EDS has filed a restraining order
against Transport Trading Limited, a Transport for London subsidiary,
to stop it handing the £100m-a-year Oyster contract to Cubic
Cubic and EDS were majority partners in TranSys, which ran London's Oyster scheme, reports the Register.
TfL was renegotiating the contract with both partners, but after
failing to get better terms from EDS it decided to hand the whole
project to Cubic.
The deal was meant to be signed at the same
time as the termination of TfL's contract with TranSys was announced on
8 August. But according to a Securities and Exchange Commission filing
by Cubic, EDS filed a temporary restraining order stopping TfL from
signing with Cubic.
The SEC document says that two rounds of
negotiations failed – one with TranSys and one with EDS and Cubic
separately. After this TfL decided to give Cubic the whole contract for
ticketing from 2010, when the deal with TranSys ends, to 2013.
A Transport for London spokesman said:
“EDS, one of the partners of the TranSys consortium, has sought to
challenge the procurement arrangements for the new contract. Transport
for London are vigorously defending this challenge and have appealed
against the interim court order. We remain committed to delivering
better value for money and to ensuring a seamless transition to any new
contract from 2010.”
The filing warned that Cubic revenues might
be hit in the short term by the restraining order but it expects it to
be lifted by the end of the year and most of the cash to be restored.
In separate news TfL said it will seek £1m
from the TranSys partnership for lost revenue caused by the two recent
failures of the Oyster card system across London.
And, In a Feb 08 settlement EDS agreed to pay £71.25m to HM Revenue & Customs (HMRC) due to problems with the tax-credit computer system it designed.
Difficulties with the scheme resulted in HMRC overpaying £6bn in tax credits during the three years after its introduction in 2003.
EDS agreed it would pay £26.5m of the settlement when it was awarded new contracts by the government, but a report by parliamentary spending watchdog the Public Accounts Committee (PAC) has found the IT services company has repaid “little” of this sum — because the government has awarded EDS less work than expected.
Richard Bacon MP, a member of PAC, said it would take EDS 106 years to repay the settlement at the current rate.
PAC chairman Edward Leigh MP warned that “HMRC must be prepared to return to the courts” to recoup the full amount from EDS if it is not repaid by the end of 2008.
So either TfL should tell EDS to get stuffed, or get the government to hit them with a windfall tax.
See EDS First quarter 2008 revenues of $5.37 billion … exceeded guidance
This is modern Britain, a corporatist society at work….move along, nothing to see here, just keep paying your taxes…
