Smartcard heading for fall

James Riley / The Australian | May 2 2006

THE federal health and welfare smartcard project may be heading for big problems, according to experts concerned by a lack of detailed planning and apparent Government willingness to work outside the business case.

Twenty years ago, populist prime minister Bob Hawke discovered precisely how much Australians dislike government intrusiveness when the Australia Card proposal was rejected wholesale by the public.
Yet, when John Howard announced a remarkably similar plan last week - albeit a considerably more powerful plan - for a $1 billion health and welfare smartcard, the initiative generated only modest reaction from interest groups and little apparent concern among voters.

That is as good an indicator as you will find in Australia of just how far the political winds have changed since September 11, 2001.

The public response - or lack of it - demonstrates the way changes in public attitude have influenced discussion, firstly on the government services card, and secondly on the scrapped proposal for a national ID card.

Regardless of its public or political implications, Cabinet's approval of the smartcard has signed the Government up for the mother of all IT projects.

It is the biggest IT project - and certainly the biggest IT story - ever to come out of Canberra.

Gartner Asia-Pacific research vice-president Richard Harris said poor definition of project details by the Government was a serious concern after a comprehensive business case had been developed by independent consultants.

Cost blow-outs and deadline problems were a fact of life for even the best-planned IT projects, and the industry was worried the Government has made the job more difficult by adding last-minute features relating to national security.

"Trying to consolidate 17 ID cards into one system is a big, big job," Mr Harris said.

"The history generally with large projects like this is that they don't finish on budget and they don't finish on time," he said.

"For the billion-dollar ball-park cost that has been announced, it's difficult to know what is included in that figure."

S2 Intelligence research principal Bruce McCabe said government risked disaster if it is contemplating function creep at this early stage.

"This is going to be an extremely complex project anyway, because of the amount of integration work it requires," Mr McCabe said. "What are the chances of it finishing on time and on budget? Virtually nil, if you look at the experience of other large projects."

The stream of IT vendors beating a path to Human Services Minister Joe Hockey's door, as the minister driving the project, is about to turn into a torrent.

After waiting a year for the decision, the announcement was everything the vendors could have wished for - it is big, and it is budgeted.

The announcement was delivered with curious lack of detail for such a big-ticket item.

That's all the more surprising because of the enormous and well-known risks that large and complex IT projects carry. With a billion dollars on offer, the industry does not know where the money will be spent, or the specific projects involved.

Cabinet approval means a Human Services team is working around the clock preparing forward costing for a four-year project in time for the federal Budget.

More details will be known when Treasurer Peter Costello delivers his Budget next Tuesday.

The Prime Minister said the card would cost about $1 billion and would save $3 billion over 10 years, but it is hard to understand where the saving will be made because so little is known.

Mr Hockey has committed to releasing the business case prepared by KPMG following complaints from industry groups.

It remains to be seen how much help this will be. Commercially sensitive information, mainly on costs, would be stripped from the KPMG document for fear that it would adversely affect the tender process, Mr Hockey said.

It is apparent that the smartcard plan Mr Hockey took to Cabinet is not the one that was announced, nor is it the one for which KPMG wrote a business case.

When the Prime Minister announced the project at Parliament House, Mr Hockey and Attorney-General Philip Ruddock were present. Mr Ruddock had been pushing a national ID card proposal.

The ID card plan was axed at the same Cabinet meeting that approved the Hockey smartcard.

Mr Howard said the Hockey smartcard had been given enhanced identity security features, but the Government would not say what those add-on features were, or what impact they would have on cost. Mr Hockey had previously said his card would not contain biometric details.

There is a suggestion the high-definition biometric photograph of millions of cardholders to be stored on a central database, called the Central Common Registration System, may have been added by the Attorney-General's Department.

This is not a small change, and it has enlivened suspicion from civil libertarians about whether the Government will use the initial access smartcard project as a platform to revisit the national ID card proposal later.

The Prime Minister denies this, saying the access card is not "a Trojan Horse for an ID card", but won't rule out adding more functions to the smartcard later.

The prospect has alarmed the Australian Chamber of Commerce and Industry, which has run a campaign opposing a national ID card as too expensive, too complex, and adding an extra layer of red tape for business to deal with. Chamber chief executive Peter Hendy remains deeply suspicious about plans to change Mr Hockey's smartcard into a fully blown ID card.

"There's concern across industry that if the original and more narrow identification purpose is expanded, this may result in a compliance burden for business," Mr Hendy said.

The chamber's concerns are based on "the need to create a national identity register to cross-check with bearers of the card and the prospect that once introduced an identity card would be used for far more extensive purposes than originally intended."

Mr Howard's assurances that the smartcard would not be turned into an ID card were not helped by ASIO head Paul O'Sullivan saying the domestic spy agency didn't need a national ID card.

That was largely, it seems, because ASIO will be given special access to the database of biometric photographs and unspecified other privileges.

The Australian Federal Police, state police and other federal departments such as Immigration will also get restricted access to the database.

Mr Hockey told The Australian last week that facial recognition software used in identity system was comparable to fingerprints for accuracy.

But photos don't carry the same political baggage of fingerprint, which voters associate with criminals.

Mr McCabe says the Hockey smartcard project is like a whole-of-government version of the "single-view of the customer" CRM projects that have been in vogue in corporate Australia in recent years.

With its ability to present a "single view of the citizen," it's no wonder ASIO and the police are happy about getting access, he said. These agencies had access to the data that would be connected by the smartcard under current law, Mr Ruddock said, but the Secure Common Registration System would make a difficult task "incredibly efficient" at gathering personal information from across a wide range of government-related activities.

There is another potential parallel to corporate experience with single-view customer relationship management systems: their complexity and propensity to cost far more than planned.

"If you look at the Commonwealth Bank and its CommSee project, you can see that it was difficult and (is believed to have) cost several hundred million dollars," Mr McCabe said.

"The bank had budgeted for about $100 million, and it is just one organisation.

"What the Government is doing runs across many departments and a lot of different systems that need to be integrated.

"This is a defining project for the Government, but it is also a very, very large project," he said.

With its central database of biometric photos, the access smartcard will be an almost perfect platform to extend into a national ID system, whether Mr Howard chooses to acknowledge it or not.

"There is really no way of avoiding the fact that this is a platform that could later become a national ID card, and I don't think the fact that they keep saying it isn't is particularly helpful," Mr McCabe said.

The project risks are enormous, at least equivalent to the size of the undertaking.

Whether government decides to look at an ID card later is a matter for policy makers.

The decision would have to be based on a separate business case, or the Government risks a massive cost blow-out, or complete failure on the Hockey plan.

"It would be very dangerous for the project to allow this to morph somehow into a national ID card," Mr McCabe said.

---------------------------------------------------

Prison Planet.tv: The Premier Multimedia Subscription Package: Download and Share the Truth!

Please help our fight against the New World Order by giving a donation. As bandwidth costs increase, the only way we can stay online and expand is with your support. Please consider giving a monthly or one-off donation for whatever you can afford. You can pay securely by either credit card or Paypal. Click here to donate.

FAIR USE NOTICE