Select Committee on Treasury Minutes of Evidence


Examination of Witnesses (Questions 300 - 319)

WEDNESDAY 23 JANUARY 2002

MR MARTIN SYKES AND MR MIKE ACHESON

  300. You said there should be more rigorous success criteria. That is a resounding phrase but it really says, "We ought to know what we are doing".
  (Mr Sykes) Yes, but understanding how you are going to measure when you have achieved the benefits that come out of the project I think is something which is not necessarily being done as well as it should have been in the past, but on my particular project I know exactly what success will look like and what I have to do to make sure that I capture the benefits.

  301. Can you give us an estimate of the benefits that have been identified in money terms?
  (Mr Sykes) From the Gateway review process?

  302. From these ten projects you are referring to.
  (Mr Sykes) I cannot give you an answer on that. I think where we are on these Gateway reviews at the moment is that we are generally in the early stages of the project, and what we are able to do is say that, because of the Gateway review process, the predictability of outcome, ie that the projects are on time, deliver their benefits and are within budget, is very much enhanced.

  303. That is very general. Are you not in a position at some point to estimate how much that enhancement is?
  (Mr Sykes) I think it would have to be done empirically against some statistics like 50 per cent of projects used to be X per cent over budget and now only 10 per cent of projects are X per cent over budget, therefore the cost avoidance that we have got from Gateway process is Y.

  304. Can you answer the question in those terms?
  (Mr Sykes) At the moment no, because not all of these projects have been through the whole Gateway cycle. The Gateway cycle has five gateways and the most advanced of these projects is at Gateway 3 where we have just committed to signing the contract.

  305. Do you expect to evaluate them in these terms?
  (Mr Sykes) Absolutely.

  306. When will that be?
  (Mr Sykes) Probably the first of these projects in about 18 months' time.

  307. Can we turn to e-commerce? You say that the OGC needs to ensure that the e-commerce agenda takes on board the needs of the departments and you refer to a number of earlier central initiatives, having led to abortive working departments. Which initiatives are you thinking of other than the electronic shopping mall?
  (Mr Sykes) The electronic shopping mall was a pre OGC initiative.

  308. What other initiatives have got nowhere?
  (Mr Sykes) That is the issue to which we are referring.

  309. Do you think the OGC are taking adequate notice of the needs of different departments and taking forward the e-commerce agenda?
  (Mr Sykes) They are now, yes.

  310. What was going on before, then? "Now" is a very weighted word.
  (Mr Sykes) As I said at the start, historically, pre OGC, the tendency was for things to be imposed from the centre—"This is good for you, you will do it. Here are some aspirational targets. Go away and do it". The OGC process now is far more consultational and, when the Gateway review process was first brought in, the first OGC project to be put through the Gateway process was the shopping mall, and the Gateway review process identified that that shopping mall was premature and would not meet the need of departments, and so the project was killed, so there was a cost avoidance there. I do not know how much the quantum was for that.

  311. Are you saying or implying that the OGC have improved their performance?
  (Mr Sykes) Yes.

  312. So they were part of the problem to begin with, were they?
  (Mr Sykes) Pre OGC?

  313. No, I am talking about the OGC, not pre OGC.
  (Mr Sykes) The shopping mall was not an OGC project. It pre-dated the OGC.

  314. Are you saying that the OGC are the improvement—
  (Mr Sykes) Yes.

  315.—or are you saying that the OGC's performance has improved in the period while they have been in being?
  (Mr Sykes) It is both.

  316. What was wrong with the earlier part? Let us just take the period while the OGC were in being. What was the previous difficulty with them?
  (Mr Sykes) With the OGC per se I do not think we have said that we have difficulties with the OGC. The concept of bringing this together as a unified body and Peter Gershon's approach to inclusion of departments in the process is all positive. The improvement aspect of that is that you cannot expect to change the world overnight and we are seeing the continuous improvement of what they provide.

Mr Cousins

  317. I wonder if I might ask you, Mr Sykes, in terms of this OGC target or estimate of 90 per cent of transactions being carried out electronically and their submission that 50 per cent across government are being carried out electronically, what is the score of your department?
  (Mr Sykes) For the centre of DTLR it is 57/58 per cent at the latest count.

  318. When would you expect it to achieve the 90 per cent target?
  (Mr Sykes) If I can preface this by saying the reason we are not at the 90 per cent at the moment is that our e-procurement project was dependent on the replacement of the Department's finance and accounting system which is on-going and due to go live in April and we have bought a package which is integral with the finance and accounting systems so we do not have integration problems, the finance package goes live on 1 April. We start to roll out e-procurement round about July of this year and we hope to have it out in the whole of the centre of the department by September. We will therefore be capable in September of this year of carrying out one hundred per cent of our procurement transactions electronically. The issue of whether we will achieve 90 per cent will then be an issue of whether our suppliers are up to speed and able to trade from their side electronically.

  319. That is very good news. What was the problem with the Department's finance and accounting system?
  (Mr Sykes) It was out of date, it did not meet the need, it was not suitable for doing resource accounting and budgeting, and it was part of a planned up-grade for the department, but the existing accounting systems had no mechanisms, without building very extensive interfaces, of doing electronic procurement.


 
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