There had been a $20.5 million blowout and a five year delay in a major IT project managed by Treasurer Kevin Foley.
Evidence given to today’s meeting of the Legislative Council Budget and Finance Committee by Under Treasurer Jim Wright confirmed that the original $22.5 million budget for Revenue SA Information Systems To Enable Compliance (RISTEC) had blown out by almost 100 per cent and an extra $20.5 million had been allocated to the project.
Liberal Member of the Legislative Council, Rob Lucas, said today that Mr Wright conceded that the project, which commenced in 2002, was meant to have been completed by June 2006 but was now expected to be concluded in 2011 – five years overdue!!
Mr Wright also had to concede that the final agreement was still being negotiated and, although he didn’t think it likely, he could not guarantee there would be no further blowout in costs.
“This is a major embarrassment for Mr Foley who claims he is a good financial manager and is often critical of other departments like Health for cost blowouts and poor financial management of projects,” Mr Lucas said.
“It is obviously a case of: ‘Do as I say, not as I do’.”
Mr Lucas said that Mr Foley was first warned about this project back in 2002/03 by the Auditor General when he was very critical of the first part of the RISTEC project:
“…no evidence that the Committee was monitoring project expenditure against budget…
“As the project costs are predominantly salary and contractor expense based, the project is likely to be subject to some over expenditure against original funding allocations. At the time of the review, Audit recommended that the project continue to the closely monitored and any corrective action applied when necessary to minimise project costs overseen”
(Auditor General’s Report 2002/03 61)
Again in his 2005/06 report, the Auditor General expressed further concerns:
“However, the advice to Cabinet has not been comprehensive with respect to providing detailed particulars concerning scope, reasons for project delay and the revised cost and timeframe expectations in regard to significant components of the replacement system”
(Auditor General’s Report 2005/06 22)
“It is now clear that Mr Foley has been ignoring warnings from the Auditor General since 2002/03 and taxpayers now have to find another $20.5 million to pay for the blowout and his slack financial management,” Mr Lucas said.