Cairns Regional Council’s adoption of TechnologyOne software to blowout to $24.8m, 50 per cent over budget

Cairns Regional Council is staring down a 50 per cent budget blowout as its adoption of a software product from a company with a controversial history has become seriously delayed.

Cairns Regional Council is set to blow an IT project budget by $8.5m after warnings about the software vendor’s controversial history. Picture: Brian Cassey

Cairns Regional Council’s current software adoption project is set to blowout by $8.5m as the mayor conceded council’s new IT product had not worked as expected.

In 2018 the council signed a 10-year contract with the publicly-listed Australian software vendor TechnologyOne, which had been previously involved in contract disputes over budget blowouts with at least one other major Queensland council.

Cairns Regional Council purchased TechnologyOne’s OneCouncil IT infrastructure to replace its previous on-premises software; the project was to be implemented across 11 modules – including its payroll, HR, rates and customer relations systems – over three years.

In 2019, the council stated the project would cost $16.35m; $6.07m was allocated for the first year.

After at least four years, council has spent $12.8m but only implemented five of the modules.

The council allocated another $6.2m for the project in its 2023/24 budget, and now expects the project to cost $24.8m when finished in the 2025/26 financial year, a four-year overshoot.

Cairns Regional Council CEO Mica Martin has backed its adoption of the OneCouncil product despite the project’s delays and budget blowout. Picture: Brendan Radke

The Cairns Post understands the implementation has had at least four project managers, and the project has been recently de-scoped to minimum viable product.

Neither the council nor TechnologyOne offered a comment on this.

Council’s CEO Mica Martin said, however, the council was confident the product was still fit for purpose and the best value option available.

“What has been delivered thus far is working and has been well received,” Ms Martin said.

“The challenges associated with this project are not unique to Cairns Regional Council – as with most enterprise resource planning implementations, it has taken longer than anticipated due to several factors which continue to be ongoing risks, including the complexities of building and implementation of the system … (and) availability and cost escalation of resources.

“During the past couple of years … council has faced significant issues with securing appropriately skilled people. This has not only impacted timing, but also impacted costs.”

TechnologyOne and its products have had troubled relationships with other councils in Australia and overseas.

Cairns mayor Bob Manning also backed the project but conceded not everything had gone to plan. Picture: Isaac McCarthy

In 2017 New Zealand media reported software problems had prevented payment to Wellington City Council service suppliers due to incorrect validation of invoices.

In the same year, Brisbane City Council terminated a $122m contract with TechnologyOne due to a feared $60m budget blowout; Brisbane City Council’s decision came after it reportedly issued notices to remedy contract breaches to TechnologyOne.

These matters were put to Cairns Regional Council in 2019 when it announced its OneCouncil purchase; at the time, the council expressed confidence despite TechnologyOne’s history.

More recently, however, Cairns mayor Bob Manning acknowledged there had been unforeseen challenges with the product.

“Things didn’t run in the early stages (of implementation) as we thought they would,” Mr Manning said.

A TechnologyOne spokeswoman said Cairns Regional Council would soon realise the long-term benefits of its local government software product.

“Digital transformation projects undertaken by Cairns Regional Council are incredibly complex, and we continue to work hand-in-hand with the council’s teams to support them through the rollout,” the spokeswoman said.

Originally published as Cairns Regional Council’s adoption of TechnologyOne software to blowout to $24.8m, 50 per cent over budget