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Post Office Business Review
Business Area: Post Office
Presenter: Gavin Bell
Date:18 June 2012
FUJITSU CONFIDENTIAL © Copyright 2011 Fujitsu Services Limited
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Content FUJITSU
@ Executive Summary
& Detail Slides
@ Q1/Q2 / FY Pipeline and Deals
@ Wins & Losses
@ Strategic Account Growth (including ABP Actions)
™ People
@ “Asks” - Support Required
@ ERM Risk
™ Dependencies
™ Corporate Social Responsibility
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Executive Summary FUJITSU
™ Customer activity
® Focus on Towers model and Framework procurements
= Board to board set up for September
= CSIP plan agreed
® Trip to Japan put on hold while Shadow being discussed
= Q1 Outcome/ Q2 /FY12 outlook??
® Q1 —HPBB completes numbers
® Q2- dependent on two initiatives DVLA and extended hours
®@ FY12 dependent on either MVNO or Shadow closing
m™ Engagement with Service line
®& Monthly opportunity reviews scheduled.
@ Market Outlook
® Significant effort being expended on Frameworks which do not deliver income in year
unless POL choose to use them.
® Towers model procurement does not deliver order until 2013
FUJITSU CONFIDENTIAL. 2 © Copyright 2011 Fujitsu Services Limited
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30,60, 90 Day Plan — Customer FUJITSU
Popeeees ecesaros MANAG 28 ccs cosa nee I 80. I et) al. I, cit od
D Group
Gavin Bell, Simon Blagden, met Alice Perkins at “Should we and could we re-invent the
Post Office” Event
Duncan Tait, Rod Vawdrey lunch with Alice Perkins (Chair of POL) and Paula Vennells
MD POL
Board to Board to be set up post HPBB signature — Dates being finalised a GB
CSIP action plan to be agreed with customer - Agreed ee GB/MA
Lesley Sewell to visit Bracknell for reconciliations team and other support teams on 2°4 GB/MA
August
iPublication TG
This will be sent to Lesley Sewell (Head of IT and Change), Neil Lecky-Thompson (Head
of Programmes and Planning) and Dave Hulbert (Senior Service Delivery Manager; IT
and Telephony)
Wimbledon and Olypics invtes for POL Exec A GB/TG
‘Fit to Change’ EDE (28" June) GB/TG
Paula Vennells, Chris Day and Lesley Sewell will be invited
Fujitsu Forum in Tokyo (17 & 18" May) GB/ JD
Now changed to bespoke tour at the end of July for Martin Moran, Chiris Day, Lesley
Sewell
National Federation of Sub Postmasters (21° — 23" May) LM/TG
Fujitsu will be exhibiting at the conference with a stand, manned by subject matter
experts complete
3 Day Event in Solihull for Crown Branch Managers LM/TG
A number of scenarios will be explored that cause branches pain and prevent them from
operating as efficiently as they could.
Horizon Service Desk Open Day for Postmasters LM/TG
Explore ways in which customer service can be improved.
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TCV/ Pipeline
June Update
FUJITSU CONFIDENTIAL © Copyright 2011 Fujitsu Services Limited
Q1 TCV Update/ Closing Actio
Target
Ns
Forecast Q2RF £0.06m
Booked £0.06m
IAS 11 booked
IAS 11 forcast
Balance to book
Total pipeline
of which is BCD
of which is Commit
May
£53.40m
£179.00m £0.79m £180.39m
£342.04m
£0.448m £0.940
£2.48
£-163.04m
£1,139m
- £0.839m £0.839m
£0.300m £0.300m
Q1 Deals to close to reach target
Deal Name
Salesforce Cloud
Branch Managed Switch
IAS11 BMS and Cl
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Tcvem I Close
Date
Stuart Finnes
Gavin Bell
£0.3m
Gavin Bell/Pete £3.48
Newsome
£0.339m 15/07
12012
30/06
12012
30/06
12
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Q2 TCV Update/ Key Deals FUITSU
Target
Forecast Q2RF
Booked
Balance to book
Total pipeline £17.050m
of which is BCD - £15,150m £15.150m
of which is Commit
£0.250m £0.250m
Pipeline vs Target
Q2 key Deals to close to reach target TCV £m Close
Deal Name Date
Mails leading to project Bentley Pete Newsome £0.150m
DWP Pete Newsome £0.500m
Extended Hours short term Tower Leads £4m
SAP upgrade to ECC6 Stuart Finnes £1.5m 30/07
Test Rigs Pete Thompson £1.7m 30/09
DVLA Stuart Finnes £15m 30/08
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Q2 Deals — top 20 Pipeline
Sector Subsector
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Private Post Office
Grand Totals (11 records)
Account Name
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Post Office Ltd
Opportunity Name
PO - Front Office Services for DVLA
SAP Upgrade to ECC6
Churn Q2 2012
Smart Metering Tactical
Churn Q2 2012 - BCD
Fraud and Error (HMRC)
POL IT Products (Hardware and Software) - Framework
RMG IT Consulting - Technical Delivery Lot
POL IT Solutions - Framework
Local Collect
IAS 11 Channel Integration Phase 1
Forecast
Category
Best Can Do
Pipeline
Commit
Pipeline
Best Can Do
Pipeline
Pipeline
Pipeline
Pipeline
Pipeline
Commit
TCV k's (converted)
GBP 15,000
GBP 1,500
GBP 250
GBP 150
GBP 150
GBP O
GBPO
GBPO
GBPO
GBPO
GBPO
Contract Signature
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Date 2PPortunity Owner
21/09/2012Stuart Finnes
30/07/2012Stuart Finnes
30/09/2012Pete Newsome
30/09/2012Pete Newsome
30/09/2012Pete Newsome
30/09/2012Gavin Bell
18/07/2012Allan Ross
02/07/2012Peter Jolley
05/07/2012Stuart Finnes
30/09/2012Pete Newsome
30/09/2012Pete Newsome
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H2 FY12 — Top 20 Pipeline FUJITSU
Sector Subsector Account Name Opportunity Name Tere TCV k's (converted) Politics Slenat Orb or anny
Category DateOwner
PrivatePost Office Post Office Ltd MVNO Pipeline GBP 140,000 31/01/2013Paul Grogan
PrivatePost Office Post Office Ltd Shadow Proposition Commit GBP 100,000 31/12/2012Stephen Long
PrivatePost Office Post Office Ltd RPI uplift on backlog 2 years remaining on contract Commit GBP 2,190 30/03/2013Hazel Taylor
PrivatePost Office Post Office Ltd Assisted Digital Self Service Kiosks for Government Pipeline GBP 2,000 31/12/2012Gavin Bell
PrivatePost Office Post Office Ltd SAP Financial Separation Pipeline GBP 1,800 30/10/2012Stuart Finnes
PrivatePost Office Singapore Post VME Managed Service Pipeline GBP 1,700 15/03/2013Colin Colclough
PrivatePost Office Post Office Ltd SAP HR Migration Pipeline GBP 1,500 31/12/2012Stuart Finnes
PrivatePost Office Post Office Ltd Non IAS 11 Branch Managed Switch 2 Commit GBP 1,400 31/12/2012Pete Newsome
PrivatePost Office Post Office Ltd Salesforce Cloud 2 Best Can Do GBP 500 30/11/2012Stuart Finnes
PrivatePost Office Post Office Ltd Non IAS 11 Channel Integration Phase 2 Commit GBP 500 30/12/2012Pete Newsome
PrivatePost Office Post Office Ltd Churn Q3 2012 Commit GBP 300 31/12/2012Pete Newsome
PrivatePost Office Post Office Ltd Branch Changes (OBC for Network Transformation) Best Can Do GBP 200 31/10/2012Pete Newsome
PrivatePost Office Post Office Ltd Churn Q3 2012 - BCD Best Can Do GBP 150 31/12/2012Pete Newsome
PrivatePost Office Post Office Ltd IAS 11 Mails Commit GBP O 31/12/2012Pete Newsome
PrivatePost Office Post Office Ltd IAS 11 GWS DWP Commit GBP O 31/12/2012Pete Newsome
PrivatePost Office Post Office Ltd Test Rigs IAS 11 Commit GBP O 30/12/2012Pete Newsome
Grand Totals (16 records) : i t :
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Full Year: Pipeline by Forecast Cat
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Full Year: Pipeline — Strategic/Key Acco
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PSD-100299-001297 Post Office Post Office Ltd HP&BB Danny Maclean GBP 342,000 14/05/20122012-Q1 New
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PSD-100299-008322 Post Office Post Office Ltd POL IT Consulting Services - Framework Peter Jolley GBP 2,000 10/05/20122012-Q1 Framework
PSD-100299-001692 Post Office Post Office Ltd Loss Prevention - IntelliQ Stuart Finnes GBP 1,500 30/06/20122012-Q1 New
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Strategic Accounts Growth
Actions
June Update
FUJITSU CONFIDENTIAL
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Strategic Account Growth (including ABP Actions)ujirsu
Post Office
Key Task Description Metric Responsible Target June
Party Date RAG
Post Office Growth Plan Strategic Accounts and New Business Stephen Long Progress Comments
Post Office Gavin B.
HPBB - Danny M
fon up from £179 to £342m
Shadow Gavin B. Customer not sure how to procure and
lengagement challenged due to trust re
above.
DVLA Stuart Finess Complete dependency on POL with DVLA
and then procuring through us and existing
contract challenge vs pushing through
ramework and competing.
Stuart Finess. I IEngaging with customer and shaping what
ay be a competitive tender. Customer not
firm on SAP vs other products
Paul Grogan ngaging with customer on a coached
jbasis.
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People
June Update
FUJITSU CONFIDENTIAL © Copyright 2011 Fujitsu Services Limited
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People FUJITSU
m™ Headcount and Recruitment
I
Transition to new organisation Issues
xe
= Flight Risk 5 ‘0 yd?
a Learnin and Development
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30,60, 90 Day Plan — People
Enhance & Publish POA Account Communication Framework
Create & Publish POA Organisation Charts (Lines of Service)
Complete Appraisal Process (inc. Personal Development Plan)
Complete & Submit a Succession Plan POA Leadership Team
Complete & Submit the Opportunity Matrix Review
Create & Publish Skills Matrix and Identify Resource all ‘Gaps’
Create & Publish Training Plan to highlight needs/close ‘Gaps’
Implement Plan to close ‘Gaps’ in terms of skills & Knowledge
Clarify, Align & Publish Global / Local Roles & Responsibilities
Utilise all Existing Mechanisms for Recognising & Rewarding
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Bus Management
Bus Management
Functional Leads
Functional Leads
Functional Leads
Bus Management
Bus Management
Functional Leads
Functional Leads
Functional Leads
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“Asks” - Support Required FUJITSU
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ERM Risk
June Update
FUJITSU CONFIDENTIAL © Copyright 2011 Fujitsu Services Limited
Post Office Account Enterprise Risks - May 2012
Area of Owner
Description of Risk of Risk
Containment
Fallback
Prob
ability
Impact
Code
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RAG
(Last
Period)
Max
Business I Proximity
Impact ofRisk RAG
HSD Benchmarking
I HSD Benchmarking Results
Comm/Leg
al
Tim
Healey
IThe potential loss of revenues and
Margin as a result of the Gartner
benchmark result showing our pricing to
be approx £600k pa above market price.
I Key skill-sets.
HRiSkills/I Protection of key skill sets and legacy
TUPE I knowledge.
James
Davidson
Next Review May 2012.
I Limitation of hosting New Business
hosting out IRE11, IRE19. Peter
Thompso
n
Comm/Leg
al
25.05.12 YS Following update from TH:
POL have made an interim agreement to
continue the existing senice levels
which are above the contracted levels for
a reduction of charges of c £400k pa
and will confirm whether this will be the
final arrangement or whether they will
Tequest the lower sence levels as per
the contract by end September. Delivery
have already taken action to reduce
costs.
TBC
09.05.12 YS Following update with
James Davidson: Graham Welsh, Dave
Court and Doug Johnson are working on
a plan to restructure AMO and create a
plan for key skills retention. End of
June for approach and outline plans.
03.01.12 YS Following update with
James Davidson: To be addressed as
part of skills review with Senice Lines inI
Q1 2012.
I
I Tec
12.04.12 YS Following update from PT:
The intention is to align the leases for
IRE11 and 19 - with December 2018 as
the end date.
15.03.12 YS Following update from PT: I
extension to IRE19 imminent.
Probability and impact reduced.
Altemative Data Centres will be used
I resulting in increased hosting costs
I owing to providing connectivity/real time
teplication to IRE11&19 for the duration
I of Horizon Contract.
50
High
400
25
High
Unquantifia
ble
25
High
TBC
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Post Office Account Enterprise Risks — May 2012 FUJITSU
Max RAG
Prob Impact I Business I Proximity (Last
Description of Risk Containment Fallback Code Impact I ofRisk I RAG _ Period)
(09.05.12 Following update from PT: I T Te
Risk 733 covering the HSD requirement I I py a
for extended hours is in POA Risk I Dee I
Register. The HSD exposure has been I I
contained by sub-contracting the I I
I
I ‘extended hours requirement to another I I
I I supplier. I
Extended branch opening hours from
27th July. Bete I
IThompsoI 3 options have been submitted to POL. 25
Service I
Ss I I for extended hours. Each option has a
New Risk raised in the ELT on 16.04.12.I I oe ct ek ute: When BOL chotes
I I an option the relevant profile will be
I I I applicable, reviewed updated and
managed.
Meeting to analyse risk to take place on
01.05.12.
24.05.12 YS Following update from TH: I Hi
No benchmarking currently in progress 05.09.11 YS Following review with TH:
I and it appears that POL do not have an ICompetitive tendering process may be
I immediate appetite to initiate the adopted if FJ thinks that methodology 40
IOngoing Benchmarking per the I I process for another tower yet. To be _used is disadvantageous.
contractual obligation to contract end dateITim I discussed with POL at the SCR
Iof 31 March 2015. [Healey I _meeting of 31st May. Absorb the potential price reduction.
ie
Comm/teg O"-99ng Benchmarking
al
23.05.12 YS Following update from PT: I
‘The auditor is due to revisit 31/5 for a
review of recently applied patches ,
there is a full deployment plan in place I
following meetings held with
architects/CISO and release
management this last week.
Probability reduced.
Patching for PCI Platforms.
We may fail the PCI audits and also
Intemet platforms may be vulnerable
(e.g. PODG on ).
12.04.12 YS Following update from PT:
Amit I The consensus is that the risk can be
‘Apte I downgraded to an amber rating given
that the auditor found that our patching I I
‘strategy at the recent PCI audit met the I I
required standard. Once in receipt of I
the formal report this risk can be I I I
Technical
New Risk ELT 05.12.11
I downgraded green risk which needs to
I be reviewed again in Sept 12 , ahead of
this financial year’s PCI audit.
Commercial need to provide a statement I
ifthis is a Fujitsu or Post Office liability. I Manna
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Post Office Account Enterprise Risks May 2012
Description of Risk
Horizon on-line.
Challenges to the integrity of the
Technical 3:
Horizon on-line.
James
Davidson
Containment
22.05.12 YS Following update from JD: I
Following discussion with Post Office, I
the KPMG integrity study is to be put
on hold pending a review of the I
approach by Post Office. We willbe
talking with Post Office over the next I
period to understand their intentions and)
what support they will need from Fujitsu I
in the future. Risk to be kept active
given that there is a possibility inthe I
future that further challenges may
emerge that need to be responded to
with regards integrity of the system. The I
work completed to date has provided a
level of assurance that out processes.
and systems have been thoroughly
reviewed (though not independently).
Change of ownership to JD.
11.04.12 YS Following update from I
Mike Deaton: Phase 0 ready to discussI
draft controls before end of April.
Fallback
TBC
Prob
ability
10
Impact
Code
High
Max
Business I Proximity
Impact
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RAG
(Last
ofRisk I RAG Period)
0-6
months
SV&l test system contract.
After March 2013 we will not be able to
test releases prior to live deployment
because the test rigs contract expires
‘on that date.
CommiLeg
al
Peter
Thompso
n
23.05.12 YS Following update from PT: I
Plan is to build cost model from scratch I
(to include HW, OS, S/W, Support I
Staff) for each of the rigs SV&l, I
Integration and CIT. This work will be I
performed by BAS and HNS. Based on I
initial feedback from Graham Welsh this I
won't be completed any earlier than July
2012. When the cost model is I
complete, we should get a figure which
we will then present to the customer for I
renewal I
11.04.12. YS Following update from PT:
Meeting scheduled on 12.04.12 to
determine requirement for the on-going
support and maintenance and SV&l
Target date end of May to produce the
proposal.
No releases to be made to the live
estate after March 2013.
25
Moderate
TBC
0-6
months
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Post Office Account Enterprise Risks May 2012
Description of Risk
Containment
09.05.12 Following update from PT:
Fallback
H&NS have agreed a seniceability plan I
for the Legacy Horizon. Incremental
cost agreed £277K.
Residual risk on Foundstone scanners
and EMC storage Discussion with 3rd
parties taking place to determine
Prob
ability
Impact
Code
Max
Business I Proximity
Impact
ofRisk I RAG
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‘Supportability of the Legacy Horizon. Peter I support best support options I De
Service Thompso I 25 Moderate 710K I
New Risk raised in the ELT on 16.04.12, nn _I Additional discussions are taking place I I
yielding to requirement for potentially I
more expenditure. I I
I I
\ End of Senice Life review is taking I I
place which part of the 4 point tactical I
plan. Discussion been held with H&NS I i
I_with Ft review options to replace 3rd I
I part products with Fu first approach I
1 I
25.05.12 YS AK to confirm meeting I I I
outcome. I I
I if
23.05.12 YS Following update from AK: I I I
A meeting about IRE19 lease with data I I I
CommiLeg centres and group properties is I I I
al scheduled on on Friday 25th, I 2 High I 000d) Svea
I
Le eee 23.02.12 YS Following update fom I I
The IRE19 lease expires in Dec 2013 - Daniel Marscen ard Alex emp sTe I I I
alates : team working with the Group Properties I I
exposure on Fujitsu ability to provide DR Alex Mies ie eae oes I
‘and test environment. ‘Kemp expect to finalise the lease Py end June. I Comorate Red Alert I
Recovery of IAS 11 Revenue. T 1 T
I I
Future business may not be realised. I I I I
Proj&Prog Forecast needs to be debooked 11.04.12 YS Following update from SD I I I
= ae & Hazel Taylor: we met our payments. I 10 I Moderate 10000 1-3
£10M cost, £14M Revenue For FY 11-12 continue to be on target. I I
This risk will be udpated in the beginning ISteve IDebook proft element for which there is I
and end of the financial year. Doyle Ino forecast work, I
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RAG
(Last
Period)
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Post Office Account Enterprise Risks - May 2012
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100
90
80
70
60
50
Probability
40
30
20
10
0-6 months
On-going Benchmarkin
SV&I test system con
Horizon on-line.
ERM For POA, May 2012
(Not all risks have beeh included in this chart)
(500)
(TBC)
(TBC)
Risk Proximity
(TBC) +
lyear
Patching for PCI Pla
HSD Benchmarking
(400)
@Comm/Legal
@HR/Skills/TUPE
@ Technical
Key skill-sets. @ projaprogm
nquantifiable)
Uneaeran Shin
TBC.
f Rovery of AS11R
(10000)
IRE19 Lease end
(60000)
3 years
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Dependencies
June Update
FUJITSU CONFIDENTIAL ‘opyright 2011 Fujitsu Services Limited
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Dependencies- Post Offive FUJITSU
Dependency Dependent Upon Risk Financial / Other Impact
MVNO HNS Full service dependency £140m TCV
Cost of migration to two new
data centres needs to be
determined — is this a Impacts costs for shadow and
Solution to Datacentre in customer charge or absorbed Hosting Tower
Ireland HNS in Fujitsu Impact cost estimated £10m
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Corporate Social
Responsibility
FUJITSU CONFIDENTIAL © Copyright 2011 Fujitsu Services Limited
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Corporate Social Responsibility FUJITSU
*Supporting Princes Trust 11" July with interview and CV
skills workshops.
FUJITSU CONFIDENTIAL. 28 © Copyright 2011 Fujitsu Services Limited
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Branch Managed Switch*
£1.7m
Channel Integration*
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Growth plan jr
p a Q2 Q3 ag FUJITSU
Frameworks leading to/ enabling new:revenue ; i -
: £10m I xm Bid/ CT activity
POL Products Framework ' 7
H —===""_—- Revenue generating
: £20m H delivery
POL Solutions Framework i © Contract CT signature
£150m : 7 I
Towers Model Procurement ‘ shew i oe
£100m i i
Horizon Transformation initiative : —_——
i £4m i i
RMG IT Consulting Framework ' o i
Major Opportunities delivering in yeat TCV and revenue
: £0.3m ;
Salesforce i —_—_——
£1.9m ;
Extended Hours £4m £20m
DVLA I £10m
SAP Financial Separation I I £1.8m
SAP Initiatives £4.2m I ;
Kiosks/ Post and Go I I £2m ‘ I
Mails Initiatives I I £0.5m
PCI CS ——
* Customer is funding initial activities until full project CT is agreed