​Human Services wants SAP to lead welfare payment system overhaul

The Department of Human Services has flagged SAP as the preferred tenderer to overhaul its 30-year-old welfare payments platform.

The Australian Department of Human Services has announced SAP as the preferred tenderer to update its ageing welfare payments system, currently responsible for processing over AU$100 billion in Centrelink payments annually.

The department said it is yet to sign with SAP Australia and contract negotiations are still underway to begin overhauling the 30-year-old system the department has in place, the Income Security Integrated System (ISIS).

Former Australian Treasurer Joe Hockey noted previously that the upgrade is set to cost the Australian government billions.

Official discussions with SAP began after the department published a Request for Expressions of Interest (REOI) in September to gather suggestions from the IT industry on how to design and begin construction of the new welfare payment system.

WPIT is expected to take seven years in total, with the REOI falling under the first tranche of the project, which also includes planning, scoping, and design work, and adding some initial "bolt-on" digital services for welfare recipients.

"This is one of the largest social welfare business transformations undertaken worldwide; success will depend on establishing strong industry partnerships," former Minister for Human Services Senator Marise Payne said previously.

The department published a request for tender this week to establish a panel of systems integrators to support the WPIT program.

"The tenderers ranked highest in the evaluation of the [request for tender] responses will be invited to form a panel with the two highest ranked tenderers invited to participate in a subsequent Competitive Dialogue process from which the department will select a partner to deliver the systems integration elements of the proposed tranche two of the WPIT Program," the lodgement documents read.

The latest request for tender will close on August 23, 2016 with "competitive dialogue on-board and execution" to kick off in November.

In 2014, Human Services selected SAP to deliver its AU$102.2 million child support payment system upgrade.

SAP also rolled out its Investigative Case Management product at Centrelink in 2011 to help investigators automate processes, streamline intelligence gathering, and increase productivity and efficiency.

"SAP was able to demonstrate solution capabilities specific to Centrelink's business processes and issues, and quickly established itself as a partner, rather than just a software vendor," Centrelink said at the time.