The stalled Oracle DHB ERP project: Time to review the review?

Published on the 11/04/2018 | Written by Jonathan Cotton


stalled Oracle DHB ERP project

Yes, there’s a conflict of interest but no, nothing to see here, says Minister for Health David Clark...

In the face of spiralling costs and missed deadlines, the Ministry of Health has chosen a consultancy with uncomfortably close ties to Oracle for its review of the problematic National Oracle Solution IT project.

The National Oracle Solution IT programme is a sector-specific Oracle system designed to run across New Zealand’s 20 DHBs. Launched six years go to replace DHBs’ ageing finance and supply chain systems, the point of the system was to standardise the business activities of New Zealand DHBs, improving the efficiency of DHB supply chains as well as providing procurement benefits.

That’s was the plan anyway. The project, previously budgeted for $65 million, has, so far, been an expensive blowout, missing go-live dates (last year’s April Key Health IT Initiatives Progress Report reported that “stability issues with the build of the new Oracle development environment [were] impacting programme milestones”), and NZ Health Partnerships – the group tasked with ensuring that the project achieves cost reductions for DHBs – is now requesting more undisclosed amounts of extra funding.

But not so fast on that last part. The Ministry of Health last month said that a review of the project would need to take place before this month’s decision on whether the project will receive more funding.

It’s now become apparent that that review was to be performed by the very owner of the company that rolled the project out: Deloitte played a part in designing the National Oracle Solution via its subsidiary Oracle ERP implementation specialists, Asparona.

Last week Minister for Health David Clark, under questioning by National Party associate spokesperson for Health Dr Shane Reti, admitted as much, acknowledging that there is indeed a conflict of interest there, but assuring the house that the situation was nevertheless above board.

“I have been assured that no individual who had anything to do with Asparona’s involvement in the National Oracle Solution project has any involvement in the Deloitte review,” responded Clark to Reti’s provocation. “The member needs to take a deep breath.”

“The conflicts of interest, perceived or actual, were declared before the review was commenced.”

National is making hay while the sun shines, so of course Clark’s assurances fell on deaf ears. Reti says that “even if, as [Clark] suggests, there is nothing to worry about with Deloitte’s review of their subsidiary company’s programme he needs to release the conflicts statement so that the sector can have confidence in the programme.

“This is a vital project that will lead to savings for the health sector and improvements in patient care, but the delays are causing significant uncertainty and cost to the Health sector.”

“The Minister’s vague assurances that the conflict has been managed are not enough. The taxpayer can reasonably expect to hold the Minister to account for what may be millions of dollars.”

So what next? Is there a conflict of interest? If so, what should be done about it? Obviously an independent review of the National Oracle Solution IT programme still needs to take place. Equally pressing perhaps is an explanation as to just how Deloitte came to be awarded the review contract for the troubled project in the first place.

Or maybe at this point what we’d like to know is: Just what will it take to get New Zealand’s healthcare system sorted in a way that makes it cost effective, efficient and digital?

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