Andersen Consulting could be made liable for up to #50 million a year following the botched implementation of the new National Insurance database.
Difficulties in rolling out the system have left over 500,000 pensioners underpaid, while millions of employers' end of year national insurance returns are being rejected completely, MPs were told.
An angry Commons Public Accounts Committee also heard that just over 1,500 bugs remain unfixed in the 14 million lines long codebase. The Contributions Agency (CA), the database's purchaser, blames Andersen for failing to resolve the bugs quickly enough.
George Bertram, chief executive of the CA, said compensation, "is a decision for ministers," but warned later: "We are not satisfied with the level of fix provided."
He had been summoned by MPs to a second hearing in 12 months because, according to committee chairman David Davis, "there has been a clear failure to deliver services to the citizen."
The new go live date is the end of March - one year behind the target date and over two years after the date set when the contract was signed. In an urgent report, the National Audit Office said it had "serious doubts" that this date would be met, doubts acknowledged by the CA.
Andersen gave its own evidence to the watchdog Public Accounts Committee today. It does not believe it should pay any compensation.
Remarkably, the CA has received income of #58 million in interest gained because money will not be paid out.
For more stories, see 28 January issue of 'Computing'
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