Qld Health payroll inquiry hears 'casual' approach allegations

The inquiry into Queensland Health’s bungled $1.25 billion payroll system upgrade has heard of warnings of budget blowouts, an atmosphere of urgency, and an allegedly casual approach taken by Treasury’s procurement officer in seeking to award the initial contract.

The Commission of Inquiry, which is being led by the Hon. Richard Chesterman QC, aims to analyse the contractual arrangements between the State of Queensland and IBM Australia, to determine why the contract price blew out over time.

It is expected to assess all aspects of the project, from procurement and contract management through to governance and implementation, and determine if "any laws, contractual provisions, codes of conduct or other government standards may have been breached".

The first day of the initial two-week sitting saw former Accenture senior partner Marcus Salouk give evidence.

Salouk was part of the Accenture team that bid for the role of prime contractor with Queensland Treasury in 2007. The contract was later awarded to IBM.

In his witness statement Salouk said he knew that the Queensland Treasury was burning its budget, and was concerned it would end up with insufficient budget “to actually get where they needed to get to with implementing the new system”.

Yesterday, Salouk told the inquiry that Queensland Government shared services provider CorpTech had been struggling with the project for some time and there was a great sense of urgency to finalise it.

However, he said he had concerns about the rigour associated with the process of seeking bids for the work.

The initial request for proposal was issued by email to Accenture, SAP, IBM and Logica.

“My concern was it’s unusual to receive a request for a firm proposal in the form of an email,” Salouk said under questioning.

“We did ask them about the process. The process seemed to be a very fast track process, it was directed at specific companies.

“They gave us an assurance that they were going to contract at the end of it.”

Accenture spent around $1 million on business development, believing it would be awarded the contract, according to Salouk's witness statement.

CorpTech later followed the initial RFP with what they referred to as an Invitation to Offer (ITO).

In his witness statement, Salouk said there was mention that one of the bidders in the initial RFP had made a complaint.

“I believe that they ran too loose a process the first time around with the RFP,” he testified.

Salouk alleged CorpTech employee Terry Burns, a former IBM executive, was casual in his communication of information to members of the Accenture bid team.

“It was far more conversational than it was disciplined as I’d expect from a procurement officer,” he alleged.

The inquiry continues.