Ageing IT system adds to Victoria's revenue leak

At nearly four years past its original completion deadline, the long wait for the Victorian Government’s new law enforcement infringement management system is adding to a loss of $110 million in unrealised revenue every year.

In a report tabled in the Victorian Parliament today (pdf), the state’s Ombudsman has found that 3.5 million warrants for fines remain unpaid, meaning that $1.2 billion owed to the government has not been realised. Fines expire after five years, with the government writing off $110 million per annum.

Ombudsman George Brouwer laid some of the blame on a 15 year-old infringements management system (VIMS) that is 'dramatically limiting the ability of fines officers to recoup the money through its sluggish performance and limited reporting functionality', which the ombudsman experienced first-hand.

“I sought data from IMES [Infringement Management and Enforcement Services] in relation to the 10 offenders with the highest value of outstanding warrants,” he said in the report.

 “It took IMES nine hours to develop the query in VIMS and develop a report in relation to one offender. IMES said that it would take another 4-6 hours to produce the report for each of the other offenders in the top 10.”

The IMES, within the Department of Justice, has also found it is unable to update the ageing system in accordance with new legislation and has come up against a bug which prevents it from suspending the licence of a non-paying offender if he or she has more than one warrant against their name.

In 2007 IMES signed a $24.9 million deal with Tenix Solutions to build modern replacement for VIMS, which is still under construction nearly four years after its August 2009 due date.

The Ombudsman said the first warning bells should have been ringing when the bid came in at nearly half of the $45 million the state had originally forecast the project would cost. Predictably, the budget has since re-grown to $44.6 million.

In a statement that echoes his damning Victorian Government ICT report of November 2011, the ombudsman said he believes sloppy preparation is the cause of the overruns and delays.

“Detailed specifications for the system were not developed prior to the state entering a contract with the external provider,” he said.

The IMES and Department of Justice have accepted the Ombudsman’s request that they make a fines reform program, funded to the tune of $34.6 million in the 2013-14 budget, a policy priority.