Birmingham set to miss deadline to make Oracle disaster 'safe and compliant'

Bankrupt council is like 'ship adrift' – lacks financial info in midst of equal pay nightmare

Birmingham City Council — Europe's largest local authority — stands accused of being a "ship adrift in the ocean" after it failed to confirm it could make its troubled Oracle implementation "safe and compliant."

According to auditors, the replacement for the council's SAP-based financial system has gone so badly BCC has not created a financial statement or outturn position for the most recent financial year and cannot provide an up-to-date financial position in the current financial year.

Challenges with the Oracle migration are exacerbating problems with the planning to settle equal pay claims which could amount to £1 billion ($1.21 billion), but which are yet to be resolved. The council effectively declared itself bankrupt last month.

Auditors Grant Thornton called on the council to make its Oracle system "safe and compliant" by the end of November.

However, the council has now responded by saying it "cannot be confident" of concluding all necessary work by that date.

Debating the council's response, leader of Liberal Democrat Group Roger Harmer said: "We're effectively, what we're being told [is] that we're a ship adrift in the ocean and the fog down, and until we clear the fog, we really don't know exactly where we are."

In a council meeting late last week, Grant Thornton West Midlands public sector leader Mark Stocks said the cost of the Oracle project had gone up from about £38 million ($46 million) to a minimum of £100 million ($122 million). Earlier cost estimates were closer to £20 million ($24 million).

However, Stocks said that, though significant, cost overruns were not his "core concern."

"You still do not have a financial reporting system that tells you where your finances are. Given the liabilities that you're going to have to pay in terms of equal pay, you need to understand what your financial position is. There's an urgency to resolving the issues around Oracle.

"You have to get into a state where you're safe and compliant, and that means where your financial systems are providing you with the information that you need without officers having to do workarounds. It's extremely important that that safe and compliant phase is reached as soon as you possibly can," he said.

He told the council earlier this month a manual workaround required to move cash required 30 officers for a significant period. The same task required three people using the earlier SAP system, The Register was told by an insider.

Despite its plan to implement cloud-based Oracle Fusion out of the box, the rollout became heavily dependent on customizations, some of which failed to work as expected. In its most recent progress report on rectifying the Oracle implementation, the council said it was working with Oracle Consulting "to ensure we deliver our 'out of the box' Oracle vision."

However, individuals close to the implementation have told The Register a "vanilla" Oracle implementation cannot perform all the functions its heavily customized SAP system executed successfully. ®

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