Ombudsman slams Victoria Police over IT

Report identifies serious financial mismanagement in the IT department

An investigation into the Victoria Police Business Information and Technology Services Department (BITS) has found damning evidence of financial mismanagement.

The report by Ombudsman Victoria revealed there were "no fewer" than three external reviews, five internal audits and two criminal investigations undertaken since August 2006 in BITS' activities.

While the findings from the reviews, audits and investigations indentified a funding gap of $39 million over three years, Victoria Police has only recently taken remedial action. The report concluding earlier action along with a more attention on the funding of individual projects would have saved "significant public expenditure".

The Ombudsman's investigation, which looked at the tendering and contracting of IT services by BITS, also found:

  • Victoria Police's CIO between April 2004 and November 2008, Valda Berzins, "acknowledged that she did not closely monitor the operation of the BITS budget, which in 2008-09 was approximately $191 million"
  • BITS enlisted "the assistance of the incumbent vendor to provide competitor analysis that would form the basis of the evaluation report and market testing"
  • That in February 2007, BITS "obtained the relevant approvals to redirect security services valued at more than $11 million from IBM to Fujitsu. In March 2007 the former CIO entered into a contract with Fujitsu to the value of $27.2 million dollars, some $15 million above the approved expenditure"
  • And in another case, BITS prepared the documentation for a $20.1 million contract in the space of 24 days. "It was a process that many in the industry estimated would normally have required anywhere from 10 to 18 months to be done effectively and efficiently."

The Ombudsman also said BITS' record keeping was inadequate and key procurement documents often had to be requested from vendors as Victoria Police had not retained or could not locate them.

As part of the report the Ombudsman made several recommendations including: BITS create a policy that prohibits adjusting contracts over a certain value without approval, according to Victorian Government Purchasing Board Procurement Policies; and establishing a central major projects management facility.

Notably the Ombudsman also said Victoria Police should take "immediate action to ensure that a full disclosure of the Fujitsu B5 contract is made on the Central Register of Major Government Contracts in accordance with Victorian Government Purchasing Board Procurement Policies and Government directions".

The full report can be found on Ombudsman Victoria's website.

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