$60 million of taxpayer funds ‘blown’ on failed project

The justice department’s bungled system was one of six public sector information and communications technology projects examined. Photo: (AP Photo/Damian DovarganesThe Department of Justice blew almost $60 million on a new IT system that was dumped without being launched.
Nanjing Night Net

Now the Department of Justice and Regulation is relying on an old system that was considered insufficient 10 years ago, according to an Auditor-General’s report tabled in Parliament on Wednesday.

The financial watchdog found the department’s infringement management and enforcement system was originally budgeted at $24.9 million and due by October 2009. However, the project cost ballooned to $59.9 million in taxpayer funds before it was terminated in March last year.

“This is simply not acceptable,” acting Auditor-General Peter Frost said.

A contractor had been engaged to build the system but the parties reached a legal settlement to terminate the project. At the time of the audit the department was seeking to procure a “new solution”.

The department’s continued reliance on its old “legacy system” meant it was unlikely to cope in the event of a major failure, the report found.

A spokeswoman for the Justice Department said the project cost reached $62 million. She said work on the project remained the intellectual property of the state of Victoria. “This was not wasted effort and indeed this work has been used on many occasions,” she said.

The spokeswoman said a “number of reforms” had been introduced to monitor expenditure on information communications technology (ICT) projects.

The justice department’s bungled system was one of six public sector information and communications technology projects examined by Dr Frost’s office.

His report showed that none of the six systems investigated would be delivered within initial budgets. Only one of them was completed on time.

Dr Frost found the projects had been plagued with problems.

The five other projects examined by Dr Frost’s office were for the Victorian Commission for Gambling and Liquor Regulation, Melbourne University, WorkSafe Victoria, Yarra Valley Water and City West Water.

The report concluded Melbourne University and Yarra Valley Water had shown some “elements of better practice” which contributed to the completion of their projects.

However, the report said information technology projects in the Victorian government should have more effective planning to avoid cost blowouts and late delivery.

A previous Auditor-General’s report found nearly 35 per cent of Victorian government ICT projects went over budget while 50 per cent were completed late.

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