Anger over Central Bank IT outsourcing move

There is outrage among opposition TDs that the Central Bank has chosen to go ahead with the outsourcing of its IT systems, despite high profile failures of crucial banking systems in Ulster Bank last year.

It was confirmed in a parliamentary question that the Central Bank had choose Hewlett Packard as the provider of a physical data centre for the Central Bank that will house critical information on Irish banks.

The Minister of Finance, Micheal Noonan confirmed to Sinn Féin’s Pearse Doherty that the contract was going ahead.

“I am informed by the Central Bank that it has entered into a contract with HP to provide the physical data centre environment to host the bank’s IT systems and to manage the technical infrastructure aspects of these systems.

“Hewlett Packard will also provide hosting facilities at a backup data centre for the purposes of business continuity,” he said.

The Central Bank has decided to outsource this data management system in order to avoid bearing the cost of having to build their own data centres as their current facilities are no longer fit for purpose.

“As the existing facilities are unsustainable, a direct comparison of costs does not provide a valid like for like comparison.

“A robust business case, in which a number of alternatives were investigated thoroughly and compared across a number of criteria, including cost, was produced and was approved by the Central Bank Commission.

“The main cost savings relate to the very significant capital costs avoided in relation to the alternative need to build two new data centres,” he said

Mr Noonan refused to reveal the level of savings achieved by outsourcing data centre, but he said that they were significant.

However, it is the nature of the data that the Government are placing in the hands of a private corporation that caused alarm.

Mr Doherty said that he was concerned that sensitive material that the state should be safeguarding was being put into the hands of a private company.

“I would have huge concerns about the outsourcing of this public IT system to a private sector operator. This system contains sensitive, commercial information that should be retained in the hands of the state.

“I would also be concerned that outsourcing government like this is an outsourcing of responsibility for when anything goes wrong.

“People who were affected by the Ulster Bank situation last year, where they couldn’t access their money, will be aware of how badly wrong an outsourced IT system can go,” he said.

The data will be completely secure according to Minister Noonan who said that measures had been taken to insure that the data will remain secret and confidential.

“The commercial agreement between the parties contains adequately robust provisions regarding the security and confidentiality of Central Bank information.

“These provisions are designed to safeguard commercially sensitive information and comply with the bank’s internal standards and those laid down by the European Central Bank,” he said.

Mr Doherty claimed that this was yet another instance of Fine Gael continuing with an agenda to privatise government without consulting the Dáil.

“The fact that the Government is presiding over this without consulting members of the Oireachtas or the public is also worrying.

“It is very much part of a trend of outsourcing state functions to the private sector, which Fine Gael and Labour seem intent on pursuing,” he said.

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