Mega vendors tie-up $100m Centrelink WPIT work

More than $100 million worth of systems integration work for the federal government’s billion-dollar Centrelink payment systems overhaul has been secured by DXC, Accenture and Capgemini.

Contracts published this week reveal that the IT giants will provide “system integration, business transformation and technology-related services” for the welfare payment infrastructure transformation (WPIT) program over the next three years.

The deals were signed under the WPIT systems integration panel, which was created for suppliers to compete for work relating to tranches three to five. These will initially focus on payments for jobseekers, older Australians, carers and people with disabilities.

A DHS spokesperson told iTnews that the arrangement related to the current tranche of WPIT, but would not disclose at which tranche the program was currently at.

DXC, formerly HPE, has secured the lion’s share of the new work having signed a $63.6 million contract, while Accenture will receive $25.2 million and Capgemini $13.1 million.

Contract notices also suggest that the vendors are not likely to win any further work under the panel.

“The reported contract value is the maximum estimated value of all work packages anticipated to be raised under this arrangement,” the contract notices say.

The spokesperson added that "the department has not committed to a minimum spend under the contracts".

"This resource arrangement does not prevent the department procuring other services under the panel," the spokesperson said.

The four-member panel was established by the department in November 2016 for suppliers to compete for WPIT tranches three to five.

The idea was to create competitive tension and limit risk for future contracting rounds.

It was revealed shortly after Accenture and Capgemini were locked in negotiations for the first system integration deal, which Accenture subsequently won.

The $26.1 million, nine-month deal was focused on tranche two of the program, student payments. Other contracts have also been signed, according to the spokesperson, but these are absent from the AusTender contracts database.

Tranche two has delivered many of the technical changes to the Centrelink back-end that will be leveraged in future tranches, including systems integration, rollout of an initial module of SAP software, and migrating student payments.

The fourth member of the panel, IBM, chose not to respond to the arrangement, the spokesperson said, and has not been awarded any contracts for the WPIT program to date.

WPIT has been allocated almost $600 million by the federal government since the program’s inception in 2015.

It was most recently handed $316.2 million in this year’s budget for the third tranche of the program, which is concerned with jobseekers, older Australians, carers and people with disabilities.

The department also recently began a process to rip and replace its complex welfare payments entitlements engine, which determines how how much welfare recipients are paid through the country’s new SAP-based Centrelink payment platform.