UKCloud Limited (“UKC”) and Virtual Infrastructure Group Limited (“VIG”) (together “the Companies”) – in Compulsory Liquidation

On 25 October 2022, the Companies were placed into Liquidation with the Official Receiver appointed as Liquidator and J Robinson and A M Hudson simultaneously appointed as Special Managers to manage the liquidation process on behalf of the Official Receiver.

Further information regarding the Liquidations can be found here:

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For any general queries relating to the Liquidations please email
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National Infrastructure for Legacy Environments

Unlocking the potential of legacy environments


A quick look at why we need NILE

After a decade of Cloud First and Digital by Default, we believe that now is the time to shift our focus on dealing with the immense burden of legacy IT that is especially common within the UK Public Sector. In this paper, we share our ideas and approach in the interests of inspiring others to put their collective creativity to solving this critical challenge that would otherwise continue to impede our nation’s ability to thrive


The government’s Cloud First policy and desire for digital transformation of public services to improve outcomes has produced demonstrable benefits across the public sector. Yet, the majority of the public sector ICT budget is still spent merely ‘keeping the lights on’ due to the costs, risks and inefficiencies of traditional and legacy IT environments. Analysts claim that up-to 80% of an organisation’s IT resources are focused on these environments, and so by driving out the costs and inefficiencies of legacy IT, organisations will have more resources to focus on exploiting digital technologies and the inherent value of their data to improve public outcomes.

It is increasingly clear that not everything can run securely and cost effectively in the cloud. There will be an enduring requirement for more traditional solutions such as Crown Hosting. Hence, in parallel to the government’s continued support for ‘Cloud First’, we believe there is a requirement for a similar policy-driven, marketplace-centric programme specifically addressing the challenges that organisations face when considering the modernisation of their legacy IT environment.  It’s often too great a leap to go straight from legacy to cloud, and so we advocate the creation of a National Infrastructure that makes some of the benefits of cloud economics available to legacy environments that cannot be immediately redeveloped to become cloud native.

The concept of a National Infrastructure for Legacy Environments builds on the success of the Crown Hosting joint venture by extending ‘datacentre-as-a-service’ to include the server, storage, network and operational resources that would otherwise add cost, risk or delay to an organisation’s IT modernisation programme.  Similar to Crown Hosting, the National Infrastructure would be a supplier neutral platform encouraging new and incumbent service providers to compete to provide better services, better service levels, better value and therefore better public outcomes. Like the Digital Marketplace, a ‘Legacy Marketplace’ would make it easier for public sector organisations to tap into the resources and capabilities of specialist service providers through a pre-competed framework – whilst enabling the current spend on these legacy environments to become an effectively managed spend.


What is legacy IT?

Almost every new IT system for the UK public sector is designed from the ground up to adhere to the Government Digital Service (GDS) Service Manual and Technology Code of Practice to support digital engagement with internal and external users. These systems are often referred to as being ‘Cloud Native’ as they inherently exploit the elasticity and functionality of cloud environments.

Any IT system that pre-dates cloud will have a much more traditional architecture. These systems are often referred to as being ‘Legacy’. Although many of these traditional systems can be made to run in the cloud – they weren’t designed to do so and therefore tend to become expensive and risky compared to more traditional datacentre environments.

The global cloud providers advocate that these legacy systems be shut down and replaced with cloud native equivalents. Across public sector, there are literally thousands of these applications – hence we advocate that these systems be given a cloud-like environment which can drive immediate cost, risk and efficiency benefits and create a more pragmatic and cost effective journey to cloud.

What are the challenges with legacy IT?

There are four fundamental challenges with legacy IT


Many traditional environments fail to comply even with the NCSC’s Minimum Cyber Security Standard. A clear example of this risk is the WannaCry ransomware attack in 2017. As cyber attacks are becoming increasingly common, the security posture of legacy environments must be addressed as a priority.

Operational resilience

Traditional IT environments often run on older hardware and in older datacentre or computer room facilities. As technology ages, it becomes increasingly likely to experience a failure – and such a failure could significantly impact the ability for the organisation to continue to operate core services.


Legacy IT accounts for at least £2.5bn per annum. These traditional environments are highly siloed and tend to be very inefficient and wasteful in terms of energy and carbon. They lack the automation that is inherent in modern environments and so require many more IT people to operate manual IT service management tasks and processes.  Further, legacy IT is often part of a wholesale outsource and so it is difficult for the organisation to benefit from competition for the supply of individual components.

Inhibits Digital Transformation and insight into data

Legacy IT environments consume up-to 80% of an organisation’s IT resources which takes focus away from accelerating digital transformation. Further, the siloed nature of legacy IT environments makes it very difficult for the government to pull together the many valuable datasets that could help drive better insights, policy decisions and better public outcomes. The longer these legacy environments persist – the longer it will take for the public sector to reap the benefits of digital transformation.

How can these challenges be addressed?

Most vendors and IT service providers typically advocate some variant of the following four stage process


A major challenge with legacy IT is it has grown organically over a long period of time and so it is not unusual that the organisation simply doesn’t really know what systems they have and whom they are used by. Unfortunately, due to the scale and complexity of these environments; the discovery phase typically involves a very large number of consultants or business analysts, and so can become prohibitively expensive especially for smaller organisations.


Once a clearer picture of the current systems exists, the next stage is to determine which systems can move straight to cloud (replatform or redevelop) and which systems don’t need to move at all (retire). However, there tend to be a large number of systems that don’t fall in either camp – they need to be rehosted onto a more modern infrastructure.


This stage is the ‘heavy lifting’ – the actual movement of systems from the legacy environment to a more modern environment. It is well accepted that the operational risk of downtime and disruption is proportional to the amount of change being made to the system – so like-for-like migrations are much less risky than transformations or replatforming. This means the modern environment needs to have multiple technologies rather than a ‘one-size-fits-all’ approach similar to the global cloud platforms.


Even though the migration from the legacy environment to the modern environment is complete by this stage, the programme should not stop. The optimisation stage is essential in driving further efficiencies and to continue to prepare the environment for onward digital transformation and adoption of cloud-based services.

Why isn't modernisaton happening?

There are some key reasons why it isn’t happening more quickly

Lack of a robust business case

The business case for IT modernisation of legacy environments (brownfield) is much harder to make than for the development of a new digital service (greenfield). A key reason for this is the requirement to ‘spend to save’. IT modernisation requires a significant upfront investment in both the infrastructure/facility and the IT services (e.g. discovery and migration). Very often, the business case is too uncertain due to the speculative nature of the programme and payback periods that are simply too long.

Inadequate skills and capacity

A second and related issue is the lack of skills and capability within public sector organisations. We often see abandoned projects where an IT vendor has sold a ‘plug and play’ solution, and the organisation has found out the hard way that the reality of building a service is much harder than that. Some of the large government departments have taken years to merely assemble and integrate the infrastructure – which has nothing to do with delivering better public outcomes. Ultimately, the goals of the project are not realised as the business benefits of moving the application and data into the cloud are rarely achieved.


There are various stakeholders that have a vested interest in the status quo. Incumbent service providers can be famously uncooperative or charge expensive ‘contract change notices’ that make the modernisation cost prohibitive. And some IT staff fear having to learn new skills or are threatened that their job might become redundant due to the inherent automation of more modern IT environments.

What can be done to remove the inertia?

We are advocating the creation of NILE


Like the ‘Cloud First’ policy and supporting GDS assets such as the Service Manual (a blueprint for digital services), we suggest a similar policy that “requires the use of the National Infrastructure unless the organisation can create a clear business case not to”. We need to give all organisations permission to accept the National Infrastructure as the default answer, facilitating the Business Case for using it – as well as enforcing the need to make a clear business case NOT to use it.


  • Shared Service / Joint Venture: Like Crown Hosting, the National Infrastructure should be owned and controlled by government, for government. We believe that a joint venture would enable the Cabinet Office to secure a controlling interest, whilst leveraging the experience and capabilities of specialist service providers prepared to make an investment to reduce the time, cost and risk of deploying the National Infrastructure.


  • Curated procurement framework: Like G-Cloud, we believe that the Crown Commercial Service should consider the creation of a ‘Legacy Marketplace’ or ‘Legacy Outcomes and Services’ framework of curated and validated suppliers and a catalogue of services that can enhance the value of the underlying National Infrastructure. Unlike G-Cloud we believe that the suppliers and services should have sufficient diversity so as to offer genuine choice and innovation, but not so profuse as to become unmanageable for either buyers or CCS.


  • Infrastructure – every IT system requires servers, storage and network. This infrastructure can be pre-deployed and made available either as Infrastructure-as-a-Service (Opex-centric, consumption based) or as Managed Hosting/colo (Capex-centric), shared for economies of scale or dedicated for specific requirements – or a mix-and-match.


  • Service Catalogue – to address the security, operational resilience, value and sustainability challenges inherent to legacy IT environments, the platform must include a catalogue of services such a SOC-as-a-Service (24/7 Security Operations based on Protective Monitoring/SIEM technology), Managed IT Operations (24/7 Network Operations based on AIOps), Software Defined Networking & Software Defined WAN (providing flexible connectivity options), and of course governance and compliance services (GDPR, DSPT, etc).

NILE addresses the blockers to IT modernisation

  • It reduces the ‘spend to save’ burden. Similar to how Crown Hosting provided more flexible commercial terms for organisations that wanted a new datacentre, the National Infrastructure for Legacy Environments will provide similar flexible commercial terms for the servers, storage and network environments that underpin a modern environment. In essence, the platform provides a cost-effective zero CAPEX option that helps organisations avoid the depreciation trap which inhibits onward migration to cloud.


  • It reduces the skills and capability gap. The National Infrastructure will be pre-deployed, pre-integrated and pre-tested so that focus shifts from plumbing together infrastructure components towards enhancing applications and processes to deliver better outcomes and to begin to exploit the inherent value of data to drive better policy decisions.


  • It motivates incumbent SI’s and providers – rather than protecting individual customer contracts, the supplier neutral National Infrastructure gives them an opportunity of expanding their higher value services across a wider community of customers – they have a huge role to play in the discover and migration phase, the ongoing service delivery and applications management phase and the future digitalisation phase.

What are the benefits of NILE?

NILE would be a strategic asset

  • It represents an essential National Capability; a safe and sovereign platform for our nation’s most secure and sensitive public systems.


  • It enhances Speed & Agility; by breaking down the barriers to modernisation and creating a platform that brings together valuable datasets that can be exploited for better policy decisions and better public services. Indeed, as Michael Gove, Chancellor of the Duchy of Lancaster, recently said, “If Government ensures its departments and agencies share and publish data far more, then data analytics specialists can help us more rigorously to evaluate policy successes and delivery failures”.


  • It underpins a vibrant GovTech community of system integrators and software developers; they can focus on helping organisations achieve their outcomes rather than maintaining silos of infrastructure. And their growth underpins the UK’s post-Brexit industrial strategy.


  • It creates a bridge between legacy systems and digital systems delivered in the cloud; providing an actionable and affordable route out of legacy environments, whilst reducing the impediments to onward transformation and enabling organisations to focus more of their time and money on digital services.


  • It starts small and scales. It does not require any investment from government that risks creating a ‘white elephant’. Rather the investment is made by the service providers to create a demonstrable environment, and the subsequent scale-out becomes self-funding as these costs are directly aligned with the business value that organisations will realise from its use.

How could NILE be delivered?

It needs the support of policy and a procurement framework

  • Leveraging the current Legacy IT programme to deliver not just a ‘playbook’ but also a new policy which makes the National Infrastructure the default destination for legacy environments as and when contractual break points occur. Like ‘Cloud First’, public sector organisations should need a business case NOT to adopt the National Infrastructure.


  • Creation of a Joint Venture to enable government to maintain the controlling interest in this strategic national asset. This could become a component of the post-Brexit/post-COVID national investment by this Government, in line with the forthcoming Digital Strategy.


  • Create a new procurement framework specifically focused on addressing the unique needs and challenges of legacy IT. This would provide public sector organisations easier access to a curated catalogue of validated suppliers and services that could be transacted on a commodity basis – the “Legacy Marketplace”.


  • Work with the Government Digital Service to create an ‘IT modernisation blueprint’ similar to the Service Manual which provides a blueprint for digital services. The IT modernisation blueprint would bring together the elements of the Crown Campus, Server/Storage/Network infrastructure and the Legacy Marketplace.