Delivery issues, conflicts of interest and timeframe “slippage”, have been flagged in an audit of the Federal Government’s Cational Cancer Screening Register (NCSR) project, which is headed up by Telstra.
In early May last year, Telstra was awarded the $220 million, five-year contract to help the Government design and operate its National Cancer Screening Register, which is aimed at establishing a register to support existing cervical and bowel screening programs, among other things.
It was initially expected that the register would go live by the end of March this year. The Department of Health subsequently revealed that this would not be the case, citing difficulties due to the complexity of assimilating and migrating data from eight state and territory registers into one register.
The Department of Health said at the time that the renewed National Cervical Screening Program would instead, be implemented on 1 December.
Now, an audit by the Australian National Audit Office (ANAO) of the Department’s procurement process for the register has revealed a more detailed view of the factors that have led to project delays.
Broadly, the audit report suggests that the procurement of the register complied with the Commonwealth Procurement Rules, effectively managing an open tender process and considering value for money.
However, it also said that the effectiveness of the procurement has been reduced due to inadequate consideration of risk during planning and poor management of probity and conflicts of interest.
Further, it noted that the objectives sought by the Government have not been achieved in the agreed timeframe and additional costs have been incurred as a result.
The Department of Health outlined ambitious timeframes for the NCSR project at the project’s inception, according to the report. Over the course of implementation, however, timeframes have generally not been met and key dates have been progressively rescheduled.
While much of the blame has already been laid at the feet of an unexpectedly complex data migration process, the ANAO has outlined other issues.
In August 2016, for example, three months after the project contract was signed, the project board was advised of Telstra’s intention to implement the register such that states and territories would not all ‘Go-Live’ by 1 May this year.
Health subsequently advised Telstra that it was concerned about this approach. Since August 2016, concerns about timeframe slippage have been regularly raised at the project board and operational governance forum associated with the project.
Due to concerns about progress, Health commissioned a review of project status in October 2016. As a result of the review, Health agreed to a number of actions, including allocating additional contract management resources, reviewing the project schedule and workshopping issues with Telstra.
While some project milestones have been met, such as the execution of the binding services agreement and the due diligence report, other project goals, such a ‘Go-Live’ dates of the bowel screening program and the cervical screening program, have been delayed.
“In an effort to progress resolution on delivery issues, Health requested Telstra to take corrective action regarding the quality of deliverables. Telstra has responded formally via letter and action is ongoing,” the report stated.
According to the ANAO, Telstra has advised the Department that some Medicare data files previously provided could not be reviewed, because the files were corrupted. Additionally, the telco said that the completeness of some files could not be determined and the data that could be reviewed was incomplete.
“The remaining issues identified by the ANAO are associated with the delivery of data,” Telstra said in its response to the ANAO’s findings. “Telstra believes it is important to understand the complexity of establishing a national register and the time required to migrate and reconcile disparate sources of data.”
The audit also uncovered potential conflicts of interest associated with the procurement for the project. These included having a working relationship with one of the tenderers and owning Telstra shares.
The ANAO identified five Department officers who did not declare a past or current working relationship with a tenderer. Additionally, one officer, who did not declare a working relationship with a tenderer, was later identified to have an apprehended bias for one tenderer and was removed from the evaluation team.
The ANAO undertook a limited review of the Telstra share registry and identified nine officers involved in the procurement, who owned Telstra shares and did not disclose this fact at the time of the procurement.
“One of these conflicts related to a voting member of the NCSR Project Board. Review of the Project Board meeting minutes noted that this member voted for Telstra as the preferred tenderer,” the report stated.
The Department of Health has since said that it is strengthening its conflict of interest declaration and management processes.