Multimillion pound security project shelved by ministers

A multimillion pound project designed to improve Britain's security by giving key government officials speedy access to secret intelligence on terrorism and other threats has been shelved, the Guardian has learned.

Ministers have frozen the development of a secure computer network that would have radically transformed the way the security and intelligence agencies handle sensitive information.

The government has refused to disclose the cost of the project, codenamed SCOPE. It has been described by parliament's Intelligence and Security Committee as marking the "beginning of the end" of distributing paper copies of intelligence reports around Whitehall and as "fundamentally changing the way the UK intelligence community interacts".

A limited version of the project, called SCOPE 1, is finally up and running after a two-year delay. This is the first stage of the project and enables the intelligence agencies - MI5, MI6, and GCHQ - and a limited number of other officials, to communicate with each other more quickly and securely than before. It enables them to call up the latest intelligence within 15 minutes rather than waiting up to 12 hours.

However, it is the project's fully-fledged second phase, SCOPE 2, which has been shelved. This would have allowed officials in as many as 10 government departments - including the Home Office, Revenue and Customs, and the Serious Organised Crime Agency - and 1,500 defence officials and military commanders, secure electronic access to intelligence, including the Joint Terrorism Analysis Centre based at MI5's headquarters.

It has been stopped at an unknown cost to Whitehall agencies and taxpayers. Although government spokesmen decline to discuss the reasons for the decision, they are believed to be both financial and technical.

The technology involved in making the system secure is more complicated than officials first realised when funding for the project was approved in 2003. The costs escalated as contractors and departments struggled to solve the problems.

SCOPE is the latest in a catalogue of computer projects which have gone wrong, wasting hundreds of millions of pounds of public money. Early this month the national audit office disclosed that a new computer network for the Ministry of Defence was 18 months late and £182m overspent.

Parliament's Intelligence and Security Committee, which oversees the intelligence agencies, has repeatedly criticised SCOPE's "history of delays". The project was due to be up and running three years ago - at that point, the committee said it was "concerned that Scope was yet to deliver any usable benefits to the UK intelligence community as a whole".

Though the committee has never spelt out in any detail what has gone wrong, nor revealed how much the project has cost, its reports suggest that initially delays were caused by a mismatch between the project's computers and those of the GCHQ, the electronic eavesdropping agency.

The Cabinet Office managed to get the limited first phase of SCOPE off the ground in late 2007 - two years later than forecast - to speed up communications between the UK's intelligence agencies as well as with four other government departments. Within a few months official reported what they called a "serious process failure", wiping out data relating to intelligence operations.

The committee has also been worried that the Cabinet Office would not be able to recruit and vet enough highly skilled staff to run the project, housed in an undisclosed building, when it was working at its full capacity.

As recently as January this year the government told the ISC that SCOPE 2 was "on track to be delivered in 2008-2009". Any hope of that happening has been dashed.

A Cabinet Office spokesman told the Guardian the project had not been cancelled. However, he added: "We are working with the contractor for [SCOPE] Phase 2 to consider ways in which the additional benefits of that phase can be delivered more simply."

He continued: "That work is expected to conclude shortly. No permanent civil servants have lost their jobs, though a number of contractors have been let go as part of the change of approach."