Labour department’s ICT strategy “underway”

The Department of Labour (DOL) says its ICT strategy aimed at fixing problems created when it cancelled the billion rand Siemens contract, is underway.

Growing dissatisfaction with service delivery, escalating project costs and the ruining of the IT capacity, all led to the decision to end the 10 year IT contract with Siemens, the department stated.

“A process was currently unfolding in partnership with Accenture to deal with capacity issues in the department and its public entities,” the department said in Parliament.

According to the department, Accenture services are currently broken up into two phases. Phase one – which is set to cost R10 million – was to conduct a current environment assessment towards the information phase of the Public Private Partnership exit – and to assist with the exit plan, through resources and subject matter expertise.

The second phase – with a budget of R8 million – will see the development an ICT strategy as well as the creation of a programme management office to manage the PPP exit and to provide skills required for the exit.

The ICT strategy was introduced after Accenture was appointed by the department to help it save money after the contract with Siemens was cancelled and to ensure compliance with Treasury regulations.

According to the DOL, the long-running Siemens contract was cancelled after the company failed to integrate labour market services and systems to offer better services and to achieve maximum IT benefits and objectives against budgetary constraints.

Following a review of the project by KPMG, the department had decided to terminate the contract at the end of its term. The contract, which dates from 2002 is due to run until November 2012. Initial costs were set at R1.2bn and are now set to increase to R1.9bn as a result of interest rate and inflation changes.

The department also committed itself to strengthen its supply chain management processes and also complement this with the appointment of well trained personnel.