Show Hide image Science & Tech 5 January 2021 How Palantir is quietly extending its reach through the British state Peter Thiel's contentious data analysis firm has won more than £83m of contracts with the NHS, Ministry of Defence and other parts of government. By Oscar Williams Follow @oscwilliams Sign UpGet the New Statesman’s Morning Call email. Sign-up As Palantir's executives were preparing over the summer to release shares publicly for the first time, they faced a challenge: how do you convince investors to buy into a 17-year-old company that has never turned a profit? To make matters worse, the data analysis firm had become closely associated with a president whose days in the White House appeared to be numbered. Under Trump's administration, Palantir had secured a landmark $800m contract to build a battlefield software platform for the US military. And its founder, Peter Thiel, had been Trump's most high-profile supporter in Silicon Valley. But while Palantir's federal government revenues grew rapidly during the Trump era, Thiel had expressed doubts about the president's chances of securing a second term. Palantir conceded in a regulatory filing in August that its “business may be impacted due to shifts in the political environment” after the election. Nevertheless, Palantir's executives were keen to emphasise that they could extend their reach further still. “We are working,” the company revealed, “towards becoming the default operating system [for data] across the US government”. The statement provided a rare insight into the scale of Palantir's federal government ambitions. But the company, whose share price has more than doubled since its September debut, is providing the same data analysis software to several parts of the British state too. In the past 12 months, it has won contracts to support the NHS throughout the pandemic and manage Britain's borders after Brexit. New Statesman analysis shows Palantir has now secured more than £83m of government and NHS deals in the UK. Yet as the company carves out a larger role for itself in Whitehall and the wider public sector, the government stands accused of keeping the public in the dark about how it intends to work with Big Tech in the years ahead. *** Named after the all-seeing crystal balls in The Lord of the Rings, Palantir has an unusual history for a company that now works with public institutions and some of the world's largest banks. Thiel founded the firm in 2003 with colleagues from his previous venture, Paypal, which had been sold to eBay the previous year. He put his own money into Palantir, but the company also received funding from a venture capital arm of the CIA. Its early clients were primarily within the US intelligence community, which used its software to carry out mass surveillance and counter-terrorism operations. Palantir's software provides a platform through which users can access, analyse and link together databases, imagery and various other forms of structured and unstructured data. It has been used by banks to identify staff who might go rogue, US police departments to predict potential perpetrators of crime and immigration officials to track down migrants. Since the start of the pandemic, the company has been expanding its role in healthcare organisations, including the NHS. In March, Palantir was enlisted, alongside other tech firms, to provide the data infrastructure required to enable the NHS to predict demand on hospitals around the country and distribute resources such as PPE and ventilators accordingly. Palantir committed 45 forward-deployed engineers to the project, dubbed the “Covid-19 data store”, in return for just £1. Within weeks the contract, which never went to competitive tender, had been extended for four months at a cost of £1m. When we reported the value of the extended contract in July, NHS England said it had asked Palantir to “package up the work they’ve been doing so the service can go out to tender in an open procurement process”. But observers were concerned at the time that some firms would be deterred from tendering for the contract. When NHS England announced its plans to extend the contract further in September, it did so in a way that meant it could do so without a competitive tender. Concerned by the lack of transparency around the work, the tech justice organisation Foxglove and the news site OpenDemocracy threatened to take legal action. “OpenDemocracy (the claimant) and Foxglove (their support) believe that such a fundamental change to the NHS requires a public consultation, under the NHS Act (and other law),” Cori Crider, the founding director of Foxglove, told the New Statesman in mid-December. “It’s for them to decide whether to share the details of their legal defence, whatever it is, but basically they don’t agree with us. They haven’t consulted, haven’t agreed with our urging in correspondence to consult, and there’s no sign they intend to.” When the New Statesman asked NHS England if it planned to hold a public consultation on its plans, the organisation said on 17 December that it could not comment due to the ongoing legal case. But just a day later, it published an article highlighting how the data store had helped officials “gather and analyse Covid-19 data to provide a single version of the truth about the rapidly evolving situation”. In the penultimate paragraph, the organisation revealed it had signed a new two-year contract with Palantir worth £23.5m. According to a linked contract notice, NHS England had awarded the contract to the US firm on 11 December, the same day Foxglove and OpenDemocracy wrote a letter to the organisation threatening court proceedings. An NHS spokesperson told the New Statesman: “Better use of data is helping frontline NHS staff save lives. This service was procured in an open and transparent way, data remains within the NHS at all time, and full details of how privacy is being protected while data is being used to support the health service in responding to the single greatest public health emergency in its history have been published.” Few within Whitehall deny that the data store has aided the government and health service's response to the crisis. Initially designed to help officials monitor hospital capacity, the tool is now also being used to guide the strategy around vaccine distribution. But what frustrates campaigners is the lengths they have to go to to make officials operate more transparently. NHS England released the contracts it had struck with tech firms to deliver the Covid-19 data store over summer, but only on the eve of legal action being taken against them and once thousands of citizens had called for details of the deals to be made public. Crider told the New Statesman on 22 December that the government has “shown a deeply troubling lack of candour around the data deals between the NHS and Palantir”. Foxglove and OpenDemocracy are now exploring whether to launch a judicial review forcing the government to hold a full public consultation before it awards a longer-lasting data store contract after the pandemic. “The British people deserve the truth about the government’s plans for the NHS and Big Tech in the future – we don’t plan to let them get away with it again,” says Crider. “As the saying goes: fool me once, shame on you; fool me twice, shame on me.” *** Palantir has sought to distinguish itself in recent years from other prominent US tech firms. Unlike companies such as Google and Facebook, it doesn't harvest data for the purposes of targeted advertising. Nor does it sell data to insurers or other third parties. For NHS patients, this is an important difference. However, if you're a migrant in the US who has been tracked down using data analysis made possible by Palantir's software, that distinction will feel academic. NHS England has said that “all data processed in the NHS Data Store is either pseudonymised, anonymised or aggregated”. There are other concerns beyond privacy too. Lina Dencik, the co-director of the Data Justice Lab at Cardiff University, warns that the public sector's increasing dependence on providers of software-as-a-service represents a form of rentierism. Within this particular relationship, says Dencik, the NHS can be seen as the tenant. “It becomes particularly difficult for the public sector to break out of the contracts once they have been locked in,” she tells the New Statesman. “It's not a one-off piece of software that they're buying; they're buying an ongoing service that is going to be continuously optimised.” The NHS may be an especially attractive target for companies such as Palantir, given its unusual status as a centralised national healthcare provider. “The NHS is an interesting one because it is a natural monopoly in many ways,” says Dencik. “So what happens when that monopoly gets locked into this kind of relationship?” As the New Statesman reported in June, these particular concerns have been exacerbated by both Palantir and the NHS's history. The New York Police Department reportedly struggled to obtain usable data from Palantir after its contract with the firm ended in 2017. (Palantir said at the time that its “data and analysis are available to [clients] at all times in an open and nonproprietary format”.) The NHS, meanwhile, spent £12bn on a national programme for IT to digitise patients records that ultimately failed, leaving the health service facing huge legal bills. Beyond the NHS, Palantir is supplying tools to provide the UK Border Agency with information on goods and customs passing in and out of the country after Brexit. The contract, which is worth up to £20m, has proved controversial in light of the company's work with US immigration officials in the US. And Palantir's work does not stop there; it has won about £30m of deals with the Ministry of Defence (MoD) since the start of 2018. One contract worth £1.7m was designed to provide analysis to help stem the tide of staff leaving the Royal Navy. The MoD has also said it spent £28m in 2018 on a “search visualisation and analysis system” developed by Palantir. [See also: Why Palantir is cosying up to Donald Trump] Where will the company move next? One of the biggest commercial opportunities for Palantir in the UK may lie in the government's renewed efforts to better manage health data. The company met the health secretary Matt Hancock and a number of other tech firms in September 2019 to discuss the subject. Many in Whitehall and the NHS believe that following the collapse of the Care.data programme in 2014, Britain's health records are underused. Granting researchers access to a centralised store of such data could accelerate medical breakthroughs, but the government will need to develop the process in a way that is transparent and accountable if it is to avoid the kind of public backlash that brought an end to the original programme. Another significant opportunity may come in the form of Downing Street's plans for an “integrated data platform”. The Office for National Statistics (ONS), which is leading the initiative, has said it aims to “unlock the vast potential of linked data to enhance decision making for the public good”. “It will be a digital collaborative environment that enables cross-government teams and wider communities to deliver complex analytical outcomes by bringing together analysts, data, information governance and domain expertise in a safe, secure and trusted infrastructure”. With data playing an increasingly important role in the development of government policy and state services, some European nations are attempting to wean themselves off American suppliers. The French government, for example, renewed a counter-terrorism software contract with Palantir last year, but said it was seeking to develop a domestic alternative in the meantime. Despite Downing Street's ambitions to accelerate the growth of the UK tech sector, the government is expected to only become more dependent on US firms such as Palantir in the years ahead. Until it starts to manage these partnerships more transparently, the public's concerns will persist. Note: This story has been updated to clarify aspects of the procurement and data protection processes. [See also: How one of America’s most controversial billionaires cracked the NHS] Oscar Williams is a senior journalist at the New Statesman covering technology. Subscribe For more great writing from our award-winning journalists subscribe for just £1 per month!