The Texas state government has given IBM 30 days to get a $900 million outsourced data centre consolidation project back on track, threatening to terminate the contract if it fails to do so.

“IBM promised an investment in people, processes and technology to bring the benefits of data centre consolidation to the state of Texas,” said the state’s CIO Karen Robinson in a statement last week. “We have had continual problems with basic service delivery and IBM has failed to deliver on their promises.”

The Texas Department of Information Resources say the seven-year project to consolidate 27 data centres into two, which began in 2006, is just 12% complete.

“The accumulated effect of under-investment by IBM, poor performance, and continual disregard for [contractual] obligations has resulted in harm to state agencies, exposure to unnecessary risks, and failure to achieve the objectives set and agreed to by IBM,” said Robinson.

IBM denies the allegations, however. “IBM has fulfilled its obligations under the contract and today’s action by DIR was unnecessary and unjustified," a company spokesman said, according to US-based Government Technology magazine. "IBM has worked in cooperation and good faith with DIR to provide benefits and improvements to all citizens of Texas. IBM very much regrets the state’s action and will aggressively protect its interests going forward."

Before this year’s general election, the UK government had planned to undertake a similar data centre consolidation strategy. “Over the next three to five years, approximately 10 to 12 highly resilient strategic data centers for the public sector will be established to a high common standard,” a government strategy document said in April 2010. “This will then enable the consolidation of existing public data centers into highly secure and resilient facilities, managed by expert suppliers.”

New rules limiting government IT expenditure may prevent this from taking place, however.