ATO Change Program performance audit due this week

A performance audit of the Australian Taxation Office (ATO) Change Program will be tabled in Parliament by the end of this week.

The audit, undertaken by the Australian National Audit Office (ANAO), will provide a "strategic review" of the ATO's progress on implementing the program, which aims to migrate the agency away from legacy and paper-based systems to a single, integrated core IT system.

The Change Program commenced in December 2004 at an estimated cost of $350-$450 million and was set to be completed by the end of 2007. However, the budget has blown out to double the original figure, now hitting close to $750 million.

Last week the ATO submitted its report to the Federal Parliament's Public Accounts and Audit Committee. In it ATO commissioner, Michael D'Ascenzo said there was "extraordinary pressure" on the agency's ICT expenditure and transformational change program.

"The change program is largely self-funded and underpins future service initiatives for taxpayers and provides a platform for ongoing productivity initiatives. Some delays have been experienced in finalising this program largely as a consequence of integrating new legislative requirements including significant reforms to the Superannuation system," the report read. "This has required us to maintain legacy systems for longer than anticipated. The sourcing program is putting to tender the ICT infrastructure services for the office providing telecommunications, end user computing and central computing services into the future. While every effort is being made to find savings we expect to be under pressure to operate within our budget for the next few years until these programs are finalised."

In September, the ATO's Change Program Steering Committee approved plans for the agency to commence processing income tax returns on the new system from 1 February, next year. The old system, the National Taxpayer System (NTS), will no longer be used, ending over 30 years of usage.

The latest date for completion for the project is July 2010 with business activity statements (BAS) excise and other remaining tax products to be quot;deployed onto the integrated core processing platformquot;. A new portal for businesses, tax agents and BAS service providers will also be launched at this time.

"We are currently testing for the Income Tax Release which is our most complex release to-date," the report to the Public Accounts and Audit Committee read. "A pilot for the Income Tax Release commenced in September 2009 and will continue until the end of 2009. This and subsequent releases remain high risk."

Services provider, Accenture is jointly responsible for the implementation of the Change Program.

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