An audit into whether the delivery of the ICT component of the Queensland government's state penalties enforcement registry (SPER) reform program was governed properly has revealed the project was a disaster from the very beginning.
"Despite the efforts of the senior public servants involved in the SPER Reform Program (including the ICT component) and the application of many procurement, project management, and assurance practices, the governance over this program was not effective from inception," the audit carried out by Auditor-General Brendan Worrall concluded.
The audit was initially launched after concerns around timeliness, clarity, reliability, and adequacy of oversight in relation to the IT component of the program were raised by Queensland government under treasurer Frankie Carroll on 25 March 2019.
SPER, which is part of the Office of State Revenue (OSR) within Queensland Treasury, is responsible for collecting and enforcing unpaid fines issued in Queensland, and uses an unsupported 19-year-old Oracle-based legacy system to do so.
The SPER reform program, which began in May 2014, included implementing new case‑management software through an ongoing Software-as-a-Service (SaaS) arrangement to assist SPER recover unpaid fines.
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However, the contract was terminated in May 2019 after the expected go-live date was changed on several occasions, the audit report said. It was initially scheduled to go live in October 2018, before being delayed to November 2018, and then to April 2019.
As a result, the audit found the total cost of the SPER Reform Program to 30 June 2019 was AU$76.8 million -- a significant difference when compared to the original contract value of AU$58.7 million.
Of the total cost, AU$52.7 million was spent on the IT component, another AU$22.3 million for the IT vendor, AU$13.8 million for the 10 consultancy service providers, and AU$9.7 million for contractors.
The audit also found that prior to the project starting, SPER had 688,000 debtors who owed AU$999 million as at June 2015, but by the end of the program SPER had seen an increase, with 757,000 debtors who owned AU$1.27 billion as at 30 June 2019.
The audit report went on to reveal there were flaws in how the service was procured. For instance, the chair of the steering committee who oversaw the project also chaired the tender evaluation panel, which meant there was the potential to compromise the independence and objectivity of the steering committee, and nor were there any other independent members.
Other weaknesses observed by the audit included the lack of adequate IT skills and experience to manage the IT component of the procurement process, and that SPER procured the product without performing a detailed assessment of the product's suitability, nor did it ensure the vendor's product met its legislative or operational requirements.
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When it came to legal advice, SPER engaged its own legal advisor to develop the contract because the Queensland Treasury's legal division did not have the necessary experience to assist with the contract for this program, and it did not provide support to the project until early 2019, when it became involved in the decision-making around terminating the contract, the report said.
Further, the detailed contract deliverables were not clearly defined, which the audit report said resulted in over 300 change requests and three significant contract variations during the project.
Worrall concluded the program suffered what was described as a "culture within SPER and the Office of State Revenue that involved operating in a silo and being overly optimistic".
He also put forward eight recommendations for the Department of Housing and Public Works and Queensland Treasury. These include developing a guideline to assist entities in establishing digital and IT contracts, upskill staff within public service on IT projects, ensure appropriate governance arrangements are established before vendors are engaged, and improve transparency of major IT projects.
He added that given the Queensland government plans to spend AU$2.6 billion on IT projects over the next four years from 2018-19 to 2021-22, the SPER reform program should be a lesson learned for other IT projects.
"The purpose of these reports will be to develop insights and to share learnings from significant projects across the public sector. The information within these reports will be over and above what departments currently report through the government's digital projects dashboard," he said.
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