IT service provider CSC, a major contributor to the National Programme for IT, is preparing to write-off up to 40% of its market value. This comes after the after the American company admitted the delayed and flawed systems it developed as part of the NHS’s National Programme for IT (NPfIT) may be of little or no value for shareholders.

The firm has been in talks with the Department of Health (DH) to renegotiate its NPfIT contract, but a statement to shareholders shortly after Christmas said proposals had not been approved.

The statement warned that as a result, CSC faces a downward revaluation of its NHS work that could be “equal to the company's net investment in the contract”, stated as £943 million so far. The NYSE-listed firm’s market cap is currently $3.67 billion (£2.35 billion).

NPfIT was abandoned in the summer, and along with BT, CSC was heavily criticised by the National Audit Office and the Public Accounts Committee over its failure to deliver much of the care record element of the programme. Nearly £3 billion was spent by the government on the proposed systems since 2002.

The DH is keen to cancel much of the remaining contract with CSC while avoiding being dragged into a lawsuit. Fujitsu is reportedly looking for £700 million for the cancellation of its IT contracts earlier in NPfIT's history.

Despite CSC’s troubled relationship with the NHS, the firm surprised many in December when it announced it had won a £45 million, seven-year deal to manage IT systems at Royal Berkshire NHS Foundation Trust.

Further information: CSC Statement