Queensland Treasury refers own debt collection agency to corruption watchdog

By Shannon Jenkins

Thursday June 18, 2020

Adobe

The Queensland Crime and Corruption Commission is assessing corruption allegations regarding the state government’s debt recovery agency following an internal probe.

Queensland Treasury referred its own agency — the State Penalty Enforcement Registry (SPER) — to the CCC last month, ABC News has revealed.

The corruption watchdog has been looking into “allegations of corrupt conduct”, including one unnamed issue which has since been referred back to the Treasury. A second matter is currently under assessment.

The Treasury revealed an internal probe has been underway for a month.

SPER handles the collection and enforcement of unpaid infringement notice fines, court-ordered monetary penalties, offender debt recovery orders, and offender levies.

While SPER had collected $1.291 billion in state debts as of May, that month more debts were registered than finalised, ABC News noted.

Scathing audit report released nine months after IT deal axed

In May last year, the state government scrapped a major contract with a debt collection software supplier, despite already paying the company $24 million.

The contract was part of a reform program for SPER, which had been underway since 2014.

At the time, then-treasurer Jackie Trad said the decision to abandon the deal was due to ongoing delays, noting she had previously “raised concerns with Treasury on multiple occasions about the progress of the SPER ICT program”.

“Mid last year I commissioned a review of the project when I became aware of delivery issues. Additionally, I commissioned ongoing independent assurance of the program,” she said.

“Through this assurance work, I was advised that further delivery issues have arisen during the user acceptability testing, including the program not meeting its scheduled testing completion date.”

A report released earlier this year by the state auditor-general, Brendan Worrall, revealed the under treasurer Frankie Carroll had contacted him to voice concerns with the program on March 25, 2019.

The audit report noted several “key facts” regarding SPER’s struggles to collect money.

“As at June 2015 … SPER had 688,000 debtors who owed $999 million; 73% of these debtors had an outstanding balance a year earlier. Of the debtors, 274,878 who owed $442.7 million were classified as ‘won’t pay’ debtors,” the report stated.

“The goal in reforming SPER was to improve its effectiveness in achieving payment or finalisation of monetary penalties. As at 30 June 2019, SPER had 757,000 debtors who owed $1.27 billion.”

Worrall concluded that SPER’s handling of the program was flawed from the beginning.

“Despite the efforts of the senior public servants involved in the SPER reform program (including the ICT component) and the application of many procurement, project management and assurance practices, the governance over this program was not effective from inception,” he wrote.

“This program suffered from a culture within SPER and the Office of State Revenue that involved operating in a silo and being overly optimistic—SPER was always optimistic that it could manage its way out of the challenges it faced.”

The report argued SPER’s “inexperience in projects of this nature and its unfounded optimism” led to numerous weaknesses in governance, including ineffective management of contractor performance, and inadequate “due diligence on a vendor with which the government signed a long-term contract”.

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