The equivalent of two thirds of the money collected by the Child Support Agency (CSA) from absent parents for the care of their children is wasted on administration because of a crap computer system and poor management.
For every £1 collected from an absent parent in 04/05, it cost 70 pence to run the administration system, leaving the tax-payer short changed, a National Audit Office (NAO) report on the CSA said today.
Auditor general Sir John Bourne noted the "hardship and distress" put upon families by the CSA and its IT contractor, EDS.
This waste has occurred despite £539m being spent by the Department for Work and Pensions, which runs the CSA, on business and IT reforms since June 2000, when a rescue plan was devised for the already troubled agency.
Since 2000, £152m of this money was paid to EDS for a computer system to replace the failing old one - but the new system doesn't work either.
In May 2000, the CSA told the House of Commons Public Accounts Committee that it had learned its lesson from its last IT bodge and would make sure that its new computer system was done properly, Computer Weekly reported at the time. Today, the NAO said the CSA had learned even more lessons from its second bodge.
In light of the recent administration problems, another £120m has been allocated to fix the dodgy system, and even more money is likely to be allocated in August when a new bunch of corrective reforms are introduced.
The EDS computer system went live nine months ago, but its "stability and performance" were still a problem, the NAO said in a statement. It noted that 600 manual workarounds had been required to get around holes in the system.
The result can be that either single parent families get too little money, or absent parents end up paying too much. The reforms have been such a failure that 61 per cent of cases are still handled under the old, pre-2000 rules. 36,000 cases have been "stuck" in the computer system. There's a backlog of 333,000 cases - one in four taken on since March 2003 have still not been handled. The typical case takes 34 weeks to clear.
An NAO statement said it was "now clear" that the reforms had been "over-ambitious" and that the IT system was too complex to work.
This is just what experts told the agency before it contracted EDS in 2000, according to the report. The timetable was too tight, even though the CSA had promised the PAC it wouldn't do another rush job.
The project then went down the pan, despite an incredible array of reviews that warned it was headed for a crash. As well as the executive programme board and an EDS guide, there were no less than 40 internal audits. Then there were the Gateway Reviews, which were introduced as a means of preventing programmes of IT and organisational change going awry; but are conducted in secret and their results protected from scrutiny. After taking all this advice, the CSA wasted £91m on external advice.
These failures suggest that the Office of Government Commerce, charged by the Treasury with governing the system of contracting and Gateway reviews, has not put an end to the jinx on government IT. It also suggests that no amount of reviews will achieve anything while their warnings are withheld from public scrutiny.
The NAO said the CSA has taken measures to avoid its mistakes being repeated a third time. ®