Failed apprenticeship IT system had 'critical defects'

The Department of Education and Training said critical defects in the national apprenticeship management IT system contributed to its decision to dump the project.

The Australian apprentice management system (AAMS) was axed by the department earlier this month after a PwC review uncovered significant project governance concerns, including around contract management and stakeholder engagement.

The report declared the system “not fit for purpose" and said it would not "realise the benefits as intended in the business case”, largely because of a lack of end user consultation.

The terms of reference from the review specifically focused on the department's project, contract management and stakeholder engagement abilities rather than problems with the technical solution or the initial tender process.

But at a senate estimates hearing today, secretary Michele Bruniges said that while accepting responsibly for the failure, her final decision not to continue with the project was also influenced by critical defects with the NEC-built system.

“I think the vendor would say that they initially underestimated the complexity of the AAMS system, and indeed probably under-resourced the technical development,” she said.

Bruniges said that there were a number of occasions where milestones were not met, particularly during 2017, which had ultimately forced her to personally order the review.

"There [were] a significant number of defects at each of those pauses in go-live statements, some of which were critical in nature, which meant that to proceed or go live at that point would have not been in the best interest of users and so the go-live decision wasn’t made,” she said.

“And I think that was a combination of defects that were in place, identified by both NEC and the department, [and] things that weren’t identified in the original schedule that should have been.

She listed a series of "critical items" she alleged were missing in November 2017, including transferred contract training, forgotten passwords and reset passwords that were supposed to be included but weren’t, missing screens and short message services, and "a single logon mechanism."

An NEC Australia spokesperson would not be drawn on the specific allegations, saying only that "NEC is not in a position to make any comment on the AAMS project at this time".

Bruniges admitted that she first became aware of the “underestimation of the complexity of the project” by both the department and NEC in July 2016, but had been “continually assured” that it could be salvaged up until August 2017.

“I did not take the decision to cease this project lightly - it was a particularly difficult decision - and I am determined to cease the AAMS project rather than to continue to invest in a system that would not have ultimately met business needs or expectations,” she said.

Two senior executives responsible for the project have also left the department in the wake of the PwC report.

They left over a two week period in April, after Bruniges held “conversations” with the pair in early April over their accountability and responsibility for the project.

But she rejected an assertion by Labor senator Doug Cameron that the senior officers were encouraged to leave.

“Those officers made a decision to leave the department,” she said.

Cameron described the terms of references for the PwC report as “designed to nail SES officers to be the scapegoats”, while neglecting assessment of the technical solution or the tender process.

Costs rise to $24 million - and more needed

The total cost of the project now sits at $24.1 million, with $10.5 million having been paid to NEC - more than the original $9.8 million deal.

Two months ago the department put the total cost of the project at $18 million.

The department also revealed that the project’s budget had risen to $27.2 million after the department was forced to funnel another $7.6 million into the project from its “departmental capital budget" in 2016-17 and 2017-18.

Bruniges said that no action had been taken to recover costs from NEC.

“We have finalised the contract with NEC, and that was done to pay them for the work that was done,” she said.

“That includes us having the intellectual property over the source code and indeed the software licence that emerged from that.”

But because technology has moved on since 2015, she said the department “would not anticipate a great use of that source code”.

Bruniges said the existing 16-year-old Training and Youth Internet Management System (TYIMS) was “stable” and would continue to operate “in the short to medium term over the next two to three years”, but would be updated.

“To ensure its effective ongoing operation we’ll upgrade the underlying infrastructure of the TYIMS system, maintaining application stability, and ensuring we have the appropriately skilled staff to support [it],” she said.

The system’s underlying technical infrastructure will be upgraded to a supported platform at a cost of between $400,000 and $900,000.

Additional support personnel would also need to be engaged at a cost of between $250,000 and $400,000 per year because the system is written in Visual Basic 6.0