Fiona Stanley Hospital IT could cost another $50 million

Outgoing West Australian under-treasurer Tim Marney believes the state will have to spend another $25 million to $50 million to get the IT systems at its new Fiona Stanley Hospital up to scratch.

Fiona Stanley Hospital under construction

Marney was called to appear before a parliamentary committee investigating the troubled construction of the new facility last week. Opening of the hospital has been delayed by six months to October 2014, primary because planners were too ambitious about the IT implementation schedule.

He said the delays had cost the state an additional $330 million already, including up to $151 million in IT costs.

But Marney said the full bill was still being negotiated between the WA government and the outsourced hospital operator Serco, with the remaining IT exposure likely to be up to $50 million, or around $25 million “if things go really well."

Despite being promoted as a “paperless hospital” at the outset, the facility that opens its doors in October will have a number of manual systems in place, after the fully digital vision had to be compromised to meet construction deadlines.

Marney also said he believed the drain Fiona Stanley placed on WA IT funding left other health technology projects short changed.

“The decision of cabinet, when it allocated the additional funds for ICT for Fiona Stanley and Albany, explicitly prioritised the systems investment for those two sites to ensure that they could open; therefore, if you like, deprioritising the rest of the system,” he told the committee.

The under-treasurer was scathing about the effective side-lining of Treasury as health officials signed away $4.3 billion worth of public funds in what he described were "carelessly prepared" Serco contracts.

The terms of the deal, he said, meant that Serco’s ability to meet key implementation milestones was dependent on the health department delivering an IT platform for the hospital on time despite an “extremely poor” track record of doing so.

“Put the two together, that meant we were going to be up for some form of compensation to Serco because we could not give them the ICT platform promised them,” he said.

In a frank exchange he said he and his Treasury colleagues were “pissed off” at being given only two weeks to scrutinise the Serco/Department of Health contract before it was signed, and said he felt pressured into waving through the process.

"Give us your comments within two weeks or you’re going to hold up the opening of the hospital,” was the message delivered by anxious health officials, he said.

Marney also shared a number of key warnings about the implementation of IT projects picked up along the lengthy gestation of the Fiona Stanley Hospital, which he said had already informed the construction of the Perth Children’s Hospital.

“The approach [in Perth] will seek to source an off-the-shelf product that can be easily adapted to the new children’s hospital rather than constructing 48 systems from scratch,” he said.

“You never build stuff that you can buy off the shelf; you never build bespoke stuff that then has to be integrated with generic products; you change your business processes rather than changing the systems to suit the business processes.

“You never do big bang,” he warned. “Because big bang goes boom!”