Government’s RealMe in doubt as Treasury calls for ‘pause’

Article – BusinessDesk

Government’s RealMe future up in the air as Treasury questions affordability

By Paul McBeth

Nov. 30 (BusinessDesk) – The government’s RealMe project to give every New Zealander one log-in for all online government services is among several dozen major government initiatives attracting extra scrutiny from the Treasury, with recommendations that it be “paused” while an independent review is completed.

“The business case currently outlines a service delivery model that is contingent on the use of RealMe for access security and ID authentication,” the report said of a Department of Internal Affairs project to use RealMe to deliver digital government services at an estimated cost of $102 million and a further $74 million in operating costs over 10 years.

The Treasury said it had concerns about the affordability of the project.

“Uncertainty about RealMe’s future functionality and user costs pose a risk,” the report said of the service, which grew out of the igovt online government initiative started in 2004, in which Auckland-based Datacom has been the long-term private sector provider.

“Our broad advice, which is in line with the programme’s view, has been that further consideration of options in the business case should be paused until the completion of the independent review of RealMe.”

Inland Revenue’s business transformation project also cited plans to use RealMe to verify the identity and login of customers, so will also rely on the outcome of the review.

The RealMe login was rolled out in 2013 and has been part of the government’s plan to make it easier for New Zealanders to complete transactions with the government online. It targeted an average of 70 percent of the most common transactions would be done online by 2017.

Also on the watch-list is the Ministry of Business, Innovation and Employment’s Immigration Global Management System project, which had its timeline pushed out to let Datacom undertake extra development work.

The Treasury reports issued today cover the New Zealand government’s 2014/15 capital investment programme and are the first snapshot ever produced of the New Zealand government’s $74 billion investment programme. While most of the 409 projects are tracking in line with expectations, Canterbury rebuild projects and defence procurement are among those warranting more attention.

Of the Crown’s major projects, 38 are on a watchlist needing closer scrutiny to ensure the government can keep watch on them, with six worth $7.3 billion attracting a red or red/amber warning sign, Finance Minister Bill English said in a statement. The two Treasury reports are the first of their kind, and cover the government’s government 2014/15 investment projects.

The Treasury report found 237 of the 409 projects under review, worth $52.5 billion, were considered on track. Another 32, worth $13.9 billion, are forecast to breach their project tolerances, and five others worth $100 million already beyond those tolerances. A swag of 128 smaller projects, worth $7.4 billion in total, have yet to be assessed.

Of the projects under close scrutiny, the Christchurch central city rebuild was seen as “highly likely” to need further funding, with unexpected costs, often relating to land remediation, delays and scope changes holding up the programme. Other Canterbury rebuild projects attracting closer attention include the residential red zone programme, plans to rebuild schools, justice and emergency services in Christchurch, and the horizontal infrastructure such as wastewater for the city.

Nine defence projects worth $4.8 billion are also being monitored, including frigate systems upgrades, future air capability, maritime capability and secret information services.

Other projects under review include a national bio-containment laboratory for the Ministry for Primary Industries, where construction costs “rose significantly” after the detailed business case was approved. MPI has worked closely with the preferred supplier, Fletcher Construction, to keep costs near a proposed $64.8 million.

Other projects under review include an upgrade to the police’s human resources and payrolls systems, which aren’t expected to be ready for an April 1, 2016, go-live date, and is unlikely to fall within its $56.2 million budget.


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