EDS is the big winner in two decisions announced by the Department of Social Welfare.
The company will take over Tritec, the DSW's information technology division, as well as redevelop its processing systems, SWIFTT (Social Welfare Information for Tomorrow Today).
Despite widespread industry expectation for some years that Tritec would be privatised, Social Welfare and EDS officials are careful to use the word 'outsourcing' when describing the Tritec deal.
However, EDS will take over Tritec's facilities in Upper Hutt - a leasehold building - and purchase the technology within, which will be replaced over the next three years as part of the SWIFTT contract. Tritec staff will hold their jobs, the department says.
How would this be handled differently if the deal were called privatisation?
"I'm not sure I can answer that," says DSW spokesman Michael Player. "It's being seen as the most economic way of providing information services to the department. It's not like the government deciding it doesn't need a telecommunications company, for instance. We still need a computer service."
EDS beat off CSC and IBM to win the Tritec deal. It is understood the other two contenders for the SWIFTT redevelopment were a Unisys/Andersens consortium and CSC.
The value of the two contracts is yet to be determined. Player says while an indicative figure was included in the bids, the exact price for both contracts is still subject to negotiation as part of the due diligence process.
Social Welfare Director -general Margaret Bazley says EDS will take over the running of Tritec on July 1.
EDS New Zealand managing director Eddie Bates says the Tritec facility, in Upper Hutt, sill be expanded, and the company will move some of its Wellington operations to the centre.
At present Tritec employs 100 people, and a condition of the deal was that those staff remain employed there, under the same conditions as now. Bates says the centre, which will become an EDS service facility, will employ 300 staff.
Bazley says the two contracts were evaluated separately, but that "the department realised the combining the two aspects by use of a single vendor would maximise the benefits."
The SWIFTT redevelopment, which will take three years, involves up to 60 EDS staff and contract partners Deloittes, Logica and Oracle.
The moves follow the decision last year by the department to focus on core business, following the trend of other departments.