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Monday, June 07, 2010

The Tax Office supercomputer that will never quite be

The Tax Office has scaled back the reach of its new $820 million supercomputer after a bumpy start that delayed one million tax returns, sent out return letters without cheques and failed to communicate with other computers because of a misunderstanding about the meaning of negative numbers.

Detailing a litany of mishaps Second Commissioner David Butler has told a Senate estimates hearing that cost overruns and the new need to work on changes flowing from the Henry Review meant the supercomputer would no longer become the "integrated system for everything" originally planned.

Business Activity Statements and superannuation guarantee statements would continue to be run outside the new system in order to give the Tax Office "space to pick up recommendations adopted from the Henry Review, the Cooper review of superannuation and whatever else might come out of that".

Earlier changes to superannuation rules under Howard government had been responsible for $200 million of the $430 million cost blowout.

Commissioned on Australia Day the new computer system had so far sparked 17,000 public complaints, required more than 500 bug fixes and sent unintelligible data to Centrelink...

Mr Butler told Senator Nick Xenophon the Tax Office normally sent 50,000 to 100,000 pieces of information per day to Centrelink.

When a Centrelink client had a loss the new system put a negative sign in front of the amount lost describing it as "for example minus $5000" but the Centrelink system "could not cope with that because it could not cope with a negative figure".

"We had to put a fix in, a change to the system, to turn that to a nil assessment, so it would show zero," he told Senator Xenaphon. "But when we put that fix in place there were some returns in flight through the system. Unfortunately it turned them to nil as well, and it should not have."

The Tax Office will terminate its contract with Accenture to introduce the system and engage a separate consultant, CPT Global to advise on how to make it work during the coming tax season. It has put on an 330 staff more than normal in effort to make the tax season work.

It had been receiving 5 times as many complaints as normal and had handed out 5233 hardship payments.

Senator Xenaphon sought an assurance tax staff would feel free to give evidence to the independent inquiry being conducted by the taxation inspector general asking Commissioner Michael D'Ascenzo whether he had written an email warning staff not to "disclose any private and personal information to the inspector general".

"If they were issued with a notice from the inspector general, this would not be in breach of the law, would it," he asked. "Will you clarify that your staff, if given and served a notice by the inspector general, can give information of a personal nature to illustrate the difficulties with the new system?"

Mr D'Ascenzo said there was no need to clarify his advice to staff because his admonition had included the phrase "unless you are requested to".

Published in today's SMH and Age 

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