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Services Australia has advised that, of the $246.1 million allocated as its budget for GovERP, $198.15 million had been spent as of 31 December 2023 (Services Australia January 2024). The Minister for Government Services has subsequently advised (see Reference 2) that the remaining budget will be used to continue sustainment of the current ERP solution, including ongoing licensing and hosting costs of the platform, see Appendix D. 

3.2 Delivery to date 

The Panel understand that 30 capabilities (out of 39 functional capabilities of the MVP 1.1) have been developed to date, with a subset of 18 of these capabilities having completed functional testing. 

Development and functional testing have primarily focused on: 

• human capability management-related capabilities (hire to retire), with 9 capabilities having completed functional testing to date; 
• financial management-related capabilities (budget to report), with 8 capabilities having functional completed testing; and 
• procurement-related capabilities (procure to pay), with one capability having completed functional testing. 

The Panel could not confirm through evidence that travel and expense management-related capabilities completed GovERP functional testing. However, a key vendor (8common) has advised that all build elements for the travel and expense management tool (Expense8; see Reference 3) have been completed and functionally tested, albeit not explicitly integrated as part of the MVP 1.1 GovERP solution. 

Note: Figure 2 shows DTA analysis based on Appendix C, Reason Group technical assessment report.

Components built-to-date were prioritised around the functionality required to onboard AGD (i.e. MVP1.1). There are some positive foundational features, however, existing capabilities are not sufficiently developed to address the MVP1.0 capabilities necessary for broader use across government.

3.3 Remaining work

As part of its terms of reference, the Panel was asked to advise on any remaining work envisaged to complete GOVERP. The Panel understands the following functional capabilities have not yet been developed and would require progression to complete the MVP1.1 (refer Appendix F):

1. Budget to Report – 2 capabilities (18 per cent of 11 functional capabilities envisaged for this value stream under MPV1.1): Commonwealth Reporting, and Lease Accounting 
2. Hire to Retire – 1 capability (8 per cent of 13 MPV1.1 functional capabilities): Employee Management 
3. Procure to Pay – 4 capabilities (44 per cent of 9 MPV1.1 functional capabilities): Accounts Payable, Report Procurement Activities, E-procurement, and Whole-of-government Purchasing (see Reference 4)
4. Travel and Expense – 2 capabilities (50 per cent of 4 MPV1.1 functional capabilities): (see Reference 5) Credit Card Management and Travel Management. 

The Panel notes that, while functional testing has been completed for some capabilities, no system integration testing or user acceptance testing appears to have occurred as part of activities to date. Such testing is critical to completion of trusted and operational ERP (see Reference 6). Services Australia has stated (Services Australia June 2024):

• SIT [system integration testing] and UAT [user acceptance testing] were planned prior to the implementation of Attorney-General’s Department (AGD) and were scheduled. SIT was to commence November 2023 and UAT early 2024
• [System integration testing and user acceptance testing may] have been completed if the programme was not ceased mid-flight.

3.3.1 Potential costs, risks, and benefits of remaining work

The Panel is mindful that progressing development of the capabilities identified in Section 3.3 for AGD’s deployment (i.e. MVP1.1) may not be sufficient to complete GovERP. 

In correspondence of 26 April 2024, the Hon Bill Shorten MP advised, “The development of the current ERP solution had primarily focussed on meeting the Attorney-General’s Department’s requirements, which in its current form are not suitable to meet the expansive operational requirements of Services Australia.” (see Reference 8).

Considering Minister Shorten’s advice that the current ERP solution is not suitable to meeting Services Australia’s requirements, the Panel notes the 18 functional capabilities completed to date falls short of both the MVP1.1 (of 39 functional capabilities) and the MVP1.0 for whole-of-government purposes (54 functional capabilities). In this context, the objective of a standardised, common transactional corporate service will not be achieved by GovERP, even if it is further developed to carry out the remaining work to complete the MVP1.1. 

Additionally, the underlying technical stack is no-longer current for GovERP’s financial and procurement-related capabilities, with a version change released in 2023. Updating to more current versions is necessary to ensure appropriate functionality, reduce ongoing out year maintenance, and to remain on the upgrade path.