Vic agencies avoiding scrutiny of IT spending: auditor

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Vic agencies avoiding scrutiny of IT spending: auditor

Damning audit reveals annual costs estimate way off.

The Victorian government is running blind when it comes to IT, and its agencies are reluctant to share details of their technology operations with the accountability watchdog, according to the state's auditor-general.

Auditor-General John Doyle and his team today revealed that estimates of the state government’s annual IT expenditure are likely to miss the mark by at least 100 percent, if not more, exposing serious deficiencies in public sector IT visibility.

Victoria’s annual tech budget has often been benchmarked between $1 billion and $1.5 billion, based on 2010 figures from research firm Ovum, with the figures notably repeated by former state Coalition Technology Minister Gordon Rich-Phillips.

However, in its review on the state's IT projects and initiatives, the audit team today placed the figure closer to $3.02 billion, representing a 4.3 percent slice of the state’s annual operating expenditure.

Doyle also used the report to express frustration with the attitude of agencies towards his investigation. He complained of pushback against attempts to shine a light on IT performance and project expenditure in the state’s public sector - which has been found severely lacking in the past.

“While many smaller entities welcomed and supported the audit objectives from the onset, I found it concerning that a number of larger agencies initially questioned the benefit of identifying and reporting their ICT expenditure and determining the status of their ICT projects,” he wrote in the report’s introduction.

His audit team was forced to chase VicRoads and the Department of Health over their failure to fully report the Roads and Licensing (RandL) program and the HealthSMART scheme - worth a combined $481.5 million - in their responses to the audit even though they were “clearly within the scope of the survey”.

Public Transport Victoria (PTV) had to be followed up for only partially reporting expenditure on the notorious myki electronic ticketing solution - the most expensive IT project in the state.

The report also suggested that favourable accounting might have been applied to some of the figures.

“Significantly lower than expected actual project costs were reported even for ICT projects previously subjected to government scrutiny," the report revealed.

"Examples include the HealthSMART and Ultranet projects. Actual costs for these have been previously estimated as far higher than what was reported in the survey."

The Auditor-General’s officers weren’t the only public officials to offer up evidence of agency-based stubbornness in the face of greater reporting demands.

The now defunct Department of State Development, Business and Innovation said “significant pushback from agencies” was one of the main reasons it never managed to flesh out a fully functional ICT dashboard tracking IT projects across Victoria's public sector.

The damning report found the same IT weaknesses continue to trouble Victorian technology operations, despite a series of reviews into the problems - including the Ombudsman’s 2011 expose which revealed the state’s top 10 IT projects were collectively $1.44 billion over budget.

“‘The Victorian public sector does not have a good track record with ICT projects,” Doyle wrote, and the most recent findings show that project management and delivery shortcomings “continue unabated”.

This latest investigation found:

  • Nearly 35 percent of all 1249 projects surveyed were already over budget or expected to be;
  • Nearly 50 percent of all surveyed projects were behind schedule;
  • Nearly 30 percent of projects had no documented business case;
  • Only 38 percent of project business cases met the minimum requirements of such a study.

The Auditor-General said he would review different elements of Victoria’s IT operations in a series of rolling reports over the next three years.

He plans to drill down to specific projects in the next instalment of the series.

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