UK government paid Atos £24m compensation over Met Office supercomputer

French company claimed in a lawsuit that their bid was unfairly rejected

The UK government has paid French tech firm Atos £24 million in an out-of-court settlement over an £850 million contract given to Microsoft to develop a weather supercomputer to be used by the UK's Met Office.

According to the latest annual report [pdf] of The Department for Business Energy and Industrial Strategy (BEIS), the BEIS and the Met Office entered into a settlement agreement with Atos to jointly pay £24 million "without admission of liability".

BEIS committed to paying £20.7 million toward the settlement, while Met Office agreed to pay the remaining £3.3 million.

Last year, Atos challenged the contract award in court, claiming that the government had violated its obligations under the Public Contract Regulations 2015.

The contract was awarded to Microsoft in February 2021.

In its complaint [pdf], Atos said that the UK government incorrectly rejected the Atos bid as non-compliant because Atos' proposed system used different processors than the main supercomputer.

The main dispute concerned the Met Office's requirement that the primary computer system and the development systems be "architecturally equivalent".

Atos asserted that the government committed "obvious errors in the evaluation" of its bid.

It argued that tender documents "failed to contain any specification that the [computer] processors used in a smaller development system had to be the same" and be "architecturally equivalent" as those used in the supercomputer system.

Atos said that the Met Office had violated procurement rules by selecting a final tender that scored lower in quality, was more costly, and increased the Met Office's exposure to commercial risk.

Although it had been known since last year that the parties involved had negotiated an out-of-court settlement, the size of the award to Atos remained unknown.

In a statement, the French company expressed its pleasure at having settled this matter.

The opposition Labour Party charged the government of wasting public funds.

"This is yet another example of the Conservatives failing to take care of public money. While families are counting every penny, the Tories are shelling out taxpayers' cash to pay for their own mistakes," said Angela Rayner, Labour's deputy leader.

A government spokesperson said: "The proceedings regarding supercomputer procurement have been resolved with no admission of liability from any party. This settlement is in the best interest of taxpayers."

The Met Office will manage the new supercomputer, which is expected to be among the most advanced in the world for weather forecasting. It is expected to rank among the top 25 supercomputers worldwide.

It will be housed within the Azure cloud computing platform, and will integrate HPE Cray EX supercomputers from Hewlett Packard Enterprise (HPE), as well as a Microsoft high-performance active data archiving system and other Azure cloud technologies.

The Met Office expects the system, which will replace its existing Cray supercomputer, will increase the organisation's computational capability by six times.