This article appeared a day or so ago.
IBM settles with Australian government over e-health contract
Summary: IBM and the National E-Health Transition Authority have settled a dispute over the termination of a key AU$24 million contract.
Although it appeared bound for the courts, IBM and the National E-Health Transition Authority have settled a dispute over the termination of an AU$24 million contract for IBM to deliver an authentication service as part of the Australian government's billion-dollar e-health project.
In 2011, IBM was tasked to develop a system that would use public key infrastructure and secure tokens, such as smart cards, in order to provide an authenticated service. This is so that healthcare personnel and providers can exchange e-health information, including referrals, prescriptions, and personally controlled electronic health records (PCEHRs).
It was part of the Australian government's initial AU$466.7 million investment in e-health record systems that came online in July 2012.
The IBM National Authentication Service for Health (NASH) system was due to be delivered by June 30, 2012, however NEHTA and IBM confirmed in October last year that the contract had been terminated and it was an "ongoing legal matter".
In the meantime, the government implemented an interim NASH system.
While the IBM and NEHTA dispute appeared to be bound for the courts, in a response to Questions on Notice provided to Liberal Senator Sue Boyce in April, the NEHTA confirmed that it had settled with IBM.
"NEHTA and IBM Australia have reached by mutual agreement a conclusion to their discussions regarding the termination of the National Authentication Service for Health (NASH) Design & Build and Operate contracts. The terms of that agreement are confidential," NEHTA said.
More here:
This prompted me to go back to the Senate Estimates site.
There are 2 links:
This one says that NEHTA have given up hire cars after being questioned about their use.
More relevant is this one where we see Senator Boyce has almost had to pull teeth to get what has been going on.
Senate Standing Committee on Community Affairs
QUESTIONS ON NOTICE
[DOHA-NEHTA] Portfolio
Additional Budget Estimates
February 2013
Subject Outcome: E-Health 10.2
Agency: NEHTA
Issue: Claims of Privilege
Name of Senator: Sue Boyce
QUESTIONS:
In the last session of estimates in October last year we submitted a number of questions related to E-Health and in particular its management by NEHTA.
We had asked a series of questions in regard to the contract entered into with IBM in regard to the completion of the NASH, a contract that was terminated by NEHTA.
NEHTA’s response to one key question, Question 6, essentially was to say and I quote; ” The subject matter of the contract termination between IBM, NEHTA is currently under legal process and privilege applies.”
We asked whether the terminated contract contained penalty clauses for non-delivery. How much had IBM already been paid under the terms of that contract and what percentage of that contract price will be written off or lost as a result of the contract termination.
1. Can you tell me what “legal process” between IBM and NEHTA is currently underway in regard to this contract?
NEHTA and IBM Australia have reached by mutual agreement a conclusion to their discussions regarding the termination of the National Authentication Service for Health (NASH) Design & Build and Operate contracts. The terms of that agreement are confidential.
2. In what way are the terms of the question I have just quoted subject to the strict legal definitions of privilege?
The questions previously asked went to the subject of legal advice which NEHTA received about termination of the contract and the discussions it was having with IBM at the time. In order to protect the privilege in that advice, NEHTA needed to ensure that its actions, including answers to your questions, did not waive that privilege.
The discussions which were occurring between NEHTA and IBM at the time of your questions were also confidential and subject to the privilege in aid of settlement. NEHTA needed, and continues to need, to ensure that it does not breach its confidentiality obligations.
As noted above, the terms of the final agreement with IBM are confidential. As such, the parties are bound, under contract law, to keep the terms confidential.
3. Who provided that advice regarding our questions and the issue of privilege and can we obtain a copy of it?
NEHTA obtained advice from its external lawyers regarding termination of the contract with IBM. That advice is protected by legal professional privilege and NEHTA will not waive its rights to that protection. NEHTA is concerned not to breach any confidentiality obligations it has, which may occur if privilege in the advice were waived.
4. What considerations were made re the balance between your notion of privilege and the public’s right to know how you are managing the expenditure of over 1 billion dollars of taxpayers money?
NEHTA takes very seriously its management of the implementation of e-Health in Australia, and the costs involved in that. It acknowledges that the public has an interest in how taxpayer dollars are spent.
Nevertheless, for NEHTA to achieve the best outcomes for taxpayers in relation to legal matters arising in the course of its operations, it needs to be able to access full and frank legal advice. Open disclosure of the advice which NEHTA received about termination of the contract and its discussions with IBM may have jeopardised those discussions and the ultimate agreement with IBM.
----- End Response
Here is the link:
Only one question - NEHTA is spending public money so now it is settled why can’t we - the public - understand what has been done, what lessons have been learnt and work out just who is to blame for this waste - and it is clear that is what this is - of money.
NEHTA get a gold star for obfuscation and cover up!
David.
Let me get this right. The terms of the settlement with IBM is not available to the public (that own and fund the whole damn thing from memory) because NEHTA have been advised it must be kept confidential.
ReplyDeleteAlso , the advice telling us this is so also must be kept confidential. Yes Minister. So we have no way of ever opening the box to see if it NEHTA's position is correct.
What absolute BS.
Such a situation would mean that corrupt practices could never be brought to light in government. If it is true, then we have a fundamental breakdown in good government and transparency.
What are they hiding??
Its always the cover up that gets you, not the indiscretion.
I can see no reason why Sneator Boyce cannot as an elected member of the Senate privately see the legal advice, as well as the settlement, even if not disclosed to the public. She could then form her own judgement and at least comfort those of us on the outside that yes, this is all above board.
My bet? Two years into the no doubt colourful and event filled Abbott government (I'm no fan) this will all come apart like a house of cards, and we will have an e-health scandal like none ever seen. What happened in Canada will be but a mere amuse bouche to this dinner. Who will be the entree? Who will make up the main meal? Either way, I know it is we the people who will pay the bill.
Is that the sound of papers shredding and hard drives formatting I hear at NEHTA HQ? You wont escape.
This is remarkably reminiscent of the Queensland Health payroll fiasco also involving IBM. Perhaps IBM have learnt to run away from a Government contract!
ReplyDeleteWhat is even more interesting in the Queensland Health case is that evidence is now emerging that the real cost of the blowout was significantly due to poor specifications being supplied by the government, and even those requirement specs being changed during software development to the extent that no one could work out who had requested which changes!
This appears to be a governmental modus operandi
Nothing surprises when it comes to Nehta and any contract in regards to the delivery of this failed system.
ReplyDeleteAn authentication system that does not provide two factor or multi-factor authentication as the mode of access. That is secure.
NASH - "No Available Security Here" only money....
What a joke. The people driving this should be all dragged before senate estimates and made to explain the cost and waste to tax-payers.
Are we in the US, who took the 5th??
Every dollar channelled through NEHTA's coffers is a dollar 50% likely to have originated from the Federal C'th Gov't or conversely 50% from one of the State or Territory Gov't treasuries!
ReplyDeleteEither way, it is TAXPAYERS MONEY which should have Accountable to the Taxpayer stamped all over it.
NEHTA are getting away with this contempt for the Taxpayer who fund them through an unadulterated failure of Governance at three specific levels:
1) NEHTA Board failure
2) COAG Governance failure
3) Senate Estimates failure
It is clear and has been clear since 2005, BCG have engineered an Accountability Free Zone in the establishment and incorporation of this pseudo “Private Non-profit" organisation in NEHTA (QANGO) that has the liberty and "privilege" to enrich its management and well-fed/funded "consultants" for no meaningful or measurable outcomes, all at great expense to the down-trodden and ripped-off taxpayer.
Observe where NEHTA’s ex-management and ex-board members end up at the end of their tenure, the well-funded consultancies of course. Nepotism and inside job if there ever was one!
This music and madness has to stop sometime, and question is, who if anyone will be left standing and superficially "pay the price" for this outright rort and robbery of the taxpayer funded Gov't treasuries in funding this National E-Health Transition Authority SHAM??
NEHTA, through its behaviour and sketchy track-record to-date, proves and demonstrates corruption is alive and well within our ever more fragile democratic system of government.
Dear David and avid readers of your blog need to understand that the reason you cannot and never will be able to access this confidential information is because as a condition of settlement an onerous and extremely costly penalty clause was inserted in the Agreement, such that the party which breaks the confidentiality terms would have to pay enormous damages to the other party. This poison pill clause is only executed if one party breaks the Agreement. The vice is too tight to force open – unless a whistle blower lurks somewhere within.
ReplyDeleteAnonymous said...
ReplyDelete"Dear David and avid readers of your blog need to understand that the reason you cannot and never will be able to access this confidential information is because as a condition of settlement an onerous and extremely costly penalty clause was inserted in the Agreement, such that the party which breaks the confidentiality terms would have to pay enormous damages to the other party ..."
With the greatest respect, that is not the reason the settlement will not become public. That is the mechanism to hide it.
It could be claimed that the real reason is because both sides are guilty of embarassing failures and do not want the details to be made know.
That may or may not be true. However, what is true is that this claim is never likely to be refuted, and no lessones will be learned.
That's exactly correct!
ReplyDeleteWho's interests are truly being served and protected here??
Obviously NOT the Taxpayers, but the self-serving incompetents guilty of the failure and slyly covering their tracks at Taxpayers expense.
An unadulterated failure of governance and accountability!
Is there an investigative journalist in the house?
ReplyDeleteThe theme of these comments fits will with it is OUR MONEY so it is important WE KNOW what it is spent on. They treat the public like mushrooms. Put them in the dark and feed them Sh....t. This is why we need WikiLeaks. Julian Assange challenges people like NEHTA and the feds.
ReplyDeleteIf anyone is:
ReplyDeletea) interested and/or
b) able to get things fixed......
I tried to register at the NEHTA site:
https://www.nehta.gov.au/sign-up?view=registration&agreedToTerms=true
and got an Error 403
Access forbidden!
You don't have permission to access the requested object. It is either read-protected or not readable by the server.
I also went to the DOHA site:
Submissions received on the PCEHR Draft Concept of Operations – Relating to the introduction of a PCEHR system.
http://yourhealth.gov.au/internet/yourhealth/publishing.nsf/Content/PCEHRSubmissionsReceived
and found another error message:
LotusScript compilation error for Block Component: blockSubmissionsListPCEHR: $EXECUTE$+158: Subscript out of range - cannot continue.
One way of cutting costs is to stop doing maintenance. I wonder if that's what has happened in these cases.
At least it isn't a life or death health issue, but it doesn't look very professional.
Nehta not only wasted the majority of the $24+m for the IBM contract. Nothing was delivered, and more funds needed to proc the alternate solution - sounds like a bargain!
ReplyDeleteWell Nehta have been a bit hopeless, and DOHA have been very silly.
ReplyDeleteWe have been told (way back) that we couldn't have a PCEHR system unless we got a new shiny NASH. But it seems we could - because taxpayers had already paid for one via the DHS. (Never mind that the DHS had pointed this out and been ignored).
The only player that comes up smelling of roses is the Dept of Human Services (Medicare Australia). They have saved the day by rolling out their pre-existing NASH to plug the 24M$ hole, do all the up front work for registration (using their Medicare proof of identity and health provider directory), and they built the HI Service and then tweaked it to fit the PCEHR. Then they obliging allowed their PBS, MBS, donor and vaccination data to be pumped over into the PCEHR to make it look like the PCEHR had something on day 1. That cannot have been an easy thing to do right at the last minute when the specifications were so wobbly and the deadlines were so tight. I don't work there, but I reckon they need a bit of a pat on the back? I never see them getting that - just victory claims by DOHA and NEHTA.
I've never worked at any of the DHS agencies (apart from DHS itself on the infamous Access Card project).
ReplyDeleteThe difference between Centrelink and Medicare (or HIC as it was) is that those two are, essentially, IT enterprises that happen to process government money. IMHO, they do it very well, especially when working to political deadlines and definitely deserve at least a pat on the back if not a bouquet or two.
On the other hand, DoHA is, essentially, a policy department with little or no experience of service delivery, never mind large scale IT.
The difference shows.
Hmmm, DHS coming to the rescue - not quite sure that's the actualitie of the situation. True enough in part, that they are able to support authentication with their limited offering, but face it they offer a very limited portion of what the sector requirement for NASH is/was. Also, the $24+m is lost, spent, not available - most of it went to IBM (despite the compromise). DHS add further cost to NEHTA and the taxpayer by costing a whacking amount more for limited NASH than IBM ever would have - I urge you to ask for build and run costs for DHS nash-like since initiation last year....I do agree though that it is all taxpayers money and we are not rxing vfm from any of them nehta, doh or dhs...imho..
ReplyDelete