Second Commissioner of Taxation David Butler today said that the increased $879 million budget for the Australian Taxation Office's (ATO) Change Program quoted in an audit report released yesterday was a worst-case scenario.
Yesterday a report by the Australian National Audit Office
revealed that the amount the tax office expected to spend on the
Change Program had increased by $105 million.
According to Butler, the tax office had included extra amounts
such as the costs of possible months of support after the Business
Activity Statement release goes live.
The $105 million was made up by $44 million in extra mainframe
costs as well as around $60 million worth of extra ATO costs,
Butler said, with main ticket items being hardware, personnel and
"We've almost built into our budget a worst-case scenario — the
maximum we could possibly spend," he said.
Yet this budget could change in the future, up or down, Butler
admitted. The Ken Henry taxation review due to go to government at the end
of this year could mean changes for the Change Program's Business
Activity Statements release, scheduled for technical implementation
mid next year, he said. "We can only plan on what we know," he said.
The team is into the detailed design phase for the BAS release,
according to Butler. He wasn't going to push the team to rush it
because of the review. "I don't think it would be sensible to drive
that very hard and turn around and change everything."
The next release to go live is the income tax component of the
program, which is
due to be implemented in January. Even that isn't
set at this point, however. There will be meetings held on
2 and 24 November, and 22 December to decide if the tax office is ready
to implement the release.
"It's a very significant release, it's very big. It's high
risk," Butler said. "It affects every tax payer in Australia."
If the team isn't ready for the January date, being the
Australia day long weekend, it will need to be pushed back.
"The real challenge is the conversion of the data. We need to
shut the whole thing down for four days," he said. "Easter's
another opportunity. But do we have enough time between Easter and
July [when the tax season starts] to stabilise it?"
One thing was certain, according to Butler. The ATO staff was
working hard. "People have been literally working seven days a week
for months," he said.
Accenture is the external systems integrator which the ATO chose
to work with on the program. The audit office report had raised
concerns about responsibilities being blurred between the
organisations. Butler believed that might be the case lower down
where Accenture and ATO were working side by side, but that at
higher levels, responsibilities were set. "Where it should be clear
it is clear," he said. He believed the relationship with Accenture
was strong and positive.
The audit office also believed that the tax office could better
use its assurance framework. Butler said the ATO had already met
that recommendation and that he thought the audit office's concerns
might have been based on historical information. The concerns the
audit office had with testing had also been addressed, Butler
He pointed out that the tax office was already seeing benefits
from the work which had already been completed since the project
Staff had been using the implemented customer relationship
management system since 2005, he said. The core platform for the
integrated core processing system had also been implemented, which
improved how the office managed fringe benefits tax and
superannuation products. Surveys showed that the community believed
the ATO's service was improving, he said.
"This complex program of work has thrown us many challenges, but
it will inevitably put us in a good position to respond quickly and
efficiently to the community's needs and any new policy initiatives
coming our way," he said.