Back to the future: Qld kickstarts payroll consolidation


news The new LNP Queensland State Government has revealed plans to consolidate eight “outmoded and heavily customised” payroll IT systems into one outsourced system, in a move which will re-ignite the debate over how the state should provide core IT services supporting administrative functions to its various departments and agencies.

In a statement issued on Sunday, Queensland technology minister Ros Bates said her department, Science, IT Arts and Innovation, currently used eight separate government-run payroll systems, with individual agencies Arts Queensland, CITEC, the Office of the Queensland Scientist, Queensland Shared Services, Queensland State Archives and Smart Service Queensland all using different systems.

Bates said that in the coming months the Government would go to market “to replace eight government-run systems with one outsourced system”. “It’s ridiculous that one department has eight standalone payroll systems that don’t talk to each other. I’m planning on bringing the eight payroll systems together,” Bates said.

Bates said that tenders would be called in the coming months for the new standalone system and that all new government tenders would include a small and medium sized enterprise component. “That way we will be boosting the economy in Queensland rather than competing against it” she said.

The payroll systems to be replaced, according to Bates, no longer have the protection of the current software versions and have all been heavily customised to keep them going, making them expensive to run and vulnerable to hackers. The new payroll system would be targeting a non-complex, straight-forward system designed for 9 to 5, Monday to Friday workers.

“Our current systems are akin to driving a 1972 Ford clunker with the original tyres which has missed most of its services,” said Bates. “We are paying IT specialists exorbitant amounts of money to gaffer tape our system so we can pay our staff.” Bates said it was time to create single efficient and cost effective system, adding that the LNP had inherited ‘profound’ problems in IT from the previous Labor administration.

However, one major payroll system — that of Queensland Health — will specifically not be included in the consolidation effort. A project to replace Queensland Health’s payroll system was first kicked off in late 2007, when the department determined there was a need to look at a new payroll platform to replace the previous platform, based on Lattice and ESP software, which had been progressively implemented from 1996. Partially as a result of the fact that the state had decided to standardise on SAP’s ECC5 and Infor’s Workbrain software across its whole of government operations, those same platforms were picked for the Queensland Health implementation.

However, the project, implemented by prime contractor IBM, Queensland Health itself and government shared services provider Corptech — quickly went off the rails as poor governance and the complexity of Queensland Health’s award system kicked in, with the result that many of Queensland Health’s 85,000 workers have gone without pay, or were overpaid, at various periods from early 2010, when the system went live.

A KMPG audit into Queensland Health’s payroll disaster found the project has already cost $417 million and will need some $837 million to fix over the next five years, in a finding which the state’s new LNP Health Minister Lawrence Springborg saying in Parliament illustrated that the project was an “abomination”.

Partially because of the Queensland Health issues, in June 2010, then-Queensland Premier Anna Bligh revealed the state would abandon its centralised IT shared services model as its exclusive structure for delivering IT services in the wake of the Queensland Health payroll disaster and damaging revelations of widespread problems in associated programs. Bates’ announcement over the weekend regarding the payroll systems of her portfolio appears to mark somewhat of a return to an IT shared services model, at least with respect to the payroll systems in her department.

Does it feel a little bit to some people out there that history is about to start repeating? With all of the state government IT disasters which Australia has witnessed recently, I find it incredibly hard to believe that the Queensland Government is capable right now of delivering a project which will see eight separate payroll systems consolidated into one — even if that system is outsourced and managed by an external provider.

This is exactly the kind of initiative which has gone wrong, time and time again, in state governments all around Australia, over the past half-decade, and I will be extremely surprised if Bates’ department can deliver this one anywhere near remotely on time or on budget.

If you think I’m being a little bit pessimistic, I encourage you to read a little bit about payroll-related IT shared services initiatives and other similar IT consolidation projects in Western Australia, Victoria, Queensland and New South Wales. You’ll find that virtually none of these projects have succeeded. I expect Bates’ department has a rocky road ahead indeed.

Image credit: Back the Future movie promotional image


  1. This can only end badly.

    To anyone considering tendering – you will be working for multiple stakeholders with a changing political agenda. The goalposts will change, and I expect at least one group to threaten to sue [for PR/political reasons if nothing else]. Control scope with formal detailed contracts [FULL SPECS]. Ensure you have a single authorised point of contact with each stakeholder. Take payment in advance. Budget for disputes.

    Basically, do your due diligence, and be prepared to walk away.

  2. Taking this is a fools errand. Figure out what you think the costs will be, then triple it and some.

    • Example of previous similar projects show that tripling the cost would wind up with an extremely conservative estimate compared to what will actually happen.

  3. I predict this is a brilliant plan by the new premier. Create project with no chance of success, blame public servants for its mal-administration and cost overruns, cancel the project and bask in the glory of having saved the taxpayer squillions.

    • Possible, except a lot of Public Servants have at some time been burnt by just such callus political mechanisational schemes. No doubt they will keep a trail of documents and terms of references which will point to the real culpable party.
      But the PR Side-Show will be always the winner to the one that can set off the “BANG!”, “BELLS and WHISTLES” and the loudest screaming to gain the attention of the subdued, half mind dead, complacent Sheeple Constituent voters, who will automatically turn to the most noisy attention grabbing think and go Baaaaaaaaaaaaaaa in agreement, once they consider if it might threaten their comfy chair, TV, grog and middle-class welfare.

  4. I wonder if IT companies (of all shapes and sizes) would be bold enough to “no bid” this one?

  5. Isn’t there a little ERP vendor in BNE that was spurned by the previous administration when they were selecting financials? From what I have heard they have a very good relationship with the current political leaders. I wonder if they are seeing this as an opportunity to trial a different payroll solution here?

  6. Renai,

    Worth watching further re QLD Gov IT audit – the new minister is claiming it will all work this time because last time Peter Grant did not have the power.But he does now. Anyone who has worked in QLD GOV IT during the last decade will know that until there is real change nothing will change. As much as we all like Peter wasnt Peter with others from Transport etc the key authors and architects of much of the direction and methods employed by QLD Government for the last decade.

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