Report on Fremantle Hospital computer project

28/9/93

A report tabled in Parliament today of an independent inquiry into a computer project at Fremantle Hospital has found serious deficiencies in the application and control of public monies, and reveals an apparent disregard for basic management controls.

Health Minister Peter Foss told Parliament that findings relating to the hospital's former chief executive, David Lewis, would be referred to the Public Service Commissioner.

The report was compiled by independent investigator Simon Ford.

Mr Foss said he would hold urgent discussions with the Board of Management on their future role, and the computer project would be reassessed.

The Minister ordered the inquiry last month, following repeated allegations relating to the handling of the project - to provide software and network development and project management for a laboratory computer system.

In a Ministerial statement to the House, Mr Foss said the report's findings clearly indicated there were serious deficiencies in the way the project was funded.

He said the project, originally estimated to cost $36,000 was allowed to rise to $1.3 million and that on current estimates, the project would cost more than $2.1 million if completed.

The Minister said the report indicated that even when the project had expanded significantly, no steps were taken to:

·       inform the board or seek its approval;

·       attain a formal contract;

·       undertake a cost-benefit analysis of the project;

·       introduce effective systems development or management processes;

·       reconsider other options or stop the project.

Mr Foss said the report revealed a breakdown in basic controls, compounding other elements of the project including:

·       a gross underestimation of the cost of the project;

·       no proper steps taken to obtain the best prices;

·       no competitive quotes sought for purchases, and in fact accepting mark-ups from the external contractor of up to 35 per cent above cost;

·       the cost of the project being allowed to rise from $36,000 to more than $1.3 million.

Mr Foss also revealed that the hospital board had been unaware of the project's existence and had no formal requirements in place to require this or any similar project to be considered or reported at the board level.

"This was particularly inappropriate when at the time the board continually complained it was not receiving adequate funding for essential patient services," Mr Foss said.

The Minister said he was also concerned that despite questions raised in Parliament by Attorney General Cheryl Edwardes (while in Opposition), the answers supplied through the previous Government had been designed to divert questioners from obtaining the truth.

He said it was obvious that there had been a significant breakdown in management and control at key levels of the hospital.

Mr Foss has asked his department to further investigate a number of other matters relating to management and accountability and said he would report to Parliament again at a later date.

Media contact:  Jeanne Klener 325 8655 / 222 9595