Senate Notice Paper Question No 416 Publication Date: 21 August 2002
Hansard: Pages 3529-31

Defence: Personnel Management Key Solution Software Package

 Senator: Evans

Senator Chris Evans asked the Minister for Defence, upon notice, on 9 July 2002:

With reference to the introduction of the Personnel Management Key Solution (PMKeyS) software package:

  1. Can a list of all contracts associated with the introduction of PMKeyS be provided, including for training and consultancies, indicating the organisation contracted, the goods or services provided under the contract, the total value of the contract and the start and end dates for the contract.
  2. At the recent estimates hearing of the Foreign Affairs, Defence and Trade Legislation Committee it was indicated that 'direct' costs for the project were likely to be $70 million: (a) what is covered by the term 'direct' costs; and (b) what other goods or services associated with the implementation of PMKeyS would not be covered by the term 'direct' costs.
  3. To date, what is the total amount spent, both on direct and indirect costs, on the introduction of PMKeyS.
  4. What is the latest estimate for the total cost, including direct and indirect costs, of introducing PMKeyS.
  5. (a) What problems were reported on the introduction of PMKeyS for civilian employees; and (b) how many faults were reported.

Senator Hill - The answer to the honourable senator's question is as follows:


  1. Company Amount Start Date Finish Date Nature of Service
    Acumen Alliance 44,839 Sept 01 Dec 01 PMKeyS/Roman data integrity testing
    Alliance Consulting 13,320 Sept 99
    Dec 99    		 Sept 99
    Dec 99    		 Data entry for testing
    Azimuth 40,992 Nov 99
    Jan 00    		 Nov 99
    Jan 00    		 Phase 1 Post Implementation Review
    Burnbax 3,247 Nov 97 Jan 98 Recruiting of Project staff
    CCFMG 19,400 May 99 May 99 Review release of civilian payroll and personnel administration
    ComTech 12,363 Jan 01 Feb 01 Development network support
    Crain 38,020 Sept 01 Oct 01 Provision of data acquisition services
    DA Consulting Group 3,707,938 Jan 00 Jul 02 Development and delivery of PMKeyS training packages
    Dorothy Outram & Associates 17,518 Dec 97 Jun 98 Communications management
    Effective People 1,423 Aug 01 Aug 01 Staff training courses
    F1 Solutions 4,000 May 01 May 01 Maintenance of PMKeyS IDAS registration database
    GemTech 566,050 May 00 Dec 01 Performance testing
    HRM Consultants 1,350 Oct 98 Oct 98 Residual work on Civilian Resource Management System
    Intelligroup 600,023 Jul 00 Apr 01 Functional test failure investigation
    Interaction 15,845 Dec 97 Oct 98 Facilitation of training for business planning and team management
    Interim Technology 4,760 Jan 01 Dec 01 Staff training courses
    InTime HR 166,400 May 01 May 02 Functional analysis and testing
    M&T Resources 229,498 Jul 01 Aug 02 Project schedule management and batch testing
    Mastech 445,236 Feb 99 Nov 02 Functional analysis and testing
    Mind Your Web 42,640 Dec 01 May 02 Functional analysis and testing
    People & Strategy 950 Dec 01 Dec 01 Planning day facilitation
    PeopleSoft Official Order 17,167,177 Jul 98 Jul 05 Contract with PeopleSoft for implementation of PMKeyS
    PeopleSoft 8,614,219 May 99 Jul 02 Additional contract support for PMKeyS implementation
    Piazza Consulting 6,870 Jun 00 Jun 00 PMKeyS Phase 1 user survey
    Puntimai 146,862 Aug 99 Nov 99 PMKeyS review of current Defence personnel systems
    Reengineering HR 769,261 Dec 99 Aug 02 PMKeyS training delivery management
    SAP Australia 100,000 Apr 98 Apr 98 PMKeyS preferred vendor selection process
    Sapphire Technologies 231,880 Jul 01 Aug 02 Performance testing
    SMS Management and Technology 13,386,746 Sept 97 Sept 02 PMKeyS project management
    Stratagem 294,553 Dec 98 Sept 02 Data migration from legacy systems
    Strategic Management 6,137 Oct 97

    May 98

    		Oct 97

    May 98

    		PMKeyS project management
    Swish Group 112,590 Mar 02 May 02 Development of PMKeyS self-paced tutorial
    Westbourne Group 35,265 Jul 00 May 01 Provision of acquisition data mapping services
    Unisys 18,181 May 02 Jul 02 Assessment report on PMKeyS upgrade
    Others 256,478 1998 1999 A breakdown of this amount is not readily available
    Total 47,122,031
    1. Direct costs are costs that can clearly be traced to a cost object, in this case, the PMKeyS project.
    2. Indirect costs are costs or outlays that cannot be identified specifically with or traced directly to a given activity or cost object by an economically feasible method, sometimes referred to in Defence as departmental overheads/on-costs. These costs do not fluctuate in total and directly with any change in cost drivers. Indirect costs include such costs as overhead expenses for general administration, and costs associated with the use of infrastructure such as building, heating, cleaning, fuel, light and power etc.
  3. Direct costs incurred by the PMKeyS project for the period ending 30 June 2002 are $59.225m comprising of APS employee expenses $5.004m, consultant/ contractor support $47.122m and other admin and licence/maintenance fees expenses $7.099m (excludes depreciation).

    The indirect cost attributed to the PMKeyS project for the period ending 30 June 2002 is $2.556m.
  4. The latest estimate for the total direct costs for the PMKeyS project is $73.711m comprising of APS Employee expenses of $6.764m, consultant/contractor support $58.772m and other admin expenses and licence/maintenance fees $8.175m.

    The estimated total indirect cost attributed to the PMKeyS project is $3.322m.
    1. An independent Post Implementation Review of PMKeyS Phase 1 (Civilian HR and Payroll) was conducted by Management Audit Branch (Report No: IT01C144). The following is a summary of the major findings identified in the report on the introduction of PMKeyS for civilian employees:
      1. Access security was initially insufficient;
      2. System performance problems with programs deadlocking and timing out;
      3. Management reports containing inaccurate or incomplete data;
      4. Incorrect leave calculations;
      5. Retrospective processing of transactions being a manually intensive process;
      6. Process of salaries and pay advices for overseas members being highly manually intensive; and
      7. Compensation calculations were incorrect under some circumstances.
    2. In the six months post the implementation of PMKeyS for civilian employees (Phase 1) there were 10 software releases into the production environment. Part of these releases were 22 fixes to software faults reported on implementation.

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