Victoria’s major IT projects under review


Several of Victoria’s major government watchdogs and the new Coalition government itself have taken the first steps in bringing the state’s trouble-plagued technology projects to heel, putting one flagship project on ice and scheduling others for a series of reviews that will govern their future.

Under the previous Labor government, which had held power from 1999 through to late 2010, a number of technology projects in the state had gone off the rails.

Perhaps the most high-profile of these has been the project to replace Victoria’s public transport ticketing system. Known as myki, the project was kicked off in 2002 and saw massive contracts awarded – including a $494 million deal with the Kamco Consortium in 2005. However, it gradually ran off the rails, with bugs plaguing the rollout and issues of probity being revealed in the contract process.

Another major project is the HealthSMART initiative, a $360 million initiative which aimed to replace the state’s medical records systems with new software across the public health network, and the LINK project, which aims to replace Victoria Police’s 17-year-old criminal history and crime reporting database, LEAP – which is used by almost all of the force’s frontline police.

In a statement this morning, the Victorian Ombudsman – an independent officer with broad-reaching powers of investigation – confirmed a report by The Age newspaper that it would be reviewing ICT projects across the government.

“I can confirm that the Ombudsman is investigating Information and Communication Technology projects. Beyond that, the Ombudsman will not be making any comment,” a spokesperson for office of the Ombudsman said. The office of the state Auditor-General is also reported to have been involved, although a spokesperson would not confirm what projects were on its list this morning.

However, speaking in a media conference in Melbourne regarding the LINK project, Deputy Premier and Minister for Police and Emergency Services, Peter Ryan, noted the executive branch of the State Government was also involved.

“The Ombudsman is now conducting an own-motion review which regards not only this project but other technological projects with which the former government has been associated in the past few years,” he told journalists. “That review has been undertaken in consultation with Attorney General. We will be guided by what the ombudsman’s report says to us, so I have no doubt the Ombudsman will make recommendations not only on this project but also on another projects.”

Although the myki project has had the most high-profile problems within the State Government over the past few years, it appears that the LINK project would be the first cab off the rank to face a review.

Victoria Police had already suspended the project in March 2010, with the force’s new chief information officer Michael Vanderheide stating in May last year that although the new platform was to have been rolled out progressively last year, significant issues were evident – so the CIO’s team had taken about six months out to re-think the initiative from start to finish – a time frame which finished up right around the time the last election campaign began in late 2010.

“We’ve spotted a problem — we’re not going to blindly charge ahead,” he said.

This morning Minister Ryan said Victoria Police had come to the Government “a few weeks ago” to request permission for the project undergo a shift – which the Government agreed to. The force is proposing to re-establish the business case for the initiative and to bring a renewed proposal back to the Government at some point in the future, with another bid for funding. “We’ll consider that on its merits, as in when that day does com,” said Ryan.

However, it appears as though the force will need to make a strong case.

“I can tell you though on behalf of the government we’re not going to spend another cracker on the development of this project, unless and until we have a business case put to us which is reflective of the contemporary needs of police in Victoria and which ensures that the interest of Victoria and taxpayers is properly protected,” said Ryan. He noted that consulting firm KPMG had reviewed the project and estimated the overall cost of the project to be about $100 million – although about $45 million had already been spent of the project’s initial $68 million budget.

HealthSMART may be the next project to be reviewed on the list. The Age reported in late March that departmental advice delivered to the new Coalition Government stated that the project would need another $200 million spent on it to justify the initial $360 million cost, with at least $95 million needed to complete the initial vision and the rest to go on replacing systems outside HealthSMART’s initial scope. Health Minister David Davis said as early as January 24 that the project would be reviewed.

Much of the public upheaval associated with the Victorian Government’s IT project failure has only come about in the past few months as the new Coalition administration has been examining the position of the state after a decade under the rival Australian Labor Party.

However, commentators were noting the widespread problems even as far back as May 2010.

Steve Hodgkinson, director of analyst firm Ovum’s Australian government practice and a former deputy chief information officer of the Victorian Government, highlighted a culture of fear regarding large IT projects in an analysis of the state’s annual budget at the time.

“Perhaps a slowdown in the funding of large IT transformation projects is prudent, given the number of projects in-flight and the high profile procurement and ongoing delivery dramas of some of the largest — including the myki public transport ticketing project and the redevelopment of the LEAP system in Police,” he wrote. “We may be at the end of a major IT project era until the Government’s confidence in its ability to successfully deliver large IT-enabled transformation projects is restored.”

Marina Freri contributed to this article. Image credit: Jonathan LaRocca, Creative Commons