NSW DEC job cuts from SAP project scaled back

NSW DEC job cuts from SAP project scaled back

Summary: The extent of job cuts to the NSW Department of Education, as part of its long-running LMBR project, were much lower than originally planned.

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When the Learning Management and Business Reform (LMBR) project was announced in 2006, the NSW Department of Education and Communities (DEC) was expecting the project to affect 1,600 roles, but only 400 are currently flagged to go after negotiations with the union.

The LMBR project was set to replace 15-year-old legacy finance, human resources, and payroll systems with SAP systems. The project was broken up into two phases, and the first phase of deploying finance systems in state and regional offices and in TAFE NSW was completed in 2010. The school implementation was set to be delivered in 2011, but, as of June 30 last year, it had not been completed.

Phase two of the project would see the human resources and student administration systems deployed. According to the NSW auditor-general's report (PDF) last year, a pilot for these systems was expected by late 2012, and is expected to be completed by 2015.

The whole project has cost AU$176 million as of last year, and is expected to cost AU$386 million in total; last month, NSW Minister for Education Adrian Piccoli flagged that 400 positions would be going as a result of efficiencies from the program by 2016 (PDF).

But despite the government seeking to save AU$1.7 billion from the DEC, and reducing the workforce by 1,800, the 400 jobs reduced through LMBR is much lower than was originally estimated. In NSW Budget Estimates hearings earlier this month, Peter Riordan, DEC deputy director general of Corporate Services, said that the original figure was 1,600.

"Part of that original business case identified savings of the equivalent of 1,600 full-time-equivalent positions across the department, flowing from the Learning Management and Business Reform system," he said.

Following the completion of stage one of LMBR, the department negotiated with the Public Service Association (PSA) for the reduction of 400 positions.

"The 400 [jobs were] part of a negotiated settlement between the department and the PSA," Riordan said.

But he indicated that more jobs could go as a result of the project.

"Currently, we are reviewing our organisation, and LMBR will provide systems which will enable us to streamline various aspects of our work, which will enable things to occur in a more efficient way, and that will sometimes mean less human contact," he said.

"We will not know the full impact on resourcing levels until such time as [a service-delivery model for the department] has been completed."

Topics: Government, Government AU, SAP

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Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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