The Queensland Government has announced plans to abandon its whole-of-Government approach to corporate services like finance, HR, and records management.
Launched in 2003, the so-called Shared Services Initiative aimed to deliver "economies of scale and skill" by having agencies outsource their corporate processes to a central provider.
The initiative originally received $125 million in funding and was expected to deliver annual savings of $100 million by 2006. Due to program management issues, however, these savings are yet to be banked.
In a statement to the media yesterday, Queensland Premier Anna Bligh said the Government would abandon the shared services model and overhaul ICT provider Corptech, which was established in 2003 to support the initiative.
Bligh's announcement followed a review by Queensland Auditor-General Glenn Poole into the governance and control of the state Government's information systems.
The report blamed poor project management and a lack of clearly defined business requirements for a failed payroll system implementation at Queensland Health.
It recommended that Queensland review its project management methodologies and ICT frameworks, and reinforce the roles and responsibilities of those involved in the Shared Service Initiative.
The state Government accepted all seven recommendations in the Auditor-General's report, which was tabled yesterday.
In addition, the Premier said the failed Queensland Health payroll implementation showed that a "one-size-fits-all" approach to the Government's payroll systems should be abandoned.
"While the principles behind the shared service model work for some agencies, the Queensland Government recognises there is a place for larger agencies to remain independent in providing corporate services such as payroll and HR," she stated.
"Larger agencies with complex payroll requirements should be able to use the payroll system which suits them and smaller agencies should have the ability to cluster with similar agencies and utilise the one payroll system.
"We are today doing the responsible thing - and that is accept the advice of this independent investigation, resolve to implement each of the recommendations and do the right thing by our hard-working staff."
PricewaterhouseCoopers Partner Roger McComiskie has been engaged to formally review the shared services business model and report to the Director General of the Department of Premier and Cabinet by the end of September.
The review is expected to determine the future of various shared service, and recommend "more flexible arrangements" for state Government agencies.
Meanwhile, a local health payroll model has been re-introduced at Queensland Health, which will this week begin implementing individual payroll hubs that are directly linked to local hospitals.
Deputy Queensland Premier and Minister for Health Paul Lucas said the current, centralised payroll system is to be "removed from the day to day operations of our hospitals".
"What people on the ground, working in our hospitals and their unions have told me is that we need local information and local decision making when it comes to payroll," he explained.
"As a result, Queensland Health will phase in a localised health payroll model over the next three months," he said.