Dismantling Human Services’ legacy system



As the complete reimagining of the way welfare payments are processed in Australia enters its delivery phase, Government News looks at the risks and opportunities this quantum cultural and technological leap presents.

The Department of Human Services (DHS) will splash out more than $1 billion and spend seven-years rolling out what has been billed as a once-in-a-generation business transformation under the Welfare Payments Infrastructure Transformation (WPIT).

Work began in July 2015 and will be delivered in five tranches, finishing in 2022, with suppliers competing for a piece of the action in each tranche.

SAP has been chosen as the preferred core software vendor and will co-design and build the new system while the lucrative systems integration contract will go to either Capgemini or Accenture.

There will also be a panel of “top ranking firms”, which could include the firm that comes in second place, who will be asked to bid for the other project stages. Panel members could be engaged to supply services around data migration, systems integration and other support services.



Overhauling the welfare payments legacy system is a labyrinthine undertaking and an incredibly sensitive task. There are 30 million lines of code to disentangle and 40 different core payments, along with 38 add-ons.

Delays or stuff-ups could affect the benefit payments of millions of people, many of whom might be vulnerable and living hand-to-mouth, and work must also be managed so that it can be rolled out gradually while keeping the current system going.

CEO of business management systems company Holocentric, Bruce Nixon, said that overhauling the DHS’s 30-year old legacy system was a “massive and incredibly complex” piece of work but a necessary one, particularly as the public’s expectations of interacting online with government and with businesses continued to increase.

Nixon says it is encouraging that the DHS is talking about the overhaul as a major business transformation, not just a systems upgrade.

Getting the planning, scoping and design stage right initially would have been essential and this will become clear as the project advances, he said this would have meant understanding where you are starting from and knowing what you want the new system to achieve, “It’s a business transformation, not a systems transformation.”


  • Partners working separately, not in unison

Nixon says that because multiple companies are involved in delivering WPIT, there is an increased risk that they may fail communicate their progress to one other. The key, he says, is to have transparency and maintain good documentation using a system where everybody can see what work is being done.

“The translation of information adds to the risk. How do you make sure that everybody is working to the same agenda? You need a blueprint,” Nixon said.

“[It should outline] the processes people need to follow, the role they will play, system design, decisions made and the impact on welfare recipients. There needs to be a single source of truth about how things are going to work in the future and everybody refers to it.”

Hammering out expectations and detailing how performance will be monitored are also important.

“Misunderstandings about what needs to be delivered and pressure can make things worse,” he said.

  • Avoiding inflexibility

Governments change their budgets and their policies and this can often have a big impact on welfare payments and entitlements, which makes it important to design a flexible system that can incorporate these.

Nixon said flexibility was achieved by understanding the current system inside out and being across all the different parts of the work required to redesign it.

Project partners will also need to be flexible, for example to take advantage of new capability and technology, because a great deal could change during the seven-year life of the project.

  • Communicating with staff

Business transformation is not just about IT, it will also be about DHS staff and taking them on the journey too.

DHS Deputy Secretary John Murphy said last month that winning over Human Services’ 36,000 workforce to new ways of working would be a bigger challenge than mastering the technical side of things.

Nixon agrees and said what people resent most is being kept in the dark about new processes and systems and then ordered to use them.

Communicating early on is key: “It is critical in any business transformation, to provide clarity for people, giving them an understanding, being transparent.”

The trap some businesses fell into was blowing most of the budget on technology, he said, “You’ve spent money on the systems’ changes and none left to invest in the people side.”


  • Lack of disaster planning

Nixon says that CensusFail was a cautionary tale for government departments and agencies about risk management, procurement, contract design and monitoring.

He said that risks should be anticipated and contingency plans built into the program of work by getting a deep understanding of how the system will be used, how the public will interact with it, what the processes are and the system’s capability.


The greatest potential the WIPIT program has is to light a rocket underneath the behemoth department’s much-maligned service delivery.

Done well, it could reduce the frustration many people feel when they interact with the department, whether it’s using a PC, at a customer service centre, via an app or over the phone and make services more convenient, equitable and reliable.  

DHS has long been plagued by criticisms of the service it provides, from people not being able to log into the MyGov portal, the skittish mobile apps and payment processing delays to tortuous  hours spent waiting on hold.

The services the department provides, Centrelink, child support and Medicare, touch millions of Australians’ lives and people have no choice but to interact with it. The federal government’s eventual aim to follow the UK and make Australian government digital by default cannot ignore Human Services, the largest Commonwealth government department.

Nixon said as well as creating greater satisfaction for the customer and showcasing the government’s digital transformation agenda, the changes could also make it easier for staff to operate more effectively behind the scenes and increase their job satisfaction.

Indeed, John Murphy has said that upgrading the processes and systems has the potential to free up benefits staff to deal with the more difficult, specialised inquiries rather than fending off routine inquiries, for example, about entitlement to various benefits or the progress of claims.

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