Justin Megawarne, managing partner at Megaslice, says the UK government needs to overhaul its approach to public sector procurement if it is serious about supporting British innovation. He has accused Whitehall of hiding behind rigid frameworks and “arbitrary assessment systems”.
Megawarne’s comments follow the decision to award Fujitsu a place in a government framework worth up to £984m, despite the company playing a central role in developing and supporting the Post Office Horizon IT system. The scheme led to the unlawful prosecution of 736 sub-postmasters across the UK and has since become one of the worst miscarriages of justice in modern British history.
Fujitsu had previously committed in a letter to the government not to bid for new public contracts until the public inquiry into the Horizon scandal was completed. Its inclusion in the framework has reignited debate about how the government selects suppliers – and whether it is doing enough to support real domestic innovation.
“If an organization has performed so poorly for its customers that it has become a national scandal and warranted its own television series, it is certainly time for the government to spend its money elsewhere,” Megawarne said.
“With so much public money being wasted on technologies that don’t serve their purpose, and in this case on the fraudulent criminalization of people, the budget for real innovation continues to shrink. We are failing to support the next generation of founders who are building truly innovative companies, instead handing contracts to the same organizations that have failed us before.”
Megawarne argues that government procurement processes are fundamentally flawed and rely too heavily on mechanistic valuation tools that have difficulty determining true value.
“Current approaches to introducing new technologies are overly complicated and extremely slow,” he said. “Assessment sheets don’t capture innovation. If the government actually worked with businesses instead of keeping them at arm’s length, we could save millions of pounds currently being wasted on the wrong solutions.”
Instead of relying on civil servants to evaluate complex and novel technologies, Megawarne believes the government should engage independent industry leaders with proven innovation skills.
“Let experts evaluate ideas based on their experience and judgment, not on a spreadsheet,” he said. “Yes, some will say that sounds unfair, but it dramatically increases the chances of finding a truly groundbreaking solution. You just have to make sure that these experts don’t have any conflicts of interest.”
He added that procurement decisions are too often driven by price rather than outcome. “Spending less on the wrong solution is not saving money at all. Much of what has been invested so far has failed to solve the everyday problems that government agencies actually face.”
Megawarne also criticized what he said was the government’s default preference for large, established suppliers, regardless of past performance.
“The mindset is still, ‘No one ever got fired for buying IBM,'” he said. “It’s a way to avoid responsibility. If something goes wrong, you can always point the finger at the big name.”
In the case of Fujitsu and the Post Office Horizon system, the error was neither minor nor isolated. “This was no simple mistake. It destroyed lives. The company only apologized when forced to do so and repeatedly resisted compensation. And yet here we are again, awarding more public contracts.”
According to Megawarne, the same pattern continues to emerge in government IT spending. “Large consulting firms win large contracts, fail spectacularly and have no real consequences. It’s a cycle of failure without responsibility.”
According to Megawarne, the core of the problem lies in institutional risk aversion.
“Real innovation is happening in the UK and a lot of it lies with founders developing solutions that could make a real difference to public services,” he said. “But the government is fundamentally risk-averse.”
He warned that founders were being led down the wrong path, optimizing for procurement scorecards rather than solving real problems. “They strive for perfect results on frameworks that measure the wrong things, while innovation is sidelined in favor of cost-cutting and box-ticking.”
“If the government really wants to unlock British innovation,” Megawarne added, “it needs to stop prioritizing spreadsheets over people and start supporting ideas that actually work.”
