COUNCIL officials underestimated how much it would cost to install IT software that went over budget by more than £3m.

The Oracle Fusion system, which went live more than a year later than expected, is used to help the council manage things like its finances, HR and payroll.

Leader of the Plaid Cymru group at Vale of Glamorgan Council, Cllr Ian Johnson, called a report brought before the local authority’s corporate performance scrutiny committee on the £3.7m overspend “very sobering”.

At the meeting, held on Wednesday, April 17, he said: “The best thing we can probably say here is we got there in the end.”

Vale of Glamorgan Council had a version of the Oracle system in place for years, but the IT company advised the local authority that it needed to update its software.

A replacement cloud-based system was initially scheduled to be in place by January 2022, with a business case suggesting it would cost £1.5m.

The final cost of the April 2023 go live was £5.2m.

Cllr Johnson said: “After an overspend of £3.7m in comparison to the original business case, this is also quite difficult reading.

“It is a report which is difficult to read as a member of a scrutiny committee because seeing all of the details here raises so many questions about the processes in the council and how we got here.”

The council’s head of finance, Matt Bowmer, admitted earlier this month that the business case was “somewhat unrealistic” and that Covid-19 posed challenges to getting the project up and running, with resources “stretched” and existing “limited capacity” at the council being diverted to the pandemic effort.

Other councillors on the corporate performance scrutiny committee and council officers also pointed out that there is an issue local authorities across the UK experience with a lack of specialist resources and procurement specialists.

Cllr Protheroe said: “Having those specialists there at the beginning to help you define the specification and include everything would have given them a better idea… and to help you as well with working out an indicative value.

“It is very clear from what we can see that there was no understanding at that stage of how much things would cost because there was no real… understanding of what was required to complete the implementation of a brand new… cloud-based Oracle… system.”

Oracle Fusion eventually went live in April 2023, but this was after a number of deadlines were pushed back.

A replacement of the project manager and project review in 2021 led to a revised go live date of August 2022.

Further work revealed that a November 2022 go live was more realistic.

Mr Bowmer said: “During the spring and summer of 2022, it was quite clear that some of the groundwork necessary hadn’t been done earlier in the project and there were great challenges faced… and at that time a real realisation of the additional support that was going to be necessary to be brought in to bring the project to go live.”

He went on to say that good progress was made to hit the new deadline, but they came “just short”.

Barry And District News: Oracle Fusion IT system is used to manage things like its finances, HR and payrollOracle Fusion IT system is used to manage things like its finances, HR and payroll (Image: Vale Council)

A January deadline was seen as “problematic”, according to a council report on the implementation of Oracle Fusion, due to payroll deadlines across the Christmas period and February and March were seen as too close to the end of the financial year.

Mr Bowmer added: “It has been a very clean go live [with] no significant issues and that is something to applaud because we do see continuously across the piece the number of similar type… financial systems that do have problems at go live.”

Swansea Council had similar issues with delays to going live with Oracle Fusion.

Its original budget of £4.8m for the implementation of the system was approved in 2019, but this increased significantly during the Covid-19 pandemic.

It was reported in October 2023 that funding for the project was £12.3m in total.

Leader of the Conservatives group at Vale of Glamorgan Council, Cllr George Carroll, said he was “stunned” by the delays and increased costs to the Oracle Fusion roll-out in his county.

He added: “I think that looking at the authorities attitude towards public money in this case compared to what we are told when it comes to setting the council tax for example is completely different.

“In the budge meeting a few weeks ago I proposed a real terms freeze to council tax which would have cost for the year £3.4m.”

He said that lessons needed to be learned from what happened.

Leader of the council, Cllr Lis Burnett, said: “There has been push back when we have talked about improving or increasing project management resource.

“There has been push back when we’ve talked about strengthening the senior leadership team to make sure we have the correct level of expertise going forward and I think that the appointments that we have made in both of those areas have proved their worth.

“I think we need to recognise the world in which we live.

"If we have an agenda of increasing the digital performance of this council then we need to be prepared to resource it and we don’t need to have discussions which are in effect a race to the bottom.

“We need to be realistic about the resource we need to deliver effectively for the people of the Vale and will continue to support that.

“I will also support any steps we can take to learn from this and help other local authorities to learn from this work as well.”