SA gov gives itself three years to replace finance system

The South Australian government is planning to have completely replaced its core financial management system in less than three years, with work on a detailed business case now underway.

Treasurer Stephen Mullighan revealed the timeframe for the replacement of the Masterpiece system used by a number of agencies across government at budget estimates last month.

The Department of Treasury and Finance (DTF) has been contemplating the potential replacement of Masterpiece since 2020-21, when it began working on a high-level business case with KPMG at a cost of $183,078.

It is now planning to spend the next 12 months developing a detailed business case that builds on a proposal developed last financial year at a cost of $1.5 million, according to budget papers.

Mullighan said that while the department was still to “put a project team together and go out to market”, the project was estimated for completion by June 2025.

He said this was “based on the department getting its project team together, scoping the work and going out to market with an understanding of what is currently available on the market”.

But Mullighan is also realistic about the possibility of cost blow outs and delays, given the government’s track record with replacement projects over the last 30 years.

“These projects are inherently complex and difficult and subject to really significant amounts of risk, not just in terms of the procurement but also in the implementation because even after you have procured a product you are effectively trying to install it at the same time that you are running the legacy system side by side,” he said.

“My experience – and it is not as extensive as that of [some other people] – is that that rarely goes to plan. There have been successful ICT projects that Treasury has managed before, for example, the e-Conveyancing system, but they are not the majority of the experience across government.”

Mullighan said that while the full cost of the project is still unclear, some funds are being held centrally in contingencies. He declined to disclose the figure citing “market sensitivities”.

“Once we go out to market and we have a better sense of [what that cost is], that might find its representation in perhaps a subsequent year’s budget papers,” he added.

Approximately $3.4 million was spent on Masterpiece in 2020-21 and 2021-22, according to budget papers.

Earlier this year, DTF began developing a transition strategy for the DXC mainframe used to host the Masterpiece system, as well as a number of other justice and child protection systems, when the support agreement expires in August 2024.

“Mainframe technology is no longer contemporary, and government agencies are moving to more modern application platforms,” the request for quote said.

According to tender documents, the department is looking to “identify options for mainframe application modernisation”, including an assessment of options for both the short, medium and long term.