The government has decided to write off a $191 million investment made in building a new entitlements calculation engine for Centrelink, as the project did not produce a working system.
Government services minister Bill Shorten announced the decision at an AFR government services summit. The project received funding of $23 million in 2019-20, followed by additional injections of $44 million, $67 million, and $57 million in the subsequent three years, totaling $191 million.
Services Australia, the agency responsible for the project, made the difficult decision to write off the calculation engine as an asset. The engine was intended to determine welfare recipients’ eligibility and the amount of payment they should receive.
Infosys was awarded the contract for the project in 2019, but some of the work was later brought back in-house. The engine was based on technology from Pega and was meant to replace the existing solution in Centrelink’s legacy income security integrated system (ISIS) as part of the broader welfare payments infrastructure transformation.
Although the engine moved into production in October 2022 and was used in a “shadow mode” from November, there were doubts about whether ISIS could be entirely switched off due to its complexity and lack of documentation over the years.
While there were reports that the project was effectively canceled due to it not working as intended, this could not be independently verified at the time. The project had also faced scrutiny over how contracts were awarded, adding to the challenges it faced throughout its development.