More costs for Queensland's shared services overhaul

The Queensland Government will spend an additional $5 million a year on ICT after reassigning the responsibilities of former shared service provider CorpTech to three separate organisations.

The state's Department of Public Works decommissioned CorpTech in July, following a review of an over-time, over-budget payroll implementation blamed for 35,000 errors at Queensland Health.

The state government planned to spend three years, commencing last financial year, and a total of $220 million to address the payroll issues.

That sum included $19.9 million (excluding GST) on implementing PricewaterhouseCooopers’ recommendation of a three-provider model, parliamentary discussions revealed this week.

According to a leaked email tabled in parliament, the new shared services model will cost an additional $4.8 million (excluding GST) a year when fully implemented in 2012-13.

The email was sent by Department of Public Works director-general Natalie MacDonald on June 22 and tabled by Shadow ICT Minister Ros Bates, who described ICT as a “key area where we’ve seen repeated, catastrophic and expensive failures”.

A spokesman for the Department of Public Works explained that the funds were needed for establishing a separate technical environment for Queensland Health and “enhanced governance and capability arrangements”.

“It is to be expected that when a new model is implemented, there will be costs incurred in the establishment, operation and maintenance of such a model," the spokesman said.

The spokesman highlighted the establishment of a new Shared Services Strategy, Planning and Portfolio Management group to support the three shared services providers.

To date, no CorpTech staff were made redundant in the transition, with more than 23 employees moving to the Department of Education and Training and 413 staff moving to Queensland Shared Services.

The third shared services provider, Queensland Health, was on track to take over payroll responsibilities from Queensland Shared Services by 2013, the spokesman said.

Last year, CorpTech charged Queensland Health $44.9 million for finance and payroll services.

The departmental spokesman said those were two of the largest systems in the Queensland public sector.