HM Revenue & Customs (HMRC) has committed up to £657 million to three. Major low-code software development and support contracts. And this challenges the common view that low-code solutions always mean low costs. It is especially true in the complex world of public sector digital change. And these large awards are part of the broader Digital and Legacy Application Services (DALAS) framework. They show the UK tax authority's urgent push to update its large and. Often criticized legacy IT setup. Which is why this guide covers how the UK taxman discovered. That low code does not mean low cost with £657M awards.
What Are the Details of HMRC's Low-Code Investment?
The big investment sees French consultancy Atos securing a £78.2 million contract for "specialist low-code leadership services," and this Lot 3 deal. Under the DALAS framework gives Atos key program oversight, supplier management, governance, assurance. And delivery support for HMRC's low-code technology estate. Michael Herron, Head of Atos UK&I, said the firm is proud to grow its "long-standing relationship with HMRC," and he added that Atos is ready to support the delivery of "better digital experiences for citizens at pace." The contract has an initial three-year term, with options for two one-year extensions.
Indian tech services company Coforge secured the third major work package. Which is a £219 million Lot 2 contract. That provides services identical to Cognizant's, focusing on build, configuration, DevOps. And live service management for HMRC's low-code estate. This contract also runs for an initial three years, with two optional one-year. Extensions, from July 27, 2026, to July 26, 2031. And the technologies supported across these contracts include well-known low-code platforms. Such as Pega, ServiceNow, Microsoft Dynamics, and Power Platform.
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Why Does Low-Code Not Always Mean Low Cost for Public Sector?
HMRC's large investment highlights a key lesson because. While low-code platforms promise faster development and less need for traditional coding, using. Them at a large scale can still cost a lot. And this is especially true in a complex public sector environment. The Digital and Legacy Application Services (DALAS) framework, under which these contracts fall, was first valued at up to £4.5 billion, and a later phase was given a combined estimated value of £2.8 billion for Lots 1, 4a, and 4b. Which shows the huge scale of modernizing HMRC's IT estate. The National Audit Office (NAO) has consistently flagged it as one of the. UK's largest and most complex setups.
The NAO has previously warned that "remediating legacy systems is taking HMRC longer. Than it had expected and is costing more," and reports show. That HMRC's administrative costs for running digital tax systems went up by 18%. Between 2019-20 and 2023-24. Its digital services have not always delivered the expected benefits or savings. And the challenges go beyond simple software licensing. Because they include full program oversight, strict governance, strong security, smooth integration with existing systems. And large-scale training for staff. For government agencies that handle sensitive data, custom encryption protocols and secure data-handling practices are critical. And they often need a level of customization that standard low-code platforms cannot easily provide.
What This Means for Tech Readers
For tech professionals and organizations, HMRC's multi-million-pound low-code awards offer several key insights. Because they show the growing maturity and strategic importance of low-code platforms in large-scale enterprise settings. And this is especially true in the public sector's ongoing battle against legacy IT. The involvement of major players like Atos, Cognizant. And Coforge points to a strong market for specialized low-code use and support services. That go beyond simple app development, and these services include complex governance, DevOps. And live service management. Second, the large spend is a reminder that low-code can speed up delivery. But it still needs major investment in expertise, integration, and oversight to work well at scale. And the "low-cost" promise of low-code often applies to smaller, departmental projects rather. Than the full overhaul of critical national infrastructure. This calls for a clear view of total cost of ownership. Including long-term support, security, and scalability.
What's Next for HMRC's Digital Transformation?
HMRC's digital transformation journey, driven by these low-code contracts, will stay a closely. Watched case study for public sector modernization. And the focus will likely stay on linking these new low-code solutions with existing systems, some of. Which are decades old. At the same time, HMRC must keep data secure and meet regulatory rules. And the growth of low-code platforms, especially with more AI for design suggestions. And automated workflow creation, could shape HMRC's strategy. It may lead to even faster development cycles and greater efficiency. But the ongoing challenge will be to show real returns on this large investment. Which means not just new applications, but measurable gains in taxpayer services, operational efficiency. And a lower overall cost and risk from legacy technology. Future buys under the DALAS framework. Which is built to be multi-supplier and multi-year, will likely keep spreading risk. And encouraging competition among providers. Because HMRC wants to become a modern and trusted tax and customs authority.
Related Resources
For more context, check our related article on Apple Calendar Gets an AI-Powered Overhaul in iOS 27 with. Smart Event Details and Enhanced Siri Integration, and keep this reference handy whenever you work with the UK taxman's £657M low-code story.
