IT services giant Tata Consultancy Services (TCS) has announced a significant partnership expansion with the National Employment Savings Trust, the largest workplace pension scheme in the UK. The £840 million ($1 billion) deal, spanning an initial tenure of 10 years, will see TCS digitally transform the firm’s administration services to provide enhanced member experiences.
If extended for its full 18-year duration, the contract’s maximum estimated value would reach £1.5 billion (approximately $1.9 billion).
A Nest spokesperson stated, “The contract will be for a minimum term of 10 years, with an optional extension period of up to 5 years, and the option of an additional period of up to 3 years for exit. The total contract value is indicative and covers this potential 18-year period.”
This contract was originally held by French IT services firm Atos, but it was canceled in early 2023, just two years into what could have been an 18-year agreement. The collapse of this contract may result in up to 1,000 job losses at Atos in both the UK and India, according to The Register.
TCS has secured its fourth major deal in the region for 2023, following agreements with Phoenix Group, Marks & Spencer, and the Teacher’s Pension Scheme in England and Wales. These deals have been achieved despite a challenging macro environment in the region.
TCS has been closely associated with Nest since 2011 when the digital, auto-enrollment pension scheme was first launched. Nest currently boasts over 12 million members and anticipates managing approximately £100 billion in assets by the end of the next decade.
While specific costs remain commercially sensitive, the Nest spokesperson confirmed that the total contract cost falls within the estimated contract value of £1.5 billion, as published in the Contract Award Notice. This amount represents the estimated maximum value for the complete duration of the contract, including potential extensions.
As part of this expanded partnership, TCS will utilize solutions from its TCS BaNCS platform to provide personalized, self-directed experiences to Nest members. By doing so, the company aims to ensure that Nest’s 12 million members and 1 million employers have access to the right information in the most suitable manner.
Gavin Perera-Betts, Chief Customer Officer at Nest, expressed confidence in the partnership, stating, “We have a strong foundation after many years of working together, and they’ve proven their ability to deliver successfully for a scheme the size and complexity of Nest. This puts us in an excellent position to further advance our operations and build a truly digital offering that delivers a superior customer experience long into the future.”
Vivekanand Ramgopal, President of BFSI Products & Platforms at TCS, added, “We are delighted to further expand this long-standing partnership with Nest and support them in pushing the boundaries in offering compelling omnichannel member experiences to the new generation of workers entering the workplace. We are looking forward to leveraging our contextual knowledge, technology expertise, and proven platform to help Nest realize our shared vision for the future.”
With a presence in 30 locations across the UK, TCS is the country’s largest provider of software and IT services.
Overall, TCS has secured approximately five major deals in the first half of 2023. The reported worth of the Marks & Spencer deal is $1 billion. Additionally, TCS recently obtained an advanced purchase order worth Rs 15,000 crore (around $1.8 billion) from the government-run telecom company BSNL to expand its 4G network nationwide in India.