Taxpayers are being “held to ransom” after Home Office payments to Amazon to store data in its web cloud more than tripled to nearly half a billion pounds.
The three-year contract signed between the department and Amazon Web Services (AWS) in December could be worth a maximum of $524million (£451million), depending on the exact amount of usage.
The “committed spend” or minimum cost will be $91.9million in the first year, $99.2million the second year and $107.2million in the third – a total of $297million, or £255million.
The Home Office’s previous contract for web cloud services with AWS was reportedly valued at about £120million, meaning the price will have more than tripled if usage hits the top level.
Questions have been raised about why the value has jumped so much, but there are also fears that the Home Office does not have the right to inspect or audit AWS’s infrastructure, according to the new contract.
Lord Clement-Jones, the Liberal Democrats’ digital spokesman in the second chamber, who submitted a series of parliamentary questions on the deal, said: “It looks like somebody has hit the jackpot.
“It would be nice to have some justification. The Home Office is being held to ransom.”
Part of the problem, he said, is that there are few competitors to AWS.
“Our cloud services are in the hands of two or three companies,” he said. “AWS has got it pretty much sown up.”
In October, media regulator Ofcom referred public cloud infrastructure services to the Competition and Markets Authority for further investigation, saying it had “identified features that make it more difficult for UK businesses to switch and use multiple cloud suppliers”.
Ofcom added: “We are particularly concerned about the position of the market leaders Amazon and Microsoft.”
Of the AWS deal, a Home Office spokesman said: “All commercial contracts are in line with government procurement rules which are designed to ensure the best value for taxpayers. We closely monitor contractor performance, including financial results.”
But Lord Clement-Jones also questioned the lack of inspection and audit rights, adding: “It’s really important that we know the Home Office has got the ability to inspect infrastructure to make sure it is delivering the goods. Do we just rely on the say-so of the supplier?
“The Home Office has got more sensitive information than any other body, other than the DWP [Department for Work and Pensions].”
In response to Lord Clement-Jones’s parliamentary questions, Home Office minister Lord Sharpe said: “The supplier shall not process or otherwise transfer Home Office data outside of the United Kingdom unless the prior written consent of the Home Office has been obtained.”
AWS was approached for comment but did not provide a response.
