SERVICE MODERNISATION PROGRAMME

Rating: Compared to financial year 24/25-Q4 the programme’s end-date at 25/26-Q4 remained on schedule. This is due to the following factors: Over the past 12 months the Programme has continued to deliver to plan with 8 major milestones delivered, transforming services for our customers and colleagues. A programme of this size, scale and complexity does occasionally result in some variance in key deliverables. Where this has happened, variance has been managed with no tolerance breaches during the financial year. The Programme’s financial benefit position remains healthy. The latest data available demonstrates the Programme is on track to deliver our financial savings forecasts. Our benefits position has been revised upwards. The Programme's non-financial benefits remain healthy with positive feedback from our customers and our colleagues. We continue to embed new ways of working, and changing our culture, which will be further accelerated this coming financial year. We remain mindful of the associated risks and complexities in this area.

Schedule: Funding for PBC2 has been approved until end of June 2026. We are currently preparing an updated Business Case and commenced engagement with HMT around obtaining funding until 28/29. Conversations have been very constructive, and we are confident of achieving the levels of funding required for continued Programme delivery. (with the exception of Child Maintenance Service’s Policy Reform implementation, where funding is limited to discovery work whilst required legislative decisions remain outstanding.)

Cost: SMP’s departmentally agreed Real Terms Costs at 25/26-Q4 (measured in £m) are £1,150m (rounded to nearest £m). This is primarily due to the following factors: A new iteration of the Programme Business Case (PBC2 Refresh) was approved by HMT that considers: - Spending Review opportunities - an increase of £340m. - A prioritisation exercise, focussing on initiatives that deliver the core objectives of Service Modernisation - a reduction of £68m. - Adding back Service Modernisation baseline Business As Usual staff - an increase of £77m - Updating sunk costs - an increase of £1m.

Source: NISTA Major Projects Annual Report 2025-26 (data)

Rating: Compared to financial year 23/24-Q4, the Infrastructure Project Authority's Delivery Confidence Assessment rating at 24/25-Q4 remained at AMBER. This is primarily due to the following factors‚ The Infrastructure Project Authority (IPA) Delivery Confidence Assessment rating at 23/24-Q4 is Amber. This is primarily due to the following factors. 1) SMP’s highly ambitious and long-term transformational programme can only be confirmed as GREEN as it nears the end of its overarching delivery cycle. 2) There are 10 recommendations, the majority of these have been addressed, with work progressing well on the remaining actions. IPA Report that successful delivery of the programme/project to time, cost and quality appears feasible but significant issues already exist requiring management attention. These appear resolvable at this stage and, if addressed promptly, should not present a cost/schedule overrun. We accepted the Review Team's recommendations in full and a number of the recommendations have already been delivered we are confident that recommendations will be address for the next IPA assessment The next IPA assessment is due to commence in July.

Schedule: Compared to financial year 23/24-Q4, the project's end-date at 24/25-Q4 remained at 31/03/2033. This is primarily due to the following factors‚ Compared to financial year 23/24-Q4 the project's end-date at 24/25-Q4 remained on schedule. This is due to the following factors: Over the past 12 months the Programme has continued to deliver to plan with 17 major milestones delivered, transforming services for our customers and colleagues. A Programme of this size, scale and complexity does occasionally result in some variance in key deliverables. Where this has happened, variance has been managed with no tolerance breaches to report. The Programme’s financial benefit position remains healthy. The latest data available demonstrates the Programme is on track to deliver our financial savings forecasts. Our benefits position has been revised upwards. The Programme's non-financial benefits remain healthy with positive feedback from our customers and our colleagues. We continue to embed new ways of working, and changing our culture, which will be further accelerated this coming financial year. We remain mindful of the associated risks and complexities in this area. Funding for PBC2 has been approved until end of September 2025, and an updated version of PBC2 will be shared with HMT shortly to secure spending for the remainder of 25/26. We have already commenced engagement with HMT around funding discussions for the next SR period.

Cost: Compared to financial year 23/24-Q4, the project's departmentally agreed Whole Life Cost at 24/25-Q4 (measured in £m) increased from 449 to 763. This is primarily due to the following factors‚ The budgeted whole life costs remain the same at £763.6m, as what was approved in May 2023 for the Programmes Business Case.

Source: NISTA Annual Report 2024-25 (data)

Rating: The Infrastructure Project Authority's Delivery Confidence Assessment rating at 23/24-Q4 is Amber. This is primarily due to the following factors. The Infrastructure Project Authority (IPA) Delivery Confidence Assessment rating at 23/24-Q4 is Amber. This is primarily due to: 1) SMP's ambitious programme can only be confirmed as GREEN as it nears the end of its overarching delivery plan. 2) The rating reflects the medium to longer term outlook for the Programme success against its Programme Business Case (PBC) due to its complexities and dependencies on the wider operating environment. 3) SMP is progressing well and there are good indications that the PBC benefits can be delivered. We agree with the IPA commentary on the Programme Delivery Confidence Assessment. The Programme continues to manage the risks arising from the dependencies around the wider operating environment. These risks are managed in line with government risk management methodology. Successful implementation will enable DWP to operate in a streamlined, optimised, more efficient and effective manner, supported by a culture of continuous improvement and incremental change. Legacy IT systems can be decommissioned once replaced with new Digital systems

Schedule: The project's end-date at 23/24-Q4 is 2033-03-31. This is primarily due to the following factors. Compared to financial year 22/23-Q4, the project's end-date at 23/24-Q4 remained on schedule. This is due to the following factors: Over the past 12 months the Programme has delivered to plan and remains on track to realise the benefits documented in its business case. Where there has been some slight variance in key deliverables, the variance has been actively managed and there have been no tolerance breaches to report during financial year 23/24. Our Programme of cultural change across the organisation continues and whilst progressing well we are mindful of the associated risks and complexities in this area. PBC2 for 24/25 funding is due for HMT approval in May 2024. The Programme will then seek further funding for the next SR period to allow us to continue our modernisation aspirations and delivery of further benefits.

Cost: The project's departmental-agree Whole Life Cost at 23/24-Q4 is 449m. This is primarily due to the following factors. The budgeted whole life costs remain the same at 448.7m, as what was approved in May 2023 for the Programmes Business Case.

Source: IPA Annual Report 2023-24 (data)