​Victoria's IT projects are poorly planned: Auditor-General

With a focus on six failed IT projects, Victoria's Acting Auditor-General has prepared a report that highlights how the state's IT projects continue to show poor planning and implementation with cost and scheduling overruns.
Written by Asha Barbaschow, Contributor

The Victorian Auditor-General Office (VAGO) yesterday released phase two of its report into the state government's IT projects, finding that despite previous reports, projects continue to show poor planning and implementation.

At a cost to taxpayers of AU$480,000, the objective of the audit according to VAGO was to examine whether Victorian public sector agencies and entities are appropriately planning, managing, and implementing selected IT projects in terms of cost, time, benefits realisation, and governance.

"Unfortunately, the Victorian public sector does not have a good track record of successfully completing ICT projects," Acting Auditor-General Dr Peter Frost wrote. "Weaknesses in planning and implementation mean that these investments often: Do not meet functionality expectations nor demonstrate expected outcomes, cost much more than the planned budget, and/or are delivered much later than planned, and are cancelled prior to completion, while still incurring significant costs."

The Digital Dashboard: Status Review of ICT Projects and Initiatives - Phase 2 report focused on six state IT projects, reporting that none of them were, or will be, completed as initially budgeted and that only one of the six projects will be delivered on time.

The first of the six projects scrutinised by Frost's team was under the umbrella of the Department of Justice & Regulation. After surpassing its AU$24.9 million budget by AU$35 million, the Infringement Management and Enforcement System Project was terminated when it became clear that the vendor could not finish the project more than six years after its originally proposed completion date.

"This cancelled project cost nearly AU$60 million in Victorian taxpayers' funds," Frost said. "This is simply not acceptable."

Still in progress, the City West Water's Arrow Program is expected to reach a total of AU$122 million, which is AU$16 million over budget. The project involves the migration of the agency's operational systems.

Another in progress IT project is the Victorian Commission for Gambling and Liquor Regulation Liquor and Gambling Information System Project, which has been reduced in scope in order to meet budget. The AU$14 million project originally intended to compile operations and to securely capture, link, store, and manage data in one place, but it will no longer deliver all initially intended functionality so it can be completed for less than AU$15 million.

The University of Melbourne's ISIS Student Management System Project was completed with a AU$7 million blowout; the Yarra Valley Water Improving Infrastructure Management System Program cost the state AU$9 million more than estimated; and the WorkSafe Electronic Document and Records Management System Project was reduced in scope to come in under budget once completed.

As a result of the ill-management of state-run IT projects, the VAGO said Victorian government IT projects should be more effectively planned and managed to avoid cost and schedule overruns.

Frost said that the latest audit confirms that IT projects continue to show poor planning and implementation, which he believes results in significant delays and budget blowouts.

"It is the responsibility of the executive leadership teams to ensure that their agencies and entities demonstrate the appropriate behaviours and required skills to ensure successful delivery of ICT projects," he said.

"A robust culture of active governance at the senior management level enables agencies to make well-considered decisions and to effectively engage with vendors. Being an informed and vigilant ICT buyer is critical to success.

"The focus should not just be on the delivery of new capabilities but also on realising the project's intended benefits."

Although under the gaze of a new Auditor-General since phase one was released, VAGO's previous report did not paint a brighter future of Victoria's information technology projects.

Part one of the VAGO's report, Delivering Services to Citizens and Consumers via Devices of Personal Choice: Phase 1 - Interim Report, updated the status of 1,249 IT projects across the Victorian public sector, finding that nearly 35 percent of Victorian Government IT projects went over budget, while some 50 percent were completed after their initially planned completion dates.

Phase one also found that about 52 percent of consumers were satisfied with government services online; however, there were increasing demands for government services to be delivered online and to be accessible anytime, anywhere, via any digital device.

At the time, former Auditor-General John Doyle promised taxpayers that despite the limited resources and outdated mandate he finds himself with, he would keep on top of the issue.

The Victorian government has also had a tumultuous history with its on-again, off-again, state-owned IT service, the Centre for IT Excellence (CenITex).

In July, an efficiency review, commissioned by the Victorian Department of Premier and Cabinet (DPC), said the proposal to outsource CenITex should not proceed and instead revert back to a government IT service, because the business case does not fully account for the amount of work and cost required within departments to achieve the required level of standardisation.

CenITex has been plagued with controversy, such as the slashing of 200 jobs in 2012 as a result of employees having exorbitant salaries and contract fees, with some salaries reportedly worth AU$500,000 per year.

Later that year, the Victorian Ombudsman released a report that listed a number of breaches in the CenITex procurement process, revealing that up to AU$4 million worth of IT contracts were awarded without due process.

Doyle also found in June that the disruption of the government's IT strategy has played a part in the ill-monitoring of the industry.

"Since 2013, responsibility for the whole-of-public-sector ICT portfolio has transferred twice -- from the Department of Treasury and Finance to the former Department of State Development, Business, and Innovation, and, most recently, to the Department of Premier and Cabinet," Doyle said in his findings.

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