UK Post Office calls for bids on £410m tender to finally replace Horizon system

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The UK's Post Office has put out a £410 million ($553m) tender, excluding VAT, for the replacement of the controversial Horizon system provided by Fujitsu.

Published yesterday (July 21), the tender is split into two lots: one for data center operations, application support management, and service and system integration, and another to "transform" the Post Office's end point of sale (EPOS) technology with software and other services.

The Post Office previously shared a "Planned Procurement Notice" for the upcoming tender in May 2025. With the tender now officially live, applicants have until August 21, 2025, to apply, with an expected decision to be made on July 1, 2026.

Lot one will see the supplier "take over the existing Horizon Services" and "be responsible for maintaining and supporting IT infrastructure within the data center until it is decommissioned," as well as managing applications, integrations, and the stabilization of current Horizon Services. This lot is valued at an estimated £269m ($362.8m) without VAT, and £322.8m ($435.4m) with VAT.

Lot two, meanwhile, will be for a commercial-off-the-shelf EPOS Software Provider that will be cloud-hosted, and accounts for the remaining value of the contract.

The Post Office's existing Horizon system is provided by Fujitsu and was first introduced in 1999. The system has been shrouded in controversy after it was found to be introducing accounting errors for which postal workers were unfairly blamed. Ultimately, more than 900 subpostmasters were wrongfully convicted of theft, fraud, and false accounting between 1999 and 2015 due to Horizon's faulty data. According to the UK government, in June 2025, more than £1 billion ($1.35bn) in compensation had been paid out to more than 7,300 postmasters affected by the Horizon IT scandal.

After the ITV drama series Mr Bates vs the Post Office brought the controversy back to public consciousness, Fujitsu officially decided to stop bidding for government contracts for the time being.

Despite this, Computer Weekly recently reported that the company had won more than "half a billion pounds" in government contracts since that self-imposed ban, excluding subcontracts.

Among those contracts are several extensions by the Post Office itself, after a previously failed migration in 2023 cost £31m ($41.23m).

The most recent extension of the Horizon contract was in March 2025 for a period of one year, with other extensions in 2021 and again in 2024, with the Post Office citing issues with the feasibility and cost of migration.