IBM banned from Queensland government contracts in Queensland Health payroll fallout

The Queensland Government has banned IBM from signing any new contracts as a government supplier until the company can improve its governance and contracting practices.

The exceptional action comes on the heels of the final report of the Queensland Health Payroll System Commission of Inquiry, which concluded the $5m review of a disastrous IBM-led payroll systems implementation for Queensland Health (QH) that dragged on for years, ended up costing $1.2 billion, and ultimately delivered an inadequate and manually intensive system due to what the report found were systematic and ongoing failures of project management and governance.

The project “must take place in the front rank of failures in public administration in this country,” the report concluded. “It may be the worst.”

Queensland premier Campbell Newman put it another way in the statement announcing the ban on IBM: “It appears that IBM took the state of Queensland for a ride,” he said.

Newman also outlined a number of other actions that would commence in the wake of the damning report, including potential legal action against adversely named public-sector employees; a review by the Integrity Commissioner into the absence of a probity adviser or conflicts register on the project; and a demand for union information about the oversight of representatives who failed to act to protect its members.

The government will detail its response to the report’s recommendations in the next session of Parliament