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SAP gains traction in two key jurisdictions

by Michael Read •
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SAP has made further gains in the Australian public sector market, following the announcement of an agreement between Accenture and the Department of Human Services (DHS) for a SAP based replacement to the Department’s Child Support payment system (Cuba). 

According to Intermedium’s Budget IT tool, the Child Support System Replacement (CSSR) project was allocated $34.7 million in capital funding in the 2013-14 Budget to be spent over four years.

In 2012-13, the Federal Government spent $44.6 million on SAP-related procurements (ie either with SAP itself or third parties supplying or working on SAP platforms).

Prior the announcement on 24 February 2014 of the deal with Accenture, SAP-related procurement as published by AusTender for 2013-14 Year to Date (YTD) was $32.6 million. Following the expected publication of the contract this week, it is likely that 2013-14 YTD will exceed 2012-13 in terms of Total Contract Value (TCV) for SAP related procurement.

Cuba was implemented in 2002 and currently supports approximately $3.2 billion in annual payments involving 1.5 million individuals, according to the original Expression of Interest released in July 2013. The EOI revealed that the system does not possess the required functionality to meet future needs.

“The CSSR Project is intended to execute over a maximum of five years to address deficient capability within the department as a result of the current Cuba application being unable to fully or easily support Commonwealth government initiatives and directions,” the EOI stated.

Cuba is accessed by over 3,000 staff and holds all electronic customer records and supporting transactions for assessments, payments and data exchange with external agencies.

The new system will be based on SAP Commercial Off-the-Shelf (COTS) software, according to a media release from Human Services Minister Senator Marise Payne.

“Accenture and SAP will assist in building the replacement system while ensuring that the department is left with a skilled, in-house workforce able to maintain the system into the future, at reduced cost to the taxpayer”, stated Minister Payne.

It is expected that the new Child Support system will be implemented in 2015, with further upgrades scheduled for completion by June 2018.

DHS’ expected timeframes for the redevelopment are:

  1. Build and deploy the child support system replacement on the new unified servicing platform by mid-2016;
  2. Transition all existing customer data from the existing Cuba system to the new departmental Unified Servicing Platform and decommission Cuba by the end of 2016; and
  3. Implement business driven enhancements by the end of 2018 that enable the child support system to accommodate Commonwealth government initiatives in addition to more fully supporting current legislation and policy.

SAP inroads in NSW

Earlier this month, the NSW Department of Finance and Services (DFS) announced it was following other NSW service clusters by consolidating its array of disparate Finance and Human Resource Systems into a single SAP compliant platform.

In January 2014, Transport for New South Wales (TfNSW) inked a $70.4 million agreement with Deloitte for systems integration services associated with TfNSW’s cluster-wide overhaul of its ERP systems. Deloitte, Fujitsu and Oxygen Business Solutions were the three respondents to the request for Expressions of Interest, with Deloitte and Fujitsu proceeding to shortlist, according to information obtained from TfNSW. 

A $13.2 million contract was signed with BackOffice Associates to migrate data from the array of existing systems into the consolidated SAP ERP platform.

In November 2013, the NSW Justice Cluster released a Request for Tender (RFT) for a cluster wide SAP, software-as-a-service ERP solution, following a business case which recommended transferring the thirteen Justice Cluster agencies to a standard ERP solution.

In July 2012, NSW Trade and Investment announced that it would consolidate its legacy ERP systems into a single system under a $14.5 million agreement with SAP. In August 2013, the project was described as “very successful” by the Department’s Director-General Mark Paterson.

Related Articles:

Queensland Health rethinks $80 million SAP replacement

SAP to rebuild Finance’s Central Budget Management System for $24 million

Trade and Investment cloud platform to go live in days

For more information, please contact the Editor (02) 9955 9896.

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  • Federal
  • NSW
  • IT Services
  • Software
  • Human Services
  • Accenture
  • BackOffice Associates
  • Cuba
  • Deloitte
  • Department of Human Services
  • NSW Department of Finance and Services
  • NSW Justice Cluster
  • SAP
  • Transport for NSW (TfNSW)