ATO defends Change Program IT overhaul

David Butler, the Australian Taxation Office's (ATO) second commissioner, said its new tax-processing information technology platform is "working well", and that it is putting on an extra 800 staff to deal with income tax returns delays.

David Butler, the Australian Taxation Office's (ATO) second commissioner, said its new tax-processing information technology platform is "working well", and that it is putting on an extra 800 staff to deal with income tax returns delays.

Butler today issued a statement in an attempt to quell concerns over recent media reports that claimed millions of tax returns were delayed. "The new system is working well," he said.

Of the 11 million returns the ATO processes each year, Butler said the ATO estimated 100,000 were over 30 days old. He added that 140,000 delayed cheques were being printed and would be with taxpayers by the end of next week.

"Millions of returns are not delayed," he said.

While the delays may have been exaggerated, the ATO, according to Butler, is hiring an additional 320 people as well as 500 temporary staff over the next few weeks to deal with the backlog.

Campbell's message went into some detail about its IT systems, which have been overhauled under the ATO's near $1 billion Change Program.

The program has been a long and at times painful one. It began in 2004 under former ATO chief information officer, Greg Farr (now Defence's CIO), as a $445 million four-year program.

IT services firm Accenture has been the ATO's major partner for the Change Program work, although Capgemini also works with the agency on assurance.

By 2008, the Change Program was renamed the Change Agenda and then had a total cost of $724 million. Farr's replacement, Bill Gibson, told ZDNet.com.au that July 2010 would be the new completion date.

By 2009, Change had been bumped up to $879 million. The ATO was saving the most complex and heavily used system until last.

"Until recently we have been working with an income tax processing system that was over 30 years old and in need of replacement. This was our largest ever IT overhaul and one of the biggest in Australia," the ATO explained today.

"It was impossible to pick a time in the year to implement a new IT system as massive and complex as this one, which would not have impacted anyone. It was unavoidable that there would be some delays and we have been open about that."

That's why it picked Easter to switch over its legacy income tax processing system to the new platform. The Business Activity Statements portion of the project was at the time expected to be completed by December 2010.