City pays $56m for new IT system

Auckland ratepayers are paying $53.8 million for a new Auckland Council computer system. Photo / Thinkstock

Auckland ratepayers are paying $53.8 million for a new Auckland Council computer system, but only $2.2 million for a similar system at the mega-transport agency.

The $56 million bill to support day-to-day functions, such as human resources, payroll, the financial system and procurement, is the single biggest cost of about $200 million in set-up costs for the Super City.

The officer in charge of overhauling the computer systems, Mike Foley, said the two organisations and their requirements were very different.

The agency setting up the Super City decided to largely rebuild an existing system from scratch for the Auckland Council because of the complexity of the system needed to serve 8000 staff.

The Auckland Transport computer system was copied off existing platforms to serve 1000 staff.

Mr Foley said the quantum of scale was appropriate in terms of the cost to introduce the two systems.

But concerns have been raised in information technology circles that the Auckland Transition Agency did not need teams of consultants to build the Auckland Council system from scratch and it could have copied existing systems used by the Auckland City Council, Auckland Regional Council and Waitakere City Council.

Former regional council information technology head John Holley, who was on an IT working group during the transition process, said the complexity of the two systems was not the issue, especially as transport was more complex in some areas than council work council and vice versa.

The issue, he said, was the different approaches of building from scratch and copying an existing system.

"Is the Auckland Council environment 25 times more complex and bigger than transport? The answer, of course, is no."

Mr Holley said an assessment of the system used by the regional council and its transport subsidiary found it was good enough to be used as the base for a new system.

This resulted in Auckland Transport's system being up and running at a cost of $2.2 million when the Super City came into being.

"To the best of my knowledge, no-one made an assessment about whether Auckland City or the ARC's implementation was appropriate for the Auckland Council," he said.

However, an evaluation was done by the consultancy firm of Ernest & Young, which recommended a new computer system for the Auckland Council - a view shared by the Department of Internal Affairs' technology arm.

A transition agency working group of senior council staff identified SAP as the most appropriate system and the $53.8 million contract was awarded to a consortium including SAP, Deloitte, Hewlett Packard and IBM after nine parties were invited to tender.

Auckland Transport chief information officer Roger Jones said copying the existing SAP system had been very successful.

Both organisations were different and difficult to compare in terms of size and functionality, he said.

"Auckland Transport has a high volume of financial transactions and a significant asset database ... the size and number of staff is really irrelevant to system functionality," he said.

Council chief executive Doug McKay said the cost of implementing computer systems was scary, but as far as he could tell the transition agency ran a good process.

The former private sector boss said he had implemented three new computer systems in the past and each time there had been serious cost blowouts.