A review of the Australian Taxation Office's (ATO) change program, completed this month by CPT Global, has found that the office is now making savings of around $150 million per annum.
After the introduction of tax reforms in 2000, the ATO realised that its National Taxpayer Systems (commissioned in 1993-1994) weren't going to be fast or effective enough to deal with the office's requirements. In 2002, the office began consulting the community to find out what citizens wanted from the tax office. The consultation resulted in a project, for which objectives were set in 2004 and a budget of $445 million, to be spent over six years. Accenture was engaged to conduct the project.
When the program was completed in 2010, the actual amount spent was found to be $814 million, according to consulting firm CPT Global. Of this, $597 million was funded by the ATO; the rest was met by the government over the years, to deal with changes in tax laws over the term of the project. This proved to be less than what the Australian National Audit Office thought would be spent.
Of the final costs, Accenture accounted for 55 per cent, 18 per cent was spent on ATO labour and contractors, 17 per cent on hardware and 10 per cent of the costs were classed as "other" (which included third-party change management services and software).
When the project started, the taxation office hoped to achieve efficiency gains of $155 million per annum. Converted into 2010 dollars, the expected gains would have been approximately $182 million per annum, CPT Global said.
The program has, to this point, actually achieved savings of $147 to $153 million per annum, mainly by saving on staff requirements in Client Account Services and Customer Service and Solutions. Given the amount the ATO, itself, spent on the project, this would mean a return on investment of four years. CPT Global warned, however, that this may not always be the case in the future. For example, the ATO had expected a reduction in the processing resources required by the system, but the move to real-time (instead of batch processing), the increase in the number of transactions and the move to a more personalised service have all combined to actually increase loads.
Intangible benefits that the project has provided include:
The ability to deliver new policy and tax changes faster
The ability to resolve issues at a client's first call due to improved case management
The ability to manage the ATO's workforce on a national scale
Increased transaction processing capability
Improved self-service options for clients via portals
Improved data integrity.