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

by Kristen Hammond •
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SAP Australia has been selected as the preferred supplier for the $24 million redevelopment of the Federal Government’s Whole-of-Government budget and financial management arrangement, the Central Budget Management System (CBMS). 

A contract notice published on AusTender on 11 April revealed that SAP would be providing Finance with Commercial-Off-The-Shelf (COTS) Software for the CBMS between March 2011 and March 2016 at a value of $24,443,375. The CBMS redevelopment is funded from the ICT Business as Usual (BAU) Reinvestment Fund, established as part of the Gershon Review.

The contract is a big win for SAP, which despite having a large ERP installation base across Canberra, has mainly contracted with Defence and the Australian Taxation Office (ATO) in recent times.

SAP’s CBMS contract with Finance is its third largest in over a decade, according to Intermedium’sICT contracts database.  Two Defence contracts executed in 2010, the first for $25 million (SAP software licences) and the second for $31 million (software maintenance and support for 5 years) make it to first and second place.  

The CBMS supports government management of appropriation, annual and monthly estimates and reporting, and the recording of Budget measures.

According to Finance’s 2009-10 Annual Report, the current CBMS system will reach the end of its usable life by the end of 2012, with a business case confirming that a comprehensive redevelopment was the best option when taking into account cost, benefit and risk. The business case was put together in consultation with agencies and industry and took into account a variety of factors, including functional and non-functional requirements and experiences with similar systems in the UK, Canadian and Victorian governments.

This has been an example of a rapid procurement for a project of this size, with the contract being finalised eight months after the issuing of the request for tender (RFT). The project was funded in the 2010-11 Budget (at an undisclosed amount), and an RFT for Provision of Commercial-Off-The-Shelf (COTS) Software for Central Budget Management System followed on 6 August 2010.

Tender documents indicate that the Central Budget Management System (CBMS) redevelopment is aimed at delivering a solution that “enables Finance to meet its core responsibilities to government for financial management, monitoring and reporting”.

The System will perform a number of key functions, including:

  • Collection and maintenance of up-to-date Budget Estimates at a per-Agency and Whole-of-Government level;
  • Management and tracking of cash;
  • Collection from Agencies of monthly established profiles, monthly and annual Actuals;
  • Responding to changes in government structures; reporting and accounting frameworks in as short a time as practicable; and
  • Being able to report both internally to government and to the broader public as to the use and collection of public monies.

The CBMS redevelopment is intended to generate significant benefits, including:

  • Improvements in strategic decision making and support of evidence-based policy through the provision of relevant, accurate and authoritative financial and budgetary information;
  • Providing timely, accurate and consistent financial and budgetary information through streamlined and simplified methods for data entry, leading to greater data integrity;
  • Flexibility to meet existing and future government initiatives, with sufficient adaptability to ensure future government initiatives with respect to financial framework, level of data collection and reporting frequencies without a significant rework;
  • Improved system performance, including stability and availability; and
  • Reduced IT operational costs in terms of the time and resources needed to maintain and operate for a given set of capabilities when compared to the current CBMS.

A project of similar scope in Victoria was awarded to CSG, to be implemented on an Oracle platform.   According to a CSG press release of 7 June 2010, a seven year contract has been executed with the Victorian Department of Treasury & Finance (DTF) to develop and support the State Resource Information Management System (SRIMS), a 600 user system which will manage the State of Victoria’s resources including the formulation of the state budget, reporting against the budget and cash management.

 

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Jurisdiction
  • Federal
Category
  • Software
Sector
  • Treasury
Tags
  • BAU Fund
  • CBMS
  • CSG
  • Department of Finance and Deregulation
  • oracle
  • SAP
  • Victorian Department of Treasury & Finance