Council's $1b in IT costs 'wasted'

The Super City has spent $1.24 billion on IT since it was formed in 2010 - enough money to pay for the council's half share of the $2.5 billion city rail link. Photo / Sarah Ivey

The Super City has spent $1.24 billion on IT since it was formed in 2010 - enough money to pay for the council's half share of the $2.5 billion city rail link.
Among the benefits, Aucklanders can now register dogs online and access nearly 100,000 e-books, but most online experiences with council are still a grind.
Libraries have also provided an e-magazine service called Zinio since 2013, peaking at 65,060 downloads last August. Popular titles include Woman's Day, Cuisine and The Economist.
Other improvements to the council's IT system, such as booking a hall or swimming lesson online, are not far off, say council chief financial officer Sue Tindal and chief operating officer Dean Kimpton.
Figures provided to the Herald under the Official Information Act show Auckland Council has spent $902 million, Auckland Transport $209 million and Watercare $124 million on IT since 2010.
Senior executives attribute the costs to moving from computer systems inherited from the eight former councils to a single environment.
Critics claim the decision by the Auckland Transition Agency to largely build a new system from scratch for Auckland Council was never properly evaluated.
ANZ Bank undertook a similar exercise to Auckland Council when it merged with the National Bank. The IT costs were about $220 million and the project took about two years, 12 months longer than planned.
A bank spokesman said 1.7 million customers were moved over and "we balanced our multi-billion dollar bank to the cent".
Said one senior council officer: "Over $1 billion of expenditure over five years is just nonsense stuff.
"You can do a hell of a lot of things with $1 billion."
Critics point to the Auckland Transport computer system, copied off the former Auckland Regional Council system for $2.2 million, which operates well for less cost.
Council officers have argued Auckland Council is far more complex than Auckland Transport, their systems are different and building from scratch would be robust and serve long-term needs.
Watercare's IT spend of $124 million is small fry compared to the council's.
Risk and assurance manager David Sellars said the water company took the prudent decision not to start from scratch but adopt an existing platform called Hansen used by some councils when it took over their retailing functions
The system has worked well for five years, he said, but acknowledged it was ageing and will need replacing.
The council IT project considered key to delivering better services and savings is NewCore.
In late 2014, the Herald revealed a cost blowout to the NewCore programme, designed to consolidate the systems of the former councils.
Mr Kimpton is confident NewCore is on budget and on track to go live in June and be fully operational a year later.
It would greatly increase the ability of Aucklanders to engage with council online, such as lodging a building consent and tracking progress, he said.
Ms Tindal, who has a corporate background, said the council's progress on NewCore compared favourably with other similar IT projects by large, publicly listed companies.
"These are multi-year, highly complex programmes. They are not easy to deliver and there are risks involved," she said.
This month (February), Ms Tindal announced a saving of $33 million over 10 years after renegotiating the council group's "strategic partnership" with SAP.
Instead of spending $125 million with SAP as per an earlier agreement, the council will spend $92 million over the next decade.
Asked if ratepayers had received value for money from SAP in the first five years, Ms Tindal said: "You are asking me to make a value judgment and I'm not going to do that."
Councillor Mike Lee said the $1.2 billion figure showed a bigger scandal than he had suspected. "There is so much good we could have done with that sort of money but most of it has been wasted."