Royal Mail strikes GBP1.5 billion computer deal

The Royal Mail today signed a #1.5 billion contract to outsource computer work to private companies in a move aimed at saving the postal group #250 million over the next 10 years.

More than 1,700 Royal Mail information technology staff will transfer to Computer Sciences Corporation (CSC), BT and Xansa, which will be responsible for running data centres, desktop computers and hundreds of business application systems.

Adam Crozier, Royal Mail Chief Executive, said: “This is a great deal for Royal Mail and a great deal for our people. It is a vital component in our renewal plans in terms of reducing costs and giving us the information technology services that we need to make Royal Mail a great company.”

Mr Crozier said that the CSC-led so-called Prism Alliance was a powerful combination of three world class companies.

“In one leap we will have access to the levels of advanced technology we need to compete successfully and improve our services to customers.”

Mr Crozier said the Royal Mail had worked hard to ensure workers were “taken care of” when they transfer to CSC, which will take on 1,470 ex-Royal Mail employees, Xansa (220) and BT (45).

“As well as the statutory transfer regulations (TUPE), which protect staff interests, we have negotiated additional guarantees on job security and pension arrangements.

“The outsourcing also opens up fresh career opportunities for our people within companies that are global players.”

The contract is one of the biggest information technology deals ever signed in the UK.