Govt sinks another $313m into Centrelink IT replacement

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Govt sinks another $313m into Centrelink IT replacement

Guarantees funding for tranche two.

The federal government has handed the Department of Human Services another $313.5 million to spend on the replacement of its Centrelink payments system, a project expected to cost $1.5 billion in total.

The mid-year economic and fiscal outlook (MYEFO) published today reveals tranche two of the welfare payments infrastructure transformation (WPIT) - which will deliver the first technical changes to the welfare back-end - will cost $313.5 million over four years.

Accenture and Capgemini are currently in the running to win the contract to rewrite the student payments module and transition it over to new SAP-based processing software.

MYEFO papers reveal the money will pay for “automated claim and assessment processes", and will help develop "core system capability, including a new omni-channel user interface, segmentation and risk profiling”.

The DHS said this critical first payments module will produce a “reusable template for delivering subsequent payments".

The new technology will deliver a strengthened foundation for the government to chase an estimated $3.7 billion it thinks it can scrape back into budget coffers by tackling welfare fraud and better debt recovery.

It has stepped up its fraud detection ambitions since this time last year, when the government announced it wanted to return $2 billion to the budget largely through expanded data matching between Centrelink claims and income records with the tax office.

The government delivered $60.5 million to the initial design and procurement phase of WPIT back in the 2015 budget, bringing the total allocations to date to $374 million.

A panel consisting of HP, IBM, Capgemini, and Accenture will recompete to win contracts for phases three through to five.

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