The Federal Department of Employment and Workplace Relations (DEWR) is being accused of forcing rival work placement applications out of the market for insisting its 200 Job Network Members undertake a multimillion dollar IT upgrade.

The upgrade could cost up to $4 million for large organisations, according to the National Employment Services Association (NESA).

An IT manager from an employment services organisation said that as the regulator of the Federal Government's Job Network the DEWR is using its leverage unfairly by forcing employment placement agencies to use the department's own EA (employment assistant) 2000 application.

Despite the department's plans to "move forward" to an EA3000 application by the end of next year DEWR employment systems general manager Anthony Parsons has rejected the criticism claiming network members are under no obligation to bid for job network service part three.

"These [network members] are generally IT naive; their strength lies in servicing job seekers," he said.

Parsons said the aim is to move toward Web services and XML by retiring the old EDI (electronic data interchange) facility to improve flexibility.

"We are writing into the new tender that we would like to close down the old EDI facility and would like the third-party packages to add value to the policy core," he said.

The cost of the project is covered in the department's $10 to $20 million yearly IT budget.

In a memo sent to Computerworld the IT manager said DEWR manages interaction between Centrelink and the 200 Job Network Members.

He said DEWR provides a software product to manage the delivery of the Job Network [EA2000], which is a frontend to its mainframe as well as the corporate interface, which is a "cheap and nasty" version of the B2B portal.

He listed the rival third-party products as including ResMan for the Job Network, JobMax, and JobReady Solutions, among others.

The IT manager claims that for 18 months the DEWR has been forcing its own products on the members, rejecting others and using what he feels are "dirty tactics" to justify department expenditure to upgrade its product to .Net with no B2B capability.

"The current strategy for the next round of contracts, Employment Services Contract 3 (ESC3), will be no B2B interface and all job network members will be required to use EA3000," he said.

The DEWR's old EDI system, called corporate interface, will be replaced in 12 months. Avanade completed a pilot project in November 2001 to deploy Microsoft's .Net framework to demonstrate connected government in action.

NESA documents, responding to a DEWR strategy paper, outline Job Network Member concerns regarding the proposed IT infrastructure for ESC3. It points out that a large number of members do not use EA2000 as part of its client-servicing operations and members are concerned about cost of compliance, timing and plug-ins, testing, privacy issues, the availability of XML and .Net experts and lack of .Net information.

The IT manager said DEWR is justifying the standardisation and upgrade with claims that it is necessary for Privacy Act compliance and that all job seeker information has to be kept with the department.

The IT manager has also cast doubts about the independence of an audit which KPMG is conducting into Privacy Act compliance because it has been commissioned by the department's own Internal Audit services.

Parsons confirmed the audit is being undertaken because there have been examples of Job Network Members retaining information about job seekers well after placement was concluded.

"Members are supposed to send all information back to us; it isn't just a matter of checking filing cabinets when electronic copies are available," he said.

Key Points

National Employment Services Association's concerns about proposed IT infrastructure:

* the new application may increase the need to manually transfer the data into a duplicate system, risking data integrity and accuracy.

* increased costs. First-year costs are estimated at $1.5 million plus replacement of third-party software, smartcard technology upgrades (to cost about $2.5 million) and business process re-engineering costs; $0.77 million plus BPR costs for a medium-sized organisation; and $45,000-plus BPR costs for a small organisation.