Agenda item

To receive a presentation from the Executive Director for Finance & Corporate Governance

The Board received a presentation from the Bi-Borough Director of Finance updating members on the Managed Services project. Officers reported that the project would now not be going live on 1^st April 2014 as originally intended. It had been agreed in December 2013 that the project would be delayed to start either on 1^st September or 1^st October as there were a number of systems that were not functioning properly.

Members asked for details of the cost implications and who would be responsible for them. Officers explained that the six month delay would halve the savings anticipated for 2014/15 to £200,000 for the Finance & Corporate Services department. The savings had been found elsewhere in the department’s budget so there were no additional costs for the year. It was also reported that the Council and BT would likely share the costs as both parties contributed to the reasons for delay. Officers described how when testing was conducted the system had a high failure rate and crashed. Members therefore questioned how the delay was not the responsibility of BT and officers explained that there was an issue of clarity regarding the Council’s initial requirements. It was also acknowledged that the Council did not have sufficient project management in place in the early stages of the project. The Board noted that the FCS department had made a realistic budget allocation for the project team that made a contingency for delays. The only costs not budgeted for were therefore the reduced savings, but these had been found elsewhere. Officers also highlighted that similar IT projects, such as the adoption of Oracle software by a number of London Boroughs, were also experiencing delays due to the complexity of the systems involved.

The Board asked how officers could be confident that the identified problems could now be resolved to prevent further delays. It was explained that the project now had a much more complete project plan with clear milestones that would allow both parties to know exactly how the project was progressing. Officers acknowledged that they did not have absolute confidence that the project would not experience further delays, but they were confident the project plan was sufficiently robust.

Members questioned why there was ongoing uncertainty regarding the practicalities of the new systems and why it was that the day-to-day operation was not addressed during the procurement and tendering process. Officers explained that the competition process was judged on the high-level outputs of each submitted tender, rather than the day-to-day systems. The Council went out for tender for a basic, vanilla system that could then be sold to other authorities, which would then amend the system for their local needs.

The Board noted the intention for Strategic HR to be retained in-house, with other HR functions being commissioned to external providers. Members asked for clarity on what was meant by Strategic HR functions. Officers undertook to investigate the issue and provide full details.

Action: Bi-Borough Director of Finance

The Board thanked officers for their presentation and agreed that a further update would be required at the July meeting.

RESOLVED –

That the report be noted.