with implications for its budget. The second option involves "delivering along an elongated delivery timeline and aiming to minimize any increase to the Spending Review settlement." The latter would presumably require further changes to the Atos contract, which is set to end in 2028. An NS&I spokesperson said it had an option to extend the contract until March 2029, when the Spending Review period ends. ®

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[2] https://www.bbc.co.uk/news/articles/c3w3eg4n9zwo

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[5] https://www.theregister.com/2025/03/07/troubled_french_outsourcer_atos_finds/

[6] https://www.theregister.com/2025/11/14/nsandi_nao_report/

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[8] https://www.theregister.com/2026/02/13/nsandi_pac_latest/

[9] https://www.theregister.com/2025/03/07/troubled_french_outsourcer_atos_finds/

[10] https://www.theregister.com/2024/03/07/nsandi_atos/

[11] https://www.theregister.com/2022/07/05/ibm_national_savings_investment/

[12] https://assets.publishing.service.gov.uk/media/69cd35d6837d4b59e502d0d3/E03580127_CP_1522_Treasury_Minutes_62-67_web.pdf

[13] https://whitepapers.theregister.com/