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BIRD & BIRD
Our Ref: ‘90 Fetter Lane
London EC4A 1°
Your Ref:
MEMORANDUM
Legally Privileged and Confidential ox
119 London
Web Page
TO: Peter Mathison, BA ‘ror iwoicds.com
ce: Rod Clark, DSS ene
Ken Davenport, BA GECamp>
Vince Gaskell, BA Pace
Sarah Graham, DSS RN Stot
Stephen Hickey, DSS Ps Cheisie
Craig Lewis, DSS Sw smoot
Marilynne Morgan, DSS C1 Smoth
Ron Powell, DSS FRE Walhey
D ker
M Macdonsii
FROM: Hamish Sandison, Bird & Bird Te ONC Stone
CW Rees
DATE: 25 May 1999 HER Sandivon
OH Aves
RE: DSS/POCL/ICL AGREEMENTS mcrae
5K Topping
TE G Tether
#1 € Pearton
VSACrook
1. Lattach for your information - and for recipients of this note - a copy of the ee
Agreements you signed yesterday. These are: See
1M Gyogett
i R Haftke
G Powel
(1) The letter agreement with ICL cancelling the Benefit Payment Card; A 1 eodenon
HJ Robin
(2) The letter agreement with POCL consenting to the first agreement. IW Baker
FA Reeve
2. If you or copy recipients have any questions about these documents, please do se hs
PC Dally
not hesitate to get in touch. BH Buterwonh
NSP Bland
BW Faween
1 Hodes?
3. 1am holding the signed originals here for safe-keeping; but if you would like : ae
me to return them to you or anyone else within the DSS/BA, please let me know. Consultants
TC Ame
Ort N Walder
K AB\BPOCL\001\MEMO\MATHISON NR”
IsvesTORIN PEOPLE Hong Kong 20/F Printing House, 18 Ice House Street, Central, Rong Kong Telephor 9 Bevsels and Pais
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DEPARTMENT OF SOCIAL SECURITY
Richmond House, 79 Whitehall, London SW1A 2NS
Telephone! _ !
Strictly Private and Confidential
24 May 1999
Keith Todd
Chief Executive
ICL ple
26 Finsbury Square
London
EC2A 1DS
Dear Mr Todd,
POCL, ICL Pathway, ICL and DSS have been negotiating, with the assistance of HM
Treasury, the withdrawal of DSS from further involvement in the Project and certain material
amendments to the existing contracts between POCL and ICL Pathway. Asa result of these
negotiations, DSS and ICL have agreed that DSS will withdraw from further involvement in
the Project on the basis that the claims of each party against the others will be settled on the
following terms:
1. Subject to the transitional arrangements substantially set out in the Schedule to this
letter (the “Transitional Arrangements”), the DSS Agreement is hereby terminated
(thereby cancelling the Benefit Payment Card-related Services) and ICL Pathway and
DSS release all obligations and waive all rights they have in respect of each other
under the DSS Agreement, save that provisions in the DSS Agreement stipulated to
survive in the event of termination or expiry shall continue in full force and effect.
ICL Pathway agrees to assist with the transitional arrangements. The DSS shall pay
ICL Pathway for such assistance, at its option to be irrevocably exercised within 14
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DEPARTMENT OF SOCIAL SECURITY
days from the date hereof, either:
(a) ICL Pathway’s auditable time and material charges (as set out in paragraph
20.1 of Schedule A6 of the Authorities’ Agreement which shall be expanded
to include ICL Pathway’s rates for senior management and consultants and to
clarify that all ICL Pathway’s reasonable expenses connected to the
Transitional Arrangements may be recovered); or
(b) a fixed price of £10 million, which shall not be audited;
provided that the transition is carried out as speedily as reasonably practicable but in
no event longer than 8 weeks and payment is made within thirty (30) days of receipt
of invoice following the completion of the Transitional Arrangements. The parties
shall co-operate in good faith with each other, and with POCL, to give effect to the
principles set out in the Schedule to this letter.
DSS withdraws from the Authorities’ Agreement with immediate effect. ICL
Pathway and DSS release all obligations and waive all rights they have in respect of
each other under the Authorities’ Agreement, save that provisions in the Authorities’
Agreement stipulated to survive in the event of such withdrawal shall continue in full
force and effect. Where any Related Agreement requires that the consent, approval or
agreement of DSS is obtained (whether in respect of a change or any other matter
whatsoever) that requirement shall cease and be of no effect as from the date of this
letter.
The terms of this letter shall be in full and final settlement of all claims and
counterclaims which any of DSS, ICL and ICL Pathway (in this paragraph the
“Parties”) may have against any other of them under or in connection with the Related
Agreements arising from or in connection with acts or events which occurred or
should have occurred, or statements that were made on or prior to the date of this
letter (whether or not such have been made the subject of a claim or counterclaim at
the date hereof). Each of the Parties hereby waives any rights whatsoever which it
might have against any other Party arising from or in connection with such acts,
events or statements.
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DEPARTMENT OF SOCIAL SECURITY
Richmond House, 79 Whi
Telephone!
Each party agrees to keep confidential and not to disclose to anyone else the existence
or the terms of this letter or the negotiations relating thereto (together “Confidential
Information”). Notwithstanding the foregoing, any party may disclose Confidential
Information:
(a) __ ifand to the extent required by law;
(b) _ ifand to the extent that the other parties have given prior written consent to
this disclosure;
(c) _ to its professional advisers;
(d) to HM Government, the National Audit Office or Parliamentary Committees;
(©) _ ifand to the extent that the Confidential Information is in the public domain or
falls into the public domain without breach of any applicable confidentiality
obligation (including this paragraph);
() ~~ to POCL;
(g) _ to Fujitsu;
(h) to potential arrangers of funding for the Project; or
@ if and to the extent necessary to be disclosed for the purpose of arranging and
maintaining funding generally for ICL and/or ICL Pathway.
In the event that Confidential Information is disclosed by any party to its professional
advisers, that party shall procure that its professional advisers comply with the
restrictions contained in this paragraph, mutatis mutandis.
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DEPARTMENT OF SOCIAL SECURITY
Richmond House, 79 Whitehall, London SW1A 2NS
Words and expressions defined in the Related Agreements shall have the same meanings
when used in this letter.
Yours sincerely
Signed for and on behalf of the
By:
Name:
Title:
Date:
By:
Name:
Title:
Date:
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WITHOUT PREJUDICE & SUBJECT TO CONTRACT
NO BNA p,
oo ving
“
es " Yeueaurce "
MEMORANDUM
To: Bruce MeNiven From: Vince Gaskell
Tony Oppenheim Project Director
Copy: Sarah Graham
Hamish Sanderson
Ron Powell
CCPB Members
CAPS PET
Date: 11 May 1999
Issues Removal of Child Benefit Customers from Benefit Card Payment
Timing: Immediate
Action: For Response
Further to discussions last week regarding the removal of Child Benefit Customers from
Benefit Card Payment, I undertook to provide you with some further details on the CAPS
view of how this might be performed.
In order to successfully remove all customers from Benefit Card Payment, ensure continuity
of benefit payment and avoid adverse publicity full co-operation would be required from
ICL Pathway, POCL and DSS, In order to be fully prepared, should a decision be taken to
remove customers from card payment, we would recommend that early meetings are held
with all three parties to:
understand the overall framework for the removal of customers;
develop and agree the detailed processes which need to be undertaken;
develop and agree a testing and implementation plan, which would be used to
remove customers from card.
Attachment J provides a high level framework which indicates the key business processes
that we understand would be involved in the removal of customers from card. The
framework focuses primarily on those activities which we have identified as necessary to
effect removal. Further work will be required by all three parties to develop the detailed
activities which need to occur and to ensure that we have a co-ordinated communications
approach across the programme.
sr/er Page 1
10 May 1999
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WITHOUT PREJUDICE & SUBJECT TO CONTRACT
Attachment 2 is an indicative plan highlighting the key business Process steps which we
understand would nced to be undertaken. The plan assumes that the approach we adopt
would:
Notify customers in advance that they arc about to experience a change in their
Method of Payment. They should not find out about the change by being unable to
use their Benefit Payment Card;
Not disrupt benefit payment to customers;
Be rehearsed in an agreed manner in advance, to prove the removal of customers,
I would appreciate it if you could let me know by tomorrow who we should be talking to to
start working up the framework we have provided into more detailed business processes and
adding any issues you have identified as necessary. I would hope that a meeting could be
organised between those people on Thursday of this week or earlier if possible,
VINCE GASKELL
ROOM B2506D
LONGBENTON
GRO I
srisr Page 2
10 May 1999
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' Attachment I — Framework Process for the Removal of Child Benefit Customers from Benefit
Payment Card
following process is an indicative framework for the removal of Child Benefit Customers from Benefit
Payment Card. The framework is intended as input to more detailed disoussions with Horizon and ICL
Pathway which would define the more detailed processes which would be required to underpin the
approach.
1 Framework
The framework consist of the following key steps:
Lt Horizon, Pathway and the DSS would all agree to the removal of customers from benefit payment
card,
12 Horizon, Pathway and the DSS would be responsible for communicating this decision within their
own organisations and for agreeing communications to wider audiences,
13 On a date to be agreed, the Child Benefit system would invoke their business continuity switch.
This switch would prevent new customers from being paid by benefit payment card. In addition, it
would also result in renewal payments becoming subject to a change of method of Payment (MOP)
at the point of renewal,
1.4 The Child Benefit Contingency scan would be invoked to identify customers who are currently
being paid by card, These details will be used to write to customers.
1.5 Child Benefit Centre staff would write to all customers in receipt of card payment to notify them
that their MOP will be changing. The date at which payment by card will become unavailable will
be notified to the customer. This is known as the ‘stop safe date’. If customers do not encash their
payments before this date, then card payment will not be possible and payment will subsequently
be made by order book,
1.6 Child Benefit staff would alter the MOP from the ‘stop safe date’ to order book using a series of
dialogues.
17 After an agreed period of time, a scan would be run of CPCS, This is known as the intermediate
sean, The scan will identify all card customers who have outstanding/uncollected card payments
and output details of such customers and the payments involved to Child Benefit Centre,
1.8 Reminder letters would be sent to those customers identified by the intermediate scan, The
reminder letters would be produced by Child Benefit Centre and sent out.
19 At an agreed date, CAPS and Pathway would stop sending and receiving files. At the same time,
the Post Office would be required to prevent all further encashments by card from being made.
1.10 A second scan of the CPCS (the Final Scan) would then be run to identify card customers with
outstanding/uncollected payments. This scan would :
Identify al! outstanding card payments
Amend the status to expired
Issue a schedule detailing the outstanding card payments
Ensure that PACS and FCS are notified that the card payment has not been encashed
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Assumptions
CAPS, Pathway and Horizon will work together to build up a more detailed assessment of the
underlying business processes, Business processes to consider would include card replacement,
change of circumstances and new claims processing during the period of customer temoval.
The process of removing customers from card will be rehearsed, as appropriate, prior to
implementation in the live environment. All three parties will be involved in the rehearsals to
ensure continuity of benefit provision.
ICL Pathway continue to run their systems during the period of customer removal, and for a short
period after the removal of customers to effect final reconciliation.
The period of removal of customers from card is less than 91 days. If the poriod is greater than 9}
days, then some of the activitics in the framework may become redundant,
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Attachment 2
Activity (Framework steps used) Weeki Week2 Week3 Week Week5S Week6 Week7 Week8
Completion of Testing/Rehearsals
Agree and communicate decision (step 1.1 and 1.2)
Invoke CHB Contingency Switch (step 1.3}
Run Contingency Scan (step 1.4)
Send Letters to Customers (step 15)
Change MOP from Safe Date (step 1.6)
Scan for Overdue payments (step 1.7} He
(Intermediate Scan)
Send reminders to Customers (step 1.8) PTE]
Close down processing (step 1.9) A
Run Final Scans (step 1.10) i
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DEPARTMENT OF SOCIAL SECURITY
24 May 1999
Stuart Sweetman
Post Office Counters Limited
King Edward Building
King Edward Street
LONDON
EC1 JAA
Dew Abroact
“CONTRACT B”
In order to enable the DSS to sign its settlement letter with ICL Pathway and ICL plc as part of
the overall Ministerially sanctioned settlement between ICL and the public sector parties, I am
writing pursuant to paragraph 3.1.1 of Schedule 18 of Contract B to seek the consent of POCL
to the termination of the DSS Agreement between the DSS and ICL Pathway. In addition, Iam
requesting your acknowledgement for the avoidance of doubt that POCL consents to the
withdrawal of the DSS from the Authorities’ Agreement between the DSS, POCL and ICL
Pathway Limited.
Yours sincerely
Signed for and.on behalf of the Secretary. of State for Social Security
GRO I
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